Public school groups decry formula for funding charters

Debra Erdley
| Monday, July 9, 2012, 12:01 a.m.

Pennsylvania charter schools are reaping a multimillion-dollar, taxpayer-funded bonus on pension reimbursements at the expense of public school districts, a coalition of school groups contends.

The associations, representing urban and rural schools, school boards, business managers and administrators, say the state's calculation for the tuition that districts must pay for charter school students requires them to pay double the amount they should for employee pensions.

The problem, according to those who have studied it, is that school districts pay 50 percent of their pension costs and the state pays the rest. Charter schools, likewise, are reimbursed 50 percent of their pension costs from the state.

But in addition, school districts must include the state and the local pension payments in their calculations for charter school tuition, a formula that theoretically provides charter schools with 150 percent of pension costs.

Jay Himes, executive director of the Pennsylvania Association of School Business Officials, discovered the problem about two years ago while examining the 15-year-old charter school tuition formula.

Last month, his group joined four other school organizations seeking to change the formula. They say it costs a district an average $500 a year for each student opting to attend a charter school.

In the Woodland Hills School District, where 1,200 of the 4,036 students attend charter schools, the cost is “extremely difficult,” substitute Superintendent Alan Johnson said. “That's half-a-million dollars for us. That's almost our fund balance,” he said, adding the district's charter school tuition tops $13 million a year.

Robert Fayfich, executive director of the Pennsylvania Commission on Charter Schools, said he wasn't aware of the so-called pension double-dip. But he said school district bills for charter school tuition likely will grow, because an estimated 40,000 students await openings to attend charter schools.

Statewide, charter school enrollment increased from 67,100 in 2007-08 to 105,000 in 2011-12. That enrollment jump, along with the elimination of $130 million in state reimbursements to districts for charter school costs, and pension costs that are expected to triple to $3.67 billion by 2015, caused district officials to examine charter school tuition.

Fayfich doesn't dispute the school districts' contention. He said charter school operators also are unhappy with tuition formulas.

“There are a lot of other areas where charters believe the traditional schools are getting an extra bite of the apple,” Fayfich said.

It's difficult for Johnson and other school superintendents struggling with costs to see that.

“I'm not crying foul. The state passed legislation for them to exist and perform. … But it's quite a conundrum for the public schools,” Johnson said.

Charter school costs became an issue last month in Gateway School District, which serves Monroeville and Pitcairn.

Gateway officials estimate the district will lose $2 million next year when 158 students leave to attend a new charter school in Pitcairn. Propel Schools is opening in a building that Gateway closed to reduce costs.

In Wilkinsburg, where 287 of the district's 1,100 students attend charter schools, business director Bruce Dakin said he keeps charter school tuition in mind every time someone suggests that Wilkinsburg apply for a grant.

He said any grant, with the exception of federal money, must be added to the charter school tuition reimbursement calculation.

“It's almost like you can shoot yourself in the foot by trying to do better for your students,” he said.

Charter school operators believe their reimbursements should include the federal, state and local funds that districts get.

Some hope state lawmakers will review and act on issues this fall.

“What the charter school community has supported and continues to support is a comprehensive look at all issues,” Fayfich said. “Nobody in the charter school community or the traditional school community likes the current way schools are funded.”

“We're not in it to beat up the public schools,” said Tom Egan, finance director of Urban Pathways Charter School, Downtown.

“They have complaints, I have complaints” about the tuition formula.

Debra Erdley is a staff writer for Trib Total Media. She can be reached at 412-320-7996 or

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