i see a lot of criticism of charter schools being “run like businesses” and profiting off of tax money in the context that traditional public schools dont do that. but i dont understand because both of them are public funded and dont cost the student anything right? so how are they run like businesses and how are they profiting off tax payer money anymore than public schools are? not looking for opinions just an explanation on how theyre different
In: Economics
There are 50+ different charter school laws in the US, it’s a state thing. (Yeah for Federalism!)
Businesses seek students that can be educated most productively, so there is some profit for the company. They borrow capital and have expenses for that, but they can be creative with their real estate options.
Public schools take whatever students they get and educate them in ways that maximize the power of teacher’s unions. Public school capital is typically public debt taken on by voters, so there is little flexibility to rework things..
In reality both of those ideas are too extreme, reality is in the spectrum between those edges.
There are 50+ different charter school laws in the US, it’s a state thing. (Yeah for Federalism!)
Businesses seek students that can be educated most productively, so there is some profit for the company. They borrow capital and have expenses for that, but they can be creative with their real estate options.
Public schools take whatever students they get and educate them in ways that maximize the power of teacher’s unions. Public school capital is typically public debt taken on by voters, so there is little flexibility to rework things..
In reality both of those ideas are too extreme, reality is in the spectrum between those edges.
No two students cost the same to educate. Students with disabilities (physical, learning, etc.) typically demand more resources. Public schools are obligated to take all students. Charter and private schools can arrange it so that they don’t have to deal with the more expensive students. Per-pupil costs for a district include those expensive students, skewing them higher. Since charter schools don’t have to deal with them, the public funding they receive is in *excess* of their actual per-pupil costs, and the school/company running the school pockets the difference.
In my area, school districts must send charter schools at least 90% of the per-pupil funds for students who live in the district. If you’re receiving a fixed cost per student, and your goal is to generate profits above all else, your incentive is to provide a “good enough” education that people won’t leave for the absolute least cost possible. You may hire less qualified teachers, use older books, defer more maintenance, get crappier food, etc.
Let’s say a public school receives the same per-public funding. They don’t have a profit motive, because if there is money left over it goes back to the district (usually). While this doesn’t incentivize smart spending in the district, it also doesn’t give them any reason to cut corners either.
In my area, school districts must send charter schools at least 90% of the per-pupil funds for students who live in the district. If you’re receiving a fixed cost per student, and your goal is to generate profits above all else, your incentive is to provide a “good enough” education that people won’t leave for the absolute least cost possible. You may hire less qualified teachers, use older books, defer more maintenance, get crappier food, etc.
Let’s say a public school receives the same per-public funding. They don’t have a profit motive, because if there is money left over it goes back to the district (usually). While this doesn’t incentivize smart spending in the district, it also doesn’t give them any reason to cut corners either.
No two students cost the same to educate. Students with disabilities (physical, learning, etc.) typically demand more resources. Public schools are obligated to take all students. Charter and private schools can arrange it so that they don’t have to deal with the more expensive students. Per-pupil costs for a district include those expensive students, skewing them higher. Since charter schools don’t have to deal with them, the public funding they receive is in *excess* of their actual per-pupil costs, and the school/company running the school pockets the difference.
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