The Pennsylvania House has taken a significant step by passing a bill aimed at capping the tuition paid by public school districts to cyber charter schools.
This legislation, which suggests a potential annual savings of over $600 million for school districts, reflects an ongoing effort to enhance oversight and reduce expenditures related to cyber charter schools.
The passage of the bill comes against a backdrop of increasing tension in the state’s education policy, where Democrats seek to amplify funding for underfunded public schools, while Republicans push for support of alternative education options, including charter schools.
Senate Majority Leader Joe Pittman acknowledged the complexities of education politics in Pennsylvania in his response to the bill’s passing.
In a statement, he noted that “certain aspects” of the House bill, such as requiring wellness checks for students at cyber schools and ensuring that public districts obtain proof of residency for students whose tuition they cover, may lead to beneficial outcomes.
However, Pittman also voiced a concern regarding the necessity for the legislature to recognize that potential cost savings should be understood as part of enhancing support for public schools, as mandated by a recent court ruling.
Democrats, particularly state Rep. Mary Isaacson, who sponsored the bill, emphasize the bill’s purpose as a much-needed administrative update to Pennsylvania’s outdated charter school law.
Isaacson described the proposal as being centered on fiscal responsibilities and aligning tuition payments to more accurately reflect actual educational costs.
The bill was narrowly passed in the House with a vote of 104-98, with the support of two moderate Republicans.
It is now set to move to the state Senate Education Committee, where its chair, Sen. Lynda Schlegel Culver, has committed to a thorough review of the legislation.
Currently, Pennsylvania school districts are obligated to pay tuition for students residing in their areas who choose to attend charter schools.
These tuition payments are determined using a formula that has seen little evolution over decades, treating cyber charters similarly to traditional brick-and-mortar charters, despite the fact that cyber schools generally operate with lower overhead costs.
The proposed bill aims to change this approach by establishing a base tuition rate of $8,000 per student, with adjustments for students who have additional needs, such as disabilities.
This proposal echoes a similar initiative put forth by Governor Josh Shapiro in recent budgets and has gained backing from Democrats in the legislature.
In addition to setting the flat tuition rate, the bill includes several key modifications aimed at improving transparency.
These changes require cyber charters to conduct student wellness checks, provide performance assessments online, and notify students of their performance status if they are classified as low-performing.
Furthermore, the bill introduces an enrollment cap for low-performing cyber charters and mandates that these schools disclose any entities involved in funding their capital projects.
In a bid to address financial practices within cyber charters, the bill proposes that by the end of the current year, cyber schools must return a significant portion of surplus funds to the state.
This recovered money would be allocated to a state fund designated for public school facility improvements and would make charter schools eligible for those funds.
Additionally, the bill aims to prevent cyber charters from accumulating substantial surpluses moving forward.
Starting after June 2026, any surplus exceeding 12% of total expenditures that is not designated for specific use must be returned to the public districts.
The bill also stipulates that any revenue generated by cyber charters through property must be returned to the respective school districts.
According to the bill’s fiscal analysis, the reduced tuition payments to cyber charters could cumulatively save school districts approximately $616 million, covering about half of the current tuition expenses.
The amount each district saves will depend on the number of students enrolled in cyber charter schools.
The growing bipartisan agreement on the need to reform Pennsylvania’s cyber charter law arises from increasing enrollment figures.
Since the onset of the COVID-19 pandemic in 2020, enrollment in cyber charters has skyrocketed by nearly 57%, resulting in approximately 60,000 students now attending these schools across the state.
As a result, more school districts and legislators now find themselves affected by these changes.
In a recent audit conducted by Republican Auditor General Tim DeFoor, evidence pointed out that the revenue for some of the commonwealth’s cyber charter schools nearly doubled from 2020 to 2023, illustrating the significant financial implications at play.
The audit revealed that revenues increased from $473 million to $898 million.
It also highlighted an increase of nearly 150% in the financial reserves of these schools over the same period, with auditors finding that cyber charters were allocating funds to “unusual” expenses, such as gift cards and vehicle payments.
Notwithstanding the support for the reform, opposition remains sharp.
During the debate on the House floor, some Republican representatives criticized the bill as fundamentally unfair to cyber charter schools.
State Rep. Craig Williams voiced concerns over the implications of the proposed changes for these schools, claiming they infringe on their rights for equitable treatment.
Separately, Marcus Hite, representative of the Pennsylvania Association of Public Cyber Charter Schools, characterized the $8,000 tuition cap as “arbitrary and unrealistic,” arguing it does not fairly reflect the costs associated with educating students with disabilities or unique learning needs.
Hite emphasized that cyber charters already operate under high levels of scrutiny, with extensive oversight, audits, and performance reviews entrenched in their operational framework.
In a joint statement, several administrators from various cyber charter schools claimed the bill could lead to potential closures of their institutions.
Jon Marsh from Philadelphia’s Esperanza Cyber Charter School referred to the legislation as an attack on vulnerable student populations, describing it as an effort against those who are already chronically disadvantaged.
Supporters of the bill, primarily public education advocates, see it as a long-overdue measure that will enhance accountability and transparency in Pennsylvania’s robust cyber charter industry.
Susan Spicka, of Education Voters of PA, indicated that the reforms could save taxpayers hundreds of millions of dollars annually while ensuring necessary oversight.
The issue surrounding cyber charters has become a focal point for lobbying efforts, with significant sums of money spent on education-related lobbying by these institutions.
For instance, Commonwealth Charter Academy, the largest cyber charter in the state, allocated $202,500 on lobbying efforts in the last year.
Other cyber charters typically invest tens of thousands of dollars annually in similar lobbying activities.
On the other hand, traditional brick-and-mortar charters, along with their advocates, engage in substantial lobbying efforts as well.
In contrast, public school advocates have their lobbying presence firmly established, with the Pennsylvania State Education Association, which represents educators, spending nearly $178,000 on lobbying last year.
With contentious debates ahead in the Senate regarding this bill, its future remains uncertain as stakeholders from all sides voice their opinions on the evolving landscape of Pennsylvania’s educational funding and governance.
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