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Finance plan attacked as unfair to charters

Differences over the impact of a proposed school finance reform plan on charter schools dominated a discussion Thursday before the State Board of Education.

While charter funding hasn’t been a high-profile issue in the A66 campaign, it was a hot topic during legislative debates over the bill last spring. At issue were two longstanding charter grievances – that they don’t get enough funding for building costs and that they don’t receive an equal share of the revenues generated by school district tax overrides, which provide money above the amounts supplied by basic state and local revenues.

Former state Sen. Keith King argued that the reform plan doesn’t fix those problems.

“I don’t think this is going to pass, and I hope we can come back together and find a more equitable solution,” he said. King, a Colorado Springs Republican, said he could have supported a tax increase if he’d felt the proposed new finance system was equitable.

King was among six panelists – three in favor and three opposed – invited to discuss Amendment 66 and its companion legislation, Senate Bill 13-213, before the board. The amendment would raise state income taxes by some $950 million to pay for the changes in school finance that are detailed in SB 13-213.

Key features of SB213

  • Changes the current single-date enrollment count to a system called average daily membership, intended to provide more accurate student counts
  • Significant changes in the weights used to calculate individual district funding
  • Full funding of state program for at-risk preschoolers and for full-day kindergarten
  • Increased funding for charters
  • Somewhat more flexibility for principals in spending at-risk funds
  • $411 per student for districts to spend on reform implementation
  • Grant program to fund innovations and measures such as longer school days
  • More funding for special education and gifted and talented
  • Increased flexibility for districts in local tax increases
  • Detailed reports required on spending and effectiveness

Funding for some parts of the bill may fluctuate depending on actual revenues, and many observers think additional legislation will be needed to fine-tune the bill.

Legislative staff analysis

How at-risk funding works

Every district would receive at least 20 percent of the statewide base per pupil amount for every at-risk and ELL student on top of the regular funding for that student

Districts whose populations have more than the statewide average of at-risk or ELL students (43.8 percent) could receive up to 40 percent of the base per pupil amount

The definition of at-risk is expanded to include students eligible for reduced-price or free lunches, not just free lunch as is the case now

Students defined as both at-risk and ELL would be given double weight

SB 13-213 would increase funding for charter facilities, but it doesn’t guarantee charters a share of local overrides. Instead, it only would require districts to negotiate override sharing with the charters they authorize. However, SB 13-213 would provide schools authorized by the state Charter School Institute with extra funding equivalent to a share of local revenues. District schools that couldn’t reach agreement on revenue sharing could move under the jurisdiction of the institute.

King served in both the House and Senate and has long experience in school finance and with charters. He’s the administrator of a Colorado Springs charter and recently started another school in Fort Collins.

The proposed new system “got it right for institute charter schools, and we didn’t get it right for the other charter schools,” he said.

The system proposed by SB 13-213 includes significant funding increases for districts with high percentages of at-risk students, which is determined by a student’s eligibility for free and reduced-price school meals.

That’s “not a good proxy” to determine whether a student is academically at-risk, King said, arguing that the drafters of SB 13-213 should have found a better indicator. He also said at-risk numbers often are underreported at charters. (Under the current finance system charters received at-risk funding based on the at-risk enrollment averages in their home districts. The new system would be based on actual enrollment of at-risk students at individual schools.)

King also criticized the SB 13-213 shift of funding to poor students in general. “There is more inequity in the new act than there is in the old act.” For instance, he argued, “It discriminates against Colorado Springs students” in favor of those in Denver.

Board member Elaine Gantz Berman, a Denver Democrat, challenged King, saying the new system “‘is the most aggressive piece of charter school legislation in the country. … I know it’s not perfect. There are a lot of compromises that were reached in this bill. I’m really surprised that the charter school issue is the basis of your opposition.”

Teacher pensions

Another panelist, Republican state Treasurer Walker Stapleton, sounded his familiar warning that the new education money will be swallowed up by the needs of the Public Employees’ Retirement Association pension system.

“Most of this money, in my opinion, is going to be eaten alive by unsustainable pension obligations,” he said. Stapleton is a persistent PERA critic and believes the system’s current assumption of an average 8 percent annual return on investments is unrealistic. If that percentage is reduced by the PERA board – something Stapleton advocates — the system’s projected unfunded liabilities will balloon, Stapleton believes, forcing the legislature to increase pension contributions by employers such as school districts.

“Anybody who tells you none of this money is going into the pension system, that’s just not true,” Stapleton said.

A66 supporters in the room seemed unconvinced. “I think this is an issue for another time and another place,” said Burnie Zercher, a Pueblo businessman who was on the panel in support of A66.

Differences over equity

Later in the hearing, board chair Paul Lundeen picked up King’s theme of inequity, wondering why at-risk students in Jefferson County would receive less per-pupil funding than those in Denver Public Schools.

Damion LeeNatali, an official of the Colorado Commits to Kids campaign, noted, “the current school finance act redistributes funds among districts” and also defended SB 13-213’s concentration of funding in districts with the highest percentages of at-risk students.

“The higher concentration of at-risk students you have in a district the more it costs to educate those students.” (LeeNatali is on leave as chief of staff for Denver Democratic Sen. Mike Johnston, the author of SB 13-213.)

Other panelists included Superintendent Michael Clough of the Sheridan Schools, who supports A66, and Christina Fogler, an administrator at Rocky Mountain Classical Academy, who opposes it.

The State Board, whose members are split on A66, isn’t taking a position on the measure and doesn’t meet again until after the election.

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