Baltimore school system officials and charter leaders are at odds over how to address an anticipated funding disparity — an issue that led to a contentious court battle five years ago.
In the district's proposed fiscal year 2012 budget — expected to be adopted by the school board Tuesday — charters will receive $9,300 per pupil, compared with the traditional schools' $5,000 per pupil. The district's allotment to charter schools will also increase by $13 million over last year because of a surge in enrollment numbers.
City schools CEO Andrés Alonso said traditional schools are shouldering the burden of the district's flat revenues and increasing cost, so he wants to revisit the charter funding formula set in 2005 — which gives charters cash in lieu of services.
Alonso said "the squeeze is on," as the district's allocation to charters passed the $100 million mark in the proposed $1.3 billion budget. Baltimore has the bulk of the state's charter schools, with 32 operating in the district next year.
"The present solution cannot hold," Alonso said. "Charters have been extraordinary partners in the reforms, so I am confident we will creatively find a new solution together.
"That might mean that the way we do business has to radically change, not necessarily that charters need to get less money. We haven't figured out how to do it. We need to do it together."
Charter school leaders say that the perceived disparity in funding is misleading.
"If there's any disparity, it's in the power, and if anything, we want traditional schools to have the power that we have because we see the impact that it can have," said Bobbi Macdonald, board member of the Coalition of Baltimore Charter Schools and executive director of City Neighbors charter schools.
"The charters are given more cash, but we have more responsibilities, we have growing populations and we get results. Instead of saying charters need to get less, we need to say how all schools can get more."
Under the school system's Fair Student Funding model, implemented during Alonso's tenure, schools receive per-pupil funding based on the number of students they enroll.
For the past three years, the model has given principals of traditional schools the autonomy to staff their schools and provide resources for their students, using "flexible cash" built into the per-pupil allotment. The amount of flexible cash in next year's budget will decrease by 4 percent because of expenses such as salaries and fringe benefits.
Charter schools are public schools that operate independently under contracts with the city school board but receive public funding based on enrollment under the Fair Student Funding model.
Unlike public schools, charters shoulder the costs of their principals, facilities and any services they don't receive from the district's central office with their per-pupil funding. But charters also receive philanthropic funds that can raise their per-pupil expenditures, the same way traditional schools can receive grants.
Macdonald noted that when services, debt service and facility costs are deducted from charters' per-pupil formula, the gap is not that great. She said charters are also feeling the economic crunch.
Alonso, who has opened charter schools that are contractually obligated to grow each year, said, "When I started, [the budget impact] wasn't that relevant because the charter population was small."
According to data provided by the district, the majority of the schools that will see the largest budget increases next year are charters; four out of five schools that received the largest decreases are traditional schools. The increases and decreases were primarily due to enrollment changes.
Impact on achievement
School leaders and education advocates said that the best funding formula is one that will ensure equal opportunity for all students.
"Schools with children of similar needs should be funded at similar levels, to ensure equity and apples-to-apples comparisons regarding student achievement," said Bebe Verdery, director of the Education Reform Project for the American Civil Liberties Union of Maryland.
"The services and funding provided to traditional, charter and transformation schools ought to be much more clearly presented so that we can be sure that all the students are getting their fair share."
Arundel Elementary/Middle School, a school enrolling predominantly poor students in Cherry Hill, has met every state academic and attendance goal for the past two years after a long history of failure. But it is losing $1,000 per student, or more than $348,000 total.
"That cut will cause a lot of pain, especially in a school that has turned around, where enrollment is rising and parents are happy," said Matt Carpenter, Arundel's principal. "We don't want to lose our momentum."
Carpenter said he learned that he lost about $800 more per pupil than a charter school counterpart.
"The solution is not to take dollars from any other schools or from the charter per-pupil formula," he said, "but to make sure that funding is distributed fairly."
Unlike charters, traditional schools do receive between $600 and $900 in additional funds for basic, advanced and special-education students, and for dropout prevention. But in next year's budget, funding for basic and advanced students was cut by $500 per pupil in order to raise base funding for all students by $56.
Charters receive federally mandated funds for disadvantaged and special-education students.
The charter formula also ties charters' per-pupil funding directly to the amount of revenue they receive, while traditional schools have more limitations. In the past four years, charter per-pupil funding has increased by 1 percent, while per-pupil funding for traditional schools has decreased by 9.8 percent.
Court case
Six years ago, when charters began fighting for their current funding model, school leaders predicted there would be challenges.
In 2005, Macdonald and charter leaders of Patterson Park Charter School appealed to the state school board, saying they should receive in cash the amount of money that the district spent on each student. Charter leaders said the traditional funding model limited their autonomy to choose how to provide services.
At the time, the school district spent the equivalent of about $11,000 on each student. Instead of deducting expenditures, such as food and central office functions, before allocating a per-pupil amount of $5,800, charters wanted the entire $11,000 to spend as they saw fit.
The state board ruled in their favor, requiring that the district provide cash in lieu of services and that charters pay 2 percent to the system for administrative services.
In 2006, the city school board vowed to challenge the decision because it would "pose a financial hardship on the vast majority of our traditional schools, which ironically could result in these schools receiving less money per student than charter schools."
The school system fought the case up to Maryland's second-highest court, which ultimately ruled in favor of the charters in 2007.
Matt Hornbeck, principal of Hampstead Hill Academy, which converted to a charter in 2005, said he maintains the same reservations he had then about receiving an increased cash flow while public schools maintain their same levels. He said, however, that "pitting charters against traditional schools makes no sense."
"Charter school kids should not get more or less money than traditional school kids," Hornbeck said. "Funding cuts hurt students in charters and traditional schools, and that is the reality right now, given what the city and state are budgeting for education."
Not unique to Baltimore
Experts on district-charter relations said that equitable funding issues are not unique to Baltimore.
"It's a standard story, and it's a hard one, but not impossible to figure out an equitable funding model," said Paul Hill, director of the Center on Reinventing Public Education, which specializes in district-charter policy.
Hill said that districts in New York and New Orleans have overcome similar hurdles by continuing to cut the central office.
"What they have to understand is that as the charter sector grows, the district's income is going to go down," Hill said. "That means that even to maintain the difference at what it is, the central office is going to have to get cheaper."
Alonso has cut the district's central office by 33 percent, shifting more than $160 million to schools in the past three years. He said he was open to a conversation about continuing to trim the central office with the goal of equalizing student funding.
Hill said the district should start by "talking about the way their funding is similar than different, and talk about the whole problem rather than parts of it."
"That will require an independent accounting of where the money is and they probably have to figure out exactly where that money is spent," he said. "Other than that, they're waving their hands."
Charter leaders said they welcome a review of the charter funding formula, though they also believe that the school system could continue reviewing its own efficiency and move toward giving traditional schools more money and power.
"They have every right to revisit the formula, but it's a philosophical stance the state board took based on what every child could get," Macdonald said. "If it's the right formula, it will be affirmed. If it's the wrong one, we'll have to come up with the right one."