State will pay Dayton schools $13M to settle 2011 lawsuit

Dayton schools will get $13.4 million in principal and could receive $1.1 million more in interest if ODE spreads the payments over three years as the settlement document suggests.

“I’d like to thank former school board member Jeffrey Mims for his leadership, and the Dayton Education Association (teachers union) for working really hard to bring about this lawsuit 15 years ago,” Dayton school board President Mohamed Al-Hamdani said Tuesday. “Sometimes people think we’re crazy when we sign up for these lawsuits, because legal fights take a long time. This money hopefully will go to great use for this district.”

DPS Treasurer Hiwot Abraha said the money can go into the general fund without strings attached. Superintendent Elizabeth Lolli said the district already has a plan for how to use the money, but she said final steps are still being mapped out.

“We’ll be announcing that in about three weeks,” Lolli said. “It’ll be something that will benefit the students directly, and it will also benefit the community.”

Dayton Public Schools first attempt 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 they failed to resolve the entire dispute.

As a result in 2011, DPS sued the state. In 2012, lawsuits by the Dayton, Cleveland and Toledo school districts were consolidated. After several years of rulings in common pleas and appeals courts as well as the Ohio Supreme Court, the case was remanded back to Judge Gina R. Russo, who found in favor of the schools in September.

Russo’s ruling said from 2004-05 through 2006-07, 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. She called it a “unilateral decision of ODE to ignore the statutory structure in place” for counting students in 05-07.

That resulted in the Dayton, Cleveland and Toledo school districts getting less funding than called for in the state formula.

The state board of education on Tuesday afternoon authorized the settlement, and Dayton’s school board approved the specific settlement document Tuesday night. That settlement still makes clear that “the state disputes the merits of Dayton’s claims in the lawsuit.”