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Charters face estimated $5.5 million cut in proposed Baltimore schools budget

Hampstead Hill Academy Principal Matthew Hornbeck is confronting another round of budget cuts to his Southeast Baltimore public charter school.

The district’s recently unveiled budget proposal cuts roughly $5.5 million from its 34 charter schools. For Hampstead Hill, which enrolls about 800 students in pre-kindergarden through eighth grade, it would mean a loss of about $150,000.

That cut, combined with new fees charter schools must pay to the district starting next school year, will mean some class sizes will grow to more than 30 students and the equivalent of at least two teaching positions will be cut, Hornbeck said.

“There’s no other way out of this,” he said.

City schools CEO Sonja Santelises unveiled a $1.3 billion budget proposal this week that she said is aimed at stabilizing and refocusing the system, following a turbulent year in which the district dealt with a $130 million budget shortfall and more than 115 layoffs to help close the gap. This year’s budget does not call for layoffs, and in fact adds more than 50 positions — most of them for Santelises’ signature initiative to provide literacy coaches and social support workers to select high-need schools.

But charter schools — which enroll about 20 percent of the district’s nearly 80,600 students — didn’t fare so well. According to the budget proposal, charters could see their budgets go down by an average of about $90,400. In two schools, the projected cuts exceed half-a-million dollars.

The school board is scheduled to vote on the budget proposal May 8.

“It’s disheartening,” said Patterson Park Public Charter School Principal Chad Kramer. “All I’m seeing is the cut, the cut, the cut.”

Charter schools are publicly funded campuses afforded more autonomy than a traditional public school. The proposed budget provides charters with $9,017 for every student they’ll serve in the upcoming year — down from $9,288 per pupil last year. Traditional schools will see their per-pupil allocation rise slightly, from $5,416 to $5,521 per student.

The city’s funding formula provides more money per pupil to charters because they don't receive the same level of services from the central office that traditional schools do. Charters, for example, are responsible for paying for their own buildings and maintenance.

Still, a variety of other costs are absorbed by school district headquarters, including payroll and standardized test administration. State guidance allows the district to charge an administrative fee to charters to cover those costs.

An analysis completed a few years ago showed that the amount the district charged charters covered less than half the actual cost of the services provided. This meant traditional public schools were, in effect, underwriting some of these administrative services for charters, according to budget documents. District officials also made a calculation mistake during last year’s budget process, which resulted in charter schools’ per-pupil funding’s being slightly inflated.

The school system said it recalibrated the funding formula during this year’s budget process.

“It helps reflect more accurately the cost of services,” said the city schools’ chief of staff, Alison Perkins-Cohen.

This year’s budget proposal also includes plans to charge charter schools for things that have historically been covered by the central office.

In the coming fiscal year, the district plans to charge charters for the cost of long-term substitute teachers and “sick leave conversion,” a benefit that allows staff to cash out some sick days at the end of the year. Charters will also be charged for tuition reimbursement, which provides financial support for district employees who go back to school.

Hornbeck anticipates the new fees will cost his school another several hundred thousand dollars, on top of the general funds Hampstead Hill is set to lose because of the per-pupil decrease.

The new charges are projected to amount to roughly $9.1 million in funding that charter schools will return to the central office.

“We don’t really have those central resources anymore to cover those excess costs,” Perkins-Cohen said.

The district office, traditional schools and charter schools have all weathered cuts over the last several years as the district wrestles with how to handle what officials say is chronic underfunding of Baltimore schools.

“We never want to see any of our schools’ funding be reduced,” Perkins-Cohen said. “All our schools are significantly underfunded. At the same time, we do need to find a way to ensure our schools are funded equitably.”

City schools need an additional $358 million a year, according to one state report, and a commission tasked with revamping the way Maryland funds its public schools has delayed its recommendations.

“Charters and traditional schools have suffered terrible cuts in funding for the last two years,” Hornbeck said. “It’s an ongoing tragedy.”

The proposed cuts also come as the district remains locked in a 2015 lawsuit against a group of charter school operators who allege that the district has failed to meet contractual obligations to charters and has not been transparent or consistent in the way it allocates funding to those schools.

Perkins-Cohen said the district is “cognizant of the fact that the lawsuit is definitely out there,” and tried to be judicious in making changes to the funding formula.

Patterson Park’s Kramer said this year’s budget news is especially disheartening in the shadow of the lawsuit. He said it does not appear the district has worked toward a remedy; rather “they’ve done something quite the opposite.”

The executive director of the Maryland Alliance of Public Charter Schools said she was disappointed in the proposed budget, especially after spending more than a year trying to resolve concerns about per-pupil funding for charters.

“Despite these good-faith efforts, the proposed changes put at risk the viability of many schools – ultimately removing valued choices for families, impacting overall district enrollment and putting further strain on the school district,” Nicole Harris-Crest said in a statement.

Kramer estimates that between the per-pupil cuts and the increase in fees, his school will operate with at least $350,000 less next year.

“We don’t want more than what we need to do what we need to do,” he said. “We are emphatic that hasn’t been the deal that city schools has given us.”

trichman@baltsun.com

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