Civic Group Finds Illinois Charter Schools Don’t Drain Resources

Published October 1, 2007

In July, the Chicago-based, nonpartisan Civic Federation released a comprehensive study showing Illinois charter schools do not place undue financial burdens on their host school districts and do not hamper districts’ ability to manage finances.

The 112-page assessment focused on three Illinois charter schools outside the Chicago Public School (CPS) system that had weathered a time of financial hardship for their host districts. During the 2003-04 school year, on which the study focused, the three schools relieved their host districts of 1.3 to 3 percent of the district’s students while tapping only 0.9 to 2.4 percent of their host districts’ operating budgets.

No Drain

The Civic Federation authors found:

  • The Illinois charter schools studied provided school choice without significantly burdening district budgets;
  • The diversion of district funds to charter schools did not compromise districts’ ability to manage financial obligations; and
  • The state’s funding per pupil and the growth or diminishment of property tax revenue had a stronger effect on the revenues available than enrollment growth or decline.

‘Important Initiative’

The Civic Federation views charter schools “as an important initiative for public education,” the study’s authors wrote, “not only because charter schools provide school choice for parents and students, but also because charter schools offer an alternative model for the funding and governance of public schools.”

Civic Federation President Lawrence Msall said charter schools’ freedom from specific state mandates is paramount to their success.

“The best way for local schools to be more innovative is to unshackle them from state statutes and labor agreements,” Msall said.

Further Confirmation

The Civic Federation’s study agrees with 2005 research from the Thomas B. Fordham Foundation, Charter School Funding: Inequity’s Next Frontier, which showed Illinois charter schools received 23 percent less funding than district schools–at the time, $6,779 per pupil, compared to the district schools’ $8,801 per pupil, a gap of $2,023.

“It’s an impressive study, and the findings speak volumes for the administrators of those charter schools studied,” said Don Soifer, executive director of the Lexington Institute, referring to the Civic Federation work.

Soifer said even with the inherent disadvantages under which charter schools operate–usually, larger at-risk populations, an inability to pass tax referenda, and difficulties in borrowing funds because of the schools’ time-limited charters–charter schools nationwide reflect the same general trends as were shown in the Illinois study.

“We’re finding the same is generally true nationwide,” Soifer said. “Charter schools do not drain district funding.”

Persistent Opposition

The study’s findings were questioned by Jack Norman, research director of the Institute for Wisconsin’s Future (IWF), a group that works to increase funding for public schools. IWF opposes Milwaukee’s school voucher program and charter school expansion.

“I’d ask if those charter schools are subject to the same obligations other schools in the district are required to abide by,” Norman said.

The study showed charter schools often make special arrangements with host districts to meet transportation, food service, and special-education demands.

Easing Funding Problems

“A group’s findings of whether a charter school drains funds completely depends on how that group perceives charter schools,” said Mike Griffith, a school finance analyst at the Greater Educational Opportunities Foundation, a national charter school advocacy group based in Colorado. “The debate on charter schools and how they affect school finances boils down to whether the monies received are less than what it costs to educate a student.”

Both the Civic Federation and Thomas B. Fordham Foundation concluded charter school advocates are correct in arguing the schools actually ease the strain on public school funding.

Fran Eaton ([email protected]) writes from Illinois.

For more information …

“The Financial Impact of Charter Schools on Illinois School Districts: A Primer and Three Case Studies,” released July 23, 2007 by the Civic Federation, is available through PolicyBot™, The Heartland Institute’s free online research database. Point your Web browser to and search for document #21960.