H.B. 79 creates risk for school district employees and others who sit on community school boards of directors

Boards of education that sponsor community schools typically create the schools as “conversion” community schools and designate school district employees to represent the board of education on the conversion school’s governing authority, typically referred to as a “board of directors.” Now, due to a recent change in Ohio law, the individuals so designated may be at risk of losing their ability to continue to work for the school district. Likewise, employees of other entities that provide services to, or oversee the operations of, community schools may be at risk of losing their jobs if they serve on the governing board of a community school.

The risk is created by language inserted by the Conference Committee into H.B. 79 (generally known as the “teacher misconduct reporting bill”) in the waning hours of the last legislative session. Although the versions of the bill initially passed by both the House and the Senate did not make changes to Chapter 3314 (the portion of the Ohio Revised Code that concerns community schools), numerous provisions related to community schools were added by the Conference Committee, including a modification of R.C. 3314.02(E) that creates the problem described in this article.

As newly modified, R.C. 3314.02(E) establishes a number of restrictions concerning those who sit on the governing boards of community schools, including the provision highlighted below:

(E) (3) No present or former member, or immediate relative of a present or former member, of the governing authority of any community school established under this chapter shall be an owner, employee, or consultant of any nonprofit or for-profit operator of a community school, as defined in section 3314.014 [3314.01.4] of the Revised Code, unless at least one year has elapsed since the conclusion of the person’s membership.

“Operator” is denied in R.C. 3314.014 as either of the following:

(1) An individual or organization that manages the daily operations of a community school pursuant to a contract between the operator and the school’s governing authority;

(2) A nonprofit organization that provides programmatic oversight and support to a community school under a contract with the school’s governing authority and that retains the right to terminate its affiliation with the school if the school fails to meet the organization’s quality standards.

Although the definitions are in some regards ambiguous, there is nevertheless a very real risk that any school district that sponsors a community school may be considered an “operator.” If so, any employee of the district who also serves (or has a relative who serves) on the board of directors of the sponsored community school (or any other community school) would run afoul of R.C. 3314.02. The individual’s continued employment with the district would then be barred until one year after membership on the community school governing board had ceased. 

Similarly, if a community school receives services from, or is overseen by, some other entity – for example, an ESC, Council of Governments, or juvenile court – the new H.B. 79 provision may prohibit a person from being employed by such other entity if the person (or his or her relative) also serves on the board of directors of any community school in Ohio. This means that if, for example, your community school has on its board of directors an individual who works for an ESC, and if that ESC provides extensive services to a community school, that board member may be at risk of losing his or her job with the ESC. And this is true even if the community school served by the ESC is not your school but a different one, elsewhere in Ohio.

Our purpose in making you aware of this legislation is not to cause undue concern but to make you aware of what could result from a literal application of this legislation. While the interpretation of this new provision may be subject to debate and the intent of the legislature is unclear, the potential consequences are of such severity that every community school and sponsor should review the composition of the school’s board of directors and consider whether modifications are appropriate. In particular, any school district board of education that has employees who serve on the governing board of a community school should consider taking immediate action aimed at terminating the employees’ service on such boards.

The new legislation becomes effective on March 30, 2007. There is no “grandfather clause.” Thus, the prohibition may be applicable to current community school board members and possibly (although seemingly doubtfully) even to those who cease their service as board members less than a year prior to March 30. We believe the legislators did not intend such a harsh consequence. Even if it were intended, to the extent the legislation would deny a school district employee the benefits of his or her employment contract, we believe the legislation would be unlikely to survive constitutional scrutiny.

We are seeking to bring this problem to the attention of education and legislative leaders in the hope that corrective legislation will address this problem. But unless designated as emergency legislation, any correction would not become effective prior to March 30.

In deciding whether and how to restructure a community school’s board of directors, community schools and their sponsors must proceed with caution, giving careful consideration to requirements stemming from the school’s corporate governing documents, the school’s tax status, the sponsor contract between the school and sponsor, and various provisions of Ohio law. School district sponsors that remove their representatives form the governing authority of a community school may also seek alternative means of preserving the district’s ability to exercise effective oversight of the school – for example, through modifications of the sponsorship contract with the school.

In light of the potential adverse impact of this legislation, you may wish to bring the problems described in this article to the attention of your legislators. You may also consider joining with others in the public school community for the purpose of seeking a legislative solution or for the purpose of challenging the constitutionality of this legislation, or both.