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November 20 2019

Do Charter Schools REALLY Drain Money from Public Schools?

by Charlotte Hays

A talking point among charter school foes is that charters take money away from public schools.

Democratic 2020 hopefuls Elizabeth Warren and Bernie Sanders have been very vocal about the threats charters supposedly pose to public school finances.

Joe Biden, whose former boss President Barack Obama supported charters, had adopted the claim.

David Osborne, author of “Reinventing America’s Schools: Creating a 21st Century Education System,” and who handles education at the Progressive Policy Institute, explains why this isn’t true in this morning’s Wall Street Journal.

Osborne explains:

Whether charters drain money from public school districts depends on the state. In over half the states with charters, when students decamp some or all districts get to keep their local tax revenue but no longer have to educate the children, so they actually increase their spending per pupil. In Massachusetts, New York and Illinois, the state cushions any revenue loss.

By law, Massachusetts districts should be reimbursed 100% of the state money for the student for a year, then 25% for the next five years—though the state has only met about 60% of that funding since 2015.

The unions and their allies ignore these realities and focus on costs the districts can’t cut even as they lose students: pensions, principals’ salaries, building maintenance and utilities. These costs are real, but in a majority of charter states local revenue or the state-provided cushion covers most or all of them.

The same arguments made about charter school funding don’t make sense in other contexts. When a family moves out of a district, the district loses state and federal money for its child’s education, but no one accuses the family of draining funds from the district. When parents move their child to a private school, no one accuses them of sabotaging public schools.

And the pension problem is exaggerated. As districts lose students, they reduce their number of teachers, which also reduces payments to the pension fund. If the pension system has been properly funded, there’s no negative impact. The real problem is that most states have fallen behind on their funding obligations, and now some districts are being forced, as in California, to play catch-up.

Schools that lose students to charters can cut down on costs in creative ways, such as renting space (often to charters, if their city is not opposed to charters).

If Osborne is right, a lot of the opposition to charters, which is union-led, is the result of unrealistic, under-funded pensions. Don’t get me wrong: teachers should have pensions. But unions have bargained some pensions into the stratosphere, and they seem to feel these charter schools must be sacrificed as a result.

So arguably foes of charter schools aren't worried as much about public school funding as they are about union coffers.

As Osborne observes:

[L]eaders of the teachers unions scream when school boards contemplate any of it.

That’s because unions shrink as charters grow. Charter schools are free to unionize, but as of last year only about 11% chose to do so. That doesn’t threaten teachers, who have more potential employers as the charter sector grows, more opportunity to choose a school that fits. But it does threaten the handsome pay union leaders receive—more than $400,000 a year for leaders of the NEA and AFT as well as more than $200,000 for other staff members.

But it seems so much more idealistic to stand up for public schools than for rich unions, right?

 





Independent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
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