Funding of Arizona’s public school system has been the topic of conversation for a number of years. There have been multiple claims of funding disparity specifically for students attending district schools versus charter schools.
Often, the funding formula is cited as the barrier to ensuring ALL public school students, district and charter, receive equivalent funding. Further, differences in school system structure are used as rationale for those per student variances between the two systems. As a longtime educator of over 34 years in Arizona, I believe it is important to note that while the
funding formula can be different to address with differing structures of charter schools versus district schools, they should be equivalent and transparent. Each child in the public school system should have adequate funding, no matter the choice of school system. The purpose of this op-ed is to highlight some of the differences between the funding formula and resulting variances in per student funding between district and charter school systems.
First, I want to address the funding formula. The formula has been the target of blame for disparate funding across the public education system in Arizona. Recently, Jake Logan asserted in his
May 24, 2024, op ed that in his opinion, the funding formula has resulted in differences in funding between district and charter schools. I disagree. I do not believe the issue lies with the formula. In fact, researchers have concluded Arizona’s school funding system is not bad. Education Week’s Quality Counts Report gave Arizona a B+ on funding equity and the Education Law Center’s Making the Grade Report gave Arizona a C. However, both studies gave Arizona an F for the level of funding provided. The US Census Bureau ranks Arizona 49
th in funding for education. Therefore, the funding formula is not the problem as Jake Logan asserted the problem is the inadequacy of funding.
Noting some key differences in the systems will illuminate the challenges of truly seeing the disparate funding between district and charter systems.
The Charter Association claims that charter schools are financially disadvantaged because they lack access to local property taxes. This assertion overlooks a critical aspect of how charter schools receive a charter additional assistance as part of their state funding to offset the lack of local tax revenue Further, charter schools are able to access additional financing, including bonding opportunities through the Local Initiatives Support Corporation. Phoenix IDA pursuant to the Industrial Development Financing Act and the Charter School Stimulus Fund are two additional avenues to secure additional funding, with the state financially backing the significant debt of charter schools.
The argument that charter schools lack access to the Teacher Experience Index (TEI), which benefits districts because TEI is used to address the higher costs associated with retaining experienced teachers, is a valid concern given the vital role experienced teachers play in student achievement. However, some charter schools have determined not to invest in their educators by forgoing entry into the state retirement system. District school systems are responsible to pay into the Arizona State Retirement System for every staff member in their system. Charters have a choice to participate in the system, but the majority do not. Currently that represents a 12.29% withholding from every staff member in the district school system and a matching expense to school districts in a system that is already receiving less funding than charter schools.
The flexibility charter schools have in their financial and operational decisions allows them to allocate resources in ways that district schools cannot. District schools are subject to rigorous financial oversight and accountability by the state. Their budgets are closely monitored to ensure funds are used effectively for student education and are in accordance with all the laws and regulations set forth by the state Legislature. Ensuring these disparate reporting requirements are met is an additional expenditure that charters do not incur.
The prosperity of a nation is directly correlated to its investment in public education for all children. The various funding options available to districts and charter school systems are clear and until all sources of revenue and expenditures are accounted for, it is nearly impossible to address the differences. The current funding formula is not the problem. The lack of sufficient funding that keeps the state ranked last and does not adequately address the needs of ALL students is the problem.
Denton Santarelli is the retired superintendent of Peoria Unified School District.
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