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Senate president moves to cut money for district charter schools

Arizona Senate President Andy Biggs (Photo by Evan Wyloge/Arizona Capitol Times)

Arizona Senate President Andy Biggs (Photo by Evan Wyloge/Arizona Capitol Times)

A threat from Arizona’s Senate president to make sweeping changes to how district-sponsored charter schools are funded came closer to reality March 25 and threatened the passage of a budget in the House.

The Senate Appropriations Committee voted 5-4 to prevent the charter schools from having access to districts’ K-12 education funding, including money from bonds and overrides that allow districts to exceed their budgets. The bill, SB1494, involves converted public schools that answer to governing bodies in each school district.

Senate President Andy Biggs, who sponsored and introduced the bill on March 24, said it would end what he called an inequity in per-pupil funding that creates an advantage for students at district-sponsored charters. They received roughly $1,200 more per student than public K-12 schools in fiscal 2014, according to estimates by the Joint Legislative Budget Committee.

Biggs initially pushed for a rollback of $33.3 million in funding from the program in fiscal 2015, but as of late March 27, it appeared the House had struck a budget deal that kept funding for the program intact — at least for the next fiscal year.

But Democrats and school officials said Biggs, R-Gilbert, was attacking classroom innovation and the push for school choice that Republican lawmakers frequently tout as the key to student success in Arizona.

Chuck Essigs, a lobbyist for the Arizona Association of School Business Officials, said, “It’s ironic that it seems the Legislature always touts choice and wants parents to have different options and different programs, and here’s an example where districts are providing additional choice.”

A small coalition of GOP representatives has made the funding for charter conversions a sticking point in negotiations with House Speaker Andy Tobin, who canceled votes on a budget for the second consecutive day March 25.

District-sponsored charters have access to charter school assistance funds, in addition to the district’s local K-12 funding.

“That means that everybody else in that district, every other pupil in that district, is treated differently,” Biggs told the Arizona Capitol Times. “They are getting a proportionately lower share of the funding because that money’s earmarked. If you want to be a charter school, you ought to experience the same restraints that regular charter schools experience.”

Funding for the 59 schools that converted to charters in fiscal 2014 required a $33 million supplemental appropriation and will continue to require $33 million appropriations for the next three fiscal years, Biggs estimates.

That’s a total of $142 million for those schools, and that doesn’t include additional funding the program may require if more school districts seek to take advantage of the extra funding available to district-sponsored charters. Biggs projects another $343 million in funding will be required to cover growth at existing district-sponsored charters and future conversion efforts.

Punishing schools for being creative

Senate Minority Leader Anna Tovar said it was ironic that GOP lawmakers were now seeking to punish schools for finding a creative and completely legal method to increase funding for some schools when lawmakers have spent the last several years cutting money for K-12 education by roughly $3 billion.

Stacey Morley, a lobbyist for the Department of Education, said she understands why districts are reaching for funds by converting public schools to charters. It was a little-known tactic until 2012, when districts in Vail and Cave Creek took advantage of the opportunity to increase per-pupil funding. Dozens of districts followed in 2013, and Morley expects more to do the same.

Biggs denied that recent lawsuits related to inflationary funding for K-12 education — school districts have claimed they’re owed roughly $1.2 billion in unpaid state aid — have anything to do with the schools’ efforts to convert to charters.

But Morley said the lawsuits over unpaid state aid played a part in each district’s decision.

“They’re afraid they’re never going to see that money again,” Morley told the Capitol Times.  She added, however that “it’s a short-term solution to a long-term problem.”

Rolling back money

Though Biggs acted swiftly to introduce and move the bill through committee, the Senate president insisted that his preference is to deal with district charter conversion as he proposed in the budget deal that left his chamber last week. That includes a $33.3 million rollback in funds for any district school that converted to a charter after July 1, 2013 — a direct threat to the 59 schools that recently converted.

“They could keep the money for this year, but they couldn’t go on being a charter school. They’d go back to being a district school,” in fiscal 2016, Biggs said.

Biggs said rebukes the Legislature has heard over a perceived “attack” on K-12 education is misleading. At the very least, sponsoring the bill helps get out the message that the Legislature is providing new funds to schools — roughly $200 million in new dollars in the budget he has proposed for fiscal 2015 — while seeking to secure the state’s financial future, he said.

Biggs lamented that a moratorium on district charter conversions, which he proposed in last year’s budget, was removed by a coalition of GOP lawmakers that also helped push through Gov. Jan Brewer’s Medicaid expansion against his will.

“None of those 2014 schools would’ve been able to convert, and you would’ve had fairness yet if, oddly enough, the Heather Carters of the world that fought to pull the moratorium out of the budget last year (had left it in),” Biggs said. “So now you end up with this mess that they’re claiming is unfair to stop.”

Biggs later added, “They don’t want to believe the reality of the fiscal picture. So they can dream about ice cream sundaes with whipped cream and cherries on top. But the reality is some of us have to say, ‘well here’s what the money is. This is what we have fiscally. And here’s what we need to do.’”

Democratic pollster Mike O’Neil, president of O’Neil Associates, said Biggs’ frustration with “the Heather Carters of the world” — a jab at the GOP coalition in the House now holding up negotiations over his budget — reveals his true intentions: an effort to exact revenge on Carter.

Carter, R-Cave Creek, represents the Paradise Valley Unified School District that has shifted many of its schools to charters.

“It’s rather blatantly retributive,” O’Neil said. “It just so happens that most of the impact comes down in her district.”

Carter could not be reached for comment.

An apparent deal struck in the House late March 27 would restore the $33.3 million in funding Biggs sought to strike from the program, but keeps intact cuts of roughly $94 million in fiscal 2016 and $216 million in fiscal 2017, leaving the future of the program in doubt.

Use pliers, not a hand grenade

It’s doubtful Biggs’ legislative threat will gain traction outside his own chamber. The GOP House coalition that opposes his rollback, Carter included, would presumably also oppose his plan to alter how the charters are funded.

And Biggs faces steep opposition from school district leaders, such as Saddle Mountain Unified School District Superintendent Mark Joraanstad, who pleaded with lawmakers to not destroy a “beautiful hybrid system” for educating students in unique, innovative ways.

While Biggs is “drastically overestimating” the future fiscal impact of district-sponsored charters, no doubt there is an ongoing problem with how the schools are funded, Joraanstad testified.

But “rather than solve that problem with a hand grenade, solve it with pliers,” he said.

Members of the Senate’s Appropriations Committee also cried foul over districts using charter assistance funds, which are earmarked for the district’s charter schools, to fund education at public schools.

Morley, the Department of Education lobbyist, described the laws governing the use of district-sponsored charter school funds as a legally gray area. The statutes date back to 1995 and interpretations of their application vary.

Joraanstad said Saddle Mountain keeps district and charter dollars segregated, but he keeps some of the dollars earmarked for charters in a small contingency fund. He unapologetically admitted that, given the right dire circumstance, he wouldn’t hesitate to use those contingency funds.

That move wouldn’t be necessary if the Legislature provided even minimal funding for schools, Tovar said.

“We talk much about providing choice and the best for our students,” Tovar said. “Well, providing a world class education system involves the proper amount of funding.”

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