In 1990, two US senators, citing $436 hammers and $640 toilet seats, urged the Defense Department to audit its purchasing records to determine whether the prices were reasonable in comparison to commercial market costs. And in 2018, a top US senator wanted to know how the Pentagon ended up paying $10,000 for an airplane toilet seat cover.
For more than 25 years, Pennsylvania taxpayers have been paying charter school tuition rates that far exceed charter schools’ actual costs, and despite broad based, statewide bipartisan calls for reform the General Assembly has done nothing to address it. Estimates of these overpayments approach $400 million per year.
While there is no question that charter and cyber charter schools have a place in our public educational system and that they work well for many students, flaws in the current formulas used to fund charter schools result in school districts overpaying by hundreds of millions of dollars, which comes out of the pockets of local taxpayers and out of school district classrooms.
When districts overpay for charter tuition there are fewer resources available for math and reading coaches, nurses, counselors, social workers, and/or librarians, especially in our most underfunded districts that tend to serve students with the greatest needs.
A recent bipartisan OP-ED calling for charter reform by Robert Gleason, former 10 year chair of the Pennsylvania Republican Party, and Eugene DePasquale, former Democratic state Auditor General, clearly and concisely illustrates that charter reform is and should be a bipartisan issue.
Even more telling is the fact that 439 of the state’s 500 school districts have passed board resolutions calling on the General Assembly to pass meaningful charter reform. That’s an overwhelming majority of locally elected school boards, in a state as diverse as Pennsylvania, recognizing that a problem exists and asking the General Assembly to fix it.
A report by a statewide task force convened by the Pennsylvania School Boards Association in 2020-2021 highlighted two major causes for these overpayments and made several recommendations for fixing them. The first cause is that cyber charter schools receive the same tuition payments as brick-and-mortar charter schools despite the fact that they do not have the same level of expenses as their brick-and-mortar colleagues such as buildings and grounds (and the costs that go along with it such as maintenance and utilities), food service, athletics, extracurriculars, and nonpublic school services.
And because cyber charters draw students from across the state, they receive vastly different tuition payments according to where each student comes from (because tuition payments are based on the sending school district’s expenses, not what it costs the cyber charter school to provide the services) even though the cyber charter school is providing the same educational program to all of its students.
This is not some recently discovered problem. In 2007 I testified before the House Education Committee regarding cyber charter funding, oversight, and accountability issues and we knew that school districts were overpaying for cyber charter tuition then. Yet, nothing has changed in the interim.
The solution for this is simple – institute a flat, statewide cyber charter tuition rate for all students who attend a cyber charter school which reflects the lower costs of providing a cyber education.
The second cause for charter school overpayments is the way special education tuition is calculated for all charter schools. When you combine the fact that a school district’s tuition rate for special education students is based on the school district’s expenses with the fact that nearly all (95%) of the special education students needing the most extensive supports and services are educated by school districts, the result is a substantially inflated tuition rate for special education.
How do those inflated tuition payments produce overpayments? Take for example a special education student in a charter school with a specific learning disability or a speech disability. That student may only require $5,000 per year in specialized supports and services, but the average school district is required to pay the charter school an extra $16,600 to provide those specialized supports and services. In this scenario, the school district would have overpaid more than $11,000. Unfortunately, this scenario plays out all too often.
This problem also comes with a similarly simple solution, implement a tiered special education funding formula that recognizes the differences in costs for addressing disabilities depending upon their severity. This is the same solution already used to drive out state special education funding to school districts, so why isn’t it good enough for charter schools?
The more you look at these overpayments, the more they start to resemble the $640 toilet seat or the $10,000 toilet seat cover.
Superintendents, school business managers and school board directors have been raising the red flag on these issues for years, making certain that their state senators and representatives are acutely aware of how these issues impact their constituents. It is well known now that there is a straight line from excessive charter tuition costs to increased local property taxes.
It’s time for our elected officials to represent the interests of taxpayers and pass meaningful charter school reform.
Lawrence Feinberg is the Director of the Keystone Center for Charter Change. A long-time advocate for public education at the county, state and federal levels, he is serving in his 23rd year as a member of the Haverford School Board in Delaware County. His views are his own.