Districts' Cyberbills growing - LancasterOnline (Lancaster Sunday News) 01/16/2011

Districts' Cyberbills growing
Superintendents, facing deficits, say they pay too much per student to online and charter schools. Their opposites and a student challenge that.
 Sunday News
Updated Jan 15, 2011 18:16

By GIL SMART, Associate Editor
As the school year began, officials in the Eastern Lancaster County School District could practically see the money walking out the door.

During the 2009-10 school year, 49 students living within the district attended cyberschools, requiring Elanco to remit more than $656,000 to those schools. But when school reconvened in September, Elanco officials discovered that the number of cyberstudents more than doubled, to 106.

District officials plan to investigate the reasons for the exodus, Superintendent Robert Hollister said. But in the meantime, as students leave, district costs skyrocket. Elanco officials now must budget an additional $638,000 next year in tuition for cyber- and charter students. It's a big reason, they say, for the district's projected $1.1 million deficit.

And what's frustrating, Hollister said, is that Elanco, like other school districts, has few options to stem the flow of students — and money.

Pennsylvania cyber- and charter schools, authorized by the state Legislature more than a decade ago, are booming. The schools are tuition-free; the money to operate the schools comes from each student's "home" district, which is required by state law to remit its average annual cost per student. In Elanco, for example, it costs an estimated $9,311 to educate every nonspecial education student (and $15,356 per special education student). If 11 students leave, or never attend Elanco schools, the district has to shell out more than $100,000 to the cyber- or charter school of the student's choice.

School districts are reimbursed some of this funding by the state, though that reimbursement rate has fallen. And as districts here and across the state face fiscal crises, there are growing concerns that the Legislature needs to do something to stem the districts' rising cyber- and charter school costs.

Pennsylvania Auditor General Jack Wagner issued a stinging report in October, asserting that the funding formula is unfair both to public school districts and charter schools. But beyond this, there has been no action in Harrisburg, and school officials aren't holding their breath.

Money follows pupil?
Cyber- and charter school officials say they understand the public schools' predicament, but say growing enrollment figures are a testament to their success, and the fact that parents want school competition, and a choice. They resent being blamed for the public schools' fiscal problems: "The real philosophical question is, whose money is it?" asked Dr. James Hanak, CEO of the West Chester-based PA Leadership Cyber Charter School, an online institution that serves about 100 students from Lancaster County. "Does it belong to the school districts, or should it follow the students?"

But local school officials say that for all the talk of how cyber- and charter schools offer competition, the reality is that public schools — with their legacy costs and union contracts — are forced to play on an unlevel field.

"My concern," Hempfield Superintendent Dr. Brenda Becker said, "is that we're not all playing by the same rules."

Pennsylvania's first charter schools opened in 1997. According to information from the Pennsylvania Department of Education, there are now 145 charter schools, and 12 cyberschools, operating in the state.

Just one charter school, La Academia, is based in Lancaster County. It has an enrollment of 105 — and 100 of those students come from the School District of Lancaster, according to state figures.

By contrast, in 2007-08 (the latest year for which comprehensive state figures are available), 847 students from Lancaster County attended the state's 12 cyberschools.

At charter schools, students physically attend classes. With cyberschools, it's all done online — students log on to a school website to access courses and interact with teachers via e-mail or videoconferencing applications like Skype. Students can log on any time of the day, although multimedia chats between students and teachers may take place at a set time.

Cybergrad's experience
"Cyberschool gave me more flexibility," said Hope Frick, of Elizabethtown, who graduated from Commonwealth Connections cyberschool last year; she's now a student at Waynesburg University.

She transferred from Elizabethtown Area High School to Commonwealth Connections when she was in 10th grade. "My high school was very cliquey," she said via e-mail. "I was succeeding in my academic school life, but I was having trouble dealing with the drama high school brings."

Cyberschool wound up being a bit more challenging than she expected: "In a traditional school, you have teachers right there to ask questions if you don't understand something, to show you a math problem on the board," she said. "In cyberschool, you essentially are your own teacher. It's up to you to show yourself how to do things because the teacher is not right there — this is why I struggled with the online courses for math," she said.

"However, this also was a positive because I could work at my own pace and work ahead if I wanted to. ... I had to hone my self-discipline and responsibility." And that, she said, helped prepare her for college.

"Everyone has a different situation, and cyberschool is a great way to accommodate everyone," she said.

Taking more students
Cyberschools in particular are accommodating more and more students from Lancaster County.

In Penn Manor, for example, cyberschool enrollment grew from 31 students in the 2001-02 school year to 78 this year. Superintendent Dr. Michael Leichliter noted that as the number of cyber- and charter kids has gone up, the number of home-schooled students has fallen; there's a direct correlation, he said. "While some [cyber]students have left the Penn Manor schools they attended, at least half have never set foot in Penn Manor," Leichliter said.

The School District of Lancaster has the highest number of students attending cyberschools. Elanco now has the second-highest total.

A growing number of districts, staring at big budget holes next year, have fingered the increasing cost of cyber- and charter students as a factor.

The state has reimbursed public school districts up to 30 percent of their cost for cyber- and charter schools. That, Auditor General Wagner noted in his report, added an entire new line item — which totaled $228 million in 2008-09 — to Pennsylvania's budget.

The state reimbursement rate fell last year to 23 percent. There are rumors, say some local officials, that it may be on the chopping block again this year — even as cyberschool enrollment continues to increase.

Elanco is projecting its costs to rise from $657,000 this year to nearly $1.3 million in the 2011-12 school year. Donegal officials said last week that cyberschool costs are expected to rise from $650,000 to an estimated $990,000 next year.

"It is serious," said Cocalico Superintendent Bruce Sensenig, whose district has seen cyber- and charter school costs increase by $333,630 over the past four years.

"I am personally not necessarily opposed to the cyber option," Sensenig said. "It does work for some students, and in education, you do need to have options.

"What's really upsetting to schools is the formula [used] to get to that expense."

A district's actual expenses are divided by the number of pupils; that is the cost each district must remit to a cyber- or charter school for each pupil — regardless of what it actually costs that cyber- or charter school to educate the child.

For example, the average cost of educating a student in the Columbia Borough School District is $9,779, according to Pennsylvania Department of Education figures; if a child living in Columbia opts to attend a cyber- or charter school, that's how much the district must pay to that school.

But in Warwick, the average cost of educating a child is $7,752 per year; that is the amount Warwick would pay to the same school, for the same program.

And in any event, say local school officials, cyber- and charter schools can educate students for far less than school districts. Public schools, said Sensenig, have higher costs for maintenance and personnel, for energy and transportation, for extracurricular activities like football teams or band.

"We're paying what it costs to educate one of our kids with all these 'legacy' costs," he said. "We're trying to compete. We can't."

A new model
Meanwhile, cyber- and charter schools look like the sleek, new model; the Lamborghini versus the Model T.

At the PA Leadership Cyber Charter School, every student gets a state-of-the-art computer, a printer-scanner-copier and wireless headset at no cost to the family. The school reimburses parents for Internet access. And without as many "legacy" costs, without teachers unions, "we can make changes, and we can make wholesale changes if we have to, and we can do it much quicker than any public school," CEO Hanak said.

The school, with an annual budget of $24 million, has an enrollment of 2,230 — and counting. "We have some students who are here because of violence problems in Philly [at Philadelphia schools], we get a lot of that," Hanak said. "We have a lot of special-education students who are not getting the attention they should be, or think they should be.

"They come here, they are successful, and they spread the word."

Pennsylvania's largest cyber school is The Pennsylvania Cyber Charter School, also known as PA Cyber. Based in Midland, it has offices in Philadelphia, Pittsburgh and Harrisburg — and an enrollment this year of 10,000 students, said CEO Nick Trombetta.

"We do have buildings," housing teachers and administrators, said Trombetta, whose school has a budget of $110 million and employs 600. "I don't have buses, bands or ballfields, but I do have Internet access to every home.

"We all have to get better, leaner and smarter," said Trombetta, who questions why public school districts are "squirreling away" millions in fund balances, or savings, while they "want to point to cyberschools as the problem."

Money in the bank
In his report, however, Auditor General Wagner noted that while public schools are limited in the amount they can keep in undesignated, unreserved fund balances, cyber/charter schools are not — and Pennsylvania cyber- and charter schools have retained $108 million in reserve funds.

Wagner has called for a moratorium on new cyber- and charter schools, and for state officials to limit cyber- and charter schools' fund balances. His report also recommended that the state come up with a new funding formula, one based on the actual cost of educating students at cyber- and charter schools rather than what it costs the "home" district to educate a pupil.

If state officials followed his suggestions, "there would be no need for a reimbursement formula," and the state could eliminate that line item from its budget and save several hundred million dollars each year, Wagner said in an interview last week.

"But so far the governor and General Assembly have not shown the fortitude to change that formula," Wagner said. "And the loser here is the taxpayer."

Can't beat 'em ...
In an attempt to compete, some school districts have started their own cyberschools — and several others are considering doing so.

Solanco was the first local district, establishing the Solanco Virtual Academy in 2005 "after getting a cyberschool bill of $600,000," said Thomas Brackbill, academy director. The academy initially served kids in grades kindergarten through six; just last year, "we got to grade 12," Brackbill said.

Students from Conestoga Valley and Pequea Valley also attend the academy; total enrollment has fluctuated around 45, Brackbill said. Like other cyber- and charter schools, the academy has provided free computers and printer/scanners, and reimbursed families for Internet costs.

Brackbill said the idea was to provide education in a format that a growing number of students appear to want or need. But saving money was absolutely a factor; if districts could keep students at a district-run cyberschool, they would lose less revenue.

Around the state, Intermediate Units have helped establish cyber/charter schools; Allegheny (County) IU 3 coordinated the founding of the PA Learners Online, founded by 10 school districts in the county. IU 13, representing schools in Lancaster and Lebanon Counties, is looking into doing something similar.

"Our hope is that we can leverage economies of scale to help school districts save money," said Brian Barnhart, IU 13 assistant executive director. "We're trying to put together a comprehensive package, with costs well south" of what schools must now pay for cyber- and charter students, "with the real goal of preventing more students from leaving." The school could be rolled out as early as next fall, he said.

Cyber- and charter school officials say they welcome the competition — but note that if districts decide to offer online education merely to save money, they're doing it for the wrong reason.

"Sometimes it's, 'Let's get the money back,' rather than, 'Let's provide for our students,' " said Carolyn Fell, director of communications for PA Leadership. "If I were the superintendent of a district where a lot of the kids were leaving, I'd be calling the parents and asking — 'How can we better serve your needs?' "

Gil Smart is associate editor of the Sunday News. E-mail him at gsmart@lnpnews.com, or phone 291-8817.

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