AKRON — A pioneer of school choice in Ohio, White Hat Management is out of the charter school business.
The for-profit operator founded in 2000 by Akron industrialist David Brennan has quietly sold off the last of its contracts to run charter schools. Brennan and his company formed a primordial force that ushered these publicly funded but privately run schools to Ohio some 21 years ago.
Once synonymous with political power and influence, White Hat’s reputation has fallen into disrepute after years of low test scores and soaring high school dropout rates. Since 2014, the company has steadily lost its edge in Ohio’s increasingly competitive school choice market. With parents now sending their kids, and the state funding that comes with them, to better rated educational options, White Hat has rapidly divested itself of school management contracts. The selling accelerated when school boards began ditching the company for more transparent operators.
By June of this year, White Hat’s once prolific presence in Ohio had shriveled to a single online school — Ohio Distance and Learning Academy (ODELA) — and 10 "Life Skills" centers, which deliver computer-based GED courses to academically faltering teens and young adults.
Virginia-based Accel Schools, which is amassing an education empire the likes of which haven’t been seen since White Hat dominated the Ohio landscape, has bought out the contract for ODELA.
Utah-based Fusion Education Group (FusionED) is taking over contracts for seven of the Life Skills centers, including the North Akron branch in a Chapel Hill storefront at 1458 Brittain Road.
Life Skills Northeast Ohio on Larchmere Boulevard in Cleveland has hired Oakmont Education, LLC, a company associated with Cambridge Education Group. White Hat could find no buyer for the last two centers, which will close at 4600 Carnegie Ave. in Cleveland and 3405 Market St. in Youngstown.
Information on White Hat’s offloading of assets came via the schools’ sponsors: the Ohio Council of Community Schools, which oversaw ODELA and two Life Skills schools, and St. Aloysius Orphanage, a Cincinnati social service provider. White Hat did not respond to multiple attempts to seek comment this week. In Ohio, sponsors oversee charter schools’ tax funding, academic standards and compliance with state and federal laws. Public school boards, which are supposed to be independent of operators, decide whether to hire a management company or go it alone.
Only 85 of Ohio’s 339 charter schools are independently operated. Most hire for-profit companies, which are consolidating operations from toppling old giants like White Hat.
Accel, which took over ODELA on July 1, is run by Ron Packard, a former Goldman Sachs executive who specialized in mergers and acquisitions. Packard left his job as CEO of K12 Inc. in 2014 to build his own network of more than 40 American charter schools — 36 in Ohio.
Packard bought White Hat’s troubled K-8 schools in 2014. Then, he swooped in on the financially distressed Mosaica Education of New York and Cleveland-based I CAN Schools, which ran Akron Preparatory Academy in the old Goodyear headquarters.
This spring, White Hat unloaded the rest of its assets to FusionED and others. It’s unclear if White Hat, with its downtown Akron address, has any schools still open outside of Ohio, where its reach once extended to the Rocky Mountains.
Brennan made millions buying and selling manufacturing companies in Akron. In the 1990s, he promised to unleash the private market on what he demonized as failing government schools.
His tactics included $1 million in political contributions to elected GOP officials. Those gifts paved the way for Brennan, known for wearing a white cowboy hat. "Some of those officials [receiving contributions] bent rules — or rewrote the rules — to his benefit. In at least one case, their actions violated the Ohio Constitution," the Akron Beacon Journal reported in a 1999 investigative series that called the "politically influential and opinionated" Brennan the "author of Ohio’s school choice movement."
Arguing that workers lacked basic skills, Brennan opened literacy programs in factories and empty store fronts while influencing lawmakers and governors. Then Gov. George Voinovich put Brennan in charge of crafting Ohio’s private voucher program, which would eventually bring Brennan’s private schools more state funding per pupil than was flowing to 85 percent of Ohio’s traditional public schools.
The Akron Beacon Journal reported that flipping the switch from private to charter school on just one White Hat operation in Akron would generate $285,000 more a year for a mere 75 students. The school, reconstituted to get around a state law that banned converting private schools to charter schools (which would have cost the state $1 billion overnight), was called Hope University Campus. It would be the first of dozens of K-8 schools bearing the Hope Academy moniker.
Brennan’s charter schools, ranking among the lowest performers in the state, were plagued from the start with allegations of padded enrollment and skirting accountability. Amid the bad publicity, White Hat lobbyists pushed for exemptions that gave his dropout recovery programs the ability to state open with single-digit graduation rates.
In 2010, fed up with not knowing how White Hat was spending 97 percent of the tax dollars sent to each academically failing school, 10 school boards sued the operator. White Hat fought them to keep ownership of all the desks, computers and assets bought over the years with public money.