Pennsylvania state lawmakers are looking to revise a funding formula that reportedly allows the state’s 12 cyber charter schools to pocket more money than their expenses–a formula that has been sore spot with school districts since it was implemented in 2000.

Parents of cyber-school students do not pay tuition. Rather, the public school district where the student lives pays tuition with state and local tax money through a state formula.

State Rep. Jess Stairs, who chairs the House Education Committee, said he will hold hearings this year to review the equation.

“We have to make sure [these schools] are not making a windfall off the people of Pennsylvania. The districts should be billed on what the actual costs are,” Stairs, R-Westmoreland, told the Pittsburgh Tribune-Review for a story in December.

Officials at Pennsylvania’s cyber schools say changing the formula will hurt their more than 10,000 students. But public school superintendents counter that the formula hurts their students, too.

Students who attend cyber schools are linked to their classrooms via computer. Cyber schools do not incur costs for transportation and athletics, and they do not need to maintain large school buildings.

Operators of cyber schools have acknowledged that the fees they receive under the state formula are “many times larger than the cyber schools’ actual costs,” according to Thomas J. Gentzel, executive director of the Pennsylvania Schools Boards Association (PSBA).

Nick Trombetta, who serves dual roles as chief administrative officer of the Pennsylvania Cyber Charter School in Midland, Pa., and superintendent of the Midland Borough School District, doesn’t dispute that.

“We create jobs and opportunity,” he said.

The Pennsylvania Cyber Charter School expects $30 million in tuition revenue this year for 4,500 students in Pennsylvania and another 3,000 students in Ohio, New Mexico, and Arizona, said Trombetta.

The school receives $5,409 to $15,204 per student, based on tuition in the student’s home district. That tuition money is helping to finance a $23.5 million performing arts center along Midland’s main street.

Such an investment proves “that these folks are making dollars hand over fist,” said Tim Allwein, PSBA’s assistant executive director.

In 2001, PSBA challenged the legality of the state’s cyber charter schools in court, arguing the schools were educating mostly home-schooled children at the expense of local school districts.

The court dismissed the case, but it handed the state’s school districts a partial victory by saying districts should have the opportunity to question tuition bills sent to them by cyber charter schools. Similar lawsuits also have failed in Wisconsin.

In 2002, Pennsylvania passed a law to partially reimburse the state’s school systems for per-pupil funding lost when students enroll in alternative schools. The law also transferred authority for the establishment, evaluation, and renewal of cyber charter schools from local school districts to the state education department, thereby tightening accountability for the online schools.

The Freedom School District in Beaver County, Pa., pays between $40,000 and $60,000 a year for students to attend various cyber schools, Superintendent Ronald Sofo said.

“Many of us are sending more money to these schools than what it costs to educate the students,” he said. “Local taxpayers should be outraged that local tax dollars are flowing between school districts this way.”

But the schools are growing in popularity.

In Lancaster County, Pa., the Columbia Borough School District saw cyber school costs increase from $18,000 in 2001-02 to $116,000 last year, said business manager Laura Cowburn.

And in Chester County, Jim Hanak, chief executive officer of the Pennsylvania Leadership Charter School, said he expects enrollment to double next year–to more than 2,400. The school opened in September with 340 students.

“We built the better mousetrap,” he said.


Pennsylvania General Assembly

Pennsylvania Schools Boards Association