Charters haven’t bled funds from Boston schools, study shows

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BOSTON Criticism that charter schools divert money away from Boston’s district schools obscures what has actually occurred, according to a study from an independent research organization, deflating a rallying cry used by opponents of expanding the number of the privately run, publicly funded institutions in the city.

But instead of charters, the biggest drain on Boston’s school budget is overcapacity and the district’s “failure to reduce seats in a timely manner,” a problem that cost the city at least $21.5 million in fiscal 2015 alone, the study from the Boston Municipal Research Bureau asserts.

“The true cost of charter expansion has not been a matter of revenue, but rather the struggle of eliminating excess capacity and rightsizing an urban school district,” the bureau said in its report. The assessment was posted to the nonprofit organization’s website Sunday.

The report was made public just days after leaders in the state Senate announced a legislative measure that would raise the cap on the number of charter schools allowed to operate in Massachusetts but requires a commitment from the Legislature to come up with a new funding agreement. Specifically, the bill would permit a 5 percent increase in the number of charters allowed over the next five years, starting in fiscal 2019, but only if lawmakers agree to fully fund a new seven-year, statewide public schools foundation budget formula. That agreement is expected to cost between $203 million to $212 million annually.

At the same time, a furious battle has been brewing between pro- and anti-charter crowds over a ballot proposal that, if passed in November, would lift the cap and allow for up to 12 new charter schools to be created annually, mainly in underperforming districts like Boston’s.

The bureau’s report also notes that Boston’s “current budget practices hold the BPS relatively harmless to the increase in the charter tuition assessment” and that for the current school year, the district’s “budgeted net school spending is $157.6 million above the net school spending required by the state to provide adequate education funding for Boston students.”

The study also showed that Boston school spending has risen each year since fiscal 2011, “despite a sharp increase in the charter tuition assessment over this period.”

For example, the report notes that Boston school expenditures rose from $821.4 million in fiscal 2011 to more than $1.01 million for fiscal 2016.

“The perception exists that the BPS has been negatively affected by the expanding charter tuition assessment,” the report states. “However the BPS expenditures have grown consistently despite growing charter costs due to the city’s budget practice that holds the BPS relatively harmless from the loss of general fund revenue.”

The study also quoted the results of a district-wide audit commissioned by the city which determined that more than half of Boston schools are under two-thirds utilized, with an enrollment of 56,650 and a capacity of 93,000 students, resulting in a student-teacher ratio of 11.6 to one.

“McKinsey & Co. estimated that if the BPS were to increase the student per teacher average to the peer average (which sits at 16.3), it could result in a reduction in the teaching workforce of roughly 1,300 teachers, resulting in a savings of between $90 million and $110 million,” the study notes. “School officials have disputed McKinsey & Co.’s potential savings estimate as overly optimistic.”

The bureau also says that Boston schools “must tackle the cost of excess capacity in order to eliminate the structural challenge in its annual budget.”

Read a copy of the report here: