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Charter schools really do get less money for children





by Jonathan Cetel

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In his recent commentary, Michael Masch, the former chief financial officer of the School District of Philadelphia, seeks to challenge the fact that Philadelphia’s public charter schools receive less per-pupil funding than District-operated schools. His arguments rest on a defense of several of the deductions that the School District of Philadelphia is able to make against its expenditures when calculating the per-pupil allocation to charter schools. Mr. Masch brings considerable authority to the subject, but his analysis fails to consider several important factors.

First, Masch discusses only some of the more than 20 deductions that the state allows districts to make in calculating the per-pupil allocation to charter schools. The deductions he cited for 2011-12, the year he used for comparison, added up to nearly $750 million, but they were not the sum total. Specifically, he failed to mention the “Other Financing Uses” deduction that includes debt service. For the 2013-14 school year, that deduction exceeded $259 million.

Some of these deductions make sense. As Masch mentions, it is fair to deduct Title I expenditures because charter schools can apply directly to the federal government for this grant. Similarly, it is reasonable to deduct for transportation costs that are provided by the District. But it’s unclear why the District should deduct other expenditures, such as debt service and facilities. Remember that the District does not provide rent-free space to charter schools. 

Masch’s calculation that the District’s per-student funding available to schools was $10,140 while funding for charters was $10,380 per student is thus an apples-to-oranges comparison. All of the $10,140 in the District school can be devoted to instruction because the overhead expenses are accounted for elsewhere, while the charters must use some of their per-student allotment for administration, rent, and facility costs.

In addition, some of the other deductions that Masch defends require closer inspection. Consider the $450 million in categorical grants, which includes early childhood programs. Since the District includes pre-K students as part of the student population in calculating the per-pupil expense, they are, in effect, “double-dipping.” As a reminder, the per-pupil spending allocation is calculated by subtracting the deductions from the District’s total expenditures and then dividing by the total number of students. There are thus two ways to deflate the per-pupil allocation: increase the amount of deductions or increase the number of students. By deducting the cost of early childhood programming and including those students as part of the student population, the District is twice deflating the per-pupil allocation. A fairer way would be to either remove the deduction or not include these students as part of the student count in the calculation. 

Finally, Masch concludes by saying that he doesn’t support a “change in the current Pennsylvania charter funding formula that would divert more of the School District of Philadelphia’s funds toward charters and away from District schools.” Instead, he argues that the existing funding formula is working. There is nothing in the proposed legislation that would divert funds away from districts to charter schools, but there are three proposed additions to the number of deductions that districts would be permitted to take before paying the charter schools. If the formula is already working as Masch suggests, the District does not need the additional deductions in the proposed bills.

 As Pennsylvania continues to debate revamping its charter law, it is evident that the discussion would benefit from a rigorous, objective, and exhaustive analysis of the fairness of the per-pupil charter school funding formula. And that’s exactly what both the House and Senate versions of the charter bills call for. Both sides agree that the existing funding formula treats them unfairly ... and both have a valid point of view. 

But let’s begin with an understanding of two basic facts: First, every child in Philadelphia deserves to be provided with enough funding for a high-quality education, regardless of the type of public school they attend. Second, charter schools receive less – not the same, and certainly not more – per-pupil public funding than District operated schools. 

Jonathan Cetel is the the founding executive director of PennCAN: The Pennsylvania Campaign for Achievement Now.  

The opinions expressed are solely those of the author.

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