Law Says “Commensurate” Funding, But Baltimore City Charter Schools Get More

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This past September, some of the charter school operators in Baltimore City filed a lawsuit against the Baltimore City School System, saying City Schools is not funding them adequately under Maryland State law.

Maryland State law says school systems must fund charter schools “commensurate with the amount disbursed to other public schools in the local jurisdiction” (Md. Code, § 9-109(a) of the Education Article). The nine charter operators who are suing the school district think they are getting less than they deserve compared to traditional schools.

A People for Public Schools analysis, however, conducted in collaboration with the principals of two similar Baltimore City elementary/middle schools – one charter and one traditional, both Title I – shows that charter schools are getting much more.

Both schools have about 740 students, but the charter school has 14 percent more full-time-equivalent (FTE) teachers – 41 compared to 36. (This does not count special education and English as a Second Language teachers, which are funded according to need at both traditional and charter schools.)

When it comes to total staff, the difference is even more stark: The charter school has 92 FTEs, compared to 62 for the traditional school, a difference of nearly 50 percent. The charter school has two assistant principals, while the traditional school has one. The charter school has 3.5 Academic Coach FTEs, while the traditional school has none.

The charter school has an orchestra with strings in addition to a band. They have a nutrition class, environmental science, and a musical production each spring. And, if that were not enough of a disparity, the charter school still had enough of a surplus saved over a number of years to undertake a significant expansion of their school building.

This is not surprising, since charter schools get about 50 percent more funding per pupil than traditional schools. Charters receive more than $9,000 per student, compared to about $6,000 for traditional schools. Charter schools need to pay for some additional costs from those funds, such as principals and professional development, but our analysis indicates that the disparate funding still results in widely unequal resources at schools.

With more than 15,000 of our roughly 80,000 students currently attending charter schools, Baltimore City is currently the only school district in Maryland that has to worry about the impact of significantly higher charter school funding on traditional schools. Baltimore City Schools is increasingly moving to a two-tiered system of schools – one much better funded than the other.

Charter operators would have you think all of that extra funding they get comes from a bloated City Schools central office at North Avenue. Our next blog post will challenge that long-held assumption.

As People for Public Schools, we want the charters to drop the lawsuit and engage in public negotiations with the District that include advocates for traditional neighborhood public schools. Baltimore City students and teachers deserve a fair and equitable funding formula – one that no longer benefits charter school students at the expense of their traditional school peers.

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Baltimore City Charter Lawsuit Q&A

In fall 2015, a number of charter schools filed suit against Baltimore City Public Schools. In the ensuing months, People for Public Schools formed, created a petition for fair school funding, and researched the legal and budgetary concerns driving the charter lawsuit. We have prepared this Q&A to help parents and others understand the issues and get a sense of what’s at stake for all students if the charters win. This post is the second in a series. Part 1 covers Maryland charter law basics.

1. Who is suing the Baltimore City Public School System?

Nine charter operators representing 14 of Baltimore City’s 34 charter schools have joined the lawsuit. These include:

Operator Schools
AFYA Baltimore, Inc. AFYA Public Charter School; Tunbridge Public Charter School; Brehms Lane Elementary School (opening 2016)
Baltimore Montessori, Inc. Baltimore Montessori Public Charter School (including the Middle School)
City Neighbors Foundation City Neighbors Charter School; City Neighbors Hamilton; City Neighbors High School
Creative City Public Charter School Foundation, Inc. Creative City Public Charter School
The Empowerment Center, Inc. The Empowerment Academy
Experiential Environmental Education, Inc. The Green School of Baltimore
KIPP Baltimore, Inc. KIPP Ujima Village Academy; KIPP Harmony Academy
Patterson Park Public Charter School, Inc. Patterson Park Public Charter School
Southwest Baltimore Charter School, Inc. Southwest Baltimore Charter School

2. What is the basis for the current lawsuit?

The lawsuit alleges that the public school system has breached its contract with the litigating charters. There are essentially two claims. The first accuses City Schools of not following the Maryland State Board of Education (MSBE) guidance regarding funding, thereby underfunding these charter schools. The second claim is that City Schools has not provided charter schools with sufficient supporting documentation for how the funding has been calculated. The nine operators who have sued as of fall 2015 have asked for damages of at least $75,000 each plus costs.  Since the lawsuit alleges breach of contract, presumably they also seek enforcement of the MSBE funding guidance and further documentation of City School’s funding.

3. How has the District calculated how much funding charter schools receive? What’s the funding formula?

This infographic provides a sketch of how Baltimore City Schools calculates charter school funding and an outline of what’s at stake if the litigating charters win their lawsuit.

Under the current funding formula used by Baltimore City Schools, the system takes all general federal, state and local funding and deducts two “buckets” of funds. The first bucket consists of money that the system must spend but that does not directly benefit K-12 students in public schools. This includes system-wide costs for:

  • Retiree health benefits for retired teachers (including teachers from charter schools)
  • Debt service
  • Money spent on Pre-K
  • Non-public placements for special education students whose needs cannot be met in public schools

    The system then deducts funding that is due only to specific K-12 students, including:

  • Special education funding
  • English for Speakers of Other Languages funding
  • Specialized transportation funding (covers the costs of transportation for students with special needs, homeless students, etc.)

Finally, according to MSBE guidance, the system deducts the 2% administrative fee and then divides what’s left by the number of K-12 students in the system. In 2014-15, this resulted in $9,556 per charter school student. Charter schools serving eligible students have then received a mix of cash and services for special education, limited English proficiency (LEP), and other students due special services, as well as any Title I funding they were due.

4. What’s wrong with the MSBE guidance about funding?

In 2004, the year charter schools began to operate in Baltimore, City Schools proposed funding them with a mix of cash and services. City Neighbors Charter School and Patterson Park Public Charter School filed petitions with MSBE, arguing that the mix was not commensurate with the funding received by other public schools in Baltimore City. MSBE’s decisions favored these early charter schools, issuing guidance that stated that local school systems should take their total budget, deduct expenses for debt service and adult education, and then divide by the number of students in the system to come up with an average per pupil amount. Charters would then receive this amount for each student they enrolled. This guidance was appealed by the Baltimore City School System, but it was ultimately upheld by Maryland’s highest court, the Court of Appeals.

However, from the point of view of those seeking fair and equitable funding for all students, the MSBE guidance is a primary source of tension between charter and traditional public schools. All school systems have out-of-classroom expenses other than debt service and adult education. If charters do not pay their fair share, the burden of these expenses falls unfairly on traditional school students and their schools.

The District and charter schools have been working around the guidance for that reason. The school system has continued to deduct commonly-shared public expenses prior to calculating per pupil funding for charter schools. Charter schools have to date agreed to share many of these expenses, such as money for specialized placements for special education students. In their October 7, 2015, presentation to the City Council, the litigating charter operators agreed that retiree health benefits, non-public placements, and specialized transportation should be deducted before charter funding is calculated.

Additionally, the guidance does not account for the fact that some funding is spent not on all students but only on students with a particular need. Baltimore charter schools have agreed in the past to the District’s deducting these funds prior to disbursing the per pupil amount for charter schools. Funding and/or services for students who qualify for them, such as English-language learners and students with special needs, are then added to the budgets of the schools that serve these students. That is where these funds should go.

5. What happens if the litigating charters win?

It’s not completely clear, but if a judge or mediator followed the logic of the litigating charters’ claim, which is based on the MSBE guidance, and required City Schools to use that formula, it is possible that the $106 million of required spending for retiree health benefits, pre-K, and non-public placements that is currently spread across all students would instead need to be paid for only by students in traditional public schools. This would result in over $15 million fewer dollars for students in traditional public schools, as charter schools would not be paying their fair share of these costs.

6. Why do traditional public school parents need a voice in this issue?

Any decisions made by the School Board, a mediator, or a judge about charter school funding will have an impact on all children in all Baltimore City Public Schools. While representatives of the litigating charters claim to speak for all parents, they are advocating for a funding formula that would be disastrous for students in traditional public schools. All parents of Baltimore City School students deserve to be heard on this issue. All of our children are owed adequate and equitable funding. If you agree, sign the petition.

Baltimore City Schools Faces $85M Budget Shortfall

On Wednesday, February 24, the Baltimore City Schools administration laid out the initial impact of the 2016-17 budget, and it’s not pretty: The bottom line is that the school system expects to be short about $85 million. Here’s why:

Revenue Down $28.5 Million

Declining enrollment and increased property wealth in Baltimore City – much of which does not provide general tax revenue to help fund our schools – means less money from the state and possibly less from the city itself.

Governor Hogan’s FY 2017 budget proposes a loss of $25.3 million in state education aid to City Schools. The school system seems to be budgeting based on a worst-case scenario to include a potential loss of $3.2 million from Mayor Rawlings-Blake and the City due to enrollment declines. While conservative budgeting may be a wise approach for the school system to take, the City has never reduced school funding based on an enrollment drop. They certainly shouldn’t consider it now. Given the increase in city wealth, our expectation is that rather than cut funds the city will add funds to City Schools – becoming part of the solution. For now, though, the school system is budgeting as if losses of state and city funding are real.

Expenses Up $56.4 Million

While we have less money and fewer students, expenses are still up:

  • Personnel costs are up $21 million, including $17 million just for health care.
  • City Schools’ portion of the 21st Century Schools investment (the $1 billion new City Schools construction program) requires an increase of $10 million this year, for a total of $30 million, as mandated by state law.
  • Facilities Maintenance funding is increasing by $3 million for FY2017. City Schools’ Comprehensive Maintenance Plan, which covers all schools in the district, requires an increase in maintenance funding by $3 million each year over the next six years.
  • Pension costs are up $7 million due to a shift in responsibility from the State to the school district.
  • Costs for students with disabilities will be up $8.6 million.
  • Required staffing in traditional schools (like principals) is up $6.8 million.

These increased costs add up to $56.4 million. Added to the $28.5 million in lower revenue, that’s about an $85 million shortfall for next year’s school system budget.

UPDATE: March 10, 2016

Advocates (including us!) went to Annapolis March 9 with the Baltimore Education Coalition to raise our voices for Baltimore City Schools. We learned that the Governor intended to submit a supplemental budget adding $12.7 million for education in Baltimore City to cover the loss of funding due to enrollment decline. Now it is up to our leaders in Baltimore City to make up the difference.

People for Public Schools Asks the School Board to Make Policy

This is what we said:

Dr. Thornton, Members of the Board, Principals, Students, and Other Supporters of City Schools:

 

We stand here today knowing that our school board is poised to set a precedent as to how to answer charter school requests for Geographic Attendance Area (or GAA) waivers. Authorized by the Public Charter School Improvement Act of 2015, these waivers would allow certain charter schools that currently draw all their students from across Baltimore City to set aside a percentage of seats for students who live in a nearby zone. As People for Public Schools – an independent grassroots organization of parents and other supporters of Baltimore City Schools – we urge the School Board to deny these waivers until it has articulated a policy that takes into account the waiver’s impact not only on neighboring traditional schools but also on the system as a whole.

As parents of students in Baltimore City Schools, we believe that the promise of choice cannot come at the expense of fairness and the sustainability of public schooling in Baltimore City. When considering the value of granting a waiver written by charter school supporters in the interest of improving charter schools, the Board has a unique duty to consider what is in the best interest of all students – especially the 70,000 students in our traditional public schools.

The Board is the only entity that can do that job.

As you know, the system is currently facing significant cuts to state funding and a lawsuit brought by 9 charter operators who are demanding more funding from City Schools – despite the fact that charter schools already receive more per pupil than traditional schools do. Also hanging over traditional schools is the Board’s effort to “right size” the District. Schools in buildings that are “underutilized” are under threat of closure, and funding for the 21st Century School Building Plan depends on maintaining occupancy levels in schools designated for new construction. Any change that would exacerbate budget pressure on zoned traditional schools by sapping enrollment, needs to meet a standard of scrutiny that the Board has yet to set. This is especially important when we are talking about citywide charter schools with waiting lists that show citywide demand.
Until the Board articulates a policy for GAA waivers that is premised on the notion that the improvement of charter schools must be a positive-sum game for charter and traditional school students alike – we respectfully request that the Board say no. In the absence of such a policy, you have no basis for saying yes.

This is what the Board did:

The Board took a vote on a GAA waiver request from Baltimore Montessori Public Charter School. The charter school, which has a waiting list and testified that it has not been meeting its enrollment cap for “strategic” reasons, asked to pull up to 30% of its student body from Greenmount West, a neighborhood currently zoned for Dallas F. Nicholas Sr. Elementary School.

The Board had heard from a staff member, a teacher, a grandparent, and the principal of Dallas Nicholas, and they watched a video that City Schools had produced about the school. The Board also learned from the Office of New Initiatives that the school is underenrolled and building utilization is under the threshold.

The Board rejected a motion to grant a waiver to Baltimore Montessori Public Charter School that would allow it to save 20% of its seats for Greenmount West students. It instead granted a GAA waiver to set aside 10% of its seats, which was the recommendation of the CEO. No numbers were attached to these percentages. No reason exists for why the waiver was granted. They had no basis for saying yes.

One board member made a point of noting for the record that a policy should be set in advance of granting such waivers in the future.

A New Voice for Public Education in Baltimore

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In fall 2015, a group of concerned parents came together at the 29th Street Community Center in Charles Village to hear about charter school funding. We wanted to know what impact the charter school lawsuit would have on students in Baltimore City’s traditional public schools.

A presentation by Baltimore City Public Schools’ Executive Director of New Initiatives, Alison Perkins-Cohen, left us wanting to know more. Over the three months since, we have learned a lot about charter law in Maryland, about how the City Schools budget works (and doesn’t work), and about the ways in which the governor and private interests are working to change the way our schools are funded and run.

We worked to understand – asking questions, creating presentations, revising presentations, creating infographics, scrapping infographics. We also decided to organize. We started to have meetings and attend other people’s meetings. We created a petition. Our hope is to become the seed of a grassroots campaign for fair and equitable school funding.

On this blog we will post original insights and links to posts we like from around the Web. We invite you to listen to the voices of public school parents, teachers, staff and supporters who are invested in their public schools – schools that take care of our children and anchor our communities. Our goal is to broaden and deepen the conversation about the future of public schooling in Baltimore City. We invite you to join us.