School Reform Commission Chairman Pedro Ramos recently postponed a vote on charter school renewals until the panel can deal with a more basic issue: the School District's budget. That makes sense, but it doesn't go far enough. The SRC should impose a moratorium on new charter schools until it can fully understand how charter school expansion is affecting the district's ability to sustain adequate, long-term funding for all the city's public schools.
Getting district finances under control is essential. The School District still needs to cut $26 million to balance this year's budget, and it faces a 2012-13 deficit of $218 million — even more if the city's property reassessment plan is delayed.
Charter schools took a $427 million bite out of this year's budget, so accurately projecting the district's short- and long-term charter costs is imperative. Failure to do so would lead to even more cuts in services for students.
Philadelphia isn't the only school district struggling to balance district needs with rising charter school costs. Across Pennsylvania, school boards are finding it increasingly difficult to manage tax dollars responsibly as the pressure to open more charter and cyber-charter schools builds.
A 2010 report by the state's auditor general, for example, found that Pennsylvania school districts could have saved about $86 million in 2009-10 if cyber-charters were funded based on what they spent per student. Cyber-charters get the same funding per child as brick-and-mortar charters, even though they spend $3,000 less per student.
In 2009-10, the state's school districts paid $800 million to charter and cyber-charter schools, with cyber charters accounting for more than 25 percent of that. The auditor general also found that charter schools have accumulated more than $100 million in reserves, because state law doesn't require them to reconcile the funds they receive with actual costs, as school districts must.
Adding to the anxiety in Philadelphia, Commonwealth Court recently ruled that the School District cannot cap charter school enrollment, a decision that could cost the district millions in unbudgeted dollars. Unless charter schools agree to voluntary caps or the SRC successfully appeals the decision, the district could be required to pay charters for students they enroll beyond previously established agreements. This is tantamount to giving a business access to a competitor's line of credit while holding the competitor responsible for all charges.
In 2002, the legislature tried to offset a growing burden by reimbursing districts for up to 30 percent of charter school costs. Last year, however, the Corbett administration eliminated the reimbursement, leaving districts across the commonwealth responsible for about $220 million in unanticipated costs.
The threat to districts could grow if the legislature approves a bill giving the state Department of Education sole authority to approve new charters. Local school boards would be forced to cover expenses they can't control.
We need a rational, equitable, and sustainable system for funding education. Unchecked expansion of charters schools will destroy public education. Lawmakers need to act now to prevent that.