Charter schools joined the usual suspects—tax reform, school funding, and Medicaid—as one of the most debated and well-publicized issues of this spring’s legislative session. If you’ve followed the issue, that probably doesn’t surprise you. After all, Governor Kasich, President Faber, and Speaker Rosenberger all announced their intentions early in the year to tackle charter school reform. The result was three strong pieces of legislation (House Bill 64, House Bill 2, and Senate Bill 148) that sought to improve the charter sector. When the legislature recessed for the summer, only HB 64, the state’s biennial budget bill, had passed. (HB 2 and SB 148 won’t be analyzed here, as they’re still pending in the legislature.)
When Governor Kasich’s team rolled out HB 64, it contained a host of charter school reforms. The focus was on strengthening the Ohio Department of Education’s ability to oversee charter school sponsors. It built on the department’s recently implemented sponsor evaluation system and instituted a series of sanctions and incentives for sponsors in an effort to drive improved student achievement at the school level. The proposal also included a series of what could best be categorized as “good government” reforms like eliminating conflicts of interest, increasing transparency, and strengthening the independence of charter school governing boards. Finally, the bill also addressed some of the funding disparities afflicting charter schools.
Of course, it’s not how a bill starts that matters, but how it finishes. The House decided to remove most of the substantive charter school reform measures from the budget bill and place those with which they agreed in their standalone charter school legislation (HB 2). The House was right to focus on charter policy in a separate bill where the proposals could receive thoughtful and deliberate consideration and deal with charter fiscal issues in the state budget. (This type of deference to the single subject rule is rare and commendable.) More pruning of HB 64’s charter provisions occurred in the Senate and in conference committee.
Now that the dust has settled and HB 64 has been signed into law, let’s take a look at how it will affect charter schools.
On the funding side, the base per-pupil allocation for charter school students (matching the increase for district students) was increased from $5,800 in the current fiscal year to $5,900 in FY 16 (an increase of 1.72 percent) and $6,000 in FY 17 (an increase of 1.69 percent). While it doesn’t address the tremendous funding disparity (charters receive 22 percent less funding statewide and around 40 percent less in some urban areas) that Ohio charter schools face, it’s desperately needed given the relatively low per-pupil funding amounts received by charters. Another funding provision, tied to the governor’s efforts to incentivize high-quality sponsors, allows local school districts to include charter schools whose sponsors have been rated “exemplary” in local tax levy requests. It’s conceivable (but unlikely given the poor relationship between many school districts and charter schools) that some districts looking holistically at the need to create high-quality seats will avail themselves of this provision and partner with top charter school networks (much like what has happened in Cleveland).
The funding inequity that charter schools face in general operations is exacerbated by the lack of adequate facility funding. The budget took significant action to address some of these challenges, particularly for high-performing charter schools. First, it increased the per-pupil facilities funding for all charter schools from $100 in FYs 14 and 15 (which was the first time that charters had received any per-pupil facilities funding) to $150 in FY 16 and $200 in FY 17. The bill also provided, somewhat paradoxically, $25 per pupil to online charter schools for “assistance with the cost associated with facilities.” This is the first time that Ohio has provided facilities funding for online charter schools. The funds will likely be used for costs tied to the physical locations needed to conduct student testing.
High-performing charter schools benefit on the facilities front from HB 64 in a couple of ways (“high-performing” is defined as schools with an A, B, or C grade on the state’s performance index and an A or a B in value added). First, they are able to apply for facility support from a newly created $25 million funding pool. In addition to being high performing, applicants will need to provide matching funds on a one-to-one basis. This requirement has the potential to leverage business, community, and philanthropic sources in support of improving charter school facilities. In addition, while charter schools already get the right of first refusal when districts make unused facilities available, high-performing charters will now get first priority among charter applicants. While this development is likely to be accompanied by some controversy, a strong case can be made that a limited resource—like an unused public school building—should be allotted based upon merit rather than random chance.
HB 64 also included a few miscellaneous charter-related provisions worth noting. First, charter schools that are high-performing or have an exemplary sponsor have the option to provide pre-K services. In the past, Ohio charters haven’t been able to serve students before they reach kindergarten. (Of course, according to this new report, neither have many other states.) This could provide better pre-K options for Ohio’s youngest students. Second, the bill creates a task force to study and make recommendations around transportation issues for traditional public schools, public charter schools, and private schools. Transportation is an issue that continues to be a sore spot for every type of school, so progress on this front could benefit all sectors. Finally, the bill requires the Ohio Department of Education to conduct a feasibility study on establishing charter schools around the state that are focused on gifted education. As longtime champions of gifted education, we feel that this is an idea worthy of consideration—especially at a time when tens of thousands of students who are identified as gifted aren’t provided gifted services by the traditional public schools they attend.
All in all, HB 64 should make it a little easier for all charter schools to make ends meet, and much easier for high-performing charter schools to secure and fund facilities. Now that the fiscal challenges faced by charter schools have begun to be addressed, it’s time for the governor and General Assembly to turn their attention to the unfinished business of substantively improving Ohio’s charter policy environment. Only then can Ohio begin to rebuild its charter school reputation.
 Based upon the 2013–14 state report card, there are forty-five schools serving 14,874 students that would meet the “high-performing” definition.