Photo: Andrew Reed/EdSource
Oakland Unified teachers and their supporters formed a picket line surrounding La Escuelita Elementary School on Feb. 27, preventing a school board meeting from taking place.

In his report on the Oakland teachers’ labor dispute, the chair of the fact-finding panel asserts that shortcomings in the state’s education funding formulas make it difficult to resolve the dispute (now a full-on strike).

Eric Premack

Najeeb Khoury channels arguments used by anti-charter activists, claiming that the “current system creates an unlevel playing field for traditional public schools and undermines those districts serving the very same disadvantaged children that charter advocates seek to aid.” A recent EdSource article extensively cites the report.

Actual facts paint a very different picture.

The fact-finding report first alleges that charter schools are enrolling so many low-income, high-need students that they reduce the concentration of such students in the Oakland Unified School District schools. Since the state’s funding formulas provide substantial extra funding to districts serving high concentrations (in excess of 55 percent) of such students, charter schools allegedly reduce the district’s funding at an “alarming rate” according to the report.

Let’s look at the actual facts. The California Department of Education’s 2017-18 data (the most recent data posted) show that charter schools in Oakland serve slightly lower proportions of low-income, high needs students than the district (77 versus 78 percent). Thus, Oakland’s charter schools actually slightly increase the proportion of high-needs students in the district along with the corresponding concentration-related funding the district receives under the state’s funding formulas.

It’s also worth noting that state funding formulas cap the amount of concentration-driven funding that charter schools may receive based on the lower of (1) a charter school’s own concentration of high-need students or (2) the district’s concentration. This is one of several significant ways in which state funding formulas ensure the playing field is tilted against charter schools, not in their favor.

The fact-finding report also alleges that charter schools saddle districts with so-called “legacy” costs, but offers no actual facts regarding such costs. The EdSource article and others have cited facilities maintenance, administrative overhead and pension costs as examples of legacy costs.

The fact-finding report did not mention that voters in Oakland have approved over $900 million dollars of school facilities bonds in recent years and that charter schools have no corresponding authority to tax property owners to pay for such bonds — again tilting the table in favor of the district and against charter schools.

While the Education Code requires school districts to share their facilities with charter schools on a “rent free” basis (plus maintenance costs), Oakland Unified has often flagrantly ignored these laws such that most of the charter schools in the district must obtain their own facilities, notwithstanding the many vacant classrooms throughout the district. The charter schools that do occupy district-owned facilities generally pay a pro-rata share of facilities maintenance, utilities and custodial/janitorial costs. These costs are levied based on Oakland Unified’s own computations.

It is also worth noting that most Oakland charter schools also participate in CalSTRS (the state teachers retirement system) and they pay exactly the same rates (currently a staggering 16 percent of payroll and set to increase to over 18 percent).

It is also incorrect to deem administrative costs to be “legacy costs.” By definition, “legacy costs” are those costs stemming from prior decisions that cannot be reduced today. Irresponsibly-high administrative costs hardly meet this definition and are instead a result of dysfunctional leadership. Instead of seeking to blame charter schools for false “legacy” costs, fact-finders should pin the blame where it belongs; on Oakland Unified’s dysfunctional board and administrative staff.

This dysfunction long predates the emergence of charter schools, continues today and is well-documented in the Fiscal Crisis and Management Assistance Team’s 2017 report finding that “leadership breakdown at the governing board and superintendent levels, including the board’s inadequate attention to signs of fiscal distress” are the actual root cause of Oakland Unified’s financial troubles.

Facts matter. If fact-finders and public education advocates really want to increase funding for teachers and improve outcomes for students, they’re going to have to stop scapegoating charter schools and begin to honestly identify the real issues plaguing California’s school districts.

•••

Eric Premack is executive director of the Charter Schools Development Center, which provides leadership development, advocacy and technical assistance on charter school issues.

The opinions expressed in this commentary represent those of the author. EdSource welcomes commentaries representing diverse points of view. If you would like to submit a commentary, please review our guidelines and contact us.

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  1. Brian Cavagnolo 4 months ago4 months ago

    Can you advise how you arrived at the claim that charters serve 77% high needs and non-charters serve 78%? The data in the table that you cite reports charter schools serving 10,124/13,135 = 77% "Socioeconomically Disadvantaged"[1] while OUSD serves 27,945/37,096 = 75%. This data actually refutes your contention. And it's pretty consistent for all the years published by the CDE. Anyway, the "alarming" statement in the fact-finding report is as follows: "Because funding is tied to attendance, … Read More

    Can you advise how you arrived at the claim that charters serve 77% high needs and non-charters serve 78%? The data in the table that you cite reports charter schools serving 10,124/13,135 = 77% “Socioeconomically Disadvantaged”[1] while OUSD serves 27,945/37,096 = 75%. This data actually refutes your contention. And it’s pretty consistent for all the years published by the CDE.

    Anyway, the “alarming” statement in the fact-finding report is as follows:

    “Because funding is tied to attendance, districts with high charter density rates are losing funding at an alarming rate even when they are concentration grant districts.”[1]

    This is not a claim that charter schools are taking concentration grant money away from non-charter schools. It is a claim that as attendance shifts from non-charter to charter schools, the district loses funding. And this is indeed happening. Here’s the data[2]:

    year, % charter
    17/18: 26.15%
    16/17: 26.02%
    15/16: 24.39%
    14/15: 22.84%

    This is the trend of concern in the face of “legacy costs,” which don’t scale down with student population. The fact-finding report does not claim that “charter schools saddle districts” with these costs as you say. It also does not classify any pension, facility, or administrative costs as “legacy.” I do honestly wonder what fits in this category. Maybe it’s insignificant. Or maybe it tilts the game in favor of charter schools. But it’s not clear from the fact-finding report or from your article.

    You claim that “state funding formulas ensure the playing field is tilted against charter schools, not in their favor” on the grounds that “state funding formulas cap the amount of concentration-driven funding that charter schools may receive based on the lower of (1) a charter school’s own concentration of high-need students or (2) the district’s concentration.”

    The obvious point of this policy is to prevent, say, a charter school serving an affluent population to secure funding meant for a low-income population. It also makes it possible for charter schools that serve concentrations of low-income students in otherwise affluent districts to access these funds. Claiming that this is a tilt against charter schools is a patently incorrect statement.

    It’s pretty clear from your tone and position that you are advocating for charter schools here. And this of course is not surprising considering the disposition of your organization. But you seem to be hiding your advocacy behind an incorrect presentation and interpretation of facts. That’s misleading by definition.

    [1] https://oaklandea.org/wp-content/uploads/2019/02/OUSD-OEA-Factfinding-Report-ocr.pdf
    [2] https://dq.cde.ca.gov/dataquest/dqcensus/EnrCharterLevels.aspx?cds=0161259&agglevel=district&year=2018-19&ro=y

    Replies

    • Eric Premack 4 months ago4 months ago

      Brian: I downloaded the actual data used by California Department of Education (CDE) staff to re-compute the district and charter schools’ funding for the 2017-18 fiscal year, the most recent year for which we have solid data, and re-created my own spreadsheet to check the figures I cited. I did discover a minor rounding error, but the point is the same. The apportionment reports that may be downloaded from CDE’s website show that … Read More

      Brian:

      I downloaded the actual data used by California Department of Education (CDE) staff to re-compute the district and charter schools’ funding for the 2017-18 fiscal year, the most recent year for which we have solid data, and re-created my own spreadsheet to check the figures I cited. I did discover a minor rounding error, but the point is the same. The apportionment reports that may be downloaded from CDE’s website show that CDE used 77.38 percent as the supplemental and concentration figure to compute Oakland Unified’s funding for 2017-18 (I had incorrectly rounded this up to 78 percent). The data also show that charter schools in Oakland served a student population consisting of 76.68 percent high-needs students (which I had rounded up to 77 percent). Either way, both show that the charter concentration factor is slightly lower than the district’s. I believe your method may exclude data from several charter schools located in Oakland whose petitions were denied by the district and later granted upon appeal by the county board.

      While the logic in the factfinding report leaves something to be desired, the use of the term “alarming” in the report does indeed strike me as alleging that charter schools are “taking” supplemental and concentration funding from the district. The central focus of the paragraph is on supplemental and concentration funding and it alleges that charter schools are “proliferating” in districts that receive such funding, etc. I was writing partially in response to Louis Freedberg’s February 19 article which also appears to interpret the fact-finding report in this manner.

      Even if the focus is on attendance as you believe, the data still doesn’t support the factfinder’s conclusions. During the four-year period you cite, for example, the Oakland district’s enrollment declined by only 527 students, or just 1.5 percent. This is hardly an “alarming” decrease, especially when spread over four years. During the same timeframe, charter school enrollment increased by 2,697 students, or 24 percent. Given these data, it seems likely that much of the growth in charter school enrollment was not the result of an “alarming” loss by the district, but rather because charter schools enrolled many students who otherwise might have already dropped out or moved to other districts.

      I have no problem with charter schools receiving less concentration funding when they actually serve lower concentrations of high-needs students. My intent was to be critical of the law that artificially caps charter schools’ concentration funding, which is reduced to the local district’s level if lower than the charter school’s actual data. This part of the formula serves as a disincentive for charter schools to serve high-needs students. Perhaps we can both agree that this feature of the formula is bad policy?

  2. Robert D. Skeels, JD 5 months ago5 months ago

    When you’re paid a staggering $175,040 a year [1] to promulgate misinformation and propaganda on behalf of the lucrative charter school industry.

    [1] Source: Charter Schools Development Center (CSDC) 2017 Form 990.

  3. Anais V-C 5 months ago5 months ago

    There are fair criticisms of charter schools and unfair criticisms. It's my understanding that Najeeb Khoury sourced data by using OEA's figures. It doesn't seem as though OUSD's Office of Charters verified charter costs vs. amounts paid by charters into the district. That said, a fair criticism is that most charters seem to pull out of the OUSD's Special Education Local Plan Area (SELPA) in order to run their own Special Education programming. I understand … Read More

    There are fair criticisms of charter schools and unfair criticisms. It’s my understanding that Najeeb Khoury sourced data by using OEA’s figures. It doesn’t seem as though OUSD’s Office of Charters verified charter costs vs. amounts paid by charters into the district. That said, a fair criticism is that most charters seem to pull out of the OUSD’s Special Education Local Plan Area (SELPA) in order to run their own Special Education programming. I understand that it’s tempting when OUSD’s SpEd services are lacking, but it’s hard for them to balance caseloads with limited funds and it impacts the greater good in a profound way.

    Replies

    • Eric Premack 5 months ago5 months ago

      Special education finance is a very complex topic and hard to address in the confines of a 750-word opinion piece, much less an electronic response, but here it goes . . . Long backstory here. Until several years ago, all charter schools in Oakland were required to function as an “arm of the district” and its special education local plan area (SELPA) for purposes of special education. In such cases, California's charter … Read More

      Special education finance is a very complex topic and hard to address in the confines of a 750-word opinion piece, much less an electronic response, but here it goes . . .

      Long backstory here. Until several years ago, all charter schools in Oakland were required to function as an “arm of the district” and its special education local plan area (SELPA) for purposes of special education. In such cases, California’s charter laws deem the district responsible for providing services to special needs students in charter schools. In return, the district retains the special education funding generated by the charter students, and the district can (and generally does) levy a hefty additional pro-rata share of district-wide costs for serving special needs students.

      While the district was supposed to provide services to special needs students in such charter schools, it struggled to do so in practice. Worse yet, the district also required charter students with more severe, “low incidence” needs to transfer back to district-operated programs. This gave charter schools in Oakland an undeserved discriminatory reputation among parents of special education students. When the charter schools pressed the district regarding low-quality and discriminatory services, Oakland’s then-superintendent and staff encouraged the charter schools to leave the Oakland SELPA and join a then-new, charter-specific SELPA operated out of El Dorado County (another option under California’s charter laws).

      Most Oakland charters did leave. Per the district’s 2017-18 data, seven of the charter schools remain with the district for special education while 28 had shifted to a charter-specific SELPA. Those who remain must generally share in the district’s excess costs. There are frequent disputes over how to compute these costs and no objective methodology, especially in cases such as Oakland where the district’s costs allegedly are high due in part due to high needs, but also in part due to poor management leading to unnecessarily restrictive (costly) placement and legal battles.

      The charter schools that have left the district’s special education program generally bear the considerable financial risk of operating their own special education programs. In early years, charter school caseloads were relatively light and districts likely were left shouldering a disproportionate burden. Charter caseloads, however, have grown rapidly. I don’t have Oakland-specific data, but the EL Dorado Charter SELPA’s most recent available (2017-18) data show that special needs students constitute about 10.3 percent of the SELPA’s members’ total population (up steadily from 7.5 percent in 2010), which is very close to the Oakland district. Likewise, the incidence of high-cost, severe and low-incidence needs in charter schools (especially autism) is also growing rapidly and increasingly approximates districts’ counts. It’s entirely possible that the district does shoulder a heavier burden than do its charter schools, especially as it relates to preschool children, but any gap also likely has substantially closed and could easily swing the other direction in the near future.

  4. Dave Fendel 5 months ago5 months ago

    I would like the author’s take on Special Education costs? How many students with IEPs are being served by charters and of those how many are students with big cost services? How many students with Autism, medically fragile or other disabilities that require intensive services. How often are charters involved due process hearings and the costs associated?

  5. Mark LeBlanc 5 months ago5 months ago

    One point not raised in this report is the significant increase in staff and salaries at the admin level created by pro-charter superintendents like Antwan Wilson. There was a massive boost in hiring of Broad-trained consultants to drive up the approval of not only charters but the facilities land grab that created the district deficit. That is a drain on resources that won’t come up in the reports cited. Additionally the data provided is high … Read More

    One point not raised in this report is the significant increase in staff and salaries at the admin level created by pro-charter superintendents like Antwan Wilson. There was a massive boost in hiring of Broad-trained consultants to drive up the approval of not only charters but the facilities land grab that created the district deficit. That is a drain on resources that won’t come up in the reports cited.
    Additionally the data provided is high level but does not drill down into granular details on a per school basis. For example: which middle school charter has an autism or TACL curriculum? Which high school charter does? I know of not one. Which charter has a refuge program? Again, not one. Yet Montana and Edna Bruer have autism programs and thus suck up most students in the district while Bret Harte pulls significantly from the refuge and sanctuary populations. I see cherry picking from certain data points to support a position here, not true investigation into the guts of the issue.

  6. Hakeem 5 months ago5 months ago

    Great read. As a parent in Oakland that have kids in both district and charter schools, I appreciate the facts being brought out.

  7. Johanna Graf 5 months ago5 months ago

    Well said, Eric.
    Thank you for the facts.