White Hat Management

Introduction

White Hat operates charter schools primarily in Ohio, but also Colorado and Arizona. White Hat runs schools for students at risk of dropping out, (Life Skills High School), fully-online schools (Distance and Electronic Learning Academy), and more traditional charter schools (the Academies). White Hat is owned and led by David Brennan, a former industrialist and investor. Brennan’s involvement in education reform began in the 1990s with the expanding voucher movement, although he eventually settled on charter schools as a way of turning a profit off of public education.

Political Connections

White Hat founder and CEO David Brennan is a major contributor to Republican causes in the state of Ohio, and the Ohio legislature has rewarded his charters handsomely. The company is nearing $1 billion in revenue from Ohio alone, and Brennan’s schools will receive additional funding this coming year. Media Matters noted the financial benefit of the recent change to White Hat and other for-profit operators, and pointed out the media’s failure to report on the connections. Brennan has tried to use his clout in Republican circles to influence legislation favoring his schools.

Secrecy

In addition to concerns about profiteering and poor quality schools, ten White Hat schools recently sued the company. A Cleveland Plain Dealer article explains why the boards felt the need to challenge White Hat in court:

In the case of White Hat contracts, the board then hands over about 96 percent of the school’s revenue to the company to handle the day-to-day business of running the schools. That covers everything from employing the principal and teachers to building expenses to buying the computers, textbooks and desks that the students use.

Anything left over would be profit, but since White Hat is a private company, it doesn’t report profits.

The lack of transparency and control over the schools only benefits the management company, and removes real checks-and-balances from preventing abuses.

Lost Schools

In a number of instances, charter authorizers have moved to shut down White Hat-operated schools, or schools themselves have tried to fire the company as the school’s operator.

Concerns about the degree to White Hat’s control over the schools led the Ohio Department of Education to reject four applications for new White Hat schools in 2012. The rejection, according to the Thomas B. Fordham Institute, “will come as a surprise to many observers because ODE has rarely challenged large, not to mention politically well-connected, operators.”

In Ohio, White Hat took advantage of loopholes and lax oversight to avoid automatic revocation of poor performing charter schools. In cases where the company lost the charter but the school remained open under different management, schools allege that it was “a very bad divorce.”

The Colorado State Board of Education voted to close a White Hat-operated school for perpetual poor performance. “I think the record is very, very clear. Life Skills is a school that has gone from terrible to worse,” Denver Superintendent Tom Boasberg told the board. Authorizers in other states, including Michigan and Florida, have refused to renew White Hat charter schools citing concerns about academic performance and management.

A school in Pennsylvania elected to drop White Hat as an operator for the following reasons:

At PA Distance Learning Charter School based in Franklin Park, CEO James Hoover said, "We felt we could do better on our own."

…

"It's a lot harder when you have a management company supplying all the services. If you're not happy with it, you can't just fire the IT part," he said.

Even pro-charter advocates and those open to for-profit management of schools have criticized White Hat. Terry Ryan, past Vice President of Ohio Programs and Policy and the conservative Fordham Institute,

“The best that can be said about them is they’re mediocre and not substantially better than urban public schools.”

Further Reading
White Hat Management: Ohio Charter School Giant
Education Empire: David Brennan’s White Hat Management, Inc.
What Happens When Charter Schools Rebel Against White Hat