Report: Cyber Charter Surpluses
PA Charter Performance Center at Children First, June 15, 2022
Cyber charter surpluses are substantial, growing, and unregulated. This issue matters to school districts that are responsible for paying public cyber charter tuition and taxpayers who ultimately foot the bill. State law already prevents school districts from stockpiling excessive reserves, and Pennsylvania’s cyber charters should be required to do the same. Cybers should either spend their surplus balances on student improvement or return the money to contributing school districts.
- Pennsylvania’s 14 cyber charters are sitting on over $164 million in unrestricted reserves in the school year (SY) 2020-21. The surpluses, also called “unassigned fund balances,” more than doubled compares to 20-19-20 and skyrocketed seven-fold as compared to SY2018-19.
- This increase was unique to cyber charters. Unassigned fund balances grew nearly 10 times faster in 2020-21 for cyber charters (+119%) than school districts (+12%).
- The spike in surpluses cannot be explained by rising cyber charter enrollment. Cyber charter surpluses rose nearly 647% during this time period – over ten times the 63% increase in enrollment.
- Using the standards applied to Pennsylvania school districts, 11 of 14 cyber charters are holding excessive surpluses.
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