Venturesome Capital- State Charter School Finance Systems

A study of eight school districts in pennsylvania

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Unformatted text preview: ound that debt service costs ranged from 2.9 percent to 14.8 percent of spending, and capital projects expenditures ranged from nothing to 3.4 percent (Hartman and Keller, 1999). A city like Washington, D.C., over time, demonstrates great variability in capital spending. Under pressure from a court order after years of neglecting its school facilities, the District spent about $600 per pupil, roughly 8 percent of total spending, on capital projects in 1996-97. 34 When debt is refinanced to obtain a lower interest rate, the amount refinanced is often counted as debt retirement. Consequently, the figures in this paragraph may be inflated. 70 Facilities and Capital Outlay Financing In 1997-98, capital spending increased to about $1,000 per student, roughly 13 percent of total spending. If charter schools receive capital funding based on spending in the host district, funding will seldom exactly match the charter school’s needs. If the host district has greater capital needs than charter schools, a charter school will receive more funding than necessary. If the host district has lower capital needs than charter schools, charter schools receive less funding than needed. Facilities Funding for Charter Schools About half of the charter school states either provide facilities as part of the conversion process or directly provide some facilities funding as shown in the following table. TABLE 23 Facilities Funding Some Facilities Funding Provided Some Assistance Possible No Funding or Assistance Provided by School Districts Arizona, District of Columbia, Florida, Massachusetts,1 Milwaukee,5 Minnesota, Rhode Island6 Colorado,2,4 Connecticut,3 Illinois,3 North Carolina,4 Michigan,7 Texas3, 7 Alaska, California,1 Louisiana, New Jersey, Pennsylvania, South Carolina California,1 Georgia, Hawaii, Kansas, Massachusetts,1 New Mexico, Wisconsin 1 Horace Mann schools in Massachusetts and conversion schools in California use district-provided facilities. 2 About one-third of school districts provided about $200 for capital, and some districts provided facilities for charter schools at no charge. School districts must allow charter schools to use surplus school property at no charge. 3 Revolving loan funds. 4 Empower bonding authorities to issue tax-exempt securities behalf of charter schools through conduit financing. 5 Under $100 per pupil. 6 On case-by-case basis. 7 Charter schools allowed to issue tax-exempt securities States Providing Facilities Funding For most of its charter schools, Arizona provides more facilities funding than surrounding school districts. The District of Columbia provides facilities funding approximately comparable to public schools, as did Massachusetts in 1998-99. Minnesota provided 80 percent funding for lease payments, up to the state average expenditure for debt redemption and capital ($465 per pupil in 1998-99). In 1999-2000, lease aid increases to 90 percent of approved costs up to $1,500 per pupil. Florida and Rhode Island provide facilities funding for some schools. Both F...
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