Charter schools bill hurts children, helps corporations
There is a new bill that is being pushed by the Florida House of Representatives aimed at bailing out another group of corporations.
However, unlike the banking and auto industry bailouts, this one negatively impacts your children in Lee County. HB 7037 proposes changes in the use of local capital outlay millage levy (COML) to require a portion of the revenue to be redirected to charter schools.
Statewide, the language entitles charter schools to about $137 million of funding from the state and local sources (the House proposed budget currently has $100 million for charter capital outlay, the Senate proposed budget has $0 for that purpose). HB7037 provides that for any shortfall of this entitlement funding by the legislature, local taxpayers would have to make up the difference by funding the shortfall. In Lee County, that language could cost our taxpayers as much as $8 million per year from the already stressed public schools capital outlay budget.
HB7037 would give taxpayer money to private entities in the similar way the federal government bailed out the auto industry and the banks. Taxpayers will never recover a single penny of charter capital outlay dollars because these not-for-profit charter boards hold all of their physical assets in for-profit corporations that the not-for-profit charter school leases from them so they can claim not-for-profit status for the actual school. This nuance is made abundantly clear when a charter closes — all of the assets purchased by the taxpayers remain with the forprofit entity, thereby giving taxpayer money to for-profit corporations with absolutely no recourse or recovery.
School Districts need capital funding, not only to build schools to provide seats to our growing population, but also to maintain assets that the citizens and taxpayers own in the form of existing schools, capital equipment and other support buildings. The formulaic allocation of funding present in the bill directly pays money to a charter school ignoring any evaluation of need. Since many charter schools are in newer facilities, they do not require additional capital funding. Conversely, failing to adequately fund existing assets already paid for by the taxpayers could result in rapid deterioration in already existing, taxpayer funded, assets.
In sum, this direct funding to charter schools does not consider the value of long-term ownership of educational assets by the public and provides a windfall to for-profit entities at the taxpayer’s cost.
The proposed legislation will not only reduce our already lacking capital funding, it will have a negative impact on the financial credit ratings of the school districts across the state.
Credit ratings are the primary factor that impacts the cost of financing new school construction.
On an operational level, HB7037 will directly impact operations and negatively impact children due the liquidity issues that it creates due to several timing issues inherent in the legislation. Charter school capital outlay payments are due in February, before districts receive ad valorem tax revenues.
Also, Districts will not know the amount due to charter schools when the district is creating the annual budget. Therefore, when notified in December regarding the amount due in February, the district may need to amend the budget to be able to make payment to the charter schools. This will typically require cutting other budget items Charter schools bill hurts children, helps corporations:
