Venturesome Capital- State Charter School Finance Systems

Part of another paper on massachusetts charter

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Unformatted text preview: nded to expose public education to the discipline of the marketplace; (2) other advocates envisioned a system made up of only the most capable institutions; (3) opponents wanted to diminish the chance of success; and (4) others simply failed to consider the cash requirements of start-up. Part of another paper on Massachusetts charter schools, by Anthony, Scarpati and Bukowick (1996), described charter school financing as “eclectic” because it involved tuition from local sending districts, state start-up monies, federal Goals 2000 funding and private donations. The paper highlighted the financial impact school districts faced when losing students to charter schools or paying for students moving from private schools to charter schools. It describes the Massachusetts provision of temporary compensation for school districts after they lose students to charter schools. An evaluation of the Wisconsin charter school program (Wisconsin Legislative Audit Bureau, 1998) found that charter schools were equitably funded when compared to host districts. Wisconsin has dependent charter schools chartered by local districts, although a newer law, affecting only Milwaukee, provides for independently chartered schools in that city. Complete budget and expenditure information was not available for most charter schools because school districts’ budgeting and cost accounting systems typically do not reflect total costs incurred by individual schools. However, available information indicates general education charter schools spent an average of $4,458 per enrolled pupil during the 1997-98 school year, compared to $4,918 per pupil for all schools in their districts. Charter schools serving students at risk of failing or dropping out spent $5,966 per pupil, which reflects the higher cost associated with educating children who require greater attention and special services in order to be successful in school. A study of voucher and charter schools’ potential financial impact on the Milwaukee public schools (Moore, 1998) identified the complexities of the revenue shifts. The revenue outflow to charter schools is mitigated, in part, because charter school students are counted as enrollees in the regular public school system for state aid purposes. Thus, the per-pupil wealth of the district does not increase as charter school students leave, preventing a further loss of funds. Special education has been a concern of a number of researchers (e.g., Finn et al. 1996), mainly echoing charter operators’ fears that a high-cost student could undermine a small charter school’s financial position. A recent study of the special education practices of Massachusetts charter schools employing for-profit management contractors has important finance implications (Zollers and Ramanathan, 1998).10 The study found a number of practices designed to discourage enrollment of students with expensive individual education programs. Companies profit because Massachusetts allocates special education revenues as part of the base funding that follows each student to a ch...
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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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