Left out of referendums, Indiana charter schools push for more funding

Nearly two decades after the first charter schools opened in Indiana, a years-long campaign to increase their funding is gaining momentum in the state legislature.

Charter schools enroll about 44,000 Indiana children, including nearly 20% of Indianapolis public school students. But the schools miss out on about $3,300 per student in local funding because they don’t get the property tax money that traditional districts use to pay for buildings, transportation, and technology.

That long-standing gap grows when districts successfully pass referendums to increase property taxes, which can be used to foot the bill for higher teacher pay. Charter advocates have been making a case for more than a year for lawmakers to give the schools more money, arguing the independent public schools serve a disproportionate share of students from low-income families.

“I believe that there is a broad recognition of the need here,” said former Indianapolis Mayor Bart Peterson, who leads Hoosiers for Great Public Schools, a political action committee that donated about $250,000 to state politicians in 2020.

In a year where state revenue is stagnant because of the coronavirus, a funding boost is far from certain. But Peterson pointed out that lawmakers could increase money for charter schools in several ways, including increasing an existing state charter supplement of $750 per student, giving schools more money to educate students from low-income families, or giving charter schools a slice of local property tax dollars.

“There’s more than one way to skin this cat,” said Peterson, who is president of Christel House International, which runs several Indianapolis charter schools.

In the most recent session, legislators narrowly approved a measure allowing districts to divert some referendum proceeds to charter schools, which many saw as a step toward making it mandatory.

But calls for increased charter school funding must compete with other priorities, such as a massive influx in state funding recommended in December by Gov. Eric Holcomb’s teacher pay commission to help increase educator salaries.

“If you’re going to increase charter school funding, it’s at the expense of the traditional public schools,” said Keith Gambill, president of ISTA, the state’s largest teachers union.

The gap in charter school funding is attracting more attention because it’s growing wider in Indianapolis, the hub of the state’s charter schools. Two years ago, Indianapolis Public Schools passed a referendum that raises $220 million over eight years to fund raises for teachers. Starting pay in the district rose to $47,800 this year, up from $40,000 in 2017-18.

Nineteen Indianapolis charter schools are part of the IPS innovation network, which gives the district credit for their enrollment and academic results. Despite that connection, many schools have missed out on the influx of cash from the referendum, advocates say.

That makes it hard to keep up with rapidly increasing teacher pay and compete for high-quality teachers, said Juli Woodrum, vice president and chief financial officer of Indianapolis Classical Schools, which includes Riverside and Herron High Schools.

Each year, the network’s two campuses struggle to hire new teachers who could often make thousands more at nearby schools. Their beginning pay is about $42,000 a year, nearly $6,000 below the district, Woodrum said.

A sought-after charter school in an affluent neighborhood, Herron has fewer students from low-income families than many Indianapolis high schools. But about 65% of Riverside students are economically disadvantaged, a higher percentage than at many traditional public schools in the Indianapolis township districts. Educating those students on a shoestring budget is especially difficult, Woodrum said.

“We operate really lean because of the situation that we’re in,” said Woodrum. “It’s really hard because about 80-85% of our budget is salaries and benefits.”

When IPS boosted teacher salaries, Purdue Polytechnic High School increased its own pay to stay competitive, said Head of School Scott Bess. The charter network, which is affiliated with Purdue University, has won grants and in-kind support that have helped prop up the budget.

But even Purdue Polytechnic has been forced to delay hiring and has brought on lower-paid staff to supervise online classes instead of certified teachers, Bess said.

If Purdue Polytechnic’s two Indianapolis campuses were traditional public schools, they could get close to $4,000 per student in local funding — more than $2.5 million.

Educational outcomes are better for students at schools with more funding, said Bess. Yet many schools across the state continue to get less.

“Let’s figure out how we can use state money, over some time, to at least narrow the gap,” he said.

Local funding means low-income students receive different levels of support depending on the district or school they attend. That’s sometimes a difference of thousands of dollars per student, said Republican House education chair Bob Behning at an education panel discussion in December.

“Why should there be such disparity? That to me is an equity issue, or an equality issue, that we’ve got to try to wrestle with,” said Behning, a staunch school choice supporter.

Joel Hand, general counsel and lobbyist for the Indiana Coalition for Public Education, argues that since property taxes come from the community, they should be used to sustain traditional districts that voters control through elected school boards.

Despite his opposition, however, Hand believes the legislature is likely to take some action to boost charter school funding.

“I do think that they will be successful with getting more funding for charter schools, even in light of the pandemic,” Hand said, “because I think that legislators are going to place a higher priority on what they refer to as ‘choice schools’ over the traditional public schools.”

Chalkbeat is a not-for-profit news site covering educational change in public schools.