The charter schools and Arizona Charter Schools Association allege the department plans to withhold funds from schools to offset overpayments in fiscal years 2011 and 2012.
The overpayments were made during an effort to make up for years when the Classroom Site Fund was underfunded. The fund was created by Proposition 301, a wide-ranging K-12 spending measure.
The charter schools claim in the lawsuit, filed in Maricopa County Superior Court Friday, the department is going to withhold funds for the next five years, which will leave schools having problems hiring teachers, paying for raises and covering routine maintenance.
The charter schools claim $5.89 million is at stake.
The Joint Legislative Budget Committee calculates how much to put into the fund every year based on student enrollment, and the department is in charge of disbursing the money.
The charter schools and department agree that the calculations for 2011 and 2012 were based on enrollment for those respective years, but the department claims it should have doled out money based on enrollment during the years of the shortfall.
Stacey Morley, director of policy development and government affairs for the department, said in an email she couldn’t respond in detail to the allegations because she hasn’t reviewed the lawsuit, but she provided a written summary of the issue.
“By distributing revenues in this manner, districts and charter schools with increasing counts or which did not exist during FY 2006 through 2010, were inadvertently given amounts they were not due,” the summary read.
School districts and charters with increased student populations got about $6 million in overpayments while schools that lost enrollment were underpaid by about $38 million, according to the department.
“[T]he Department does want to point out, all school districts and charter schools benefit from the Classroom Site Fund and any overpayment of funds which is not recouped reduces the amount available for all Arizona public schools,” Morley said.
The reductions are set to begin Aug. 1, the charters claim.
The charter schools allege the department didn’t give schools proper notification of the disbursement change as provided by law.
They also allege the department has violated the U.S. Constitution, the Arizona Constitution and the Voter Protection Act.
The charters are asking for the court to order the department to continue to use current enrollment levels to base disbursements to schools.