Audits show some charter schools' cash struggles
When district officials, auditors and state officials scrutinize a charter school’s finances, they often ask a basic question: Did the charter school spend more than it took in; could it cover all of its bills with its revenues?
By some measures, one-third of Duval’s charter schools had trouble with that in fiscal year 2015.
An analysis of the audited financial statements filed with the state indicates that at least 12 Duval charter schools spent more than they made in fiscal 2015. That’s called deficit spending.
The state Auditor General uses a slightly different measure — it focuses on “net position,” which compares a school’s assets to its liabilities. If a school’s liabilities are more than its assets, the school has a net position deficit.
Ten Duval County charter schools reported a net position deficit for fiscal 2015.
The auditor general’s reports also compare how much money is left in a school’s coffers — its ending or unrestricted balance — with revenues or its general fund. By that ratio, 16 Duval charter schools fell below state averages for charter schools.
It could be worse. They could have had a zero or negative ending balance.
The state in 2014 said six Duval charter schools had negative ending balances — or no money left over — at the end of the fiscal year. Since then, five of those schools improved to positive balances and a sixth, Acclaim Academy, closed its doors.
Charter schools, which are independent public schools, gave a variety of reasons for their financial struggles.
Five noted lower-than-expected enrollments, and five noted lower-than-expected state funds. Several schools had sizable leasing or lending costs associated with school buildings, while others had unbudgeted expenses.
SOS Academy, for instance, cut staff salaries and froze spending on supplies to cope with lower state and local funds.
River City Science Academy blamed accounting rules for unfunded pension liabilities blowing up its negative net position.
San Jose Academy and San Jose Preparatory High both said outstanding loans were a factor, while Lone Star High noted higher management fees “commensurate with revenue increases” and Biscayne High cited higher-than-expected teacher wages and operating expenses.
‘A TOUGH BUSINESS’
These chinks in charter school finances don’t necessarily predict a bankruptcy or closure, said Linda Norman-Teck, executive director of the Florida Charter School Alliance. They’re only a snapshot of finances and are likely a symptom of charter schools getting less money per student than district schools, she said.
“It doesn’t mean they’re in financial emergency,” she said. “It is a tough business because you can’t predict per-student funding. The money that follows that child to a charter school isAudits show some charter schools' cash struggles | jacksonville.com:
