Charter School Funding

Scenario: Your high school friend from Georgia called you about a great travel package he and his wife just got for a Rhine River cruise next fall–$1300 per person, double occupancy.  (He knows a Rhine River cruise has been on your bucket list since…forever.)  He gave you the travel agency and the agent’s name.  You make the call and book the same cruise at the same time with identical accommodations; in fact, the cabin is adjoining your friend’s.  When you get out your credit card, the agent tells you that the price for all this is $2200 per person, double occupancy.  “Why the difference?” you ask.

“Because you can afford to pay more.”

I doubt that you would accept that explanation; I certainly wouldn’t.  Yet, that is similar logic used by  the Commonwealth in determining how much a school district should pay to send one of its students to a charter school in PA.  The cost of educating students at the charter school should be roughly the same, student to student.  But that is not reflected in the payments.

When the General Assembly passed the Charter School Law (Act 22 of 1997), they inserted a funding formula (23 PS section 17-1725-A) that based the district’s payment per pupil to a charter school at roughly 75% of the amount of money the district spent on each of its own non-special education students, less some expenses, such as transportation, debt service, and so forth.  For instance, a rural school district might pay about $7,000 per student to send its student to a charter school, while a suburban Philadelphia school district might pay twice that much for the same education.  Little consideration appears to have been given as to what the actual cost of the charter school education might be.  (Interesting business model!)

For special needs students, there is a flat payment based on the median costs to school districts to educate their own students with certain categories of special needs.  Again, that flat payment might be more or less than the actual cost to educate the student in his home school district.  And the mandated flat payment might have no relationship to the charter school’s actual cost to provide the special education.

With bricks-and-mortar charter schools, the number of students a district might send to a charter is fairly limited, due to space and facility size.  With the advent of cyber charter schools, however, the pool of potential charter students (and the potential revenue stream) increased drastically.  Add to that the cost savings in delivery of instruction by a cyber charter school using internet technology, and the surplus revenue can be enormous.  Those cost savings have not been addressed in the payment formula for (cyber) charter schools.  Why should a suburban Philadelphia school district pay $12,000/pupil to a charter school and a rural school district pay only $7,000?

As charter schools continue to provide the viable educational option that proponents originally imagined, it is time to re-visit this funding formula.  As taxes increase, the dollars need to be more rationally spent.  This is one place to start.

To learn more, go to the following PDE website for more data on charter school payments:

http://www.education.pa.gov/K-12/Charter%20Schools/Pages/Charter-School-Funding.aspx#tab-1