MMA letter urges Education Committee to support bill to reform charter school finance

The Honorable Alice Hanlon Peisch, House Chair
The Honorable Jason M. Lewis, Senate Chair
Joint Committee on Education
State House, Boston

Dear Representative Peisch, Senator Lewis, and Distinguished Members of the Committee,

On behalf of cities and towns in all parts of the Commonwealth, the Massachusetts Municipal Association is writing to support House 418, an Act Relative to Transparency and Accountability in Charter School Finance. This bill would bring long-overdue accountability to charter school finance and provide a measure of relief to local public schools.

The diversion of Chapter 70 school aid from local public schools to pay tuition to charter schools has imposed a major and growing financial burden on cities and towns, a problem made more acute as the state grants more charters and existing charter schools expand. The fiscal drain on cities, towns and school districts has led to fewer programs for the vast majority of students who remain in the local public school setting. This issue is impacting a large number of communities, including some of the state’s poorest and most financially distressed cities and towns.

H. 418 would cap the assessment on cities, towns and regional school districts used to finance charter school tuition payments. It would not change how tuition payments are calculated for individual charter schools, and would not reduce the total tuition payments that charters receive. The bill would set a maximum local contribution to charter schools and provide for state payment of the balance, subject to appropriation. The bill would not change the statute governing reimbursements.

This proposal would mitigate some of the harm done to local public schools by the current system. The preliminary Cherry Sheets for fiscal 2020 released in January show that approximately 80 municipalities and school districts are facing a net reduction in Chapter 70 school aid next year, after accounting for charter school assessments. Other school districts would see extremely small aid increases, including many whose net aid increases would be below minimum aid amounts.

The preliminary numbers for fiscal 2020 show that the charter school assessments placed on cities and towns are expected to increase by $53 million, and will reach nearly $720 million. This transfer of public funds happens completely off-budget. There is no appropriation to charter schools in either the state budget or in local budgets – instead, $720 million is deducted from the Chapter 70 aid distribution to impacted cities and towns, and is transferred directly to the respective charter schools without a hearing and without any review or approval by local residents or the Legislature. It is a system that lacks any real transparency or accountability.

H. 418 would amend the charter school finance law (section 89 of Chapter 71 of the General Laws) to create a local share and a state share of charter school tuition payments. There are four parts of the tuition calculation: the local share of the basic per-pupil foundation budget component, the basic amount (the above-foundation spending amount), facilities, and transportation. This proposal would cap the local share of the basic per-pupil foundation budget component at the statewide average Required Local Contribution (RLC) per student (FTE) as calculated through Chapter 70. For fiscal 2019, this amount is $6,636 per pupil, based on Department of Elementary and Secondary Education (DESE) projections. The bill would also cap the adjustment to the basic amount (the above-foundation spending amount) at the statewide average above-foundation amount. For fiscal 2019, this amount is $3,580. H. 418 would not change the facilities or transportation parts of the calculation.

This change to charter school finance would finally recognize that school costs cannot be reduced uniformly when a student leaves a local public school to attend a charter school. Because student transfers are marbled throughout the system, communities rarely, if at all, have the ability to reduce overhead, building costs, faculty or support services without compromising the quality of programming and classroom education for all of the remaining public school students. That’s why the current system is so harmful to the impacted cities and towns.

This important bill will create a more transparent and sustainable system, and ensure that all students, regardless of whether they are in regular public schools or charter schools, will have the opportunities and programs they deserve. We respectfully urge you to support H. 418.

Please contact us at any time if you have any questions or need additional information by having your office reach out to me or MMA Legislative Director John Robertson at 617-426-7272 ext. 122, or jrobertson@mma.org at any time.

Thank you again for your distinguished record of support, dedication and commitment to the cities, towns, and public schools of Massachusetts.

Sincerely,

Geoffrey C. Beckwith
Executive Director & CEO

• Written testimony from Northampton Mayor Narkewicz (339K PDF)
• Written testimony from New Bedford Mayor Mitchell (192K PDF)