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Pennsylvania's charter school funding debate no closer to resolution

Sunday, March 30, 2014, 9:10 p.m.

The contract that ousted PA Cyber Charter School founder Nick Trombetta brokered with its curriculum provider remains in place months after prosecutors indicted the former school chief on 11 counts of mail fraud, bribery, tax conspiracy and filing false tax returns.

Lawmakers pointed to the Trombetta case as a high-profile opportunity to overhaul the charter school laws passed in the early-Internet days of 1997 and address criticisms that cyber schools pocket too much money compared to their operational costs.

While legislation sits in limbo, many educators agree no one has hard data on how much money cyber schools should receive.

Bob Clements, the new president of the National Network of Digital Schools, which helps manage and maintain all PA Cyber offices and inventory, defended the company's $30 million cut.

Started in 2005, NNDS entered into a management company contract with PA Cyber for a flat 12 percent of the charter school's total revenue, rather than an amount based on the services it provides. The fees paid by the school represent nearly all NNDS revenue, according to a report by Auditor General Eugene DePasquale.

Trombetta, who pleaded not guilty, was founder and CEO of PA Cyber Charter School. He founded and was formerly the president of NNDS.

“Fair market value at the time was, I believe, around 18 (percent) to 20 percent. We set a discounted value,” Clements said. “PA Cyber manages their own virtual classrooms, teachers, administrative staff and supervisors. We do everything else.”

In Pennsylvania, cyber schools get 80 percent of the state funding a public school would receive for a student, usually several thousand dollars. The student's home district keeps the remaining 20 percent with no obligation to educate the child.

“They don't spend their money the same way as traditional public schools, sure, but they have to support and maintain a vast network of Internet technology,” said John Bouder, policy analyst with the Commonwealth Foundation for Public Policy Alternatives. “There's specialized curriculum to invest in, rentals for teacher trainings and study sessions — and all of that has to be done statewide for a huge student population. Their costs are not dissimilar just because they don't have brick and mortar to back it up.”

Unlike charter schools authorized by public districts, cyber charters are approved and overseen by the state Department of Education. They are required to submit a financial report to the department each year.

Spokesman Tim Eller said the state's Charter School Office reviews management contracts, leases and deeds. “However, it is difficult to specify every category of contracts that the department would review, (and) not every contract is reviewed in its entirety.”

Temple University professor Susan L. DeJarnatt, who studies charter school funding, said she found pages of private student data among financial documents on the state's website.

“Honestly, I'd be surprised if anyone is reviewing their financial information,” DeJarnatt said. “Even if you're just leafing through them and focused on the numbers, you have to notice 10 pages of student test scores and addresses. I would be appalled if I were the parent of one of those kids.”

State Education Committee minority chairman Rep. Jim Roebuck, D-Philadelphia, pushed for greater accountability with a bill proposed in 2013.

“Part of the problem in PA is that the Department of Education isn't properly staffed to do a good job,” Roebuck said. “There are simply not enough people in place to do that kind of analysis.”

Jonathan Cetel, executive director of advocacy group Pennsylvania Campaign for Achievement Now, said he is seeing signs of improvement at the state level. The state closed two cyber schools. It rejected eight applications it received in the past two years, he said.

“It shows they're paying some attention,” he said.

Sen. Jim Brewster, D-Mc-Keesport, who attended regional charter school meetings with DePasquale and others, said oversight is the source of his concerns.

“No one complains about the quality or the substance of the education at cyber charter schools,” he said.

Megan Harris is a Trib Total Media staff writer. Reach her at 412-388-5815 or

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