News Column

ECS Report: States Explore Changes in School Funding Formulas to Meet Needs of Rapidly Growing Virtual Charters

February 19, 2014

DENVER, Feb. 19 -- The Education Commission of the States issued the following news release:

A rapidly growing number of virtual charter schools is forcing states to re-evaluate their school finance formulas, with several opting to pay less per student to fund these cyber charters.

An ECS analysis of this new type of public education, which delivers 100 percent of courses online, outlines key funding differences between virtual schools and traditional brick-and-mortar schools.

Virtual charter schools have unique characteristics that make it difficult, if not impossible, to fund them through traditional school finance formulas,"said Mike Griffith, ECS school finance consultant.

As of 2014, 34 states and the District of Columbia have laws allowing the operation of virtual charters-however, such schools are currently operating in only 30 states. In the past 10 years, enrollment in virtual charter schools has grown to more than 310,000 nationwide.

Griffith, who authored the report What State Policymakers Need to Know about Funding Virtual Charter Schools (resource://pdf.js/web/), said virtual schools typically have unlimited school sizes and unlimited enrollment areas.

These characteristics make it possible, for example, for the Pennsylvania Cyber Charter School to enroll 10,343 students in 2012-13-up from 500 students just 11 years earlier. This single charter now enrolls almost three times the number of students as the average school district in Pennsylvania.

States have taken a number of approaches to funding cyber charters. This includes:

* In fiscal year 2013-14, Georgia funded students enrolled in a virtual charter school at a rate of $4,334 an d students in traditional brick-and-mortar schools at a rate of $7,104. This means Georgia supplies virtual schools with 61 percent of the funding provided other schools.

* The state of Colorado guarantees in its school funding formula that each district will receive total program funding from both state and local sources of $7,468 per traditional student and $7,180 per online student. This means funding for online students is $288, or 3.9 percent, less than it is for a traditional student.

* In Ohio's school funding formula, cyber charters receive a base-funding amount that is equal to traditional schools. However, e-schools are not entitled to receive funding for several programs, including at-risk students, English language learners, and career and technical learning.

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Source: Targeted News Service

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