Court awards Dayton schools $23 million in lawsuit against state

Dayton Public Schools headquarters building, 115 S. Ludlow St. in downtown Dayton
Dayton Public Schools headquarters building, 115 S. Ludlow St. in downtown Dayton

Credit: JEREMY P. KELLEY / STAFF

Credit: JEREMY P. KELLEY / STAFF

A Franklin County Common Pleas judge has awarded Dayton Public Schools $23.67 million in its decade-long lawsuit against the Ohio Department of Education concerning state school funding from 2004-05 through 2006-07.

The judge’s ruling says in those years the state improperly calculated funding tied to charter school enrollment, as well as “add-in students” who enrolled in charter schools after the state’s annual October enrollment count. That resulted in the Dayton, Cleveland and Toledo school districts getting less funding than called for in the state formula.

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“Our students who lost educational opportunities because of the Ohio Department of Education’s failure to follow the funding formula, are likely long gone from our district,” said DPS Superintendent Elizabeth Lolli. “But the funding that flows from the court’s decision will provide an opportunity for students filling their seats today.”

DPS emphasized that the court ruling came in the past week, and the district has not yet received the money.

Ohio Department of Education spokeswoman Mandy Minick said Thursday that ODE would not comment on the ruling. She declined to say whether the agency would appeal.

In Ohio, charter schools are funded in pass-through fashion. State funding goes to the public school district where students live. Then the district sends funds to each charter school based on how many of the district’s students are being educated there.

Russo’s ruling said Dayton’s lawsuit arose “from the unilateral decision of ODE to ignore the statutory structure in place” for counting students in 05-07. The ruling said ODE’s method reduced the number of students for which the public school districts were to receive funding, and also failed to increase for add-in students.

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The Dayton, Cleveland and Toledo school districts all sued ODE on these grounds, and their cases were consolidated in 2012. After procedural rulings over several years in common pleas and appeals courts as well as the Ohio Supreme Court, the case was remanded back to Judge Gina R. Russo, who made last week’s ruling.

Russo awarded $13.78 million to Cleveland schools and $4.89 million to Toledo schools. Those awards were lower than Dayton’s in part because they addressed only the funding missing due to later arriving “add-in students.”

Dayton Public Schools officials also said Dayton had a “significantly greater number” of students choose charter schools in 2005 than those other districts.

Jim Hughes, an attorney with Bricker & Eckler who represents the school districts, said “post-judgment interest” awarded by the court accrues from the date of the decision. He said with a total award of $42.3 million to the three school districts, that interest would be more than $100,000 per month until the money is paid.

Dayton Public Schools had attempted to resolve its claims with the Ohio Department of Education years ago, and in 2009, the sides reached a partial settlement ($7.18 million to DPS), but failed to resolve the entire dispute.

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ODE had argued in the lawsuit that Dayton was barred from pursuing the remaining dispute because of language passed by the legislature later in 2009.

The court disagreed, saying of the partial settlement, “the agreement’s straightforward language … expressly reserves Dayton’s ability to pursue resolution of its remaining dispute” and plainly states that “no legislation shall have any effect whatsoever on the claims under this agreement.”

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