Ohio Charter Schools get More Per Pupil Federal COVID Relief Money than Many School Districts Received in State Aid. What Gives?

Included in the $2.3 trillion CARES Act passed in March to cope with the COVID-19 crisis was something called the Elementary and Secondary School Emergency Relief Fund, or ESSER. This fund set aside $13.2 billion for K-12 schools to cope with the new normal in preparing education spaces for COVID-19. Things like enhanced cleaning, or preparing online learning material, or maximizing spaces to ensure social distancing for potential return to school were the expenses contemplated for this money.

Every school qualified, including charter schools, for this money, some of which was passed out again last week. The money was and is essential to maintain public education through this crisis.

However, only charter schools would qualify for another program included in the CARES Act – the $669 billion Payroll Protection Program (PPP) -- a fund meant to keep small businesses and non-profits afloat during the economic shutdown. Public entities like school districts and local governments did not qualify for the program, which has been essential to keeping businesses from collapsing.

But charter schools, which are organized as 501c3 non-profits, did qualify.

So did their sponsoring organizations.

So did their management companies.

All tolled, a charter school could receive federal money four ways:

1. Through ESSER, just like every school district in the country
2. Directly to the school through the PPP
3. Indirectly through their sponsoring organization through the PPP
4. Indirectly through their management company (which could be non-profit or for-profit) through the PPP

This resulted in the typical Ohio charter school receiving as much as $817 in total federal CARES Act funding while the typical Ohio public school district only received $150.

That’s more than 5.4 times as much.

In fact, many charters received more per pupil federal aid through CARES Act funding than many public school districts received last year in state aid!

When schools that educate 90 percent of your children get 5.4 times less federal revenue to stay afloat than schools that educate 6 percent of your children, perhaps it's time to examine that federal revenue stream's equity.

Perhaps most outrageous is this result: Children in nearly 1 in 10 charters each received as much federal aid through the CARES Act as children in Columbus – Ohio’s largest school district – received in state aid this year!

There are other shocking incongruities. In no particular order:

• Charter Schools received as much as $82.3 million in PPP funding either directly or indirectly. They only received $55 million in ESSER funding.
• Of the bottom half of all districts and charters in per pupil CARES Act funding, only 9 were charters; 444 were districts. 
• Meanwhile, 97 percent of Ohio charter schools were in the top half of total federal per pupil aid.
• The top 98 per pupil federal revenue recipients were all charter schools, representing more than 1 in 3 Ohio charter schools.
• Children in 2 of 3 Ohio school districts got less per pupil federal aid than children in the charter with the lowest total federal aid. 
• Meanwhile, children in 116 charter schools got as much as $1,000 (or more) each in federal aid. Children in only 3 districts did (Bloomfield-Mespo in Trumbull County, Youngstown and East Cleveland -- the last two of which are state takeover districts). 
• One charter school (SMART Academy) got as much as $26,000 per pupil in federal money. 

Not every charter school quadruple dipped. But some did. Here’s how it worked in some cases.

The Academy of Urban Scholars in Columbus

• $108,961 through the ESSER aid that was available through the CARES Act to all Ohio schools. 
• As much as $700,000 in direct aid from the PPP. 
• Sponsored by the Buckeye Community Hope Foundation, which received as much as $1 million in PPP funding, the relative share of which is $22,265. 
• They are run by the National Center for Urban Solutions, which received as much as $350,000 in PPP funding -- $213,195 of which would have gone to the Academy.
• That’s more than as much as $1.04 million in federal CARES Act funding for the school, which has 305 students, which works out to as much as $3,424 per pupil – about the same amount as each student received in state aid last year in Putnam County’s Ottawa-Glandorf Local School District.

There is even one charter school that quintuple dipped.

Village Preparatory School Woodland Hills

• This school received $501,215 through the ESSER aid
• They received as much as $1 million in direct PPP funding
• Village Prep Woodland Hills was sponsored by the Buckeye Community Hope Foundation. Village Prep’s share of the up to $1 million Buckeye received from the PPP would be as much as $35,989.
• Village Prep is run by the Breakthrough Schools, which received as much as $1 million in PPP funding. However, Breakthrough also has a fundraising arm called the Friends of Breakthrough Schools, which received as much as $350,000 from the PPP program. Village Prep’s share of the $1.35 million total between the operator and its fundraising operation would be as much as $234,668
• Village Prep Woodland Hills received as much as $1.77 million in federal aid for its 493 students – as much as $3,594 per student, or almost the exact amount of state aid each student received in Tuscarawas County’s Garaway Local School District this year.

Others only triple dipped, but did so at large amounts.

KIPP Columbus

• The school received $1,081,480 in ESSER funding available to all schools
• The school also received as much as $5 million in direct PPP funding
• KIPP is sponsored by the Thomas B. Fordham Foundation, which received as much as $1 million in PPP funding, with KIPP’s proportionate share being as much as $256,987 of that
• So for KIPP’s 1,373 students, it was able to draw down $6.4 million in federal CARES Act funding. That’s $4,638 per student, or as much as $1,379 more than what every student in Columbus received this year in state aid.

No school district could double, triple, quadruple or quintuple dip into federal revenue streams to help its students deal with the COVID-19 crisis.

But charter schools could, and many did.

It is unfair that charter schools – which have for years insisted they are “public schools” – be granted more opportunities to access federal funding than the schools that educate 90 percent of our children simply because of their corporate structure.

And this shows once again how Ohio charter schools are not really “public schools”.

When it benefits them to be considered “public schools”, they tap into those funds.

When it benefits them to be considered businesses, they tap into those funds.

One final reminder: Barely 30 percent of charter school grades are A, B or C. Meanwhile, about 70 percent of school district grades are A, B, or C. Yet the federal CARES Act is providing 5.4 times as much money to the schools that get 70 percent Ds and Fs.

Sometimes I wonder.

Note: “As much as” will be a shorthand for acknowledging that the CARES Act funding as currently reported through the PPP is being reported as a range between two dollar amounts. I reported data for the upper most amount and qualified it by saying “as much as” because the entity could be receiving less than that, but I wanted to explain how much it could be. I would urge the Treasury Department to release exact amounts for a more accurate dollar figure. The calculation was made in the following way: for charter schools, each school was searched for its ESSER funding and whether it is receiving direct PPP funding. Then each charter school’s sponsor, as listed by the Ohio Department of Education was searched. Then each charter’s operator was searched. If a sponsor or operator was found, then the amount granted to those entities were divided by the number of students each sponsor or operator oversaw in all the schools they sponsor or operate. Then each charter school was granted a proportionate share of that overall revenue based on the number of students they had. It was assumed that every dollar received would go to benefit each student through the retention of teachers and staff meant to help educate each student. There were 16 charter schools whose student populations weren’t reported in the state’s charter school directory, or were reported as having 0 students. However, every one of those schools received ESSER funding (a total of $1 million), with some receiving direct and indirect PPP funding. However, because the state didn’t report the student population, they were not included as part of the per pupil calculations utilized in this analysis.

COVID-19 isn't like Kid Crud. So Maybe Returning to School Won't be a Disaster.

A month ago, I would have told you that sending a bunch of kids indoors into schools during a pandemic was nuts. Dangerous, even.

But then I started reading the literature. And now I'm thinking it may not be as nuts as I originally thought.

I think one thing we all have to deal with (especially us parents) is overcoming our well-founded belief that kids are disease vectors. This is something I (and probably many of you) have experienced over the years. Our kids go to school, come home with the sniffles and suddenly we parents are down for a week or two. Who hasn't explained a persistent cough, fever, sneezing as "kid crud"?

We all have.

Which is why it just seems common sense to think that getting these little disease vectors back in school during COVID would be a horrible idea.

But it appears that, at least with COVID, the "kid crud" prejudice may not be justified.

For example:

•  One study  found that children were the initial source of infection among the families in about 8% of households.

• Another study looked at staff and students at five Australian primary schools and 10 high schools and found that out of 863 people who were in close contact with someone with Covid-19, only two got it

• Another study discovered that a 9-year-old who attended three different schools and a ski class while showing symptoms of Covid-19 didn't infect anyone, which would never happen if the 9-year-old were an adult. 

• Likewise, British researchers have found only one COVID outbreak in the entire world that could be credibly said to have started in a school.

And while some express caution about these results, with the caveat that no one study proves anything, none other than the American Academy of Pediatrics -- a legendarily cautious and small c conservative organization -- came out and all but said that kids should go back to school buildings in the fall. According to one of the authors of the AAP's school guidance:

"This virus is different from most of the respiratory viruses we deal with every year. School-age kids clearly play a role in driving influenza rates within communities. That doesn’t seem to be the case with Covid-19. And it seems like in countries where they have reopened schools, it plays a much smaller role in driving spread of disease than we would expect."

The AAP recommends taking precautions, but it also says that the mitigating efforts should be geared toward returning kids to classrooms, citing the health concerns kids have with remaining isolated, as well as the fact that in-school learning is so much better, overall, than online learning.

Look, it's been tough for me to turn at all on this issue. Letting kids get together indoors in groups during a pandemic seems completely illogical to me.

But I also have learned to trust science. And the science is saying that physically returning kids to schools, with the attendant precautions (hand washing, mask wearing, socially distancing however you can and making sure you don't go to school sick and go home if you do get sick) may actually work.

This is basically the approach our Gov. Mike DeWine is now advocating, though he isn't mandating any school or district to return full bore this fall. I will be intrested to see how much of the Cares Act money he's willing to spend to help districts and schools cope with the post-COVID reality. But at least he recognizes there will be a need, though importantly he already admits that the new money won't be enough to cover the cost.

Typical Ohio education funding.

Anyway, I know lots of parents will still doubt. Their experience with "kid crud" is so ingrained that they are like I was -- doubting every single piece of evidence that says returning to school isn't as dangerous as our experience suggests.

But the science is telling us something different. And if we want science to govern our COVID response, it's incumbent upon us to let it.

Even when it says we may have to set aside our lifelong battle with kid crud. 

Don't Sleep on Charter Schools

I know there's been lots of commentary and news coverage of vouchers lately.

However, I don't want anyone to forget about the massive charter school program we still have in this state.

Just because ECOT is gone doesn't mean our charter school problem is.

I'm going to post a bunch of charts for you to look at. In short, here's what they show:

• This past school year was the first time in five years that charter school enrollment and the number of charter schools in operation increased over the previous year

• This school year, 606 of Ohio's 612 school districts lost at least some funding to Ohio's charter schools -- that's a record 99 percent of school districts.

• This past school year was the first time in three years that the state funding to charters eclipsed $900 million

• Meanwhile, per pupil funding to charters has steadily increased every year since 2013, largely remaining unabated despite fewer students attending charters, with a record $8,393 per pupil this year, compared with the $4,846 in state aid kids in local public schools receive.

• Likewise, a record $2.8 million per charter building was paid out this school year 

• More than $400 million in local tax dollars had to subsidize charter schools this last school year because the state funding to them was so much more than kids in lcoal public schools receive

So while the fallout from the historic charter school reforms from House Bill 2 and the collapse of ECOT led to definite movement down in terms of numbers of charter schools and enrollment in them, those trends started reversing this year. And despite those downturns, per pupil and building funding kept marching up and up. 

However, because of COVID, expect the enrollment and funding trends to continue going up. Why? Because the state won't be issuing a report card for this year and perhaps next year, though we'll see.

That will mean that charters in danger of closing for persistent academic failure will have at least a 2, maybe 3 year reprieve. Liekwise, charter sponsors in danger of losing their ability to run charter schools will receive a similar reprieve.

So that means that charters won't be closing as frequently (though COVID may force clsoures for non-academic reasons, and, in fact, that's why all but 52 of the 307 Ohio charter schools have closed over the years).

And need I remind everyone how poor charter school academic performance has been relative to local public schools.

So while vouchers deserve much of our attention, don't sleep on the budget hog that continues to be Ohio's Charter Schools. They remain a concern and drain on Ohio's state budget and kids' educational opportunities.

What If Ohio Re-Focused on Education away from Prisons?

I know I haven't done much on the historic protests around the country. But I wanted to kind of put in Ohio budget terms what their goals about de-emphasizing law enforcement spending could mean for our communities.

So I dug into some spreadsheets.

The Ohio Legislative Service Commission (one of Ohio's finest bureaucratic institutions) puts out a spreadsheet every year tracing Ohio revenue and spending since the 1974-1975 fiscal year. So it's possible to trace the historic legislative appropriations patterns for the last 35 years.

What's amazing to discover is that while Ohio's commitment to K-12 and (especially) higher education has dropped since 1975, the percentage of the state budget going to corrections has skyrocketed from 5 percent in 1975 to nearly 15 percent of the non-human services budget in 2021.

I am excluding human services because spending there has exploded due to changing Medicaid rules and state spending requirements over the last 35 years.

And while K-12 has dropped by about 3 percentage points, most of the transfer in priority to corrections has come from the state's higher education budget, which has dropped in state commitment by 25 percent. These are the two areas of the state budget that can actually prevent incarcerations.

The state has decided to triple the commitment to its prisons and drop the value it places on preventing people from going to prison by more than 10 percent.

What does this mean?

Very simply, it means that we have more prisoners. Which shouldn't shock anyone.

What if we changed the focus, though, and spent the same relative amount on education and prisons as we did 35 years ago?

The results are stunning.

That's right. Another $875 million for higher education and $518.4 million for K-12. 

What could that buy?

Let's look at higher education first.

An additional $875 million would:

• Cover every student's tuition at every community and technical college in the state, plus every student's tuition at Central State and Shawnee State
• Cover every student's tuition at Ohio State University and Cleveland State University
• Allow for a flat, 29 percent tuition cut at every 4-year public university in the State of Ohio

Now K-12.

An additional $518.4 million would:

• Allow school districts to cut property taxes on the typical Ohio home by more than $100 a year, on average
•  Nearly pay for all the social-emotional, security and community liaisons called for in the Cupp-Patterson school funding model currently sitting in the House Finance and Approrpriations Committee
• Pay for every teacher in Akron, Canton, Cincinnati, Cleveland and Columbus under the Cupp Patterson model

You get the idea. It would get us a lot. Without a single additional tax increase or new revenue stream. With simply the same budget priorities we had 35 years ago. 

Re-focusing away from incarcertaion and back on education, as we did 35 years ago, would provide tremendous benefits for our kids and communities. 

This is exactly what the protestors are asking us to do -- stop investing so much in law enforcement and instead invest in what we know reduces the need for law enforcement.

They have a point.

Re-emphasizing education as a funding priority would grant more folks greater opportunities at the American Dream, regardless of where they come from. That's what we should all get behind.

Private School Enrollment Drops 14 percent since 2008. Why has their funding jumped 135 percent?

If you ever wondered what power looks like, I give you Ohio's private school lobby. Why do I say that?

Because on what other planet, in what other universe, in what other industry would increasing investment by 135 percent over 11 years in a service that lost 14 percent of their customers over the same time be tolerated?

Because that's exactly what's happened here in Ohio with your money.

Here's the data: In October 2008, the Ohio Department of Education counted about 171,319 students in Ohio's non-public schools. Meanwhile, in October 2019, ODE reported 146,054.

That's a 14.7 percent enrollment drop.

Meanwhile, in the 2008-2009 school year, Ohio taxpayers sent $291,530,743 to private schools through busing, administrative cost reimbursements, auxiliary services and vouchers (SEE note below on what these are). This year, that number will balloon to $685,853,844.

Graphically speaking, here's what that increase looks like vs. the commensurate enrollment drop.

Crazy, right?

'Well, that's all driven by voucher funding, Steve. The funding for non-vouchers is actually pretty in-line with enrollment," you might say.

And you would be wrong.

Yes, the busing, administrative cost reimbursment and auxiliary services lines haven't exploded the way vouchers have (from $58 million in the 2008-2009 school year to more than $420 million today), but the increase is still significantly greater than what private school enrollment would seem to dictate.

That increase to serve fewer kids seems to not make much sense.

"Yeah, but what about public school kids, Steve. We've seen an increase in funding to public school kids since then too and their enrollment hasn't increased," you might say.

And you would be incredibly incorrect.

First of all, the Ohio Constitution requires the state to fund a publicly accountable education system -- a system that was found to be inadequately funded by the Ohio Supreme Court four different times. 

Nothing in the Ohio Constitution requires the state to provide a plug nickel to the state's private schools, which are not audited or held to nearly the same accountability standards as public schools.

But even ignoring that, in October 2008, there were 1,679,369 students enrolled in Ohio's public schools. In October 2019, there were 1,659,251. So there was an enrollment drop of 1.2 percent, which considering how many more students take vouchers and attend charters today than 2008, is kind of impressive.

And given that, funding for those students has basically kept pace with inflation. Meanwhile, public funding of Ohio's private schools has way outstripped inflation, even though enrollment has dropped in those schools by more than 12 times.

What has this meant on a per pupil basis?

In the 2008-2009 school year, Ohio taxpayers sent the equivalent of $1,702 per private school student to private schools. This school year, that number will be $4,696 -- or about $600 more than the state sends every kid in Cincinnati, Columbus, Northern Local in Perry County (the school funding lawsuit district), the average small town Ohio school district, and 46 percent of all Ohio school districts.

It's true. Not every private school student benefits from all this money.

Which is kind of worse.

It means that private school students who do get public funding receive substantially more than even the numbers I'm quoting here. And I remind you that the overwhelming majority of the schools receiving this money are religiously affiliated.

Not to open up that can of worms.

So how can the state justify a more than doubling of the investment in Ohio's private schools when enrollment in these schools is significantly falling?

Call your legislator. Ask them. See what they say. And as much as I bristle at referring to education in business terms, I would like to use the pro-privatizer language here to make a point: See how they justify taking your money and putting it into a business that's hemhorraging customers, especially in a business where we can't even find out how that money is being spent.

I'll be waiting for their responses.

Eagerly.

Note: Ohio Department of Education enrollment data is not an exact science. If the headcount is above zero and below 10, the department reports "<10". So the exact enrollment count can't be easily discerned. What I did was take the median figure of 5 for every "<10" in the enrollment count sheet. But, like the U.S. Census, the actual enrollment count is a fairly narrow range of about 10,000 or so students. I used the same methodology for each year I examined. Also, transportation funding spreadsheets at ODE did not go back to the 2008-2009 school year, so I used the earliest one I could find for the 2011-2012 school year. Administrative cost reimbursements and auxiliary services have been Ohio budget line items for years. Administrative cost reimbursement is described by ODE as "the actual mandated service administrative and clerical costs incurred by such school during the preceding school year". Auxiliary services are costs for physicians, psychologists, and other additional services that are borne by the private school and taxpayers subsidize.

Ohio Gets National Credit for Fair School Cuts. But is it Warrented?

I can't tell you how many calls I've gotten from national news outlets about Ohio's school cuts. Especially about how "fair" they have been compared with the generally flat cuts other states have done. And while I have contended that Ohio at least tried to be fair, school districts with the most needy kids still get hurt the most.

All while protecting Charter Schools and vouchers, but that's another blog for another day.

 

Compounding the issue is the fact these cuts have come over the final three state payments to school districts from this year. So that's about $100 million off each payment for each of the final three payment periods.

That's a roughly 30 percent loss during the last three bi-monthly payments. Prior to the cuts, districts typically got about $336 million in their bi-monthly payments. Now it's about $236 million.

So that means districts have had to deal with essentially a 30 percent drop in their expected state aid during the height of the pandemic. That's bad for all districts and kids.

But if you want to see why the cuts still disproportionately harm kids in Ohio's neediest communities, look at the districts that lose the most money relative to their ability to offset those cuts using local revenue. A district-by-district spreadsheet of these cuts exists here. 

As you can see from the chart I've put together, the average wealthy suburban district loses more per pupil funding and almost double the total funding of the average urban district. Seems fair, right?

Yet in order to cover that loss, the urban district has to come up with almost 25 percent more local funding than the wealthy district. And they have to come up with that money by asking folks who barely make half as much money.

Same goes for major urban districts -- Akron, Canton Columbus, Cleveland, Cincinnati, Dayton, Toledo, and Youngstown. Even though folks living there make substantially less than half of what folks living in wealthy suburban districts earn, they have to tax themselves at about a 20 percent higher rate than the wealthy communities do to cover the state losses. 

Which community do you think has a better shot at recovering their lost state revenue with local revenue? That's a rhetorical question.

Is this outcome better than it could have been? 

Absolutely. 

The governor's office should be commended for doing what they could to try to make this distribution as fair as possible. But I think what this demonstrably proves is that there simply isn't enough money in wealthy districts to offset the disproportionate pain felt by our state's poorer communities when cuts come. And with more cuts expected for this coming school year, not to mention next year's biennial budget, the urgency of federal intervention to protect kids in our most vulnerable communities because clear and obvious.

In our poorest rural, small town and urban districts, folks who make substantially less money than folks in our wealthiest districts have to come up with substantially more local revenue to offset any state cuts -- regardless of state efforts to soften the blow.

This is why we need a school funding formula that makes sense and relies less on local revenue to fund schools. This is why the Ohio Supreme Court was absolutely correct when it ruled four times that the way Ohio funds schools is unconstitutional.

And, unfortunately, this is exactly why the system remains so 18 years after the final court ruling.

But on the immediate, COVID-emergency horizon, it speaks to the absolute necessity of federal funding to help alleviate this pain that will be felt in our most needy communities. 

Congress -- specifically the Senate -- must act. 

Now.

Confronting EdChoice: A Chance for Public Education to Protect their Kids

You know I don't typically toot my own horn on this blog. I like to do my analysis, make my point (or points) and move on.

However, there is a crisis facing public education in Ohio. And that crisis is the EdChoice Voucher program. This is a program that when I left the legislature in 2010 cost taxpayers $60 million. It is now about $150 million, and it's only growing.

Unlike Charter Schools, when taxpayer money is used by private schools to subsidize their tuitions, the state doesn't audit how the money is spent.

But even worse than that, it hurts kids who don't take the voucher -- kids who tend to be less well off, less white and with more special needs.

Every kid in 3 of 4 Ohio school districts receive less state and local revenue because of this and other voucher programs. 

This is not just an issue for large, urban school districts. Only 1 poor, rural or small town district lost any money to EdChoice vouchers in 2010. It's now throughout our rural communities and the money has jumped from $10,400 in 2010 to more than $850,000 today. 

As districts face huge budget cuts in the coming school years, it behooves them to defend every dollar they can so their students have all they need to succeed. That's why the folks at Real Choice Ohio, which fought for years to help districts cope with charter school losses to great success, have started a series of workshops to help districts educate and inform parents nd their communities about the dangers of the EdChoice vouchers to their kids and other kids' futures.

The first pillar of these conferences deals with the overall problem facing districts and the kids theiy serve. I am helping to lead this pillar, complete with Power Point presentations and I will be moderating an all-star panel on the EdChoice and voucher problem next week.

Signing up is easy and cheap -- $100 for all 4 pillars, which covers 5 participants. I would urge any school district officials, teachers and parents who are concerned with the threat these voucher pose to public education to sign up and join us.

We must push back. Together. I look forward to working with all of you.