Fact Check: School Choice Saves

As the "Tax You More" lobbying tour continues its journey Matt Brouillette continues to offer the real facts on state education spending. Today's education fact focusing on how school choice saves taxpayer money and provides quality education.

The $75 million Educational Improvement Tax Credit (EITC) is currently a 75-90% tax credit for businesses that contribute to a non-profit scholarship or educational improvement organization.

• The EITC provides $44.7 million in K-12 scholarships for low-moderate income families, $8 million in pre-K scholarships, and $22.3 million for aid to “innovative” educational initiatives.
• In the current school year, 44,000 students are receiving EITC Scholarships.
• Since 2001, 244,038 students benefited from a better or safer school through the EITC.
• The EITC saved taxpayers over $500 million in the 2007-2008 school year alone.
• The average EITC Scholarship is $1,100, compared with average school district spending of $13,300 per-pupil n 2007-08.
• If the EITC were to be cut and scholarship opportunities reduced, many students would be forced backinto high-cost public schools, resulting in higher property taxes.
  

Taxpayers saved approximately $3.622 billion from other school choice options in the 2007-08 school year.

• Charter schools saved taxpayers $80.03 million in the 2007-08 school year. 45,560 students were served at an average savings of $2,589 per student.

• Cyber charter schools saved taxpayers $94.14 million in the 2007-08 school year. 19,715 students were served at an average savings of $4,775 per student.

• Private and nonpublic schools saved taxpayers $3.15 billion in the 2007-08 school year. 260,000 students were served, with an average savings to taxpayers of over $12,000 per-pupil.

• Home schooling saved taxpayers $297.5 million in the 2007-08 school year. 22,316 students were served at virtually no cost to the taxpayers.

Budget Facts 2009: State Education Spending (click here for a printable version)

Funding for Cybers up For Debate

The Philadelphia Inquirer has a story about an upcoming hearing on charter schools and cyber school funding. As I will be testifying at the hearing, I won't repeat my remarks here. I will add a couple of points in response to criticism:

At today's hearing, Zahorchak is scheduled to testify that the administration of Gov. Rendell again will push for a statewide tuition rate for cyber charters and for capping the amount of their unreserved balances, an Education Department spokesman said.

The complaint that cyber schools have too much in their fund balances is ridiculous, unless you also complain that school districts typically have much larger amounts in their reserve funds. Cyber schools typically need to keep a large reserve because school districts refuse to paying in a timely manner.

State Sen Andrew E. Dinniman (D., West Chester) said that among the questions he planned to ask charter operators was how they intended to guard against further financial scandals. ...

As The Inquirer has reported, at least three Philadelphia charter schools and a cyber charter in Devon have been ensnared in a widening federal criminal probe.

As Bob Maranto has pointed out, charter schools are more accountable, as they depend on parents choosing them, and can be shut down/have their charter revoke. Unfortunatlely, this emphasis on a few problems in charter schools (leading to the main theme of today's hearing, remaking the entire charter law), doesn't address far more important questions, fraud, wasteful spending, or poor academic performance in school districts.

Voices of school choice ... and how to get involved

The REACH Foundation has a new "Voices of School Choice" profile on its website. This one is about Katie, who writes about how the choice of going to cyber school opened far more opportunities to her.

REACH also has provided an info sheet and hosted a conference call (audio available) about how S-Corporations and others can take the Educational Improvement Tax Credit under the latest changes to the law.

Georgia Charter School Success

Our sister think tank, Georgia Public Policy Foundation, highlights the success that charter schools are enjoying in the state.

85% of the state's 71 charter schools met Adequate Yearly Progress (AYP) in 2006. In 2007, the charter high schools experienced a graduation rate of 90%, compared to an average 72% of public schools.

More and more states are experiencing these levels of achievement from charter schools since competition yields improvement.

Check out Edifice Complex, which highlights the benefits of cyber charter schools in Pennsylvania.

The Liberace Complex?

The York Daily Record has a story on the South Eastern School District paying $97,000 for - wait for it - a grand piano. I may have to stop using the label Edifice Complex and switch to the Liberace Complex.

But don't pay attention to how school districts mispend 99.4% of your education tax dollars - get them cyber schools instead.

School Officials Raise Salaries Again

An article in the Pottstown Mercury today highlights the salaries of school officials in the Pottstown School District. The school board voted on raises for administrators twice in the past four months, bringing the combined total to $116,934.78. Some of the big earners include four members on the “executive team,” whose combined salaries are nearly $575 thousand.

While districts claim they can’t keep up with cyber charter school costs, they somehow manage to boost the salaries of its administrators (which far outweigh the total cost of cyber schools, without educating a student...

As Tony Phyrillas points out, this is just “another reason why school taxes are so high.”

Check out the Commonwealth Foundation study, Edifice Complex, for more reasons why taxes keep increasing.

Also, stop by our website, SchoolChoiceSaves.org, to learn about cost-efficient alternatives to the traditional public school.

Real Savings: Cutting Cybers vs. School Choice

The Pittsburgh Tribune-Review and Post-Gazette have stories on the renewed push to reduce cyber school funding.

Rep. Karen Beyer and other proponents are touting that:

• The bill would save $18 million ($13 million when you deduct reimbursements to districts, or, $3.76 per homeowner).
• Cyber schools have "large surpluses." This ignores that cybers need fund surpluses when districts refuse to pay and that many school districts have large surpluses - some are even raising property taxes in spite of large surpluses.
• Cybers don't have buildings, so they need less money. Of course, cyber schools already receive about 30% less funding, since they don't get money for buildings (though their technology cost are significantly higher than school districts)

The most astonishing quote is when Rep. Beyer says "Any parochial school will tell you they can more than educate a child for $7,000." While this is true (parochial schools' tuition is in the $2,500-$5,000 range, and their total costs are likely around $4,000-$7,000 per pupil) it says less about cyber schools than it does about the overspending and Edifice Complex of school districts.

Consider that cyber schools educate 20,000 students at about $9,000 per-pupil, compared with school districts with 1,800,000 students @ $12,000 per-pupil. Where is the real taxpayer savings? Representative Beyer should either push for caps on school district spending, or push for more school choice programs - since school choice saves taxpayers.

More on cyber schools and how school choice saves students and taxpayers at SchoolChoiceSaves.org

The myths of cyber schools

A May 11 article on cyber schools in the Daily Local repeats claims that cyber schools are a major drain on taxpayers (though with a strong rebuttal from cyber school advocates), in regard to the Coatesville school districts. While the article claims that cyber schools represent "one of the fastest growing items in Coatesville Area's budget", that is because cyber schools did not exist seven years ago. Cyber schools remain a small percentage (0.49%) of overall school spending. Indeed, the article cites the $3.56 million paid by Coatesville to cyber schools over six years. Last year (2006-07) alone, the district spent: $7 million for administration, $8 million for student transportation, $11 million for operation and administration of plant, and a whopping $22 million for construction and debt (a 156% increase in six years).

Additionally, based on the numbers put out by the bill's sponsors, HB 446 would save Coatesville taxpayers a total of $16 per homeowner in property taxes—assuming no children return to the district's schools as cyber school funding is reduced. Given the discrepancy between what Coatesville district spends per-pupil ($16,478) and what they pay for cyber school students ($10,078 for non-special education students), cyber schools appear to be saving Coatesville taxpayers a significant amount of money.

Read more on the Edifice Complex.

Talking Cyber Schools

I discuss Cyber Schools on this week's Lincoln Radio Journal with Lowman Henry of the Lincoln Institute. Our recent policy brief on cyber schools is here.

I am also appearing on The BOX this week, discussing the broader school choice options in PA. I will be drawing from The Dollars and Sense of School Choice, and from SchoolChoiceSaves.org

Edifice Complex Video

Here is the video from yesterday's lucheon on public school spending and cyber schools. (The Commonwealth Foundation report referenced can be found here.)



Visit EdificeComplex.org for more on this issue.

Click here to view and subscribe to all the Commonwealth Foundation's videos.

Wisconsin votes to protect cyber schools

As we had noted previously that cyber schools in Wisconsin are also facing attack (primarily from the teachers unions), I thought I would pass along this story Pennsylvania Families for Public Cyber Schools on how the Wisconsin legislature voted to protect virtual schools .

Here is a related news story from Wisconsin.

Answers to Attacks on Cyber Schools

One of our loyal readers asked for some help responding to attacks on Cyber School Funding and a lobbying effort by Pennsylvania School Boards Association (PSBA) in support of HB 446 (sponsored by Rep. Beyer).

Essentially the claims of the critic were that cyber schools take money from school districts, don't need as much money because they have no buildings, have excessive fund surpluses, don't require students to take the state tests (PSSA), have no accountability, don't educate special needs students, only take formerly homeschooled students, and a number of other myths. The PSBA push is centered on the claim the HB 446 will save taxpayers $18 million.

We answered these claims in our report Edifice Complex and in our Cyber Schools FAQ as well as previously on this blog, but here is quick rundown of my response:

1. Cyber schools get NO FUNDING for buildings and other expenses, no federal funds, and no funding for special education except for special education students (about 11% of all cyber students). In total this means that cyber schools get only about 73% of the funding per-pupil as public schools.


2. Total spending on cyber schools is 0.49% of total education spending. School Districts spend 22 times that amount on school construction alone. Beyer's bill would save homeowners (by her own estimates) about $4 per homeowner.


3. Public schools have large surpluses as well. The only limit on surpluses in when schools want to issue new debt. About 30% of districts had fund surpluses in excess of the limit they want to impose on cyber schools.


4. Cyber schools need to keep a surplus because (a) they are growing and (b) school districts often refuse to pay. Tim Allwein of the PSBA even attempted to justify this non-payment like school districts are Henry David Thoroueau practicing civil disobedience.


5. Cyber schools reports to the state are readily available. When we testified on Beyer's bill, Bob Maranto took a picture of himself next to the bookshelf full of binders at one of the cyber schools.


6. Cyber schools students Do TAKE the PSSA, their results are posted online at PAAYP.com.


7. Cyber school students DO NOT come from primarily from previously homeschooled families. Cyber enrollment went from 0 to 20,000 in 7 years. The number of home schooled students went from 23,900 to 22,200 in that time. School district enrollment dropped 70,000.


8. Since cyber students cost so much less, and the school district gets reimbursed from the state, they keep about 50% of the per-pupil funding for children they no longer educate. This allows them to increase per-pupil spending, while reducing class size and the need for new construction.


9. Cyber schools can be shut down if not performing adequately. They only get funding when parents choose them—let's apply these same standards to school districts.


10. Beyer's bill would fund cyber schools at the level of the "lowest spending school to reach AYP." Why doesn't the PSBA supporting limiting school districts' funding to the same standard?


11. Cyber schools offer choice for parents, funding the goes to the education of children (rather than awarded to districts), offer a chance to improve educational performance, provide greater safety, personalized educational plans, and options for special needs students, and reduces costs to taxpayers. The school boards are only interested in keeping the money.

Wisconsin's Virtual Schools Could Close this Summer

Intriguing piece in School Reform News on how the Wisconsin teachers' union is also working to undermine cyber schools - rather than targeting funding, they are going after cyber schools based on a state law that requires certified teachers in the building. Their campaign slogan is "A unionized teacher in every home."

Good day for school choice in PA

The Commonwealth Court ruled that Chester-Upland school district could not limit the number of students enrolling in charter schools. Read the Philadelphia Inquirer story. About 40% of Chester-Upland student opt for charter schools, in large part due to the abysmal performance of the district-run schools.

On the other side of the state, the Pittsburgh Tribune-Review has a story about Penn Hills School district potential working with VLN Partners to provide online offerings to students. The district hopes to attract many of the students who have been leaving for cyber schools. This is exactly how districts should be responding - offering new and better services to students and compete with cyber schools - rather than lobbying for limitations on cyber school funding. This is just another example of the benefits of school choice and competition.

(Not) A closer look at Cyber Schools

IssuesPA has a new article on Cyber School Funding. They claim to provide "a closer look at the ongoing debate", but don't look any closer than quoting what some school district officials tell them. With a quick bit of research (even, say reading this blog), IssuesPA would discover several factual errors in their article.

For instance, they state:

Unlike traditional school districts, cyber schools are permitted to accumulate surpluses with no cap.

This is blatantly false - though it would be true if they change "unlike" to "like." There is no limit on school districts' fund balances except when seeking to issue new bonds. At the end of 2005-06, 187 districts (37%) had fund balances in excess of this so-called cap. Twenty-six districts (5%) had balances in excess of 30% of their expenditures. We discussed fund balances of districts and cyber schools in Edifice Complex, and have an extended blog post on the issue here.

They go on to note:

According to many district officials, many cyber school students are former home school students for which the districts receive no current state reimbursement

If IssuesPA had done any research other than quoting "many district officials", they would realize this claim has no support. Prior to the creation of cyber schools there were 24,000 homeschooled students, today there are 22,300. Meanwhile, there were over 16,000 cyber school students in 2006-07, and an estimated 20,000 this year.

IssuesPA points out that cyber schools receive far less funding, per-pupil, than districts spend, but recites the charge that "critics maintain" that:

The cost is much lower than traditional schools because cyber schools do not pay for things like maintenance or utilities.

They should point out, as we have, that the funding formula means cyber schools already receive no funding for maintenance or utilities, or for construction, debt, and numerous other categories of spending.

They also repeat the absurd claim that:

Price’s school district [East Lycoming], for instance, started its own cyber school where costs run $1,500 to $2,000 per student, compared to the district’s 2004 per pupil cost of $8,494 for “traditional schooling.”

I would love to check that out, but if you visit East Lycoming's website, you will not find any mention of this cyber school. There is no enrollment data for this cyber school. PDE has no financial records for this school. There is no record of academic performance for this cyber school - whereas every cyber and charter school in the state is listed. In other words, there is no East Lycoming cyber school.

Perhaps the districts offers online services to students (though there is no mention of that on their website either), but that raises a whole host of questions: Are they counting teacher salaries as part of the "cyber school" costs? Are they counting adminstrative cost, or even Mr. Price's salary? Are any students actually enrolled? What services are they provided? If East Lycoming is offering comparable services, why are students leaving for cyber schools? And if East Lycoming's "cyber school" is so cost efficient, why not set it up as a cyber charter school and get students from across PA, competing with the 11 other cybers schools they think receive too much funding?

Too bad IssuesPA didn't ask any of those question or do any research themselves. For a more accurate understanding of cyber schools, read our FAQ.

Legislators Seek 'Accountability' For Cyber Charters

Article in today's Evening Bulletin on the battle over cyber schools. Karen Beyer claims that "school choice proponents have paid lobbyists a sizeable amount to argue against HB 446: $250,000 from January to June alone" - which looks to me to be about $200,000 more than the lobbyist expenses of all the cyber schools, cyber school associations, and charter school associations combined - though this wouldn't be the first time I have questioned Beyer's claims about cyber schools.

Simon Campbell correctly points out that the PSEA lobbying and campaign spending dwarfs any lobbying by school choice proponents, which is like comparing Jabba the Hutt to Ashley Olsen in terms of body fat.

There is a articulate comment by "Recovering B&M Teacher" as well:

Let's talk about the new "teacher" portion of this bill. Currently, cybers must have highly-qualified, certified teachers, and those teachers must abide by the state's rules relating to Act 48, which is professional development. The new provision in the bill states that teachers in cyber schools can not count the time teaching there toward their permanent certification. Interesting, isn't it? Why, you ask? Well, the PSEA doesn't like any school where teachers aren't in a union. AND, Rep. Beyer is working hard to make it so unattractive to work in cyber schools that teachers won't want to do it.

This bill is absolutely appalling. It's trying to make cyber students "second class" students, who
receive less money toward their education, and who have a hard time finding teachers to teach them.

What do "highly-paid lobbyists" want?

I had to share this email exchange between Simon Campbell of StopTeacherStrikes and Rep. Karen Beyer, prime sponsor of HB 446 (which, in the name of "accountability" includes reducing funding of cyber schools). I'm not entirely sure which "highly paid lobbyists" Rep Beyer is referring to, or what misinformation they have spread, but Simon's identification of "highly paid lobbyists" who are spreading misinformation is spot on.

On Wed, 05 Dec 2007 13:21:33 -0500, Karen Beyer wrote:

All, While I appreciate all of your interest and thoughtful dialogue on the issues surrounding HB 446, I want to take this opportunity to invite any of you to meet with me so that I can explain the legislation. Please know this...there has been a great deal of misinformation regarding this important legislation circulated by highly-paid lobbyists in Harrisburg.

It is unfortunate that some lobbyists believe that they are more important than elected officials, taxpayers and residents of our great Commonwealth. Let me assure all of you that I would never do harm to folks who have chosen cyber charter education for their children. This is an accountability bill. Please understand too that I do not intend to have a constant email exchange on this issue. If you would like to meet, I welcome the opportunity.

With warm regards,
Karen
State Rep. Karen D. Beyer
131st Legislative District

----

Dear Rep. Beyer,

I have a question pertaining to these "highly-paid lobbyists in Harrisburg". Do they include any of the following:

- John Baughman: $159,435
- Kathleen Caswell: $92,145
- Stephen Dunkle: $124,236
- Carol Karl: $118,763
- Laurel McLeaish: $132,748
- James Vaughan: $90,402
- Kelby Waltman: $120,455

I'm guessing that you may have run across one or more of these delightful people at some point - because when they are not playing golf at the Kimberton Golf Club, they don't have far to walk to do their lobbying. In fact their headquarters are right across the street from the Capitol building.

However, in the event that these names are unfamiliar, you may recall that their political action committee endorsed your election campaign last year. That would be the same year they gave you $6,150. I could be mistaken but I believe the above "highly paid lobbyists" work for a little entity called ... P.S.E.A.

Yep, I'm pretty sure that's who they work for. Regarding this accountability bill ...are you referring to HB 1369 that you refused to co-sponsor? This accountability bill holds public school employees accountable for teaching children instead of booting them out of the classroom. I could be mistaken but I believe the same highly paid lobbyists that oppose HB 1369 also support HB 446?

Anyway, if you do accidentally catch a glimpse of Mr. Baughman as he wanders around looking for a non-endorsed legislator to talk to, please tell him not to celebrate too hard at the Pinecrest Golf Club when HB 446 passes.

Thanks,
Simon Campbell
Poverty-stricken unpaid parent volunteer
http://www.stopteacherstrikes.org

Response to Cyber School News Release

Following our call for rejection of unequal limits on cyber schools (which passed the House Education Committee today), I had an interesting email exchange with a public school employee.

One major points were about why students were choosing cyber schools. Me:

While I can't speak specifically to the students who left [your district], our report Edifice Complex does address why many families choose cyber schools. It often has to with the curriculum, the individualized education plans that cyber schools provide, the greater personal connection the comfort and safety of cyber school and the like.

The accountability is that parents chose to leave your schools, for whatever reason, and send their children to cyber schools. Public schools should try to find out why students are leaving, what they need, and then try to provide for those needs. That is, they should compete for students by improving their services and providing a better education.

Instead, the public school establishment is calling for cutting off funding for students in cyber schools.

It also seems, despite everything we have written on cyber schools, that there is a lot of misinformation out there - particularly that cyber students to do not take the PSSA tests.
Cyber school are required to administer the PSSA to all students. Their results are public on paayp.com. More myths are addressed in our FAQ on Cyber Schools.

Also, John Micek is reporting that many in the public and press were turned away from the hearing today, which may be why I haven't heard how the vote went down.

Bill threatens future of Pa. cyber schools

Editorial by Joanne Jones Barnett in the Express Times on the renewed effort to limit funding, enrollment, and now even teachers in cyber charter schools.

Cyber 101 Day

From the Reach Foundation: Cyber 101 day will be held next Tuesday in the Capitol. Lawmakers looking at proposals to limit funding for cyber shools (which represent less than 1% of education spending, and already receive less than traditional district schools) might want to attend.

They should also read our FAQ on Cyber Schools and our report constrasting school district spending with that of cyber schools in our Edifice Complex report.