Gov. Wolf: Bipartisan Charter School Accountability Plan Saves $395 Million
May 19, 2021
Protects taxpayers by reining in skyrocketing charter school costs
Protects students by holding low performing charter schools accountable
Protects the public trust by increasing transparency of for-profit management companies
Pennsylvania school districts would save an estimated $395 million under Gov. Tom Wolf’s commonsense and fair bipartisan plan to hold charter schools accountable to students, parents and taxpayers. The governor announced the updated savings estimate during a press conference today at G.A.R. Memorial Junior & Senior High School, in Wilkes-Barre, Luzerne County.
As part of his budget, the governor is also proposing a historic $1.3 billion investment in public schools to strengthen education, while cutting taxes for working families and businesses.
“Our goal to provide a high-quality education to all students in Pennsylvania is undermined by our outdated charter school law,” said Gov. Wolf. “Pennsylvania’s charter school law is among the worst in the entire country. Some charter schools in Pennsylvania are outstanding institutions with a solid track record giving students an excellent education. But the way the law is set up, we can’t guarantee that every charter school is actually putting students ahead of profits.
“Sadly, research shows that some charter schools are failing students, while at the same time charging taxpayers exorbitant amounts of money.”
The uncontrolled cost of charter schools is draining funding from traditional neighborhood public schools, forcing school districts to cut educational programs and hike local property taxes.
Taxpayers spent $2.1 billion on charter schools last year, including more than $600 million on cyber schools, and the burden on taxpayers will increase by more than $400 million a year. Between 2013 and 2019, 44 cents of every $1 of new property taxes went to charter schools, according to the Pennsylvania Association of School Business Officials.
The governor’s common-sense plan to fix Pennsylvania’s broken charter school law will control rising costs and ensure all students are treated fairly:
Protect taxpayers and save school districts an estimated $395 million a year
Charter school costs are increasing faster than local school district taxpayers can afford and is not sustainable. The bipartisan plan will prevent large property tax increases and has strong support among school districts.
Under the plan, school districts would save an estimated $395 million a year, according to new data from the 2020-21 school year provided by the Department of Education. The savings include $185 million a year by funding special education in charter schools the same way the state does for all other public schools and $210 million a year by establishing a statewide cyber charter school tuition rate.
Savings by county for school districts from charter school accountability include:
- Monroe Co. school districts save $8 million,
- Luzerne Co. school districts save $4.9 million,
- Lackawanna Co school districts save $4.1 million,
- Schuylkill County school districts save $3.8 million, and
- Carbon Co. school districts save $2.6 million.
Individual school districts savings from charter school accountability would include
- Pocono Mountain School District saves $3.2 million,
- Wilkes-Barre Area School District saves $2.2 million,
- East Stroudsburg Area School District saves $2.2 million, and
- Scranton School District saves $1.3 million.
A complete of savings by school district is available here.
“It is about time we have gathered together to create comprehensive charter school reform policies to change outcomes for our students,” said Representative Maureen Madden. “It is imperative that legislators across both sides of the aisle support the Governor’s plan, which addresses multiple issues within the realm of charter school operation. These include a lack of performance metrics, accountability, creating processes for charter amendments through local school boards, and requiring higher standards of transparency. Together, we can change the future of education in this state, which has been taking hit after hit in terms of funding. It’s time to be better, Pennsylvania – and the time for action has come.”
The Bipartisan Special Education Funding Commission recommended using the special education funding formula for charter schools just as the state does for school districts.
The current flawed process requires school districts to pay charter schools using the outdated assumption that 16 percent of students get special education. As a result, some charters are vastly overpaid for services they do not provide, leaving special education students in school districts and other charter schools with less funding.
Providing an online education costs the same regardless of where the student lives, but cyber schools charge school districts between $9,170 and $22,300 per student, while Intermediate Units only charge $5,400 per online student. Setting one statewide rate ensures that school districts are not charged more than $9,500 per regular education student, reflecting the actual cost of an online education by higher-performing cyber schools.
“The last 15 months with the pandemic have reaffirmed that there is no substitute for in-person learning,” said Michael Mahon, superintendent of the Abington Heights School District. “While Pennsylvania’s cyber schools continue to rank among the lowest in the commonwealth in nearly every educational measure, current charter laws, coupled with slick marketing campaigns, empower them to drain community resources and poorly serve our students.”
Protect students by holding low-performing charter schools accountable
Real school choice means quality learning. While some charter schools provide a great education, many charters, especially cyber charter schools, have poor educational outcomes. The governor’s bipartisan plan ensures charter schools are providing students with a quality education.
- Creates charter school performance standards that hold low-performing charter schools accountable and reward high-performing charters with more flexibility.
- Limits cyber school enrollment until their educational quality improves. All 14 cyber schools in Pennsylvania are designated for federal school improvement, with the vast majority among the lowest 5 percent of public schools. A Stanford University report released in 2019 found overwhelming negative results from Pennsylvania’s cyber schools and urged reform by the state.
Protect public trust by making for-profit charter school companies accountable to taxpayers
Despite costing taxpayers more than $2 billion a year, charter schools have little public oversight and no publicly elected school board. For-profit companies that manage many charter schools are not required to have independent financial audits.
- Require charter schools to have policies to prevent nepotism and conflicts of interest so leaders do not use charter schools for their own financial benefit.
- Ensure charter schools and their leaders follow requirements of the State Ethics Commission, since they are public officials.
“It’s past time to fix our charter school law,” Gov. Wolf said. “These commonsense solutions will protect taxpayers, students, and the public trust, while improving accountability and quality in education.”
Directing $6.4 billion in state funding through the fair funding formula
In addition to fixing the charter school law, the governor is proposing a solution to Pennsylvania’s unfair school funding system. While the state’s fair funding formula was created in 2016, only new funding, about 11 percent, which is $700 million, runs through it. The remaining 89 percent, or $5.5 billion, is still distributed based on student enrollment in 1992, without considering shifts in student counts or actual costs school districts face today. Urban and rural school districts with growing student enrollment must fill the funding gap with frequent property tax increases, adding to the burden of homeowners and businesses.
The governor’s proposal runs all existing basic education funding, $6.2 billion, plus a $200 million increase this year, through the fair funding formula. Separately, an additional $1.15 billion will ensure that no school loses a single dollar in state resources from using the formula.
“Schools with increasing enrollment in urban, suburban and rural communities will finally be funded fairly and shrinking districts are protected,” said Gov. Wolf. “Our state can no longer wait to address the school funding problem. Every student deserves a good education, no matter where they live. That’s what parents want for their children, and what Pennsylvania needs for our future.”
Later today the governor will join state legislators and school leaders in Pottstown, Montgomery County to discuss the need for his charter school accountability plan.