CPS adopts per-pupil budgets, equal charter funding

March 11, 2013

After many years of discussion and a pilot program, CPS will this year make a radical shift in its budgeting practice by giving schools a set amount of money per student for core instruction, rather than allocating a certain number of positions based on enrollment. 

At the same time, the district will provide charter schools with the same amount of funding, on a per-pupil basis, as traditional schools—a practice that charter supporters have long advocated for. But with the exact amount of per-student funding still to be determined, it is unclear whether the move will be a boon or a detriment to charters, said Illinois Network of Charter Schools President Andrew Broy.

The new practice, called student-based budgeting in the education world, might seem merely a technical change. But in reality, it could have a far-reaching impact on the composition of teaching force and the equity of programs among schools.

CPS officials hailed the move as a way to give principals more power over their budgets and emphasized that the switch is not being done to save money. In the past, officials curtailed plans to adopt the practice because they were concerned about how it would work in a time of shrinking budgets.

Gray Elementary School Principal Sandra Carlson, whose school has been part of a per-pupil budgeting pilot program since 2006, said she is worried, considering the district is facing a projected billion deficit.

“I am waiting to see my new budget,” said Carlson. Yet she added that having more control over her budget has allowed her to respond better to past reductions in funding.

Student-based budgeting is touted as a way to give principals the flexibility to spend money in the way they see fit to best meet the needs of their students. Done well, advocates say, student-based budgeting can also bring more parity and transparency to school budgets. As it is now, the district’s funding formula is complicated and weighted so that it is difficult to figure out if one school is making out better than the other.

“I loved it when I was a principal,” said CEO Barbara Byrd-Bennett, who said the practice allowed her to add an art teacher at her school. Byrd-Bennett and Budget Director Ginger Ostro unveiled the new system on Monday.

Pitfall for veteran teachers?

But there are potential dangers. One is that principals will veer toward hiring inexperienced teachers to save money, or contract out programs, such as the arts, rather than hire a certified teacher. In 2005, Catalyst wrote about the pitfalls of per-pupil funding in 2005, when then CPS CEO Arne Duncan was looking at making the shift. 

CPS officials stressed that they don’t want to provide a disincentive to hiring experienced teachers and are creating a pot of money to help offset the salary cost to schools that have more than the average number of highly experienced teachers. As yet, it’s unclear how much money the district will provide to offset veteran salaries or whether it will be maintained as time goes on.

In a press release, the Chicago Teachers Union called the extra funding a "stop-gap measure." It "in no way compensates for the destructive, long-term, and systemic consequences of this program.”

There’s also concern that principals could misspend money. In the past, CPS officials have hesitated to move toward student-based budgeting because it meant that they lose control of budgets.

Byrd-Bennett said she believes that principals generally do what is best for their school, but that there will be safeguards in place. As is the case now, she said principals will have to get their budgets approved by the network offices. Also, the budget office will monitor for any unusual spending.

Currently, the district provides a regular classroom teacher for every 28 students in primary grades and one teacher for every 31 students for 4th grade and up. In addition, for every 750 students, the district provides an assistant principal, an art or music teacher and a librarian or gym teacher. Schools with smaller enrollments get part-time positions.

Questions of extra resources, charter benefit

Under student-based budgeting, principals will get a special amount of money per student and will have to decide how many teachers, clerks, art, gym and music teachers they need. While principals could decide to have extra-small class sizes and forego other things, they can’t raise class sizes beyond the limits established in the teacher’s union contract (28 for primary grades and 31 for upper elementary grades and high school).

Carlson said that student-based budgeting has had another big benefit for her: stability. Now, a school’s budget is based on the number of teachers for a projected enrollment. But if a school gets fewer students than expected, they stand to lose a teacher or two. For years, principals have complained about how disruptive this practice can be to students. In the past, Carlson has made the decision to reduce her equipment and supply budget rather than lay off a teacher.  

As they roll out student-based budgeting, CPS is side-stepping the thorny issue of how to handle the additional funding that schools get for low-income students, special education and bilingual students and for magnet and selective enrollment schools. This money will not be folded into the per-student allotment, but rather doled out based on the complicated formula currently in use.

Yet Ostro said that extra money and positions given to schools this year to implement the longer school day will be included in the per-student allocation.

Another question is how CPS will take into account the district’s high mobility rate.  Byrd-Bennett said that detail has not been worked out yet. In other districts with student-based budgeting, the money follows the student, up until a certain point in the year, at which time, the original school keeps the money, Byrd-Bennett said.

The district’s charter and performance schools have been funded using student-based budgeting since their inception. But they have always complained that they have gotten less than traditional CPS schools. Even after a boost in funding last year, they currently get 80 percent of the core costs, so Monday’s move could end up providing another boost in funding for them, Broy said.

Not only is it unclear whether the new per-student allocation will be more than the current amount charter schools get for each student, but Broy said that he doesn’t know how CPS officials plan to deal with the things charters pay for and traditional schools don’t. The biggest additional weight on charter school budgets are facilities and operations, he said.

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