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The National Education Policy Center, a nonprofit research organization, released a lengthy report this week that raises more questions about the performance of virtual charter schools operated by K12 Inc.

The 65-page report acknowledges that while computer-assisted learning has tremendous potential, students enrolled in K12 Inc. schools are falling further behind in reading and math scores than students in brick-and-mortar schools, according to the study.

Some of NEPC’s key findings include:

• Math scores for K12 Inc.’s students are 14 to 36 percent lower than scores for other students in the states in which the company operates schools.

• Only 27.7 percent of K12 Inc.’s schools reported meeting Adequate Yearly Progress (AYP) standards in 2010-11, compared to 52% for brick-and-mortar schools in the nation as a whole.

• Student attrition is exceptionally high in K12 Inc. and other virtual schools. Many families appear to approach the virtual schools as a temporary service: Data in K12 Inc.’s own school performance report indicate that 31% of parents intend to keep their students enrolled for a year or less, and more than half intend to keep their students enrolled for two years or less.

The NEPC report goes on to recommend that state policymakers “slow or put a moratorium on the growth of full-time virtual schools” until they better understand the reasons for the disparities in outcomes:

‘In the area of full-time virtual education, states should place their first priority on understanding why the performance of virtual schools suffers and how it can be improved before undertaking any measures or programs to expand this new model of schooling.’

In response to the report, K12 Inc. says NEPC used selective data and failed to take into account student academic growth.

Earlier this month, K12 had its plans derailed to open a virtual charter school in North Carolina this fall. The Wall Street company had hopes to recruit 2,750 students in its first year and take in $18 million in federal, state and local education dollars.

You can read the NEPC full report, “Understanding and Improving Virtual Schools,” here.  For K12′s response, click here.  And to read more about K12 Inc. in North Carolina, read Sarah Ovaska’s most recent story here.

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Cross-posted from the blog of State Government Radio commentator Barlow Herget:

See if the pig is in the bag
By Barlow Herget

The idea of the Internet as the next big thing in education is an appealing vision.  There are ways now being tried in some schools in which computer programs and the Internet are designed to aid teachers in developing custom learning plans for individual students.

But the virtual schools that for-profit companies are pedaling to financially strapped North Carolina school boards are pigs in a poke.  The State Board of Education and its chairman Bill Harrison are correct to ask for a detailed review of such questionable sales.

The issue surfaced after the Cabarrus School Board was casting about to save money in these tight budget times.  Under the guise of a charter school, a North Carolina non-profit, NC Learns, sold the Cabarrus board a virtual school program operated by a for-profit company called K12.

The charter school expects to get over $18 million in public school funds, most of which will be paid to K12.  The N.C. Virtual Academy as it’s called, offers to teach 2,700 students from across the state.

Now, stop and think.

Does an on-line K through 12 school pass the common sense test?  Hardly. Read More

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A Wake Superior Court judge will announce his decision Friday on whether a virtual charter school should open this fall, after the N.C. Board of Education neglected to take up its application.

The State Board of Education is asking Judge Abe Jones to set aside an administrative judge’s order and give the state board a second chance decide if the virtual charter school should be approved to open up in North Carolina. (The state education board didn’t act on the virtual charters application earlier this spring, saying they had already announced they weren’t going to take up online-only charter schools this year).

N.C. Learns, the non-profit set up to house the K12, Inc.-run school, wants the administrative law judge’s order to hold, so that they can open up this fall and begin recruiting students.  The company expects to find 2,750 students statewide in its first year, meaning more than $18 million of public education funding would be diverted from the already-tight budgets of public schools around the state.

The virtual charter school would be run by K12, Inc., a for-profit online education company that runs similar online-only school in 29 other states. Students at virtual schools take their classes online from their home computers, paid for by taxpayers.

There have been a lot of questions about the quality of K12 schools, with states like Ohio reporting four-year graduation rates as low as 30 percent, and down to 12.2 percent for black students.

North Carolina’s cohort graduation rate is 77.9 percent overall, and 71.5 percent for black students and 68.8 for Latinos.

In this case, The North Carolina Virtual Academy would be run by K12, and be open to students statewide. The school would get the same per-pupil amount as other charter schools get (ranges from $7,000 to $10,000, depending on where the student lives and if they are special needs), despite not having to shoulder the cost of having a physical school and paying for the building costs, and all that goes along with that.

This is just a quick update, and you can read more here about the hearing in today’s News & Observer, as well as this story from WRAL.

Check back with N.C. Policy Watch later on, where we’ll have more detailed account about yesterday’s hearing as well as Judge Abe Jones’ decision Friday.

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Cross-posted from the blog of national education expert Diane Ravitch:

Profits, Not Better Education

An article in a publication called “The Financial Investigator” took a close look at K12, the for-profit online “education” corporation whose growth had made it a darling of Wall Street. The article paid particular attention to the “churn rate” at K12 online schools. That is, how many students left in a given year. In the Ohio Virtual Academy of K12, a staggering 51% of students turned over in a single year. That helps to explain why the name of the game for the for-profit online academies is recruitment. So long as the corporations can keep their numbers up, they will collect tuition money from the state, usually double their real costs.

The more the for-profit academies churn, the more they earn. And every dollar they collect comes right out of the public school budget. Read More

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An administrative law judge will hear this afternoon from a proposed virtual charter school run by Wall Street investors that hopes to open its virtual doors to North Carolina students this fall.

N.C. Learns, a non-profit group set up to house a virtual charter school run by the online education giant K12, Inc., (NYSE: LRN), filed a grievance in March against the State Board of Education, arguing that it should be allowed to open this fall despite missing other deadlines because the company had gotten the blessing of an individual school district. (Click here to read our previous story about the legal suit.)

Update, 3:30 p.m.: N.C. Administrative Law Judge Beecher Gray ruled that the state board should have reviewed the school’s application, and the judge gave the school approval. Unless the state appeals or gets a stay, the virtual school can open this fall, according to Gray’s ruling from the bench. A final written order will be issued in coming days.

The school, which would contract fully with K12, sent its application endorsed by the Cabarrus County school board to the state board in February – other charter schools hoping to be approved as part of the “fast-track” approval process had sent their applications into the N.C. Department of Public Instruction in November.

The state board approved nine new charters schools as part of the fast-track process in March, the first group to gain approval since the state legislature lifted the 100-school cap on charter schools last year (Charter schools are public schools funded with public education dollars that operate outside of traditional school districts by non-profits.) The state is now in the process of sifting through 60-plus more schools that have applied to open for the 2013-14 school year (notably, K12 did not submit an application in that bunch either.)

K12, who had hired a former state representative for the area to lobby on their behalf, had persuaded the Cabarrus County school board to back its application in January, but hopes to serve students statewide.

The company, in its applications to both the state board and Cabarrus school officials, wants to enroll as many as 1,750 students in its first year, to the tune of $18 million in public school funding.

Arguing on behalf of the non-profit at today’s hearing will be state Sen. Fletcher Hartsell, a prominent Republican lawmaker from Cabarrus County, that the non-profit retained as its legal counsel. It’s not entirely clear who is paying for Hartsell. The non-profit indicated in documents filed with the state board that it had no cash on hand but a draft copy of a contract with K12 said the company would cover all start-up costs associated with opening the virtual charter school.

The state education board is asking the judge dismiss Hartsell’s claims, and has argued that the school didn’t follow the proper procedures in its applications, and that the state is developing a way of evaluating virtual education applicants because of concerns about quality.

Reporter Sarah Ovaska will be going to the hearing, and you can follow updates from her via Twitter at @SarahOvaska.