The Local Superintendents Advisory Council approved proposed regulations to charter schools in Kentucky during a meeting in late September.
The approval comes as the group still finds uncertainties around House Bill 9, which modified Kentucky’s charter school law and set up a funding mechanism for charter schools.
Kentucky Department of Education (KDE) Commissioner Jason Glass addressed the council during the meeting.
Glass said the regulations put forward by KDE are required by law by the Kentucky General Assembly under HB9 and are an attempt by the executive branch to comply even though the law and regulations are uncertain.
“Like many of you, I believe there are numerous constitutional uncertainties with HB9,” Glass said.
After the approval, the proposed regulations will head to the Kentucky Board of Education during its meeting on Wednesday, Oct. 12.
“I’ll make it very clear, I’m not in favor of charter schools, especially the way they’re written in statute. I do not believe, especially the way it’s set up in finances … that they are constitutional,” said Superintendent’s Council Chair Robbie Fletcher, superintendent of Lawrence County Schools.
But, as the process moves forward, it’s still unclear what will happen in Northern Kentucky, which is the destination for one of the state’s two pilot projects, the other being Louisville.
What is House Bill 9 and how does it pertain to Northern Kentucky?
In addition to providing a funding mechanism for another charter school bill passed in 2017 that allowed the schools to become a reality in Kentucky, House Bill 9 established the Kentucky Public Charter School Pilot Program.
This “requires a county school district located in a county with a consolidated local government and the Board of Regents of Northern Kentucky University to ‘solicit, review, and approve at least one (1) charter application for a public charter school within the authorizer’s jurisdiction that serves as an urban academy’ prior to July 1, 2023,” Glass said in a presentation to at the superintendent’s council meeting.
An authorizer is a public entity responsible for oversight of the charter school. But, for an authorizer to meet the deadline, the Kentucky Board of Education (KBE) must approve the 10 regulations.
In short, the regulations address enrollment preference, where a student resides, district location, establishing a food program, the timeline in which an authorizer and the KBE approve a charter school application, charter school funding, which includes SEEK funding, authorizers fees, and deadlines.
Northern Kentucky University is listed as the authorizer for the pilot school in Northern Kentucky, which means they will oversee and make decisions on the project. They can vote to approve or deny applications for a charter school, but only if they choose to be an authorizer. They have until Jan. 1, 2023, to decide.
When the bill first appeared in the legislature in March, NKU said they didn’t know anything about their inclusion.
“NKU was not consulted about being included as a potential charter school authorizer prior to our inclusion in HB9,” a statement from NKU said in March. “Furthermore, we have not had the opportunity to fully understand what is in the bill. However, the language in the legislation does provide us the ability to study the implications before making any decisions. Should HB9 become law, we will have conversations with the multiple stakeholders in our community about what impact charter schools would have on K-12 education in northern Kentucky.”
Once the university learned of its role, it spent $5,000 lobbying to change the bill’s language.
“Once we learned of NKU’s inclusion in HB9, we had conversations with the bill sponsor and other legislators to discuss our role as a charter school authorizer in Northern Kentucky,” said Carmen Hickerson, the assistant vice president of economic and government relations at NKU.
“These conversations resulted in the bill language being amended to ‘may’ from ‘shall,’ giving us greater flexibility in NKU’s role,” Hickerson said.
The reports show that from March 1 to March 31, the NKU Foundation spent $5,000 lobbying for several bills.
If NKU declines to be an authorizer, then local school boards will be required to put forward two members from each local board of a district located in a county that contains four or more local school districts. These members will become the substitute pilot project authorizer.
The NKU Board of Regents meets on Nov. 9, but it’s unclear if they’ll make a decision on that date. They could call a special meeting to address it before or after that day.
“I feel that any district being required from an authorizer to take on a charter without any of their input is totally unconstitutional,” said Mike Borchers, superintendent of Ludlow Independent Schools, during the superintendent’s council meeting.
He was referring to a statute that will require a school district to take on a charter school if the authorizer chooses it for the district.
During the meeting, Borchers made a point that if NKU selects a district for a charter school, that district will have to use its funds for the school. However, due to language in House Bill 9, students from other districts can attend the charter, which means the local school district selected for a charter may be spending funds on out-of-district students.
The authorizer would also collect a 3% fee from the district’s funds.
“Our situation is so much more unique than the other situation in the state with the pilot projects,” Borchers said.
All this could affect where a potential school is located.
On the House floor in March, Rep. Chad McCoy (R-Bardstown), the lead sponsor on the bill, noted that the bill wouldn’t change much about that initial law from 2017, but it would allow smaller school districts with under 7,500 students to vote on whether or not they want a charter school. For schools above that number, that rule doesn’t apply, leaving school boards at the mercy of the state on whether or not a school would be put into their district.
McCoy didn’t respond to multiple requests for comment.
Rep. Lynn Belcher (R-Hopkins) is the second sponsor of the bill. Three Northern Kentucky representatives also co-sponsored the bill: Adam Koenig (R-Erlanger), Sal Santoro (R-Union), and Kim Moser (R-Taylor Mill).
Despite repeated requests to the House communications staff, all declined to go on the record to help clarify any points of the bill and how it applies to Northern Kentucky.
McCoy commented during the 2022 session about one particular part of the bill that seems to specifically apply to Kenton County. On page 17, and in Section 3 of the bill, it reads that in school districts with less than 7,500 students, a charter school application should include approval via a memorandum of understanding of the district’s approval of the application.
However, if the enrollment is above 7,500 then this doesn’t apply, meaning a charter school application will not need to be approved by the local school district.
The total enrollment of Kenton county’s four independent districts is roughly 9,100 (Covington Independent has approximately 4,100; Beechwood Independent has approximately 1,500; Erlanger-Elsmere Independent has approximately 2,600; Ludlow Independent has approximately 855).
Campbell County has five independent districts that have a combined total enrollment of around 6,600 (Fort Thomas Independent has approximately 3,200; Newport Independent has approximately 1,500; Dayton Independent has approximately 1,000; Bellevue Independent has approximately 660; Southgate Independent has approximately 200).
However, the bill also states that NKU has authorizing jurisdiction within any county containing four or more districts, which means it could technically only be at a site in either Kenton or Campbell.
While a location is still undecided, one group of local leaders said they have a preferred site for a potential charter school or a private school. But, it all depends on who becomes the authorizer and if the bill applies to what they are trying to accomplish.
Local leaders involved with a potential charter school
Covington-based developer Corporex CEO Bill Butler has supported efforts to establish a private or charter school across from the 25-acre, mixed-use Ovation Project.
Butler sits on the managing board of LINK nky, which does not affect editorial operations.
“The preferred site is due to two elements: A) its close proximity to several bridges, making a commute for parents taking their children to school much easier, and B) the size and proper zoning to create a new contemporary, state-of-the-art building,” Butler said. “It remains our preferred site whether for the original private school concept and for the charter school alternative.”
While their main choice is the site in Newport, Butler and his team hasn’t picked a site out in Kenton County.
“We acknowledge that the bill, as written, puts a limitation on the district in which the charter school can be located,” Butler said. “If that prevails in the end, the preferred site will not be appropriate. We do not have a site selected in Kenton County. The one in Newport seems so perfect and the housing authority owns it – Newport could benefit for the school in greater measures than Covington. However, given Covington’s endeavors to bring housing into the urban core, Covington, too, would greatly benefit.”
In January 2021, Butler approached Mike Clines to help him bring a private elementary school to Northern Kentucky.
Clines, who served as the superintendent for the Diocese of Covington from 2009 to 2020, was the lead consultant on the private elementary school, Urban Academy. Clines is also the Republican nominee for the 68th House District that comprises most of Campbell County along Route 8 starting in Fort Thomas.
“An Urban Academy Charter School would be a publicly funded independent school under the terms of a charter with a local or national authority which is different from a private school,” Clines said.
He said Urban Academy Inc. is the nonprofit created to establish, manage and operate the private school. Now that having publicly funded charter schools is possible in Kentucky, the group has yet to decide whether Urban Academy will be private or a public charter.
Clines listed himself as the lead consultant for “Northern KY New Urban Elementary School Initiative” (another name for Urban Academy) on his LinkedIn profile. It’s a job title he has since removed from his professional profile.
“I was a consultant to a private individual doing research for a privately funded academy,” Clines said via email. “I was not involved with the charter school legislation.”
Butler has been vocal in his support to bring more education options to Northern Kentucky.
“The mission is to provide an alternative pre-K through level eight school with an eye to two goals,” Butler said, elaborating he wants to keep young families in the area by providing an opportunity for low-income children to learn at a higher academic level.
The duo worked with Lynn Schaber, who previously led a project to bring a charter school to Northern Kentucky. Schaber’s efforts were fruitless due to a lack of funding for charters at the time.
Then came House Bill 9.
HB9’s relationship with Ovation
The bill designates Northern Kentucky as one of two locations for a charter school pilot. House Bill 9 also cements funding of charter schools in Kentucky, bringing the 2017 bill that allowed public charter schools in the Commonwealth full circle.
During the 2022 legislative session, LINK nky obtained documents showing that Butler lobbied for House Bill 9.
While the language in House Bill 9 makes specific reference to an “Urban Academy,” it’s unclear if any particular person influenced that language.
None of the legislators that sponsored the bill would speak on the record.
“‘Urban academy’ means a public charter school that includes an enrollment preference for students who live in close proximity to the school as defined in the charter contract,” the bill reads.
“I did not have anything to do with the language that they chose to put in that document,” Butler said. “I did not see it at any point.”
After the bill passed, rumors circulated about Butler’s involvement. The public thought the pilot mentioned in House Bill 9 meant the school could potentially be on the Ovation site. But the Ovation site was never going to get a charter school, with Industrial Revenue Bonds for the project showing that when the Newport Board of Education approved them, the school board added a stipulation that a school can’t be built on that site.
“The city shall not permit a private or charter school to be constructed or operate upon the Ovation site,” the addendum reads.
While a school can’t go at Ovation, Butler, Clines, and Schaber picked the site across the street from Ovation as their top choice for Urban Academy. The site is currently an empty green space. The Peter G. Noll housing project previously occupied the space across the street from Ovation.
“The site we’ve been most interested in is across from the newly built park on the west side of Newport – south of the Fourth street bridge, east of Route 9,” Schaber said.
The Housing Authority of Newport owns the site across from the Ovation Project. It is not in the best interest of the group to sell the site for another three years, said Tom Guidugli Sr., the executive director of the Housing Authority.
The Fourth Street site is adjacent to the Victoria Square apartment complex. Sunset Property Solutions bought that complex earlier this year and told residents they needed to vacate for renovations.
I did not lobby for charter schools, I want that clear.
Bill Butler, founder and CEO of Corporex
While Butler has denied he lobbied for House Bill 9, records show the Butler Foundation paid Commonwealth Alliances $15,450.50 over the course of the 2022 legislative session, according to information from the Kentucky Legislative Ethics Commission.
During this time, Clines continued on as a consultant in a reduced role at two days a week. He ultimately left the role on Aug. 1.
Butler denied that the project would go to Ovation. He also said that he did not ask the legislature to bring a charter school pilot to Northern Kentucky, and he denied he lobbied for the bill.
“I did not lobby for charter schools, I want that clear,” Butler said, elaborating that he spent $5,000 a month to pay for the lobbyists. “I did not. I did hire lobbyists to lobby for scholarship changes to the scholarship law.”
But lobbying reports from KLEC show that Butler via the foundation lobbied for House Bill 9, the charter school bill, Senate Bill 90 and House Bills 1. He also lobbied for HB 305, which deals with educational opportunity account scholarships. House Bill 305 did not pass.
House Bill 1 is the House budget, and SB 90 is behavioral health legislation.
Butler countered that his lobbying efforts were for the educational opportunity account scholarships.
“I hired lobbyists to help me with Education Opportunity Scholarships (EOS),” Butler said. “There are two flaws in the current EOS legislation: 1.) It only provides a $25,000,000 cap on tax credits for the entire state for those looking to help fund it, and 2.) The money must be spent in the year of the donation, therefore preventing this method of endowment for scholarships. We want to build up funds to create more opportunities for future generations.”
Butler said when he spent time in Frankfort in late February that the ball for House Bill 9 was already rolling.
“The train was moving at a high speed,” he said.
House Bill 9 in turmoil
Shortly after the bill passed the House, an ethics complaint was filed against Rep. Kim Banta (R-Fort Wright) for her vote on the bill.
Banta served on the House Education committee where the bill initially passed. Her vote proved crucial to the bill moving through the committee and then the House where it narrowly passed 51-46.
Banta’s husband, Tom, is the chief real estate officer for Ovation developer Corporex. He is also a board member for the Butler Foundation, a nonprofit built by Butler that lobbied the legislature in 2022 for HB9.
KY-120 United, which is now a union organizing under American Federation of Teachers, filed the complaint, alleging Tom Banta’s connection potentially influenced Kim Banta’s vote on the House floor. They argued Corporex is “the same firm that is developing a project in Northern Kentucky that has plans to include a charter school in this development.”
While reports at the time showed a school can’t go at Ovation, it’s now clear that Butler’s group wants the school to sit adjacent to the project.
“It gives the appearance that Rep. Banta stands to gain financially from the passage of HB9,” said Stacy Crosslin, a KY-120 United member, during a press conference in March when the ethics complaint was filed.
“Given the direct investment by her husband in the outcome of (the) vote, Rep. Banta had an obvious and significant conflict of interest and should have abstained from voting,” the complaint says.
Butler said that his work on the charter school is solely his and has nothing to do with Corporex.
“These are initiatives that I’m working on and it involves only my personal money,” he said. “I did it outside of the company.”
But records show that when he registered the nonprofit Urban Academy, he listed the Covington Corporex address as the nonprofit’s address. He also put Corporex as the nonprofit’s website.
“Urban Academy Inc. is a 501 C3 corporation, which has been capitalized by William P. Butler as an individual,”said Butler’s team in a statement. “It is located at 100 E Rivercenter Blvd. in Covington, which is also where the Corporex offices are headquartered, although on separate floors, and where the Chairman of Corporex, Mr. Butler, reside during office hours. The RiverCenter Towers hold offices for multiple not-for-profit corporations Mr. Butler has formed, including The Butler Foundation and Urban Community Developers Inc.”
A looming decision
Schaber, who has been working to bring a private school to NKY with Butler, said the group has not made a final decision on whether Urban Academy is to be a public charter or private school. If they decide on a charter school they will have to go through the application process to whoever ends up being the authorizer.
“I will tell you from a timeline standpoint around April of 2022, is when we sat down and said, ‘Okay, if we want a school in Northern Kentucky to give a choice to parents here, we now have an option we could continue moving forward with a private school, or we could switch over and make this into a charter school,'” Schaber said of meetings between her, Clines and Butler.
Schaber said they weighed the pros and cons of either having a private school or a charter school.
But there has been no final decision.
“You actually have to ask Bill Butler directly if he’s made that final decision,” Schaber said. “But the last time we were together, we had not made that final decision.”
That’s a decision that Butler says he’s yet to make.
“I did not know then, I do not know now if you can even use that charter school legislation to set out to do what I had set out to do with a private academy,” Butler said.
While charter schools are controversial, some want school choice in Northern Kentucky. For those leading the charge, they’re going to have to build trust, according to Schaber.
“I’m not really even pro-charter school because I have looked at all the data too, and there are lots of bad charter schools out there,” Schaber said. “But there are lots of good ones, too. And if you get the right people designing the school, it’s going to be good for this region. But there’s trust involved in that.”
But, that trust is hard coming so far, with no legislators willing to talk, Clines distancing himself from and leaving the project, and nobody readily admitting that they are involved with the school.
“They’re minimizing connections and personal gains that they will have from all this passing and that should be a red flag for everybody,” said Kelly Jones, a Democratic candidate that’s running against Clines in the 68th District.
Jones, who does contract work to provide mental health services in the Covington Independent School District, elaborated that those involved in education don’t think it’s a good idea.
“Who I do hear from that thinks it’s a good idea is people who can make money off it,” Jones said.
Correction: An earlier version of this article stated that Rep. Kim Banta subbed on the House Education Committee. However, she already had been on the committee.