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U.S. Department of Education/Flickr

What charter schools are doing to the Philadelphia School District’s budget

If you’ve read about the charter school approval process in the last two years, no doubt you’ve come across a common critique: That our financially hamstrung school district simply can’t afford more charters, making new charters unwise.

The school district, by state law, pays charter schools for each student they educate, plus covers transportation costs. According to the school district’s budget book for the 2016 fiscal year, charter school costs accounted for 18 percent of their operating budget in 2011, steadily rising to 29 percent by 2015.

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From the School District of Philadelphia's most recent budget book

But is there a certain number of charters that would essentially financially break the district? How many charter approvals or new charter seats would mean insolvency? Experts on both sides of the debate weren’t fans of this question. And there’s no way to tell.

“We’re past that,” said At-Large Councilwoman Helen Gym. “Because we don’t have a [state] funding formula, and since the Supreme Court has upheld charter school rights to unfettered expansion without district control, we have guaranteed a structural deficit.”

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School District budget book

This is to say that the district’s expenses will surpass its revenue. Gym points out that the fastest growing expenses for the district are pensions and charters. “We had a structural deficit 15 years ago,” she says. “We’re in a worse one now.”

The bone that Jonathan Cetel, executive director of PennCAN, the state branch of a national pro-charter organization 50CAN, had to pick with tabulating a cap is that it “look[ed] at charters as simply a cost to districts, as opposed to how to allocate the resources to educate all kids.”

He continues, “So much of our framing of how we think of public education is about preserving the system, and we see it as one big system instead of a system of great schools.”

This goes to the core of the debate. Everyone rooting for Philly students wants quality and equity. Where advocates differ is on how we get there. The trouble with charter expansion, Gym says, is “it hasn’t fundamentally stabilized the public school system.” With diminished state and federal support in recent years, the city has upped its funding to plug the gap. City analysis found that from the 2009 to 2015 fiscal year, Philadelphia’s contributions had grown by 42 percent, to the tune of $357 million. Gym notes that this funding crunch has tightened as the number of public schools “expanded by a third.”

“With no new money from Harrisburg and DC, we’re in a zero-sum game,” she says.

The anxiety this elicits is basic: Why degrade the quality existing traditional schools by siphoning off funds elsewhere? Cetel has a different take. “When you live in a zero-sum game environment, you think [of] every single student who goes to a charter school leaving the school district. And if you’re goal is trying to preserve the school district, that’s inherently frightening,” he says. He mentions that he doesn’t know a single local advocate that’s pushing for Philly schools to be entirely charters, but states, “I think of the role of the district as managing a portfolio… Their track record on managing schools is not good.”

Cetel concedes that there are unrecoverable costs when student moves on to a charter school. What PennCAN and other school choice groups challenge, however, is how much that figure really is. Reportedly, the district puts this number at around $7,000 or $7,500 per student, but school choice groups, citing a study from a private consulting firm, argue these estimates may be thousands higher than they should be. A school district spokesperson told NewsWorks a “review [of the costs] is still ongoing.” (This NewsWorks report, using the district’s $7,000 estimate, calculates that charters approved in 2015 will create roughly $11 million in additional costs for the district through 2019.) Beyond this, Cetel believes the district should continue rightsizing— closing schools and selling buildings— to free up funding for quality charter seats. “We don’t think there’s a magic number in terms of market share,” he says, but the target area should be “any public dollars on schools that aren’t working.”

Not healing the school district’s funding woes would prove too dangerous, says Gym. “Charter schools won’t benefit from a destabilized post-system,” the councilwoman says. “They’ll cannibalize each other.”

Gym returns to a point that she and Cetel actually stongly agree on: “We have to address the systemic inequality,” she says. “That is a state issue. That is a federal issue. And it’s certainly a Philadelphia issue.”

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