Report: Charter Schools an Expensive Proposition for MNPS

A report by a third-party group commissioned by the MNPS School Board finds that the rapid growth of charter schools in Nashville is having a negative financial impact on the district.

The report, prepared by MGT of America, notes:

“… it is clear that charter schools impose a cost on MNPS – both directly and indirectly.  It is also clear … that the loss of operating funds caused by the transfer of revenue cannot likely be made up through a reduction in capital or facility costs.  Therefore, approving future charter schools does potentially meet the “bar” described in  Tennessee Code Annotated 49-13-108(b) which encourages local boards of education to consider fiscal impact in determining whether new charter schools may be “contrary to the best interest of the pupils, school district or community.”  From this analysis, new charter schools will, with nearly 100 percent certainty, have a negative fiscal impact on MNPS:    

They will continue to cause the transfer of state and local per student funds without reducing operational costs. 

They will continue to increase direct and indirect costs. 

They will continue to negatively impact deferred maintenance at leased buildings. 

They may have an offsetting impact on capital costs, if they open in areas of need for increased capacity.

The report confirms what some have suspected: Continued growth of charter schools presents higher costs to the district than operating without such growth.”

That’s not to say that the report suggest MNPS should not approve future charter schools. The report makes recommendations for handling future growth of charter schools, including encouraging such growth in areas of the school system experiencing rapid student growth. The Board adopted just such a proposal earlier this year.

The recommendations for managing future growth include: Developing a process to identify and quantify indirect costs to MNPS, such as support services; establishing a separate fund to better account for direct and indirect costs; levying depreciation charges to charter operators leasing MNPS facilities; and identifying areas of the school district where charter school growth would help offset the need for MNPS capital growth and expenditures.

The study is likely to shape future discussions at the Board level about what direction future charter growth will take.

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MNPS Committee Recommends Charter Transparency

The Governance Committee of the Metro Nashville School Board met on Saturday and made recommendations for policy changes that will result in more financial transparency for all schools, including publicly-funded, privately run charter schools.

The changes require that private funds used to support a school be disclosed and that complaints about charter school operating procedures be handled in the same way as complaints about traditional schools are handled.

Board members who supported the change suggest that the new policy would lead to more transparency system-wide.

Board member Amy Frogge noted that the policy will allow for fiscal transparency and prevent potential financial mishaps.

For more, read Joey Garrison’s full story here.