YORK, Pa. - The Pennsylvania Coalition of Charter Schools is preparing a code of ethics for charter operators to address allegations of financial impropriety and mismanagement that have surfaced at charters in the Philadelphia area, roiling the charter community.

Lawrence F. Jones Jr., president of the coalition, told members of the state Senate Education Committee yesterday: "Charter schools were created to be held to a higher standard of accountability. That includes fiscal, moral, and all aspects of accountability."

The committee had scheduled the half-day hearing to take stock of the state's 1997 charter law and legislation adopted in 2002 covering cyber charter schools, which provide online instruction to students in their homes.

Although the session was dominated by debate over funding and suggestions from school district representatives and charter officials for amending the laws, Jones devoted part of his testimony to announcing the accountability code that the coalition will release this month.

The organization represents 120 of the 127 charter operators in the state, said Jones, chief executive officer of the Richard Allen Preparatory School in Philadelphia.

Sen. Andrew Dinniman (D., Chester), who this week said he planned to ask charter operators how they intended to police themselves to prevent further scandals, welcomed the coalition's action.

At least three Philadelphia charter schools and a cyber charter in Devon have been ensnared in a widening federal criminal probe.

The investigation began last spring after The Inquirer reported that the Philadelphia School District's inspector general was investigating allegations of nepotism, conflicts of interest, and financial mismanagement at Philadelphia Academy Charter School in the Northeast.

Sen. Jeffrey E. Piccola (R., Dauphin), chairman of the Education Committee, scheduled the hearing to gather testimony about ways to improve upon the law. A cosponsor of the 1997 charter law, he described himself as a strong supporter of charter schools, but added that it may be time to consider changes.

"Let's be clear," Piccola said. "Charter schools are public schools, and it is the intention of this committee to have a comprehensive review of our charter school law - its successes and its failures."

The committee intends to rewrite laws "to improve on the chartering of these public schools and improve upon their oversight and accountability," he said. "The greatest accountability - and what I like most about charters and cyber charters - is that parents can, and do, vote with their feet."

As expected, Education Secretary Gerald Zahorchak's proposals to set a statewide tuition rate for cyber charters and create a two-tier funding formula for special-education students at all charters was sharply criticized by charter operators and parents. Several warned that the changes would reduce funding for charters and could threaten their viability.

Under the current law, school districts pay the same amount for a student of a cyber school as for one at a regular charter school. The rates vary widely and are based on how much a district spends to educate students in its own schools.

But because cyber schools enroll students from across the state, their districts pay different amounts for students receiving the same instruction. For example, Jenkintown paid $15,076 per student last year and Reading $5,380.

Zahorchak said the Rendell administration favored statewide funding rate for cyber schools based on the "most efficient, effective cyber charters" that have met the standards of the federal No Child Left Behind Act.

For the 2009-10 academic year, the rate would be a maximum of $8,856 but no more than the rate a district pays for a student at a regular charter school. In future years, he said, payments would keep pace with inflation.

Joanne Jones Barnett, chief executive officer of the Pennsylvania Virtual Charter School in Norristown, said cyber rates reflected the state's inequities in funding public education. She said that if the state fixed the funding for all public schools, the perceived problems with cyber rates would disappear.

"We did not ask for the funding model we have. We inherited it," she said.

Barnett also said one rate would not cover all charter schools. Even the 11 cyber charters, she said, offer different grades and have students with differing needs. "All charter schools are not the same," she said.

Cindy Strausberger, president of the Pennsylvania Families for Public Cyber Schools, challenged critics of the costs of cyber charter schools. The state's cybers enroll 20,000 students. She said that amounted to just over 1 percent of the students in public schools and accounted for less than 1 percent of the state's education costs.

She said cybers were excellent examples of cost efficiency and offered programs for students who did not do well in traditional school.

Noting that the state's school districts will receive a total of $1.5 billion federal stimulus funding, Strausberger asked: "How can we consider funding and program reductions to public cyber charter schools with this huge infusion of funds for other public school students?"

After the hearing, Piccola said he would like to schedule another session in Philadelphia in early May. Sixty-five percent of the state's charters are in Southeastern Pennsylvania.

"There are some special problems," he said, "that really didn't come up that are endemic to some Philadelphia schools."

Contact staff writer Martha Woodall at 215-854-2789 or martha.woodall@phillynews.com.