The State has not been shy in its efforts to expand the number of privately-
operated charter schools. This is evidenced by the 101 new charter campuses currently approved to open and SB 1882 that provides financial rewards and reduced academic accountability requirements to school districts that turn campuses over to privately-operated charters. With over 500 school districts rated “Exemplary” (A) or “Recognized” (B) and with school districts operating 95.8% of the highest rated campuses, it is noteworthy that the incentives within SB 1882 excludes partnerships with high-performing school districts. There is no data available to consistently support that privately-operated charters better serve students or that they are better equipped to improve student learning at low performing campuses. Since inception, TEA documents that 108 Texas charters have closed. In addition, 2 of the most high-profile examples of charters engaged to improve student learning at low performing schools have been unsuccessful.....

THE NEGATIVE FINANCIAL CONSEQUENCES OF STATE APPROVED CHARTERS – IMPACT TO SCHOOL DISTRICTS:
With the State authorizing privately-operated charter schools to serve existing school district students, there are negative financial consequences to school districts and taxpayers. First, the revenues of a school district decline by an average of approximately $6,600 for each student transferring to a State approved charter school. Second, a school district is unable to proportionately reduce its existing operating costs as students transfer. For example, the existing fixed costs of a school district for building maintenance, debt service, food service personnel, administration/campus leadership, utilities, student transportation, etc. remain highly unchanged. In addition, to maintain acceptable student/teacher ratios at each campus, a school district can only marginally reduce teacher staffing as students transfer from various grades and numerous campuses. The May 2018 report entitled “Breaking Point: The Cost of Charter Schools for Public School Districts” reviewed the net cost of charter schools in 3 California school districts. Published by “In the Public Interest” and written by Gordon Lafer, Ph.D., the report concluded that school districts incurred a net cost of $5,000 – $6,600 per charter student. The report also cited other studies that portrayed a net cost of $3,136 – $6,701 per charter student. Assuming a net cost of $4,000 per charter student (which is at the lower end of the studies), the State’s dual education system has forced school districts to annually absorb $1.32 billion of existing costs.

IMPACT TO TAXPAYERS:
Charter schools are funded at the statewide average and are projected to receive public funding of approximately $9,600 per student (refined average daily attendance) or $2.85 billion in 2018/19. Comparatively, the revenues of a school district decline by an average of approximately $6,600 for each charter student transfer. Based upon this difference, the “money does not totally follow the student” and the result is that privately-operated charters increase the cost of taxpayers an estimated $892.4 million per year. The Legislative Budget Board (LBB) has previously acknowledged the savings that would accrue if the funding difference between charters and school districts was amended. While an estimate based upon certain assumptions, the LBB indicated a potential savings of $882 million per biennium if charters were funded at the lesser of: the current statewide average or the funding level of the school districts they operated within.

STATE FUNDING AND LOCAL SCHOOL DISTRICT TAXES:
With rising school district property values resulting in higher local taxes, it is reasonable for taxpayers to question why school districts have not imposed lower tax rates. The answer is the State has taken the opportunity to reduce its percentage cost of the dual education system by using rising local property values to transfer the cost to local taxpayers. As shown in the table below, since 2010/11 local property values and school district property taxes have increased by 49%-51% and the net State funding to school districts has declined by 3%. During the same time that local property taxes have increased, the funding of charter schools and school district recapture payments paid to the State have both increased by over 150% or a total of $5.6 billion per year.