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Charter School Funding

March 21, 2022
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WRITTEN BY Dr. Alan Moss

Executive Summary 

Charter schools in Missouri are considered public schools because they are publicly funded, though they are privately managed and have more flexibility in their curricula and administration than traditional public schools (district schools). They are also funded differently from district schools and are not eligible for some forms of local public funding. Introduced in the 2022 legislative session, HB 1552 would require public school districts to allocate charter schools a proportionate share of local and state funding based on the number of pupils enrolled in the charter school. 

Highlights 

  • Currently, funds for charter schools in Missouri are provided by the Missouri Department of Elementary and Secondary Education through state funds withheld from the school district where the charter school is located.
  • Traditional public schools can use local bonds to pay for new school buildings and upgrades and use local tax levies to pay for maintaining facilities while charter schools cannot.
  • As charter school attendance rises, the amount of local funding designated for charter schools can exceed the amount of state funds that are withheld from traditional district schools, resulting in underfunding.
  • Some of the fixed costs associated with educating students (e.g., pensions, debts, maintenance, and administrative staff) cannot be easily or quickly reduced by school districts after students transfer from public district schools to charter schools.

Limitations 

  • Regulations in how charter schools are funded vary significantly from state to state. Differences in state regulations make broad analyses of funding methods and their efficacies difficult.
  • One North Carolina study found that the negative fiscal impact on district schools from charter schools transfers was about $3,600 per student that transferred out. Because of differences between charter school funding mechanisms, it is difficult to predict if similar trends exist in Missouri.
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