Colorado Charters Get Construction Funds

Published June 1, 2001

In April, Colorado Governor Bill Owens signed into law a school funding bill that includes a provision for the creation of a capital construction fund for charter schools.

Allocated to charter schools as a per-pupil stipend of $322 each, the funds may be used for construction, demolition, remodeling, financing, purchasing, or leasing of land, buildings, or facilities used to educate charter school students. Although a few other states provide some form of capital assistance to charter schools, Colorado’s new law is the most expansive.

The Republican governor had called for such a provision in his January 11 State of the State Address, in which he highlighted the inequality in funding between children who attend traditional public schools and children who attend public charter schools. Unlike public neighborhood schools, public charter schools in Colorado have had to pay for their school buildings out of their operating funds, which meant less money to pay teachers, buy textbooks, and operate the school.

“It is simply wrong that children who attend public charter schools must have their buildings paid for out of their school’s operating funds, while children in public neighborhood schools have their school paid for out of additional, separate, capital funding,” said Owens after signing the School Finance Act. “Charter schools will now not erode their instruction budgets for capital needs.”

Although the $322 stipend will be a great help to charter schools, it is only about 55 percent of the state’s average per-pupil bond redemption amount per year. Even so, when the original bill to create the stipend was introduced by House Speaker Doug Dean, it was bitterly opposed by Democrats, who now control the State Senate for the first time in 40 years. The provision won final approval only as an amendment to the School Finance Act.

When Owens was a legislator and helped spearhead the passage of Colorado’s 1993 charter school law, local school districts were required to fund only 80 percent of charter school operating costs. As governor in 1999, Owens approved a law increasing that requirement to 95 percent. Over time, charter school supporters hope to ramp up the capital stipend in a similar manner, from 55 percent of the average bond redemption to a figure closer to 100 percent.

“I believe in choice and believe in the coming years there will be other ideas on how to increase the choices available to parents and students,” said Owens.

In a 1998 analysis of the capital requirements of Arizona’s charter schools, researchers at the Phoenix-based Goldwater Institute estimated annual funding of $650 per pupil would be sufficient to convert school construction and maintenance costs to a per-pupil stipend. In Child-Centered School Funding, authors Michael K. Block, Jeffry L. Flake (now Congressman Flake), Mary Gifford, and Lewis Solomon report the $650 amount “would allow the vast majority of existing school districts to build new facilities and renovate old ones, on a pay-as-you-go basis.”

For more information . . .

Use PolicyBot, The Heartland Institute’s free online research service, to request the documents in Adobe Acrobat’s PDF format. Point your browser to and click on PolicyBot.