|
Charter School Funding
October 7, 2004
After what seems like months
and months and months, the funding of New Hampshire charter schools is
starting to seem clear(er). Good thing! Three schools are open; 3 more
plan to open before February; and 3 more are on the road to approval.
It is our first year of charter schools actually open and this most
important detail (money to pay school teachers) will be resolved.
It’s quite clear how school
district-authorized charter schools receive funding. There is a contract
between the charter school and the local district, and each year the
charter school receives no less than 80% of the average per pupil cost
(of the sending district) for each student. The law is flexible,
allowing a contract for “less” than the 80% or “more.” This is the
funding model on record from 1995 through 2004 for district-authorized
charter schools. Our temporary confusion is how the charter school’s
state funds for state-authorized charter schools reach the charter
school—through the district or directly from the state?
Different states handle the
path of funding in different ways. In addition to New Hampshire, the
district-to-charter school cash flow scheme is used in many states,
including New Jersey, New Mexico, and New York. Best practice is not
routing money through the local school district. States having all
charter school funds flow directly from state coffers include Minnesota,
Massachusetts, Delaware, Ohio, Nevada, Indiana, Hawaii, Washington, and
District of Columbia.
Finally, several states have
a logical system: money flow from districts to the charter school IF the
authorizer is the district, and money flows from the state to the
charter school IF the authorizer is the state (or if the charter school
is open enrollment, taking students from more than one district). This
logical model is found in Texas, Michigan, Connecticut, Arkansas,
Arizona, and Louisiana
When the legislature drafted
the 2003 revision allowing state-authorized charter schools, the
district was no longer the authorizer and overseer of these schools.
Legislators repealed those sections of charter school law pertinent only
to district-authorized charter schools: “the following provisions of
law shall not apply” to state-authorized schools: 1) the contract
between the charter school and the school district, 2) the application
going to and through the school district and the appeal process
involving the school district, 3) amendments going to and through the
school district, 4) open enrollment provisions involving the school
district, and 5) grievances going through the school district. So the
legislature’s effort was to disconnect the charter school from the local
district IF the state was authorizer.
Somehow, the most essential
component of the state-authorized charter schools—operational
funding—was left in the hands of the local school districts. “For any
charter school authorized by the state board of education, the pupil’s
resident district shall pay tuition beginning July 1, 2004, and every
fiscal year thereafter, in an amount per pupil equal to the amount
determined in RSA 198:40. To the extent permitted by law, tuition
payments shall coincide with the distribution of adequacy grants under
RSA 198:42 or on such other terms as are mutually acceptable.” This
2003 provision for state-authorized charter schools does not mention
anticipation notes. It does not mention the state’s per pupil amount
flowing directly from the state.
An additional statement of
the 2003 statute revision allows all other provisions of charter school
law to stay in place. And so we turn to another charter school funding
provision (RSA 194-B:11) to find 2 more funding concepts: “the
pupil’s resident school district or department of education shall pay
tuition in cash or may issue reimbursement anticipation notes as set
forth in RSA 198:20-d.” Two additional provisions are in this one
statement--1) the department may pay the tuition to the charter school
directly and 2) the department or the district may seek reimbursement
anticipation notes to delay the current-year transfer of their own state
funds. Charter schools requesting direct payment from the state are told
this provision is not allowable or possible. Charter schools seeking
funds in a timely fashion without any holdup around anticipation notes
are told this provision is allowable. Both of these provisions are in
the same sentence of law.
The good news (for charter
schools and school districts) is that the Department of Education now
explains that the Department pays the borrowing costs when the
municipality issues and keeps an anticipation note. No borrowing cost to
the town/city, school district, or charter schools if the municipality
obtains the anticipation notes. The situation is confusing and a bit
harrowing for charter schools who are not school-district sponsored and
are open.
According to New Hampshire’s
Jose Alfonso, a long-time administrator for the Massachusetts Department
of Education and currently an administrator with Sabis International, “No
state with a truly strong charter school initiative has funding flow
through the local district. That's simply a recipe for problems.”
"I can tell you that if there is an option, you should not have charter
school funding flow through local districts. And particularly with
state-authorized schools, the state should find a way to have funding
flow directly from the state to the charter schools with no middle step
where the funding could be delayed or challenged or forgotten. It's
essential for funding to be transferred to the charter school on time.
Salaries, contracts, lease payments and other expenses must be covered
in a timely manner. In my experience, no state with a first-class
charter school initiative has funding flow through the local district
unless it is a district-authorized school."
States with top-rated charter school laws have money flowing directly
from the state to the charter school, especially for state-authorized
charter schools:
-
ARIZONA—1st –rated charter school law in the country.
Money path is through district for district-authorized schools and
directly from the state for other schools.
-
MINNESOTA—2nd highest rated law—money path is from state
directly to charter school.
-
DISTRICT OF COLUMBIA--3rd highest rated law—money flows
from state and district to school.
-
DELAWARE—rated 4th highest law—money flows from state and
the district to the charter school.
-
MICHIGAN—5th highest rated charter school law—money flows
from state to authorizing body acting as fiscal agent to the public
school academy.
-
MASSACHUSETTS—6th highest rating for charter school
law—money flows from state to school.
Other models:
-
ARKANSAS—money flows through districts for conversion schools; money
directly flows from state to school for open enrollment schools.
-
CONNECTICUT--money path through district for district-authorized
schools; directly from state for other schools.
-
TEXAS—through district to school authorized by local school boards;
directly from state for open enrollment schools
New Hampshire has the
opportunity to correct this funding path issue right from the start of
our charter school pilot program. State money should flow from the state
directly to charter schools for state-authorized schools. Local funding
should flow directly from local school districts to charter schools. All
public schools and especially charter schools MUST know the dates they
will receive their funding. Public schools must receive their funds in a
timely and predictable manner.
Charter schools in
New Hampshire can have charters revoked if the school become insolvent
or financially unstable. Confusion about funding path, inadequate
funding, problems receiving allowed funding in a timely manner—these
problems only serve to undermine the success of our charter schools and
so should be resolved promptly. |