Charter schools bracing for funding cuts, still seeking parity

Ohio charter schools could face funding cuts of 10 percent, 15 percent, or more in the next biennial budget. But the state budget crisis also will give charters an opportunity to talk about the current financial inequities between them and district schools.

Charters don’t have access to local school property or income taxes and it is unlikely charters’ minimal access to state facilities dollars will be increased. Charter advocates do hope the General Assembly will at least address charters’ lack of access to educational challenge factor funds (ECF). The ECF money, a component of the new evidence-based funding model, adjusts the amount of funding school districts receive in order to provide additional dollars to those districts with a higher proportion of disadvantaged students. However, charter schools, regardless of how disadvantaged a population they serve, do not see this boost in funding.

“That’s blatantly discriminatory. We’ll take the budget cuts like everyone else but give us the ECF so our urban charter schools can have the same benefit [as urban districts],” said William Sims, president of the Ohio Alliance for Public Charter Schools.

“Also, charter schools don’t get [funding] guarantees if enrollment drops. They don’t get guaranteed funding as districts do,” he said. “The real question is one the House majority caucus and Rep. Steven Dyer and Rep. Clayton Luckie don’t like to hear me say -- we have separate and unequal funding for public school kids in the state.”

Although lawmakers are bracing for a financial crisis, neither Sims nor Ron Adler, president of the Ohio Coalition for Quality Education, have received many inquiries from charter schools about the next budget. Administrators are worried about the school year that begins this month, but they’ll soon start focusing on the next state budget.

“Everybody is going to be scraping for a small piece of the pie. We’re not even getting calls about it. People are not reacting quickly but they’re going to have to,” Sims said.

“We’ve always operated on lean budgets. There’s no extra fat. No place to go. Charters don’t have the luxury to try to get local tax money through a levy,” Adler said. “We’ve done everything required but with 30 percent less.”

Comparing Ohio urban charters to the state’s Big Eight city districts – where most charters operate – shows that while charters may have more schools in the lower performing categories, they also have some of the highest-performing as well. “And a lot of the higher-performing schools are independents. Not the ones run by education management organizations (EMOs),” Sims said.

He said a 10-percent state budget cut, for example, could deal a devastating blow to a high-flying school like Columbus Collegiate Academy, a small school entering its third-year of operation that bested the district’s middle schools on state achievement tests last year and is likely to do the same this year. (CCA is authorized by the Thomas B. Fordham Foundation.)

“My biggest concern is about these high-performing independents, in order to save themselves [they] have to join an EMO or have to put a bullet in their own heads,” Sims said.

One move that shows promise is the joining of several independent Cleveland-area charters -- Intergenerational School, Citizens Academy, Entrepreneurship Preparatory School, and Village Preparatory School -- into a non-profit charter management organization called Breakthrough Schools group. The charter management company is headed by former Jo-Ann Stores, Inc. chief executive Alan Rosskamm.

Breakthrough Schools has a preliminary agreement with the Cleveland Metropolitan School District to open three more charter schools in the 2011-12 school year.

The idea is to collaborate to find ways to save money, but Rosskamm said the network also could help philanthropy. “Given the scale of a network of schools, there are certain funders taking us more seriously because they see more chance to grow,” he said. “There are limits as to what we can realistically hope to raise. Nonetheless we have a well-developed family of friends and supporters that make me hope they will be there for us. “

The difficult question, even for charter schools with successful fundraising programs, is the long-term funding environment. A one-time request to meet a short-term financial problem is one thing, Rosskamm said, but a sustained 10-percent cut in state funding over multiple years is something else.

So far, the state budget process has been one of political posturing. Serious discussion won’t get underway until January – or until March if Ohioans elect a new governor.

Nationally, the Center for Budget and Policy Priorities estimates state budget shortfalls could total $120 billion next year. Deficits, however large, may be ameliorated if Congress approves additional temporary federal funding for the states along the lines of the federal stimulus money that Ohio and many other states used to close gaps in the current two-year budget.

“If there’s no supplemental money, there will be cuts across the board,” said C. Todd Jones, president Of the Association of Independent Colleges and Universities of Ohio.

What won’t be seen in Ohio is anything similar to the proposal by New Jersey Gov. Chris Christie that the state’s charter schools should be held harmless in the next budget round because he considers them a good educational value. Christie has pledged to push for more New Jersey charter schools.

“Under the current political structure, charter schools are always going to be a step child and we have a responsibility to keep reminding people of that,” Sims said.

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