The table below compares the annual expenditures of a typical virtual charter school with the annual expenditures of a typical traditional public school, coded to the Oklahoma Cost Accounting System (OCAS). Dr. Trice Butler of Wilburton Public Schools, Doug Brown of Idabel Public Schools, and Scott Farmer of Fort Gibson Public Schools presented this evidence along with much more - that virtual charter schools are miss-spending our Oklahoma tax dollars. The table provides a percentage of total spent in each category for each school:
Virtual Charter School Traditional Public
Instruction 62.7% 58%
Student Support Services 15.0% 6%
Staff Support Services 2.0 % 3%
General Administration 17.0% 4%
School Administration 3.0% 5%
Building Operations .3% 16%
Student Transportation 0% 2%
Child Nutrition 0% 6%
Total 100% 100%
As one may readily observe, the spending category percentages for the virtual charter school is drastically different (in some cases) from the traditional public school. The largest percentage spent for both schools is relatively equal for Instruction, which includes teacher salaries as the predominant expenditure. The virtual charter actually spent 4.7% more of its total expenditures on teacher salaries than the traditional school did. The virtual charter passes the 60% test for Instruction, while the traditional school fails by 2 percentage points.
Student Support Services includes Guidance Services (school counselors), Medical Services (school nurses and medical equipment/supplies), Occupational Therapy, Psychological Services, Speech Pathology Services, and Audiology Services. The traditional public school spent far less than the virtual charter for Student Support Services, but a more detailed observation reveals a more interesting difference - The virtual charter spent 99.5% of its total in only two subcategories: Attendance Services and Guidance Services. Since the virtual charter probably has no employees who are only charged with guidance counseling or student attendance, the nearly $1 million spent for Student Support Services went into teacher salaries. The traditional public school costs for Student Support Services were evenly divided between all the aforementioned subcategories, and were "stand-alone" services. In other words, a teacher was not also the school nurse or the guidance counselor. Traditional public schools must adhere to restrictions of assignments (certifications), which virtual charters are relieved of. This fact alone partially explains why virtual charter teachers can earn a higher salary than traditional public school teachers.
Staff Support Services includes Instruction and Curriculum Development Services, Instructional Staff Training Services, Library/Media Services, and Instruction-Related Technology. The percentage spent for the virtual and the traditional was almost the same (2% and 3%), with Library/Media being the major beneficiary. Since traditional public schools must have certified librarians, the largest cost went to the salary of the school librarians. The virtual charter probably has no librarians, so the bulk of its Staff Support Service expenditures went into teacher salaries and other virtual media costs.
General Administration Services includes Board Clerk/Deputy Clerk/ Minute Clerk Services, Board Treasurer Services, Election Services, Legal Services, Audit Services, Office of the Superintendent Services, Tax Assessment and Collection Services, Communication Services, and Personnel Services. There is a stark difference in the percentage spent by the virtual charter (17%) and the traditional public school (4%). The virtual charter spent $1,113,130 in General Administration, while the traditional public spent $522,296. The bulk of the virtual charter expenditures went to the Business Office - $672,414.72. After Instruction, this spending category is the virtual charter's largest cost.
School Administration Services includes principal services, site personnel services (secretaries, etc...), printing services, and all other principal office's associated costs. The virtual charter (1,100 students) spent $300,400 in this category, while the traditional public school with 2000 students spent $633,326.
Building Operations and Maintenance includes repairs and maintenance for school facilities, new building construction, and may include custodial and maintenance employee salaries. After Instruction, this is the traditional public school's largest cost. The virtual charter has very little costs associated with building operations and maintenance because it has few buildings (maybe none).
Student transportation makes up very little of the traditional public school expenditures as a percentage (2%), but still accounts for $505,307 in costs. The virtual charter spent nothing in transporting students, because it doesn't transport students to school.
Child Nutrition includes Food and Milk Purchases and Food Preparation and Dispensing Services. The traditional public spent $842,865.64 or 6% in this category, while the virtual charter spent nothing.
Analysis of Data
As we analyze the percentages spent for the OCAS categories of virtual charters as compared to traditional public schools, it is important to keep the corporate reformers' goal for our public schools in mind: All public schools, both charter and traditional public schools should spend at least 60% of total expenditures in the classroom (Instruction). This goal has been touted by Governor Fallin, former gubernatorial candidate Todd Lamb, and specific profitable non-profit groups - as the way to provide teacher pay raises and streamline public education. As one may observe from the data above, the virtual charter school passes the 60% rule, as it provides 62.7% of total expenditures to Instruction. The traditional public school fails by 2 percentage points, by spending only 58% in the classroom. Many lawmakers believe the virtual charter requires no more examination, since it passed the Fallin and Lamb 60% Rule. The question then becomes "How may the traditional public school spend more of its funds in Instruction?" Common sense dictates that the school should look to the other categorical expenditures, and transfer costs from those to Instruction. Those "60% Rule" advocates believe that if other categorical costs could only be transferred to Instruction - public education outcomes would improve. Graduation rates would increase and student test scores would rise. Most traditional public schools have graduation rates of between 80% and 95% and "school letter grades of A's and B's, but these may be improved upon if the "60% Rule" is followed.
The second largest category for expenditures is "Building Operations and Maintenance" at 16%. If the traditional public school could only transfer 2 percentage points from "Building" costs to Instruction, the "classroom" would now have 60% and Building costs would be reduced to 14%. Problem solved.
A much better way of solving the 60% Crisis may have already occurred. The legislature increased taxes for the working poor (cigarette and fuel) and provided a much needed teacher pay raise, which is now in effect. The "teacher pay raises" are coded directly to Instruction, so many traditional public schools will now pass the Fallin/Lamb test. Look for many traditional public schools to spend more than 60% of total costs "in the classroom".
Although the virtual charter school passed the Fallin/Lamb 60% Rule with flying colors, a cost/benefit analysis will now be provided for it. Since the focus of many Oklahoma citizens is most often trained on administrative costs for our public schools, our analysis is limited to General administrative costs for virtual charters in comparison and contrast to traditional public schools. The virtual charter school in our analysis is composed of approximately 1,100 enrolled students, while the traditional public school has approximately 2,000 students. Of the over $1 million spent by the virtual for General Administration, $624,324 was spent for Official/Administrative Services by the virtual charter. It is uncertain which Business Officials received over a half-million tax-payer dollars, but one may be the Virtual Charter "Director of Government Relations" who was present at the capitol on Tuesday when this cost-benefit analysis was presented. The question now must be asked, "What are some of the benefits provided to Oklahoma tax-payers by virtual charters, for this spending?" The benefits to tax-paying citizens would be a good public education for all citizens. A well-educated public benefits everyone, not just students. One test of the cost-benefit relationship is the student graduation rate as a percentage of cohort attendance. In other words, of the students entering 9th grade, what percentage graduate within four years? Traditional public schools usually graduate between 85% and 99% of students who enter 9th grade at any particular traditional public. The four virtual charter schools in our state had graduation rates of 15%, 22%, 28%, and 33% for the 2015-2016 school year. The high cost of the Business Office for virtual charters doesn't appear to translate into high graduation rates. In fact, the goal of the Business Office appears to be enrolling students for the cash benefit, then forgetting to educate.
The traditional public school with 2,000 students incurred Business Office expenses totaling $40,900 for the same time period the virtual charter (1,100 students) incurred $578,074 in Business Office costs. Several state senators have stated it is irrelevant how virtual charter schools spend tax-payer dollars (whether for the Business Office or for students), as long as results like the "average 25% graduation rate" are obtained. Several other state senators believe Oklahoma tax-payers should expect better results, if virtual charters are willing to spend $Thousands for a "Director of Government Relations". (The Director's job is assumed to be "lobbying for more taxpayer dollars".)
As a result of this limited cost/benefit analysis - a state senator has promised legislation which would 1) Prohibit "for profit" virtual charter schools, and 2) Provide virtual education for traditional public school students. This proposed legislation needs the support of all Oklahoma tax-payers to succeed, as "for-profit" charter schools will be working very hard to defeat it.
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