Venturesome Capital- State Charter School Finance Systems

Lack of facilities funding was described as the most

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Unformatted text preview: arter school finance in early 1996 when only 240 charter schools were operating and 22 states had charter school laws. The brief drew a distinction between state and local funding and described charter schools as not having full access to local funds. Lack of facilities funding was described as the most significant cost issue facing charter schools. The brief asserted that charter schools are frequently ineligible for state and federal categorical funding. Without describing how special education funding flows to charter schools, the authors described the potential problem of high-cost special education students “breaking the budget.” The brief identified funding-related paperwork as especially burdensome in small charter schools. School district financial issues such as school district fixed costs that are not reduced when students move to charter schools and the cost to the district of monitoring charter schools were also addressed. The Center for Education Reform (CER) maintains one of the most widely used compilations of charter school laws. The center prefers finance systems that give charter schools the maximum freedom from regulation and access to funding, and it rates the laws accordingly. The center examines whether charter holders are allowed to earn profit, how transportation services are provided, and the extent to which charters receive facilities assistance. The section on teachers contains information on retirement, and the student section examines whether the law contains specific provisions regarding service to children at risk. While providing a framework for overview and cross-state comparison, the CER analysis is limited by its focus on laws rather than on regulations, practices, procedures and other details that give life to the laws. The California Charter School Finance Manual (Premack, 1999) provides an insightful examination of California school finance and how charter schools fit into it. The manual is intended as an aid to charter applicants and holders. The discussion of issues involved in negotiating fiscal matters with sponsoring school districts has broad applicability to any charter schools that must negotiate with school districts. The information on conversion schools’ financing, which involves budget allocation formulas, staffing rules and district level changes, is especially useful. 9 Protheroe, (1997) found that the net cost of food service to school districts was $13 per pupil per year or 0.2 percent of expenditures. 15 Venturesome Capital: How States Pay for Charter Schools In work for the Charter Friends National Network Hassel (1999) prepared a comprehensive study of charter school facilities financing. According to the study, most states do not provide financing for charter school facilities. This problem is compounded by the low supply of suitable facilities. Charter schools generally do not benefit from the low-cost financing and favorable tax status enjoyed by school districts. In addition to suggesting equitable capital funding, Hassel offers a number of examples and sugges...
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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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