from Pat Drago
Senator Gaetz and Representative Fresen are meeting this weekend to hammer out the education budget. I received a list of Representative Fresen’s proposals. It shifts $430 million in projected funding increases from local property taxes to the State. The new per student amount would be $7,178.49 and tops the 2007 level by about $52 per student. This is long overdue.
There are increases in specific areas and as much total funding as reported earlier.
The two new bills heard in the Senate Appropriations Committee today were not really new. Senator Gaetz collapsed a number of existing bills into two omnibus bills. The recess bill did not get included. The limit on capital outlay for public school facilities was included.
The second bill relates to early childhood education, open enrollment, dual enrollment, private school sports participation, and charter school accountability.
These bills move on next week. A lot of negotiation will happen between the House and the Senate. The specifics follow:
Do you wonder why I am so pleased about Sen. Gaetz’s bill? I will tell you a story. It’s an unbelievable story. Pat Hall, LWVF Education Chair for Hillsborough’s League wrote it after her investigation of CSUSA real estate practices. It’s a peek into another world.
Read it here.
Pat and I have wondered if we were whistling into the wind. Maybe, just maybe, people are beginning to hear.
Senator Gaetz is thinking about what is right. He and Rep. Fresen (HB 873) are squaring off over charter school funding for facilities. Both bills would reduce the amount of capital outlay dollars public schools can assess through local property taxes. According to the Miami Herald, Senator Gaetz’s bill would also crack down on ‘private enrichment’ schemes that charter management firms use to build and lease facilities for which they charge exorbitant rates.
For years, some legislators have tried to get part of the local districts’ school facility money. Now, they are trying again. In an effort led by Representative Erik Fresen, HB 873 has a new substitute version that would:
Money talks. This budget battle speaks volumes about what is important in the legislature this year. Everyone promises more money to education–sort of. The biggest issue is over how much of the increase local property taxes must pick up. Governor Scott allocates 85% of the increase to local communities. Senator Gaetz has expressed concern about the tax burden on local property taxes. He is suggesting a 50-50 split between the State budget and the local effort. There is likely to be about a $175 increase per student which will at least equal the 2007 funding.
This is how the money wars break down:
Governor Scott: $500 million increase with $75 million each for charters and public school facilities
House: $601 million increase with $90 million for charters and $50 million for public school facilities
Senate: $650 million increase with $ 50 million only for public schools
There is another battle brewing over funding for school facilities. As long as so many charters are run by for-profit companies, it is hard to be sympathetic to charter claims that they deserve more public money for their privately owned school buildings. Representative Fresen is leading the charge for facilities funding for charters this year. He is trying to discredit public school construction projects. He argues that the 650 charter schools should receive $90 million for facilities while the nearly 4,000 traditional public schools would receive only $50 million.
The fact that Representative Fresen’s wife and brother-in-law run Academica, the largest for-profit charter management firm with 100 schools, would not factor into his thinking, of course. You do remember that these large management firms have their own real estate companies that buy and/or lease facilities to the charter boards. Some of these leases are over a million dollars per year.
Are charter schools an emotional response by inner city low income families to long standing state funding inequities? A University of Virginia Law Review article addresses concerns that school funding inequities in Black urban areas lead to a tolerance of unfettered growth in charter schools.
The federal government support for charters also feeds the expansion without sufficient regulation. The net result may be a bubble and crash much like the recent financial crisis. What should be done to avoid a cataclysmic fall that could destroy communities?
Mother Jones summarizes the three practices that lead to serious mismanagement. I add a summary of the status Florida’s legislation to address these concerns.
Most of us are not aware of how management companies finance charter facilities. These companies form their own real estate companies from which they lease facilities. These charter school buildings are privately owned, and if the charter closes, the buildings remain with the management companies.
Many of these charter facilities are financed through long term revenue and other types of bonds. Funds from the charter operating budget, financed by state tax dollars, is used to make principal and interest payments on these loans. Building loans may be several million dollars, and lease payments are kept relatively small for several years. Then, as the bonds become due, the schools face large balloon payments. Where the money will come from is unclear. It may be another form of the construction bubble that burst in 2007.
These facility loan practices occur in many ways. In School Finance 101, Bruce Baker provides graphs showing how this debt is mounting on purchases of public buildings by private firms that were initially paid for by tax dollars and in other startling ways. However the financing occurs, the buildings are owned by private firms. The public pays for them. Some states have funding and financing guidelines. Florida does not.
Florida’s charter industry has received over $700 million in state tax dollars for facilities and capital expenses since 2000. The Associated Press analysis reveals that closed charters received over $70 million since 2000 just for their buildings. The money spent on closed charter facilities is lost. The facilities are owned privately.
Many small private operators rely on state capital outlay dollars that they receive in addition to the per student funding that both public and charter schools receive for operating schools. These funds, often called PECO (Public Education Capital Outlay) used to go to traditional public schools for renovation and maintenance. For the last several years, the legislature designated most of the PECO funds to charter schools. Districts feel the impact of the loss of funding as they try to upgrade aging traditional public school buildings.
Just to make the problem real, read a 2014 Ledger article from Polk County. Alachua County has had similar concerns. In today’s Gainesville Sun, Erin Jester reports that Alachua County received no PECO funds from 2011-2014, but its charter schools received over $163,000. The article lists losses of over $1.2 million due to the closure of seven of the county’s 21 charter schools.