Case Title: State ex rel. Horizon Science Academy of Lorain, Inc. v. Ohio Department of Education

Citation: 2021-Ohio-1681

Docket Number: 2020-0749

State: ohio

Court: Ohio Supreme Court

Date: 2021-05-19T00:00:00Z

Document:
[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as State 
ex rel. Horizon Science Academy of Lorain, Inc. v. Ohio Dept. of Edn., Slip Opinion No. 2021-
Ohio-1681.] 
 
 
 
NOTICE 
This slip opinion is subject to formal revision before it is published in an 
advance sheet of the Ohio Official Reports.  Readers are requested to 
promptly notify the Reporter of Decisions, Supreme Court of Ohio, 65 
South Front Street, Columbus, Ohio 43215, of any typographical or other 
formal errors in the opinion, in order that corrections may be made before 
the opinion is published. 
 
 
SLIP OPINION NO. 2021-OHIO-1681 
THE STATE EX REL. HORIZON SCIENCE ACADEMY OF LORAIN, INC. ET AL. v. 
OHIO DEPARTMENT OF EDUCATION ET AL. 
[Until this opinion appears in the Ohio Official Reports advance sheets, it 
may be cited as State ex rel. Horizon Science Academy of Lorain, Inc. v. Ohio 
Dept. of Edn., Slip Opinion No. 2021-Ohio-1681.] 
Mandamus—Grant funding for community schools under the Quality Community 
School Support (“QCSS”) Program—Section 265.335 of H.B. 166—
Definition of “in good standing” for community-school operators under the 
QCSS Program relates to operator’s effectiveness, not corporate 
registration with the secretary of state—Writ granted as to Ohio 
Department of Education. 
(No. 2020-0749—Submitted March 2, 2021—Decided May 19, 2021.) 
IN MANDAMUS. 
________________ 
 
Per Curiam. 
SUPREME COURT OF OHIO 
 
2
{¶ 1} In the 2020–2021 biennial budget bill, 2019 Am.Sub.H.B. No. 166 
(“H.B. 166”), the General Assembly appropriated $30 million for a Quality 
Community School Support (“QCSS”) Program.  Under the program, a community 
school that has met certain criteria would receive grant funding for the 2020–2021 
and 2021–2022 fiscal years.  H.B. 166, Section 265.335. 
{¶ 2} Relators are 12 Horizon Science Academy community schools 
(collectively, “the HSA schools”)1 that had applied for QCSS grants.  The Ohio 
Department of Education (“ODE”) denied the applications because the schools’ 
operator was a foreign corporation not licensed with the Ohio secretary of state and 
was therefore, according to ODE, not “in good standing” as required by Section 
265.335 of H.B. 166.  The HSA schools seek a writ of mandamus ordering 
respondents, ODE; its director of community schools, Karl J. Koenig; the Ohio 
State Board of Education; and Ohio Superintendent of Public Instruction Paolo 
DeMaria, to approve their applications and pay them the amounts due under H.B. 
166.  Because ODE’s interpretation of “in good standing” is incorrect, we grant the 
writ as to ODE.  We deny the writ as to the remaining respondents because Section 
265.335 of H.B. 166 does not impose duties upon them to perform the requested 
acts. 
I.  Factual and Procedural Background 
A.  The HSA schools 
{¶ 3} The HSA schools are community schools organized under R.C. 
Chapter 3314.  “[C]ommunity schools are independently governed public schools 
that are funded from state revenues pursuant to R.C. Chapter 3314.”  See State ex 
                                                 
1. The 12 schools are Horizon Science Academy of Lorain, Inc.; Horizon Science Academy 
Youngstown, Inc.; Horizon Science Academy Cincinnati High School, Inc.; Horizon Educational 
Services, Inc.; Horizon Science Academy–Cleveland Middle School; Horizon Science Academy 
Elementary School, Inc.; Horizon Science Academy, Inc.; Horizon Science Academy Primary; 
Horizon Science Academy–Dayton; Horizon Science Academy Dayton High School, Inc.; Horizon 
Science Academy–Springfield; and Horizon Science Academy–Toledo.   
January Term, 2021 
 
3
rel. Ohio Congress of Parents & Teachers v. State Bd. of Edn., 111 Ohio St.3d 568, 
2006-Ohio-5512, 857 N.E.2d 1148, ¶ 5. 
{¶ 4} As authorized by R.C. 3314.01(B), each of the HSA schools contracts 
with an operator, Concept Schools NFP (“Concept”), for school-management 
services.  Concept is an Illinois nonprofit corporation that has operated community 
schools in Ohio for more than 15 years.  Concept operates 30 schools in seven 
states, including 17 schools in Ohio. 
B.  Section 265.335 of H.B. 166 
{¶ 5} Section 265.335 of H.B. 166 established the QCSS Program, which 
provides general-revenue funding for community schools.  Under the program, a 
school designated by ODE as a “Community School of Quality” receives additional 
funding of $1,750 or $1,000 per fiscal year, per student, with the amount depending 
on whether the student is economically disadvantaged.  H.B. 166, Section 
265.335(A).  ODE is required to pay the grant amounts to eligible schools no later 
than January 31 of each fiscal year.  Id.  A school deemed eligible for a QCSS grant 
for the 2020–2021 school year would also receive the grant for the 2021–2022 
school year.  H.B. 166, Section 265.335(C).  The General Assembly appropriated 
$30 million for QCSS grants for the 2020 and 2021 fiscal years.  H.B. 166, Section 
265.10. 
{¶ 6} There are four ways in which a school may qualify for a QCSS grant 
as an eligible Community School of Quality, which ODE refers to as Criteria 1, 
Criteria 2, Criteria 3(b)(i), and Criteria 3(b)(ii).  Only Criteria 3(b)(i) and 3(b)(ii) 
evaluate a school’s operator in determining eligibility.  In this case, the HSA 
schools attempted to qualify for a QCSS grant under Criteria 3(b)(ii). 
{¶ 7} Under Criteria 3(b)(ii), a school qualifies for a QCSS grant if it 
“contracts with an operator that operates schools in other states” and the operator 
meets all of the following criteria:  
 
SUPREME COURT OF OHIO 
 
4
(I)  One of the operator’s schools in another state performed 
better than the school district in which the school is located, as 
determined by [ODE]. 
(II)  At least fifty per cent of the total number of students 
enrolled in all of the operator’s schools are economically 
disadvantaged, as determined by [ODE]. 
(III)  The operator is in good standing in all states where it 
operates schools. 
(IV)  [ODE] has determined that the operator does not have 
any financial viability issues that would prevent it from effectively 
operating a community school in Ohio. 
 
(Emphasis added.)  H.B. 166, Section 265.335(B)(3)(b)(ii).  H.B. 166 does not 
define “in good standing.” 
{¶ 8} ODE created a multipage form for schools to use when applying for a 
QCSS grant.  The form as completed by the HSA schools in November 2019 recited 
the eligibility requirements stated in Section 265.335(B)(3)(b)(ii) and further 
provided the following five criteria that the operator had to satisfy in order “to meet 
the definition of good standing”:      
   
 All schools it currently manages in all states are not on 
probation;   
 All schools it currently manages in all states are not in 
receipt of notices of intent to suspend operations from the schools’ 
current sponsors/authorizers; 
 All schools it currently manages in all states have not 
been required by their sponsors/authorizers to suspend operations;  
January Term, 2021 
 
5
 All schools it currently manages are not in receipt of 
notices of termination from their current sponsors/authorizers;   
 All schools it currently manages do not have unresolved 
corrective action plans from the state department of education, 
current sponsor/authorizer, or current operator.2   
 
(Footnote added.)  The form also contained a section titled “Operator Assurances 
Supplement,” which required the applicant to attest that its operator satisfied each 
of the five criteria for “good standing.”  However, the form completed by the HSA 
schools in 2019 did not require applicants to assure that their operator was 
registered as a corporate entity with the office of the Ohio secretary of state or its 
equivalent in other states where the operator operates schools. 
C.  The HSA schools’ applications for QCSS grants 
{¶ 9} In November 2019, the HSA schools each applied for a QCSS grant 
under Criteria 3(b)(ii).  Each school used the application form created by ODE and 
attested to its compliance with the requirements of Section 265.335(B)(3)(b)(ii)(I) 
to (IV).  The HSA schools also attested that Concept satisfied each of the five good-
standing criteria pertaining to operators. 
{¶ 10} On January 10, 2020, Koenig, ODE’s director of community 
schools, notified the HSA schools that their applications had been denied.  Koenig 
informed the schools that they did not satisfy Section 265.335(B)(3)(b)(ii)(III) 
because their operator, Concept, “is not registered as a foreign corporation with the 
Ohio Secretary of State’s Office and, therefore, is not in good standing in Ohio.”  
Koenig did not identify any other criteria that the HSA schools failed to satisfy. 
 
 
                                                 
2. Ohio’s community-school statutes define “sponsor” as an ODE-approved entity that monitors the 
school’s performance according to state laws and regulations.  See R.C. 3314.02(A)(1) and (C)(1), 
3314.03(A)(4).  In turn, ODE monitors the sponsor’s performance.  R.C. 3314.015(A)(2) and (3).     
SUPREME COURT OF OHIO 
 
6
D.  The mandamus action 
{¶ 11} The HSA schools commenced this action on June 15, 2020, naming 
ODE, the Ohio State Board of Education, Koenig, DeMaria, and Governor Mike 
DeWine as respondents.  They requested a writ of mandamus directing all 
respondents to (1) approve the schools’ QCSS-grant applications and (2) award 
each school “an amount up to $1,750 for each student identified as economically 
disadvantaged and up to $1,000 for other students enrolled for fiscal year 2020,” in 
accordance with the General Assembly’s appropriation in H.B. 166.  Respondents 
moved to dismiss the complaint, with a separate filing by Governor DeWine.  We 
granted the motion to dismiss as to Governor DeWine, denied the remaining 
respondents’ motion to dismiss, and granted an alternative writ.  160 Ohio St.3d 
1414, 2020-Ohio-4612, 154 N.E.3d 87.  The parties submitted evidence and briefs, 
and the case is now before us for a decision on the merits. 
II.  Analysis 
{¶ 12} To be entitled to a writ of mandamus, the HSA schools must 
establish by clear and convincing evidence (1) a clear legal right to the requested 
relief, (2) a clear legal duty on the part of the respondents to provide it, and (3) the 
lack of an adequate remedy in the ordinary course of law.  State ex rel. Waters v. 
Spaeth, 131 Ohio St.3d 55, 2012-Ohio-69, 960 N.E.2d 452, ¶ 6, 13.  Respondents 
do not dispute that the HSA schools lack an adequate remedy in the ordinary course 
of law.  Indeed, the schools have no avenue to appeal ODE’s determination that 
they are ineligible for QCSS grants.  See State ex rel. Lakeview Local School Dist. 
Bd. of Edn. v. Trumbull Cty. Bd. of Commrs., 109 Ohio St.3d 200, 2006-Ohio-2183, 
846 N.E.2d 847, ¶ 9 (mandamus is appropriate remedy when a school board has no 
right to appeal the commissioners’ alleged failure to follow statutory duty to 
distribute funds).  Thus, our decision turns on whether the HSA schools have 
established a clear legal right to QCSS-grant funding and whether respondents have 
a clear legal duty to provide it. 
January Term, 2021 
 
7
A.  The meaning of “in good standing” in Section 265.335 of H.B. 166 
{¶ 13} The crux of the legal dispute in this case is the meaning of the 
requirement that a community school’s operator be “in good standing in all states 
where it operates schools” in order for the school to qualify for a QCSS grant under 
Criteria 3(b)(ii).  See H.B. 166, Section 265.335(B)(3)(b)(ii).  ODE denied the HSA 
schools’ grant applications because their operator, Concept, is an Illinois nonprofit 
corporation that had not been licensed by the secretary of state to do business in 
Ohio when the schools submitted their applications.  See R.C. 1703.27 (“No foreign 
nonprofit corporation shall exercise its corporate privileges in this state in a 
continual course of transactions until it has first procured from the secretary of state 
a certificate authorizing it to do so”).  Concept’s failure to be properly registered 
does not affect the validity of its school-management agreements with the HSA 
schools.  See R.C. 1703.29(A).  But for purposes of the schools’ eligibility for 
QCSS-grant funding under Criteria 3(b)(ii), ODE considers the term “in good 
standing” to implicitly include licensure with the secretary of state. 
{¶ 14} When construing a legislative enactment, we must discern the intent 
of the General Assembly.  State ex rel. Repeal the Lorain Cty. Permissive Sales Tax 
Commt. v. Lorain Cty. Bd. of Elections, 151 Ohio St.3d 247, 2017-Ohio-7648, 87 
N.E.3d 1234, ¶ 14.  In doing so, we begin with the plain language of the statute.  Id.  
In this case, however, the General Assembly did not define “in good standing” in 
Section 265.335 of H.B. 166.  Undefined words and phrases in an enactment “shall 
be read in context and construed according to the rules of grammar and common 
usage.”  R.C. 1.42.  “[A] court cannot pick out one sentence and disassociate it from 
the context, but must look to the four corners of the enactment to determine the 
intent of the [legislature].”  State v. Wilson, 77 Ohio St.3d 334, 336, 673 N.E.2d 
1347 (1997); see also Commerce & Industry Ins. Co. v. Toledo, 45 Ohio St.3d 96, 
102, 543 N.E.2d 1188 (1989) (“words and phrases in a statute must be read in 
context of the whole statute”).  Here, an examination of the QCSS-grant-funding 
SUPREME COURT OF OHIO 
 
8
criteria as a whole indicates that the “in good standing” requirement in Criteria 
3(b)(ii) speaks solely to the operator’s standing as a qualified and effective operator 
of community schools. 
{¶ 15} This interpretation of “in good standing” makes sense when 
examined in the context of the other Criteria 3(b)(ii) requirements.  The other 
requirements for a school to qualify for a QCSS grant under Criteria 3(b)(ii) are (1) 
that one of the operator’s schools in another state outperformed its school district, 
(2) that at least 50 percent of the students enrolled in all of the operator’s schools 
are economically disadvantaged, and (3) that the operator does not have any 
financial-viability problems that would interfere with its ability to operate a school 
in Ohio.  See H.B. 166, Section 265.335(B)(3)(b)(ii).  Each of these requirements 
relates to either the operator’s effectiveness or the provision of educational 
opportunity to economically disadvantaged students.  In this context, the 
requirement that the operator also be “in good standing in all states where it 
operates schools” is logically construed to relate to the operator’s ability to 
effectively operate community schools.  That is, an operator is “in good standing in 
all states where it operates schools” if the operator is not subject to any form of 
sanction, suspension, or disciplinary censure by a state’s educational authority or a 
school’s sponsor.  Not surprisingly, ODE’s own list of “good standing assurances,” 
to which the HSA schools had to attest, related to these types of issues and not to 
any corporate-registration requirement in Ohio or any other state. 
{¶ 16} An examination of the rest of Section 265.335 of H.B. 166 provides 
further support for the conclusion that “in good standing” does not mean 
compliance with a corporate-registration requirement with the Ohio secretary of 
state (or an equivalent requirement in other states).  Under Criteria 1, a school 
qualifies for QCSS-grant funding if it meets certain academic performance 
standards as of the program’s effective date and if at least 50 percent of its students 
are economically disadvantaged.  H.B. 166, Section 265.335(B)(1).  Under Criteria 
January Term, 2021 
 
9
2, a school qualifies for QCSS-grant funding if it is a relatively new school 
operating under certain timing parameters and is replicating the operational and 
instructional model of a Criteria 1 school.  H.B. 166, Section 265.335(B)(2).  And 
under Criteria 3(b)(i), a school qualifies for QCSS-grant funding if its operator 
operates schools in other states and if, as of the program’s effective date, its 
operator operated a school that received either a grant under the federal Charter 
School Program (20 U.S.C. 7221) or funding from the Charter School Growth 
Fund.3  H.B. 166, Section 265.335(B)(3)(b)(i). 
{¶ 17} All of the requirements in Criteria 1, 2, 3(b)(i), and 3(b)(ii) relate to 
indicia of a school’s successful performance.  However, Criteria 3(b)(i) and 3(b)(ii) 
also focus on the school operator.  Criteria 3(b)(i) does not require that the school 
operator be “in good standing” in all states where it operates schools, even though 
the General Assembly expressly contemplated that a school applying for grant 
funding under Criteria 3(b)(i) would have an out-of-state operator.  See H.B. 166, 
Section 265.335(B)(3)(b)(i).  Instead, the General Assembly considered that a 
school that contracts with an operator sufficiently demonstrates the operator’s 
effectiveness if it received funding from the federal Charter School Program or the 
Charter School Growth Fund.  We likewise interpret the school-operator 
requirements in Criteria 3(b)(ii) as being geared toward assurances of the operator’s 
effectiveness. 
{¶ 18} If the General Assembly had been concerned with a school 
operator’s corporate-registration status as a prerequisite to QCSS-grant funding, it 
would have imposed corporate registration as a requirement for schools applying 
under any of the criteria and not just for eligibility under Criteria 3(b)(ii).  It is just 
as likely that a community school seeking to qualify under Criteria 1, Criteria 2, or 
                                                 
3. The Charter School Growth Fund is a nationally recognized philanthropic organization that funds 
charter 
schools 
nationwide, 
https://chartergrowthfund.org/ 
(accessed 
April 
13, 
2021) 
[https://perma.cc/TNQ2-YSHS]. 
SUPREME COURT OF OHIO 
 
10 
Criteria 3(b)(i) could have an operator that is a foreign corporation.  Indeed, three 
other Horizon Science Academy schools also operated by Concept received QCSS-
grant funding under Criteria 1.  There is nothing in the language of Section 265.335 
of H.B. 166 to suggest that the General Assembly intended to disqualify a school 
from a QCSS grant under Criteria 3(b)(ii) if its operator was not registered with the 
Ohio secretary of state yet allow a school with the same operator to obtain a QCSS 
grant under any of the other three criteria.  The QCSS-grant scheme as a whole 
indicates that the General Assembly intended the eligibility requirements to relate 
to performance-based factors of the school itself (Criteria 1 and 2) or the operator 
(Criteria 3(b)(i) and 3(b)(ii)). 
B.  ODE’s interpretation is not entitled to deference 
{¶ 19} In support of its interpretation of “in good standing” to include a 
corporate-registration requirement, ODE asks the court to apply the principle of 
agency deference.  But deference to an administrative interpretation is not 
appropriate when the enactment is unambiguous.  Cleveland Clinic Found. v. 
Cleveland Bd. of Zoning Appeals, 141 Ohio St.3d 318, 2014-Ohio-4809, 23 N.E.3d 
1161, ¶ 29.  For the reasons stated above, the phrase “in good standing” as used in 
Section 265.335 of H.B. 166 is unambiguous.  Based on a reading of the legislative 
enactment as a whole, the term has nothing to do with corporate registration.  
Therefore, ODE is not entitled to agency deference in this case. 
C.  Mandamus is appropriate only as to ODE 
{¶ 20} For the reasons set forth above, corporate registration is not a 
prerequisite to qualify for grant funding under Criteria 3(b)(ii) of the QCSS 
Program.  Because the HSA schools have met the Criteria 3(b)(ii) requirements, 
they have established a clear legal right to QCSS grants and a clear legal duty on 
the part of ODE to provide them.  The HSA schools are therefore entitled to a writ 
of mandamus ordering ODE to approve their grant applications and award them 
January Term, 2021 
 
11 
QCSS-grant funding.  The schools are not, however, entitled to a writ of mandamus 
as to respondents Koenig, DeMaria, or the Ohio State Board of Education. 
{¶ 21} Section 265.335 of H.B. 166 imposes no duties on either DeMaria 
or the Ohio State Board of Education to approve grant applications or disburse grant 
funds.  And though Koenig is the ODE director of community schools, H.B. 166 
imposes the duty of administering the QCSS Program and disbursing the grant 
funds on ODE, not on any particular individual or officer.  See H.B. 166, Section 
265.335(A).  Moreover, the evidence shows that ODE’s decisions on whether a 
school qualifies for a QCSS grant and whether to approve a disbursement of QCSS 
funds to a school are not relegated solely to Koenig.  We will not issue a writ of 
mandamus against a respondent who has no duty to perform the requested acts.  See 
State ex rel. Becker v. Eastlake, 93 Ohio St.3d 502, 506, 756 N.E.2d 1228 (2001). 
III.  Conclusion 
{¶ 22} The HSA schools satisfied all of the requirements to obtain QCSS-
grant funding under Section 265.335(B)(3)(b)(ii) of H.B. 166.  We therefore grant 
a writ of mandamus requiring ODE to approve the HSA schools’ QCSS 
applications and award them grant funding as set forth in Section 265.335 of H.B. 
166.  We deny the writ as to the remaining respondents. 
Writ granted in part  
and denied in part. 
O’CONNOR, C.J., and KENNEDY, FISCHER, DEWINE, and STEWART, JJ., 
concur. 
DONNELLY and BRUNNER, JJ., dissent and would deny the writ as to all 
respondents. 
_________________ 
Nicola, Gudbranson & Cooper, L.L.C., Nicholas J. Dertouzos, and Arthur 
L. Clements III, for relators. 
Organ Law, L.L.P., Erik J. Clark, and Gabriel Siegle, for respondents. 
SUPREME COURT OF O1110