Charters receive full payments, but less federal funding after CPS error

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INCS rally July 22

Photo courtesy Illinois Network of Charter Schools

Students and parents asked CPS to release money due to charters at a July 2015 rally. More than two dozen charters could close under this year's potential budget cuts.

Charters and other independently run schools got mixed news this week after they found out they’d receive the remainder of their first-quarter payments but would see a slight decrease in some federal funds, due to a CPS miscalculation.

Earlier this month, CPS told charter, alternative and contract schools they’d receive only 15 percent of their first-quarter payments, due July 22, which include per-pupil funding plus money for buildings, state aid and federal dollars for low-income students. The rest would follow at a later, unspecified date.

At last week’s CPS Board of Education meeting, dozens of parents and others came out to protest the delayed payments at a rally held by the advocacy group Illinois Network of Charter Schools (INCS). And about half of the public speakers at the meeting pleaded for the full payment in order to open schools on time.

CPS spokesman Bill McCaffrey said the district processed the second installment of the first-quarter payment Tuesday and that schools should be receiving their funds.*

Some charter school leaders said they received the rest of their first-quarter payment on Tuesday — six days later than it was originally due. INCS said Wednesday that some charters had received the full payment, but others were still waiting.

“We just got confirmed that they deposited the money today,” said a relieved Aydin Kara on Tuesday. Kara is principal of Chicago Math & Science Academy in the Rogers Park neighborhood. “We’re happy to receive the full funding for the first quarter.”

Kara says the school has been around long enough to have built up money in reserves that would have allowed it to open up on time and operate without the remaining 85 percent of funding. But for a newer charter school that needs to hire and pay teachers, “it would have been a catastrophe,” he said. “Our cash buffer would allow us to survive a few more months without funding, but not more than that.”

But those payments arrived after CPS began notifying charter, contract and alternative schools on Monday that some of their federal Title I funds — used to help low-income students — would be reduced, due to a calculation error.

In a letter, Jack Elsey, the district’s chief innovation and incubation officer, told those schools to assume they’d receive about 30 percent of the Title I program funding they’d previously been told.

Elsey said the error didn’t affect other funds and that the Title I program dollars account “for approximately 1 percent of the overall annual charter funding.”

Schools had yet to receive Title I funds, but will have to adjust their budgets.

McCaffrey says CPS “immediately took steps to correct this discrepancy” after it was discovered.

“Regardless, all CPS schools — both district-run and charter schools — will receive more Title I funding this school year than last school year, and we will continue to work with charter schools to minimize any impact on their budgets,” McCaffrey wrote in a statement.

After seeing enrollment boosts, charters are taking in $38.6 million in Title I funding this coming school year, up from $34 million last school year.

District-run schools were not affected by the error. CPS officials did not explain how they miscalculated the Title I allocations or if it was simply a typo.

Harder to plan, hire staff

Jodie Cantrell, a spokeswoman for INCS, said charter schools had expected to receive about $16 million in those federal funds, but would now receive about $6 million. CPS confirmed those figures.

The mistake, she said, will make it harder for principals to plan and hire staff for the coming school year, which starts earlier for many charters than district-run schools.

Michael Bradley, the chief financial officer for UNO Network of Charter Schools (UCSN), described the changes as “mixed news, but not all bad news,” in an update to the network’s board on Monday night.

Bradley said CPS actually paid UCSN more than 15 percent in its first installment, but it came on July 24, two days late. Already, he said, CPS has advised the network that second-quarter payments will be delayed a week.

“We obviously have to factor that in when we think about not only budgeting, but cash management for the next couple months,” he said.

CPS says it provided larger first installments in cases where a delayed payment would have had a greater impact on the charter school.

Matthew McCabe, a spokesman for the Noble Network of Charter Schools, confirmed receipt of the Title I notification, but said the network was still working to figure out how it would affect school budgets.

But Chicago Math & Science Academy’s Kara said Tuesday he hadn’t been notified of any mistakes in his budget.

His school typically receives about $500,000 in Title I funding each year, and that shouldn’t fluctuate too much, he said, because the percentage of low-income students at the school hasn’t changed.

“We should be receiving the same amount of money, and I don’t see why that should change,” he said.

Pa Joof, principal of the Joshua Johnston Fine Arts and Design alternative charter school, called it “a very strange” mistake. He says he still needs to sit down with his chief financial officer to understand how the change will impact the school’s programming.

“Title I for us, because we’re a small school, is not a big chunk of money […] compared to some other charter schools,” he said. Still, he added, “it’s money that we could use.”

Questions about transparency

CPS officials did not release updated school-level budgets to reflect the Title I reductions for independently run schools. The district had released a spreadsheet of school-level budgets three weeks ago with categories for year-to-year changes in per-pupil and “supplemental” funding, which includes Title I dollars.

District officials have also not released the full CPS budget, which, under state law, is supposed to go to public hearings and be approved by the Board of Education by the end of August. CPS officials — who already announced layoffs and other cuts last month — are counting on pension relief from lawmakers in Springfield to close a $1.1 billion deficit.

In recent weeks, Local School Councils and parents across the city have been protesting the school budget cuts — which hit district-run schools harder due to projected enrollment loss. And some are raising questions about whether there are discrepancies between the budgets principals received from CPS and those distributed to media.

George Szkapiak, principal at Kennedy High School in Garfield Ridge, raised concerns about budget figures for his school after he compared a spreadsheet provided to the media with figures CPS provided him. The media file showed he’d gained $406,000 with a boost in enrollment, but his budget document showed he’d lost almost as much in special education dollars that didn’t seem to be accounted for in the media file.

Szkapiak says after his school budget was posted on another principal’s blog he got calls from more principals raising similar concerns. Similarly, many principals have told Catalyst they’re losing special education and bilingual positions.

“You would think there would be a much clearer accounting of what money a school should have and how those funding formulas are determined,” Szkapiak said. “Transparency and clarity when it comes to school budgets has got to improve. There’s no reason why it’s so complicated.”

*This story was updated Wednesday, July 29, 2015 at 4:15 p.m. to include more details from CPS about payments to charter schools.

  • Rodney Estvan

    Like Catalyst indicates Access Living has also received information from several principals about special education position reductions. Several included formal objections made by principals to the reductions to their Networks. In order to protect the confidentiality of these principals we can’t release the details of these communications. We have asked these principals to have their association make a formal statement on these reductions, as yet I have seen no such statement issued by the association.
    Rod Estvan

  • Concerned Parent

    Charters are stealing students from neighborhood schools now- to get more money. Why don’t charters have a final date to accept and then that is it? That is how it works with CPS selective enrollment. Instead, right now, they are recruiting and taking students from the neighborhood schools to get more money. This causes chaos at the neighborhood schools-as they lose more money. Charters are cannibalizing our schools. And when the charter kicks out kids after the 20th day, charters keep the money from those students. The neighborhood schools, who must take these students, get NO FUNDs at ALL.

  • NBCT Vet

    Charter schools are expected to see a 3% increase in student enrollment for 2015-2016. They will receive a 9% increase in funding.
    Non-charter schools are expected to see a 2% increase in student enrollment for 2015-2016. They will receive a 7% decrease in funding.