Venturesome Capital- State Charter School Finance Systems

The authors estimated that it could require as much

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Unformatted text preview: rict depended on district enrollment, the number of private school students transferring to charter schools, whether the charter school used an existing facility, and the number of schools in the district from which the charter school drew pupils. The authors estimated that it could require as much as a 30 percent reduction in the revenue provided to a charter school for a district to fully recoup losses, with the amount depending primarily on school district size and charter school size. Another important finding: It costs more per pupil to run a small charter school than to run a school district. To improve efficiency, charter schools opt to purchase services from either school districts or private entities. The Colorado study recommended that school districts receive funds as if their charter schools were school districts in order to get funding in line with funding that small school districts in the state receive. With added funding, the charter schools would be in a better position to buy back services from the host school district. WestEd’s (1998) evaluation of 13 Los Angeles charter schools considered finance issues, especially for the three independent charter schools that operate an outside the district structure. The independent charter schools were better funded primarily because they qualified for revenues targeted at high concentrations of economically disadvantaged and special needs students. The study found that independent charter schools used their budget flexibility to implement changes quickly. One limitation of this study is that it compared independent charter schools to dependent charter schools, not to regular public schools. 8 Information on Form B, the financial report school districts and charter schools file with the state, is available at http://www.state.mi.us/mde/forms/. Bulletin 1014, which summarizes information from Form B is posted at http://www.state.mi.us/mde/reports/B1014/index.html 14 Research on Charter School Finance Because the financial practices of regular public schools were not examined, some practices described as innovations in charter school finance may actually be common practices in some other public schools. For example, the food service programs in two independent charter schools were privately contracted at virtually no cost (about $19 per student per year at each school), and the contractor provided an array of benefits (e.g., low contractor food prices, a nutritionist, auditing for compliance with federal school lunch funding). Savings were used for capital improvement. However, food service programs in most school districts are financially self-supporting, provide the same services as a contractor and often yield “profits” to finance capital improvements.9 Furthermore, school districts regularly contract with private companies for food service. Analysis of Finance Policy An Education Commission of the States policy brief (Bierlein and Fulton, 1996) illustrates the general thinking on the subject of 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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