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The Philadelphia School District wouldn’t be in the financial trouble it is today if the state put its money where its mouth is.
The Corbett administration is vocal when it comes to supporting charter schools in the name of school choice. Its Education Department is permissive when it comes to charter requests to override local school districts attempting to cap charter enrollment and otherwise discourage their growth.
But, when it comes to financially supporting charter schools, the state offers zero help.
The state would argue that it already does enough. Charters get the same share of per pupil, transportation and special education aid handed out by the state. Instead of going to the local public school, the money goes to a charter. So what’s the problem?
But it is too simplistic to say that a dollar given to a charter school is a dollar saved by the school district. What is missing from this equation is something called “stranded costs”— money the local district still must pay even if a student defects to a charter.
Let’s use this hypothetical as an example:
Suppose a K-8 charter school opens down the road from a public elementary school. Eventually, 40 percent of the students in the district school enroll in the charter.
The elementary school may be able to reduce the number of classes—and save money on teacher’s salaries. On the other hand, it may only be able to decrease class size and have the same number of teachers. A fifth grade class with 24 students instead of 33 still is a fifth grade class that must be taught.
Even if it does shed teachers, the school must open every day, still must have a principal and a secretary and some support staff. It still must pay for maintenance and utilities.
All of those services cost the same whether there are 450 students in the building or 275.
It’s one thing for a school district to deal with this issue if it has just a handful of charters, which is the case in most districts across the state.
It is another thing if a district is the capital city of charters, which is the case in Philadelphia.
Philadelphia has 80-plus charter schools enrolling 60,000 students. Next year, the school district will spend $767 million—a figure equal to 31 percent of its budget—on charter school reimbursement, a figure that has risen every year for the past 10.
One answer to stranded costs is to close or consolidate district schools whose enrollment continues to sink. The district did that last year in a gut-wrenching process that saw two-dozen schools closed or consolidated.
But, it is hard to keep up with what amounts to an annual and unpredictable shift in student populations. The district has tried, often unsuccessfully, to cap charter enrollment—not because it opposes charters, but to get a handle on expenses.
But, it seems, every year the district estimates enrollment—and budgets accordingly—more students than expected slip across the line and end up in charters. This year, about 2,000 more than anticipated did so.
As the district’s budget problems deepen and the cuts made to services multiply, the lure of charters increases.
One way out of this mess is for the state to recognize that local districts need financial help to deal with such issues as stranded costs, which where unforeseen when the charter law first passed in 1997.
In fact, the state did just that. Act 88 of 2002 said the state could reimburse local districts for charters up to 30 percent of the cost of maintaining them. The Rendell administration began including Act 88 money in the Education Department’s budget.
Act 88 was one of those odd pieces of legislation that was supported by both pro- and anti-charter legislatures. For those who favored charters, it offered an incentive to districts to let them set up shop and to expand. For those opposed to charters, it provided aid to a school district to defray charter costs—and apply them to its overall operating budget.
In 2010, the Philadelphia School District got $114 million under Act 88, roughly a third of the $378 million it spent on charters that year.
And then the money went away.
In his first budget, Gov. Corbett zeroed out the Act 88 line item in the budget and removed the state entirely from supporting charter costs. The state, it seems, was in favor of supporting charters in every way but the most important—financial support.
Today, if Act 88 was in place the city would be due to get $228 million from the state for charter cost reimbursement.
That would be enough to take it out of deficit and also fund some of the initiatives Superintendent William Hite wants to take.
As it has done consistently, the Corbett administration has shifted support for the schools from the state to local governments.
In this case, there is the added hypocrisy of being vocal in support of charters while telling districts they are on their own in paying for the ancillary costs associated with them.
Corbett has a “pro-choice” agenda while simultaneously punishing the districts that pursue that path.
In this case, unlike other education aid schemes, there is no need to pass a new law or change a formula for disbursement of state aid. Act 88 remains in place. The legislature, in its wisdom, could decide that it was right in 2002 to recognize the issue of stranded costs, and it could add money for reimbursement to next year’s state budget.
It would end the hypocrisy and signal a halt to the political games being played over Philadelphia schools.