This brief by the National Alliance for Public Charter Schools and the National Center for Special Education in Charter Schools offers “the most comprehensive analysis to date” on what is a very convoluted topic—special education funding in charter schools. Drawing from a review of state funding laws, websites, documents, and interviews with key stakeholders, the authors present their findings in several parts.
First, “Getting Lost While Trying to Follow the Money” (apt title, by the way) offers a primer on special education funding. Understanding the flow of special education dollars requires a grasp of overlapping federal, state, and local funding streams, which the brief outlines effectively. Readers learn the history of IDEA Part B, the ins and outs of the “maintenance of effort” requirements, and instances in which schools can qualify for Medicaid reimbursements. The report also describes the types of state funding formulas used. Ohio is one of nineteen states with a weighted funding formula (i.e., special education funding is based on the severity of a student’s disability, type of placement, and overall need). The vast majority of charters can’t access local funds (in Ohio, a handful in Cleveland can). Thus, if their special education costs exceed the categorical amount they receive from the state, they lack the flexibility afforded to district schools—which can draw from local reserves, raise taxes, or reallocate their budget accordingly.
The brief also explains how a charter school’s legal identity (as its own Local Education Agency or not) has major implications on its finances and programs. Charter schools that operate as their own LEA (as in Ohio) experience greater curricular, HR, and programmatic freedoms when it comes to spending state and federal special education dollars, but they are still “wholly responsible” for giving students with disabilities the full array of services (including a continuum of alternative placements) expected from a multi-school district. To mitigate the associated costs, some states give charters access to special support funds from the state, or allow them to contract with school districts, other service providers, or join a special education cooperative (which more states should allow). In some states, having a “partial” link to an LEA is beneficial for exactly this reason—the full cost of educating students falls to the charter school, except for students requiring private or residential placement. On the flip side, charters that operate as part of an LEA benefit from shared services like transportation or legal counsel, and if a student requires private placement, the financial cost falls on the district. But they are restricted programmatically and financially.
Next, the report takes a deep-dive look at three states (Arizona, Colorado, and New York). These case studies are meant to illustrate the complexity of each state’s special education funding landscape, the impact of charters’ legal status (LEA or non-LEA), and the particulars of various formula models. It also explores the various strengths and weaknesses associated with each, though the authors readily admit that “absent a more in-depth and representative analysis…we cannot assess which approach to funding special education in charter schools is ‘best.’” Finally, the brief provides a comprehensive fifty-state summary of special education funding practices and laws in the context of each state’s charter landscape.
The authors are absolutely correct when writing that “a high level of technical expertise is needed” by schools and advocates alike to ensure that charter schools receive their share of federal, state, and local dollars for special education. This brief is a valuable contribution toward building that expertise.
Source: Lauren Morando Rhim, Paul O’Neill, Amy Ruck, Kathryn Huber, Sivan Tuchman, “Getting Lost While Trying to Follow the Money: Special Education Finance in Charter Schools,” National Alliance for Public Charter Schools and National Center for Special Education in Charter Schools (November 2015).
