Testimony by Rick Pressler before the senate budget committee for FY16, March 25, 2015

Note: This testimony was also presented to the Assembly Budget Committee on March 24, 2015.

Good afternoon Chairman Sarlo and members of the Senate Budget  and Appropriations Committee.  For the record my name is Rick Pressler, Interim President & CEO of the NJ Charter Schools Association (NJCSA).  I appreciate the opportunity to appear before you today on behalf of the 87 public charter schools in New Jersey, the 40,000 students attending those schools this year and the 20,000 households that are currently sitting on waiting lists for public charter schools.

Charter school students, as a community, have amassed a remarkable level of achievement over the past 19 years. A recent study by the Center for Research on Education Outcomes (CREDO) at Stanford University, one of the most respected sources for research on educational outcomes, found that while many urban charters throughout the country are doing a remarkable job advancing student achievement, this is nowhere more evident than right here in Newark, New Jersey. Our own research indicates that charters have substantially closed the achievement gap statewide between Black and Latino students and White and Asian students.  On the NJASK, they have eliminated 20% of the gap in Language Arts and 36% of the gap in Math over the past five years. On the HSPA, they have eliminated 34% of the gap in Math and 80% of the gap in Language Arts over the past five years. This is especially noteworthy since 67% of the students attending charter schools are considered disadvantaged based on their eligibility for free and reduced lunch (compared to 37% across the state).

Charter schools have provided a much needed alternative to families who are desperately seeking better public education opportunities, especially in New Jersey’s urban districts, but in rural and suburban communities as well. The demand far exceeds our schools’ capacities—there are over 20,000 students on waiting lists—and we cannot afford to lose any of our existing high performing schools. But this is exactly what is threatened by the large inequity in the way charter schools are funded.

The Charter School Act of 1995 guarantees charter school students 90% of the per pupil funding provided to their sending district peers.. In practice, charter students receive anywhere from 59% to 90%–and an average of just 69%– depending on their district. The chief culprit of this inequity is state adjustment aid and its several variations. By labeling state aid to school districts “adjustment aid,” the current state education funding scheme has effectively prevented charter school students from receiving their fair share of a significant source of educational funding. The following table summarizes the various aid categories provided to school districts and indicates where charter schools are excluded:

District Aid Type Charter School Aid Received
Equalization Aid 90% of per pupil Equalization Aid
Special Education Categorical Aid 90% of per pupil Special Education
Speech Only 90% per pupil Speech Only
Local Levy + CPI 90% of per pupil Local Levy + CPI
Security Aid Security Aid
Preschool Aid (where applicable) Preschool aid (where applicable)
Adjustment Aid DO NOT RECEIVE
Additional Adjustment Aid DO NOT RECEIVE
Educational Adequacy Aid DO NOT RECEIVE
School Choice Aid DO NOT RECEIVE
Per Pupil Growth Aid DO NOT RECEIVE
PARCC Readiness Aid DO NOT RECEIVE
Under Adequacy Aid DO NOT RECEIVE
Transportation Aid DO NOT RECEIVE
Debt Service Aid Type 1 & 2 DO NOT RECEIVE

 

This missing adjustment aid represents the most significant source of the funding inequity charter schools are facing and drives significant per pupil funding disparities. For example:

Sending District District Budget Per Pupil Charter Average Budget Per Pupil (%)
Camden $20,793 $13,431 (65%)
Jersey City $18,119 $10,621 (59%)
Trenton $16,951 $13,789 (81%)
East Orange $19,261 $13,156 (68%)

 

On top of disparities caused by state adjustment aid, charter school students are the only public school students in the state whose schools are not eligible for the billions of dollars in facility aid that has been provided to district schools over the past several years. Facility costs currently consume on average about 14% of a charter school’s operating budget—money that is sorely needed in the classroom.

These profound disparities affect the ability of charters to hire and keep experienced teachers, to provide the range of services and materials their students need and deserve; and it forces administrators and other staff to wear many different hats as they struggle to comply with virtually all the same regulations and reporting requirements as traditional school districts—with only a fraction of the resources.

Charter school founders went into business knowing they would receive only 90% of the per pupil funding that their sending districts received, and they knew they would have to do more with less. But the inequities have reached a point where we are concerned about the sustainability of our hardest hit schools, as well as the growth and sustainability of the charter school community. There is only so much financial pressure that individual schools can bear before it begins to affect their ability to provide the excellent education demanded by the Charter School Performance Framework.

As a state we are right to demand excellence from all our public schools; charter schools, in spite of their remarkable record of performance and their progress in closing the achievement gap, cannot grow and flourish without adequate support. The current state aid allocations represent a reduction in charter school per pupil aid of anywhere from 2% to 6% (after adjusting aid upward for projected favorable October 15 census weightings). Given that they are already receiving far less than their district counterparts, this only makes matters worse.

It is noteworthy that part of this reduction is fueled by a mysterious and sudden increase in the weighted enrollment of sending districts such as Newark, Jersey City, and Trenton. The Department of Education has indicated that charter schools would receive flat funding based on 2014 funding levels—however, through some unexplained recalculation, district weighted enrollment levels for 2014 have been retroactively increased, effectively reducing the charter school’s per pupil allocation. For example, charter schools in Trenton received $9267 per pupil in 2014, but only $8119 in 2015-2016—even though the state has claimed “flat funding” based on 2014 levels. This is $1148 per pupil reduction represents over a 12% decrease to the charter school.

Projected Charter School Aid Loss Resulting from
Current Revisions to Fiscal Year 2013-14 Weighted Enrollment

  Charter School Aid for 2015-16 uses maximum  of these two columns (maximum is bolded)  This column represents aid loss based on current DOE projections
District 13-14 Per Pupil Aid (Enrollment) Calculated in 2013 13-14 Per Pupil Aid (Enrollment) Calculated in 2015 15-16 Projected Aid (Enrollment) Calculated in 2015 Per Pupil Aid Difference (% Different)
Newark $10,306 (59,992) $9,356 (66,081) $8,187 (75,821) -$950 (-9.2%)
Jersey City $7,520 (41,336) $6,912 (45,004) $6,675 (46,875) -$608 (-8.1%)
Trenton $9,267  (18,826) $8,119 (21,488) $7,847 (22,202) -$1148 (-12.4%)
Sources:
BUD Page, line item H from 13-14 Newark/Jersey City/Trenton Aid Summary
BUD Page, line item H-1 from 15-16 Newark/Jersey City/Trenton Aid Summary

We understand the many pressures bearing on New Jersey’s budget, and we recognize that many schools and districts are facing resource challenges. We also know that charter schools have become an invaluable part of the public education framework, with a particular benefit to those most desperately in need of public education options.

We propose that the New Jersey State Assembly incorporate measures in the 2016 budget to mitigate the disparities in per pupil funding for charter schools by providing direct state funding to those charter schools most drastically affected by the funding inequities resulting from adjustment aid to school districts. By focusing on those schools most severely affected—in Jersey City, Asbury Park, Trenton, Camden, and elsewhere—we can allocate our precious education dollars to those places where charter students are facing the greatest disparity in funding.

We should value New Jersey’s fine public charter schools as an important lifeline for thousands of students, and we should ensure they remain viable. This can only occur if we meet our obligation to provide charter schools and their students with a true 90% of the funding received by their sending districts. The current system treats charter public school students as less deserving of adequate funding than their peers in district public school. Such an arrangement is inherently unfair, and does meet the spirit of the visionary Charter School Act of 1995.

Testimony by Rick Pressler before the senate budget committee for FY16,