Thursday, April 09, 2009

Charter Funding Inequities Remain - Response to

Jonathan Gyurko writes a professorial essay this week in the Edwise weblog (hosted by NYSUT) discussing charter school and district funding comparisons, picking up on a 2004 study he co-authored when he was director of the New York City Department of Education's Office of Charter Schools.

In summary, Gyurko's study, co-authored with Robin Jacobowitz, identified a funding gap where New York City district schools received about 5 percent more in operating dollars than charter schools accounting for the fact that charters got some operating support on an in-kind basis (transportation, health services, etc.) and that district schools were eligible for categorical funding while charters were not.

Since this time, categorical funding streams have mostly been folded into "foundation" aid for school districts, and spent out as an "approved operating expense" that translates to the charter school funding formula.

Gyurko argues that there is effective operating funding parity for charter and district schools in New York City, and effective parity for those schools in free, district-owned space. (This discussion does not translate to charter schools outside New York City since they do not generally receive comparable support provided by the City DOE.)

He does acknowledge that for charter schools in New York City that operate in private space, without the benefit of free district space, the funding gap obviously remains since charters do not receive facilities funding.

In a roundabout way, Jonathan's high-minded essay is designed to justify the UFT's and NYSUT's position to freeze charter school funding for next year at present levels, which the state legislature adopted earlier this month with the enactment of the 2009-10 state budget.

The legislature's action remains a profound injustice to charter schools, and Gyurko's erstwhile justification for freezing charter funding omits several key factors:

1) Charter funding and state school aid to districts are apples-to-oranges; it is not the same. For 10 years charter schools received funding based on district operating expenses per pupil which is influenced, but not correspondent with, school aid for districts. Freezing part of state aid, this being "foundation aid" which is two-thirds of state aid, doesn't mean school districts will freeze overall spending since they can tap into other sources, including federal and local revenues.

2) Not all funding "freezes" are alike. In New York City's case, foundation aid is about one-third of its school budget, while charter funding from district student tuition payments amounts to 90 percent or more of a typical charter school budget. This disproportionate reliance by charter schools on this single source makes a freeze much more crippling to its operations than the effect of freezing only part of school aid.

3) School districts have taxing power, either directly or, in the case of the Big 5 districts, through the municipality's taxing authority. Therefore, if they chose, districts can and do often make up for state aid reductions with higher taxes. Charter schools do not have taxing power and would have to raise private philanthropy -- a much tougher prospect in the economic downturn.

4) The charter funding freeze actually cuts its 2009-10 funding, which will widen the funding inequity between district and charter schools. New York City and other school district operating spending has gone up sharply in recent years, yet charter schools will not benefit from these spending increases next year, as they were entitled, thanks to the funding cut of its 2009-10 amounts at the urging of UFT-NYSUT. Yet, if district spending declines next year, that will translate via the formula to charter schools in 2010 and 2011 -- the very "double-cut" that has been feared by charter advocates.

5) As for all the charter schools in district space, for most this is a tenuous existence that can be undone by a less-accommodating mayor or schools chancellor. At best, it is a stop-gap solution for many charter schools that cannot afford expensive real estate in the some of the neediest neighborhoods in the City.

6) Pension costs, which are dictated by actuarial assumptions, are a rising burden for both district and charter schools especially after the sharp decline in the stock market. For those charters that opted into the public employee, guaranteed benefit systems, these costs will go up without the schools getting the higher funding to reflect district spending. The five City charter schools that converted from district schools are especially hard hit (all of whose faculty remain UFT represented), yet won't have the funding increase to adequately cover this expense. Something will have to give, including likely layoffs.

Rather than explaining away its anti-charter school legislative agenda, the UFT should be advocating for real funding parity for charter schools. Even if you accept Jonathan Gyurko's assumptions, the absence of facilities aid remains the primary factor driving the funding inequity that disadvantages charters by as much as 30 percent or more compared to districts.

State facilities aid could put within reach private space for more charter schools, or could allow the City or any school district a source of lease revenue for allowing charters to use district space.

The teacher unions' opposition to charter school funding formula growth for next year remains a serious and costly error, and a betrayal of their dues-paying faculty members working in charter schools.

Peter Murphy
for The Chalkboard

Disclaimer: The Chalkboard is hosted by the New York Charter Schools Association (NYCSA) as a place where members, public education advocates and others can view and respond to informed commentary on timely public education and charter school issues. The views expressed here are not necessarily the official views of the NYCSA, its board, or of any of its individual charter school members. Anyone who claims otherwise is violating the spirit and purpose of this blog. To comment on anything you read here, or to offer tips, advice, comments, or complaints. please contact TheChalkboard.