Venturesome Capital- State Charter School Finance Systems

In effect charter schools spend at the same level as

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Unformatted text preview: k children compared to state averages.7 Wolfram’s calculations showed no statistical correlation between charter school status and such factors as perpupil expenditures for basic instruction, current operations, or the total general fund. In effect, charter schools spend at the same level as school districts. According to Wolfram, other studies erred due to incorrect use of financial reporting data collected by the state and 6 This conclusion may be compromised by problems with the way management companies report financial data to the state. Charter school facility costs and payments to private contractors for instructional support are misleadingly classified as business and administration expenditures (Wolfram, 1999). 7 According to the National Charter School Study (RPP, 1999), 34 percent of Michigan charter school students qualified for federal free-lunch programs compared to the 29 percent state average. About 5 percent of charter school students qualified for special education services compared to about 11 percent statewide. Some argue that charter schools should be compared to surrounding school districts. Since Michigan charter schools tend to be located near urban areas, charter school populations probably reflect student characteristics in surrounding school districts. 13 Venturesome Capital: How States Pay for Charter Schools reported in Bulletin 1014.8 Wolfram’s study reiterates Prince’s (1999b) point that charter school facilities, leases and payments to private contractors for instructional support are misleadingly classified as business and administration expenditures. Wolfram suggests that it is possible for schools to report their payments to contractors using categories consistent with school district reporting, but that this is not happening. Wolfram also challenges the classification of the mandatory 3 percent payment to chartering authorities as an administrative expense for charter schools. In Massachusetts, charter schools are financed through “tuition” or payments attached to students from their district of residence. The KPMG-Peat Marwick (1998) study, financed by the state legislature, reviewed charter school tuition payments, but in addressing the intricate issues of the Massachusetts system, this study has broader implications for charter school finance. KPMG-Peat Marwick found that the tuition calculation includes about twothirds of school district capital expenditures. KPMG-Peat Marwick also found that charter schools served fewer high-cost special education students. Yet the tuition calculation system provided funds as if charter schools served the same high-cost special education population as the sending school districts. Nevertheless, the study argued that simplicity was an advantage in the current tuition calculation. The report also observed that charter schools were not required to submit financial data to the state in the same uniform accounting format as school districts, which complicated the analysis. In a paper prepared for the Colorado Association of School Executives, Berk, Augenblick and Myers (1998) studied three charter schools and the districts that chartered them. The impact of a charter school on a school dist...
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This note was uploaded on 02/11/2013 for the course ECON 101 taught by Professor Smith during the Spring '09 term at Harvard.

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