ALASKA’S CHARTER SCHOOL PROGRAM: Funding Alaska’s Future Leaders  “To educate students for success in life.” This mission statement has provided focus for the students, the staff, parents and the community and has provided guidance as the budget has been prepared. Superintendent Carol Comeau, September 10, 2001 

2013 

Sian Ng‐Ashcraft, Theresa Lyons & Daniel Pulu – Team 4 PADM A628: Administration of Financial Resources, Spring 2013   

Professor Protasel 4/12/2013 

 

 

Alaska’s Charter School Program

Table of Contents

Executive Summary 2

History of the Charter School Movement 4

Alaska’s Charter School Legislation 6

Alaska’s Charter Schools 8

Anchorage’s Choice Schools 12

Charter School Program National Ranking & Scorecard 16

Measuring Up & Adequate Yearly Progress (AYP) 19

History behind Funding Formula 20

Funding Formula for Charter Schools 21

Business Partnerships 25

Anchorage School District Funding 26

a. Where does ASD’s money come from?

b. Where does ASD’s money go?

Other Revenue and Funding 29

Revenue & Sustainability Options 30

Conclusion 31

References 33

Appendices 36

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Alaska’s Charter School Program: Funding Alaska’s Future Leaders

Executive Summary

Public education has always been at the forefront of our national dialogue for many

decades, and has remained a topic of healthy debate. The charter school movement which

started in the 1960s grew out of the desire of parents, educators, and legislations to provide

parents and their children with choices of schools which offer innovative teaching curriculum

that enhance learning, and provide students with academic opportunities for excellence (NEA).

With Minnesota leading the way with the nation’s first charter school legislation in 1991,

the charter school movement has grown rapidly in the last 21 years. Currently, 42 states and the

District of Columbia have passed charter school laws, although the laws are not created equal.

Some states have strong charter school laws, while others are weaker in comparison, which we

will see from analysis by two organizations: the Center for Education Reform (CER) and the

National Alliance for Public Charter Schools (NAPCS). There are now over 5,600 charter

schools with an enrollment of over two million students. (NAPCS, 2012).

  Alaska’s enacted it Charter School Act in 1995. Currently, Alaska has 27 charter schools

serving 5,613 students (CER, 2012). Charter schools make up 5.3% of all public schools in

Alaska (NAPCS, 2013). In Anchorage, there are currently seven charter schools (ASD).

Charter schools in Alaska have become fully entrenched into the educational fabric of our

public school system, and are here to stay. While many other states have multiple authorizers,

Alaska only has a single authorizer of charter schools, the Alaska Department of Education and

Early Development (Alaska EED). The Department of Education authorizes the charter

following the approval of charter school applications by the local school boards. Charter

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schools receive their funding from the local school districts (Alaska EED, 2013). CER is of the

opinion that Alaska’s charter school law is vaguely written with regard to student funding.

Funding decisions are left to the school districts and subject to school district terms. The charter

schools do not have autonomy over operational and funding decisions (CER, 2012). Charter

schools are funded using a formula as written in state statue (AS Sec. 14.03.260), less state

approved indirect cost rate.

  There have been much media attention and public debate over charter schools’

achievement and performance, and whether academic outcomes are better and improved for

students attending charter schools than students attending traditional public schools. Critics

focus on those schools that did not make the grade, while proponents focus on the positive

effects of charter schools on student academic achievement with examples of high quality, high

performing charter schools.

Alaska’s charter school legislation earns a D grade from CER, and ranks 41 out of 43

state laws in 2013 (CER, 2013). The Center for Education Reform (CER) and the National

Alliance for Public Charter Schools (NAPCS) performs annual analysis of the individual state’s

charter law; makes comparison, and issues report card and ranking. From reports issued by both

organizations, it appears that Alaska’s Charter School Law still needs some work in the areas of

authorizing options, transparency in charter applications and review, monitoring and data

collection, increase operation autonomy and equitable operation funding and access to capital

funding (NAPCS, 2013).

However, the good news is that Alaska’s charter schools score higher than the national

average for percentage of charter schools passing Adequate Yearly Progress (AYP), an

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accountability measure requirement for receiving federal funds (NAPCS, 2013). There are other

funding options for charter schools that we will examine in this essay.

History of the Charter School Movement

The charter school movement grew out of the desire to improve classroom learning by

parents, educators and politicians who were frustrated with the poor performance of students in

public schools. The movement can be traced back to the “late 1960’s and early 1970’s when

innovative schools were established in such places as Chicago, New York, Philadelphia,

Minneapolis and St. Paul” (NEA-Alaska). These schools sought to provide choice and

innovative curriculums to students and parents while rejecting the “one size fits all” traditional

approach to classroom teaching.

In April 1965, the Elementary and Secondary Education Act (ESEA), one of the many

Great Society programs under President Lyndon B. Johnson, was signed into law (U.S.

Department of Education). The law allocated significant federal funding toward primary and

secondary school education to increase equality in education. Project Head Start, an eight-week

summer program started by the Office of Economic Opportunity for preschool children from low

income families entering public school in the fall, became a permanent program under this act.

Federal legislation addressing the charter school program did not come until 1994. In

October 1994, under the Clinton administration, the Federal Charter School Program (CSP) was

created as an amendment to the Elementary and Secondary Education Act of 1965, under Title

X, Part C, 20 U.S.C. 8061-8067 (U.S. DOE). The purpose of CSP is to provide federal funds to

State Education Agencies (SEA), other local agencies and local school boards to “support

planning, program design, and initial implementation of charter schools” (U.S. DOE) across the

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country. It is intended to “enhance parent and student choices among public schools and give

more students the opportunity to learn to challenging standards” (U.S. DOE).

Four years later, under the Bush administration, the CSP was amended in the Charter

Schools Expansion Act of 1998. The act was widely supported in both houses, with an 84% vote

in the House of Representatives, and a 100% vote in the Senate (Wikipedia). The program was

again amended with the No Child Left Behind Act (NCLB) of 2001. The purpose of the NCLB

Act is to support standards-based education reform based on the premise that setting high

standards and establishing measurable goals can improve educational outcome for students and

result in higher student achievement (U.S. DOE).

In 1991, the first charter school legislation was enacted in Minnesota. California

followed next in 1992. Now, a total of 42 states, including Alaska, and the District of Columbia

have passed similar charter school laws. Charter schools are established according to individual

State charter school laws, and the enactment of charter school laws is solely a State prerogative

(U.S. DOE).

Community-based organizations and business entities may play an important role in

charter schools by partnering with charter schools to provide tutoring and recreational services,

help plan new schools, develop curriculum and assessment strategies, serve on governing boards,

and participate in day-to-day management. Charter schools operated by or affiliated with

community-based organizations and business entities “must be public school of choice, non-

religious, and must operate in a non-discriminatory manner” (U.S. DOE).

Charter schools are “exempt from certain state laws and policies to allow innovation to

take place” (Alaska EED). In exchange for more autonomy, they face increased accountability.

Title I of ESEA, as reauthorized by the NCLB Act of 2001, requires each State, as a condition of

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receiving federal funds, to implement a “single, statewide State accountability system” (U.S.

DOE) applicable to all public schools, including charter schools. Adequate Yearly Progress

(AYP), a component of the accountability system, measures “the extent to which schools

succeed in educating all students to a proficiency in at least reading and mathematics” (U.S.

DOE).

Alaska’s Charter School Legislation

In 1995, the Alaska Legislature passed the Charter School Act which Governor Knowles

signed into law. Since then, there had been two amendments to the Alaska stature for charter

schools. The first amendment in 2001, HB 101, increases the maximum number of charter

schools from 30 to 60; the length of charter was changed to a maximum of ten years, and

previous geographical restrictions were removed. Senate Bill 235 amended the limit of 60

charter schools to no limit (Alaska EED).

The law that pertains to the establishment and funding of charter schools in Alaska is as

follow (AK State Legislature):

Sec. 14.03.250. Establishment of charter schools. (a) A charter school may be

established as provided under AS 14.03.250 - 14.03.290 upon the approval of the local school

board and the state Board of Education and Early Development of an application for a charter

school.

Sec. 14.03.260. Funding for charter school. (a) A local school board shall provide an

approved charter school with an annual program budget. The budget shall be not less than the

amount generated by the students enrolled in the charter school less administrative costs retained

by the local school district, determined by applying the indirect cost rate approved by the

Department of Education and Early Development. The "amount generated by students enrolled

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in the charter school" is to be determined in the same manner as it would be for a student

enrolled in another public school in that school district (Alaska EED).

Sec. 14.11.121. Supplemental charter school facilities construction, lease, and major

maintenance grant program.

(a) The department shall establish a charter school facilities construction, lease, and major

maintenance grant program that supplements grant aid otherwise available under this chapter and

that is based on a per pupil funding formula.

(b) The department shall apply for available federal funding and award federal funding made

available under the grant program established under (a) of this section for not more than five

years for approved projects for charter school facilities construction, lease, or major

maintenance.

(c) The grant program established in this section is subject to legislative appropriation and

available funding and must be consistent with applicable federal and state requirements.

Charter schools are non-traditional public schools that are publicly funded and

independently operated. Alaska’s charter schools operate under the jurisdiction of local school

districts. The Alaska Department of Education and Early Development (Alaska EED) is the only

authorizer of charters, following the approval from the local school boards (Alaska EED). The

role of the local school board is to approve, monitor, renew or terminate a charter school’s

contract. A charter school can be terminated for its “failure to meet educational or financial

goals” or for other good cause such as low student enrollment (Alaska EED). If student

enrollment exceeds a charter school’s capacity, the school can select students by random lottery

drawing. A charter school seeking “to achieve greater gender balance should do so by targeting

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additional recruitment efforts toward male or female students”, but “may not create separate

lottery pools for girls and boys” (Alaska EED).

Currently, Alaska has 27 charters serving 5,613 students. As of December 2011, six

charter schools have closed. Charter schools in Alaska make up 5.3% of all public schools

(NAPCS, 2013).

Alaska’s Charter Schools

The four year period (1996-1999) following the passing of the Charter School Act in

1995, twenty-six (26) charter schools were proposed in the great state of Alaska (State of Alaska,

2013). Eight (8) schools were proposed in Anchorage, three (3) in Juneau, two (2) in Fairbanks,

and one (1) school each in Barrow, Bethel, Craig, Galena, Homer, Ketchikan, Kenai, Nome,

Palmer, Seward, Wasilla, and Wiseman. Those that never opened or withdrew the application

totaled eleven (11) (State of Alaska, 2013). Alaskan residents, educators, parents, and

community members alike were seeking alternative ways to educate the state’s students.

Today in 2013, the state of Alaska has 27 operating charter schools. This is considered

slow growth to some who advocate for charter schools. The national debate over whether charter

schools interfere with the sustainability of traditional public schools, whether they can improve

student achievement, and what the future holds for charter schools in Alaska is still the topic of

healthy debate.

Charter schools are established upon approval of the local school board and the Alaska

State Board of Education. Any person, organization, or group may apply to operate a charter

school. The local contract between the charter school and the local school board permits the

charter school to operate.

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Charter schools would become known as “choice schools” and provide unique methods

of instruction. Charter schools are public schools that operate within a school district; they are

free and non-parochial. Exemptions are allowed concerning curricula, textbooks, programs,

calendar, and scheduling. Students who attend charter schools may participate in sports and

other activities at their neighborhood schools. Parents are required to volunteer for a minimum

amount of time, and must agree with the school’s vision and mission. Likewise, teachers and

parents must agree with how and what is taught.

The same collective bargaining agreements of the school district apply to the teachers and

other employees of charter schools. Exceptions only apply when the district and the charter

school agree to an exemption. As in the case with the position of principal, who is hired by the

Academic Policy Committee (APC), made up of parents of students attending the school,

teachers, employees of the school, and members of the community (M. Meade-Olberding,

personal communication, March 13, 2013). The role of the APC is to supervise all operations of

the charter school, this would include ensuring operations are legal and ethical, the school is

safe; certifying budget accountability (establish and monitor the budget) (Meade-Olberding,

2012).

All monies collected by the schools must be maintained in the school district’s account

for the charter school (Meade-Olberding, 2012). Funding is distributed via the local school

district from state foundation monies, which is based on the number of students enrolled; similar

to other public schools in the same district (M. Meade-Olberding, personal communication,

March 13, 2013). On the other hand, these choice schools have discretion on how monies are

spent; for example they may elect to hire teacher assistants, specialists, or additional staff

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support. However, the school district is owner of all supplies and equipment purchased by the

charter school.

Charter school administrators are charged with stretching the already tight budget. Some

ways schools make ends meet, is to maximize volunteerism by requiring families to volunteer a

minimum number of hours annually. In some schools, if families are not able to volunteer, they

are required to pay a certain dollar amount per hour up to the required time; for example, should

the school require 50 hours annually per family or charge it out at $20 per hour, which totals

$1,000 annually. Charters schools also fundraise, receive philanthropic dollars from community

businesses and/or organizations, in-kind donations, and the use of interns (college students that

volunteer per semester as part of their graduation requirement) (E. Pederson, personal

communication, April 9, 2013).

Charter school admission is open to all students and requires an application process.

Whenever more students apply than there is space available, schools utilize the lottery system to

select new students. Typically, there are two lotteries per year, one in fall the week prior to

registration, and again in spring, the last two weeks in March. Preference is given to applicants

who have siblings already enrolled at the charter school or to maintain gender and/or grade level

balance.

Two of Alaska’s charter schools were named among the eighteen (18) Alaska Blue

Ribbon Schools; Aurora Borealis Charter School in Kenai in 2010, and Tongass School of Arts

and Sciences in Ketchikan in 2012 (Public School Review, 2013). These schools have been

recognized by the Department of Education for achieving superior standards of academic

excellence.

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Toma and Zimmer (2011) wrote an article that “reflected upon the promises and

limitations of charter schools and to offer policy advice” (p. 209). The empirical analysis offered

insight into the achievement of charter schools, whether they are cost effective, do they create

competition, are they innovative, and whether or not their mode of operations (policy) affect

outcome.

The findings indicated variation in performance (student achievement) of charter schools

across states (Toma & Zimmer, 2011). While some charter schools outperformed the traditional

public schools in their areas, others were similar, and yet others lagged behind. Another

consideration was the maturity level of the charter school. The charters with years of experience

typically did better than the new schools. The data suggest that new schools lag behind initially,

but increase in performance after two to three years of operation. This is believed to be related

to challenges related to establishing a charter school, the skill level of parents and leaders

responsible for administration, and teacher turnover. “The well-motivated empirical analysis

suggests that teacher attrition is higher in charter schools than in traditional public schools in part

because the teachers in charter schools are younger and less experienced than in the traditional

public schools” (Toma & Zimmer, 2011, p. 210).

There was a small positive implication that charters create competition for traditional

public schools in New York. Likewise, charter schools “provide schooling per unit costs that

are lower than traditional public schools; they also find charters are inefficient in an absolute

sense just as are traditional schools” (Toma & Zimmer, 2011, p. 211). As the practice of

managing charter school per state evolves with discussion about oversight, policies,

achievement, and competition, this article suggest that instead of working to offer charter schools

within a district, we might consider creating entire charter school districts; “While creating a

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charter district may maximize school choices, Levin forces us to think about tradeoffs and the

responsibilities of a democratic society to educate future generations of children” (Toma &

Zimmer, 2011, p. 211).

The move toward alternative education choices in the nation is a voluntary one, this is

clear. Families are choosing charter schools, states are navigating the waters to understand the

balance between offering what is demanded by residents, the impact to traditional public schools,

and ultimately, the academic success of students.

Anchorage’s Choice Schools

The Anchorage School District hosts eight (7) charter schools in Anchorage, Native

Cultural, Aquarian, Family Partnership, Frontier, Highland Tech, Rilke Schule, and Winterberry

Charter Schools; and one (1) in Eagle River, Eagle Academy Charter Schools . At the core of

each charter school’s mission is the education of children. The curriculum aligns with Alaska

State and Anchorage School District grade level expectations. The uniqueness of their charter

schools is found in the way they’ve determined to reach that goal. It defines the educational

choice available to families. Descriptions of five charter schools are listed below to provide

insight into the specificity of each school (Anchorage School District, 2012).

Alaska Native Cultural Charter School blends academics and culture to enrich learning

for students. It would be a common experience for students to be exposed to practices that are

customary in native culture, i.e. cutting, cleaning, and drying fish, ducks, geese; reciting the

Pledge of Allegiance in the Yupik language; and to learn values from the phrase of the week that

is shared by an Elder. The school views itself as a village raising every child, in that community

members are often guest presenters, teachers know the students by name, and Elders regularly

work at the school. Alaska Native Charter School is proud that it is connected to all of the

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regions of the state and all five groups (Aleut, Athabascan, Aleut, Inupiat, Tlingkit and Haida,

and Yupik). Although the school’s emphasis is on Alaska Native culture, the value is added to

all students regardless of their race/ethnicity; in that effort is made to help all students connect to

their cultural identity because of the value placed on understanding one’s heritage. Learning

who they are, and where they come from helps the students build their inward spirit. It

empowers students to live their own values, and be able to resist peer pressure (Anchorage

School District, 2012).

Alaska Native Cultural Charter School serves pre-kindergarten through 7th grade;

approximately 206 students, has a 14:1 student-teacher ratio. It offers teaching methods based in

Native ways of instruction and learning, active, inquiry/project based learning environments.

Individualized tutoring is available. Students enjoy a warm, welcoming, safe educational setting

(Anchorage School District, 2012).

Aquarian Charter School is famous for integrating the arts into every aspect of learning

for students. Special care is given to the décor in an effort to create space where teachers can

facilitate the students learning. The emphasis is to educate the whole child, academically,

socially, and emotionally. Students at Aquarian are “encouraged to create and not just follow a

methodical curriculum; but to create from within, studying masters and different types of

methodology using different materials.” The passion of the child is important to this learning

experience. Teachers are collaborative and lessons are tailored to the level of each student.

Teaching the same concept to the entire class at a level where the students understands serves to

unify the class. Aquarian provides an inclusionary gifted program and inclusionary special

education programming; this means that a certified gifted instructor goes into every class and

teaches high level thinking in science and math. “Aquarian believes that all students should have

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the opportunity for enriched activities and be treated as gifted” (Anchorage School District,

2012).

Aquarian Charter School serves kindergarten through 6th grade; approximately 369

students; has an18:1 student-teacher ratio. It offers a plethora of after school activities, i.e.

running team, music, band, orchestra, arts programs, snowshoeing, cross-country skiing, gym

hockey, flag football, etc. Four times per year students explore “teacher’s choice courses”, for

enriched learning. “Parents say Aquarian feels like family, staff knows their children, loves

them, and cares about their education.” Words used to describe Aquarian are: caring, active,

open, academic, loving, welcoming and friendly” (Anchorage School District, 2012).

Family Partnership Charter School was designed to provide support to parents that

homeschool their children. It offers flexibility and freedom, cooperative learning, and

mentorship opportunities. Sponsor Teachers assist families with writing individualized learning

plans, create budget plans, and provides instructional support. Families have full charge of their

students’ educational process. They use “home study, on-line courses, correspondence, small

classes, private lessons and college classes to achieve the well-rounded education they desire.”

Students at Family Partnership Charter School enjoy small group instruction, may participate in

their local traditional school’s extra-curricular activities, and attend the King Career Center. It is

also possible for students to benefit from dual enrollment in the charter school and their local

traditional school (Anchorage School District, 2012).

Family Partnership Charter School serves kindergarten through 12th grade; approximately

460-600 students; Northwest Accreditation, and students enjoy a number of social gatherings

annually. Supporters view it as a school without walls, one that “cuts the jacket to fit the kid, not

the kid to fit the jacket” (Anchorage School District, 2012).

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Highland Technical Charter School supports full-time homeschool families. The

standards based learning environment is one where students own their learning and strive for

success. The focus is on educating for leadership. Students that graduate Highland Tech are

prepared to enter higher education or enter the workforce. The students, parent, teachers, and

administrators have a shared vision; accountability, character development, career, service

learning, and academics. Student are encouraged to govern themselves; CORE which stands for

Culture of Respect for Everyone is the standard for engagement. Students are not bound by time,

as it is the variable; learning is the constant. Students perform to proficiency and mastery in all

learning concepts. Highland Tech is believed to be the school of the future. Students utilize

technology to network with other students around the world in Australia, India, Singapore, New

Zealand, and Canada. The school has been invited by Microsoft Partnership Learning Network

to mentor other schools (Anchorage School District, 2012).

Highland Tech Charter School serves 6th through 12th grade; approximately 230 students;

and has a strong robotics team. Curriculum includes core content strands, career strands,

technology; personal, social, and service learning, contextual learning and community

involvement. Parents feel welcome and students thrive at Highland Tech Charter School

(Anchorage School District, 2012).

Rilke Schule Charter School is the only emersion charter school in Anchorage. Students

spend half the day learning in German and the other half learning in English. A dress code is

required, as well as a healthy food program. Pre-school students are able to attend Saturday

Class where they learn their numbers in German and their colors. Fifty (50%) of the teachers are

native German speakers. The other fifty percent are required to visit Germany often and take

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courses to improve their German. Annually, the eighth (8th) grade class travels to Germany as

part of the emersion experience (Anchorage School District, 2012).

Across the nation and in the state of Alaska, charter schools have become part of the

educational fabric and norm for educating students. This is further supported by the Anchorage

School Board and Anchorage School District’s vision, core values, and operating principles

(outlined below). Additionally, Anchorage charter schools are slated to receive level funding in

fiscal year 2013-2014 according to the ASD Office of Management and Budget. This suggests

that the future of charter schools in the Anchorage School District will continue to provide

choice.

Entity* Value Commitment Anchorage School Board Vision Create a high performance district Responsiveness Public education should be responsive to an

ever-changing world Operating Principle School Innovation Commitment Effective public school choice options Anchorage School District Strategic Plan:

Destination 2020 Enhance and focus programs to improve overall effectiveness

Priority Initiative Determine what school choice means at Anchorage School District

*Anchorage School District (2013).

Charter School Program National Ranking & Scorecard

The Center for Education Reform (CER) performs annual analysis of charter school laws

across the nation, and documents the conditions for effective laws that support the growth and

success of these quality public schools. CER analyzed each state’s laws against national

benchmarks that “dictate the impact of charter schools policies and best practices on healthy and

sustainable charter schools” (CER, 2012).

In its 13th annual scorecard done in 2012, CER awarded a national GPA of 2.1 (a C

grade) to 42 charter schools laws as a result of states having earned five A grades, ten Bs, fifteen

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Cs, eight Ds and four Fs. Alaska was awarded a D grade. At the conclusion of its 14th annual

scorecard in 2013, the nation’s 43 charter school laws did not fare much better, earning four As,

nine Bs, nineteen Cs, seven Ds and four Fs. Alaska still has a D grade and has the sixth weakest

of the nation’s 43 charter laws (CER, 2013 – Appendix A).

CER is of the opinion that “independent, multiple authorizers are the key to a strong

charter law” (CER, 2013). States with strong and permanent authorizing structures, a critical

component of charter school law can better “withstand political elections or partisan whims with

regard to funding, operations and accountability” (CER, 2013). Alaska law only allows the local

school districts to approve or reject charter school applications before the applications move on

to the single state authorizer, the State Board of Education and Early Development. In

comparison, the states that earned an A grade, Washington D.C., Minnesota, Indiana and

Michigan have nine to ten authorizers. States that received a D or F grade have only one or two

authorizers (CER, 2013).

In January 2013, Representative Lynn Gattis of Wasilla introduced a bill to enhance the

current public charter school law. HB93, if passed will allows multiple authorizers of public

charter schools in Alaska, allowing other government agencies, universities, nonprofit

organizations and business entities to participate in the authorizing processes. Representative

Gattis said that having a sole authorizer “limits the ability of parents and community members to

establish more charter schools and has also created an added layer of financial burdens that

diminish the level of services that charter schools can offer” (Press Release, House Majority

Press, 2013).

Mary Meade, Supervisor of Anchorage School District, disagrees, saying that multiple

authorizes will result in a “dramatic increase of charter schools in all cities in Alaska; including

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rural areas. The increase of charter schools increases the probability of transfers from other

public schools and into choice (charter) schools, therefore diminishing the traditional public

schools and making funding more difficult.” Local school boards act as a check on charter

school over-proliferation and growth (Press Release, House Majority Press, 2013).

Other key components used by CER in state laws comparison are state and local

operational autonomy, teachers’ freedom, and student funding equity. Alaska scores low on all

these key components. The Alaska Charter School law is vaguely written with regard to student

funding. Funding decisions are left to the local school district to provide the charter school with

its annual budget, deducts its operational expenses and sets administrative costs. Facilities

funding through grant aid program is dependent on annual state appropriations, and not

guaranteed.

Another organization, National Alliance for Public Charter Schools (NAPCS), in its 2013

State Charter School Law Ranking report, ranks Alaska 41 (out of 43). Based on 20 essential

components of the NAPCS model law, it awarded Alaska a score of 63 points (out of 228)

(NAPCS - Appendices B & C).

The analysis of both NAPCS and CER highlight the needs for Alaska’s Charter School

Law to be strengthened in the following areas (NAPCS & CER):

1. Expanding authorizing options

2. Transparency in Charter application, review, and decision-making process

3. Requiring performance-based charter contracts

4. Clear processes for renewal, nonrenewal and revocation decisions

5. Comprehensive charter school monitoring and data collection processes

6. Increasing operation autonomy

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7. Ensuring equitable operational funding and equitable access to capital funding and

facilities

Measuring Up & Adequate Yearly Progress (AYP)

Adequate Yearly Progress (AYP) measures “the extent to which schools succeed in

educating all students to a proficiency in at least reading and mathematics (U.S.DOE). From

NAPCS’s data for 2011, Alaska scores above the national average in meeting AYP. Charter

schools making the AYP is 77.8% (21 out of 27 schools), and schools failing to make AYP is

22.2% (6 out of 27). The national average for charter schools making the AYP is 58.9% (2,469

out of 4,195 charter schools), and 41.1% (1,726) of charter schools failing to meet the AYP

standards (NAPCS, 2013).

“At 21 years old, the national charter school movement is only making satisfactory

progress,” said CER president Jeanne Allen. Policy makers are facing enormous challenges with

only less than half of the states’ charter school laws making a satisfactory grade. Charter school

laws have to be strengthen to meet demand of parents and educators with choice for quality

charter schools, to ensure excellent learning opportunities for children, and to ensure growth and

sustainability of quality choice public schools. Allen also noted that “if a charter school law isn’t

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strong, school choice options minimal or non-existent…teacher quality measures are not assured,

students will not have the opportunities they need and deserve.”

Both CER and NAPCS reports show that the majority of state charter laws lack the

necessary components for successful charter school policy implementation, and critical

ingredients for success in growing and nurturing high quantity of high quality non-traditional

public schools. According to CER, “state laws that vest authority in existing power structures

for charter schools’, that are uncertain about authority and funding, have low degree of

autonomy, “compromise individuals and quality authorizing.”

History behind Funding Formula

For the past 20 years, Alaska’s public school funding formula has historically contained

five major adjustments to the formula. These same adjustments can be found in most public

school funding formulas in the nation. The five adjustments include: sparseness and size of

student population, special needs or categorical funding, regional cost differences, equalization,

and supplemental funding floor.

In 1998, the McDowell Group assembled a panel of Alaskans with many years of

experience in the field of education to review and make recommendations to improve the

adjustment mechanism in the public school funding formula. The group reviewed the funding

community concept and its application under the instructional unit funding formula. The group

determined that the school, not the community, is the fundamental cost center for delivering

instructional services. The panel determined that adopting the school as the basis for funding

would result in a more equitable allocation of instructional resources by providing comparable

levels of instructional staffing in all schools regardless of district size and location. The group

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determined that schools of similar size should receive similar resources for staffing regardless of

location (Alaska Department of Education & Early Development, 1998).

The money distributed through the foundation formula provides the Anchorage school

district with the majority of the state’s contribution to K-12 education. The funding formula

allocates resources for general operations, routine maintenance, and operations of school

facilities. General operations include: staff salaries and benefits, teaching supplies, textbooks,

communications, contracted services, school, and district administrative services. Operations of

school facilities include: custodial and maintenance staff salaries and benefits, utilities, and other

expense associated with routine maintenance to operate school facilities.

Funding Formula for Charter Schools

Charter schools are funded using the basic need formula as written in state statue (AS

Sec. 14.03.260), less the state approved indirect cost rate (see Appendix D for Departments

included in the Indirect Cost Rate). The specific revenue provided to cover the dollar amount of

the formula is comprised of non-categorical revenues in the General Fund including local

property taxes, Federal Impact Aid, and state Foundation funding. The formula is based on

student count (Alaska Department of Education & Early Development, 2013).

AS Sec. 14.03.260 states: The budget shall be not less than the amount generated by the

students enrolled in the charter school less administrative costs retained by the local school

district, determined by applying the indirect cost rate approved by the Department of Education

and Early Development. The “amount generated by the students enrolled in the charter school”

is to be determined in the same manner as it would be for a student enrolled in another public

school in that school district.

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The basic need formula for charter schools involves six variables (the other “public

schools” have eight variables). The variables in the basic need formula for charter schools are

labeled A through F. Each variable will be explained thoroughly in the sections below.

Variable A consists of two items: Average Daily Membership (ADM) and School Size

Factor Formula. Average Daily Membership (ADM) is the average number of enrolled students

during the twenty-school day count period. The twenty-school day count ends the fourth Friday

of October (reports are due within two weeks after the end of the 20-school day count period).

The school formula is based on the ADM. Below is a table that depicts which formula to use for

the given ADM. Once the appropriate school size formula has been chosen, you would multiply

the ADM by the product of the school size formula; that would formulate Variable A. To obtain

Variable B, you would multiply Variable A by 120% (the additional 20% is the Special Ed

Factor).

Table 1: School Formula Calculation for Given ADM

Reference School Size Formula 1. 10-19.99 39.60 2. 20-29.99 39.60 + (1.62*(ADM-20)) 3. 30-74.99 55.80 + (1.49*(ADM-30)) 4. 75-149.99 122.85 + (1.27*(ADM-75)) 5. 150-249.99 218.10 + (1.08*(ADM-150)) 6. 250-399.99 326.10 + (.97*(ADM-250)) 7. 400-749.99 471.60 + (.92*(ADM-400)) 8. Over 750 793.60 + (.84*(ADM -750)) Alaska Department of Education & Early Development

Variable C covers the Level III Special Education Intensive Student population. A

school district receives funding for intensive special education students that: are receiving

intensive services, are enrolled on the last day of the 20-school day count period and have an

established Individual Education Plan. The district’s intensive student count is multiplied by 13

and the product will be form Variable C.

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Variable D deals with the number students in grades 9 through 12. This particular cohort

is identified as the CTE in the basic need formula. Once you calculate the number of students in

grades 9 through 12 (students enrolled after the 20-school day count period), you’ll multiply that

number by 1% and that will generate Variable D.

The sum of Variables B, C, & D is called the “adjusted ADM.” The adjusted ADM is

then multiplied by the Base Student Allocation. The Base Student Allocation is a dollar amount

given each year by the Anchorage School District; this year’s Base Student Allocation is $5,680.

Once the adjusted ADM is multiplied by Base Student Allocation, the product becomes known

as total “Basic Need.”

Each school is allocated a quality school grant which entails that for each student in the

adjusted ADM, the school gets an extra $16 per student. The adjusted ADM multiplied by the

Quality School Grant $16 equals the Variable E. The next portion of the formula deals with

indirect rates; like the Base Student Allocation, the indirect rate is delivered by the Anchorage

School District each year.

According to Mary Meade, the supervisor of the Anchorage Charter Schools, the indirect

rate for Anchorage has been around 3% for the past years. For the fiscal school year of 2013, the

fixed indirect rate is 3.64%. The indirect rate is multiplied by the sum of the Total “Basic Need”

and Variable E. The product of the indirect rate and the sum of the Total “Basic Need” and

Variable E is called the Indirect Cost. The indirect cost is then subtracted from the sum of the

Total “Basic Need” and Variable E and therefore creating the total funding the charter school

receives, Variable F.

Formula Example

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The table below is an example of the basic need formula being computed for Rilke

Schule (a charter school in Anchorage). The proposed enrollment is 360 students, the indirect

cost rate is at 3.64% and the Base Student Allocation is $5,680. Variables C (Level III Special

Education Intensive Students) and Variable D (CTE 9-12 Graders) do not apply to the example

below because Rilke Schule doesn’t have any Special Ed Intensive Students and the school is a

K-8 school (making Variable D irrelevant in this case).

Table 2: Basic Funding Need Formula

Variables Student ADM 360.00School Size Factor 432.80Adjusted ADM 432.80Times: Special Needs Factor 1.20Total Adjusted ADM 519.36Times: Student allocation 5,680Full Implementation 2,949,965Plus: Quality grants ($16*adjusted ADM) 8,310Less: Indirect Cost (107,681)Total Funding 2,850,594Charter Funding 1213

Variable A is the Student ADM and the School Size Factor. Since the project enrollment

is 360, we would use the school size formula for the bracket 6 in table 1 (school size 250-

399.99). The formula for bracket 6 is: 326.10 + (.97*(360-250)) which equals 432.80. The

adjusted ADM is then multiplied by the Special Ed Factor 1.2 which equals 519.36, the Total

Adjusted ADM (Variable B). The Total Adjusted ADM (Variable B) is then multiplied by

Student Allocation (5,680) which gives us 29,949,965, the “basic need.”

The Quality Grants is then multiplied by the adjusted ADM and added to the full

implementation. The Quality Grants being $16 and the adjusted ADM being 432.80, giving us

the product of 8,310. After adding the 8,310 to the adjusted ADM, we would subtract the

indirect costs. The indirect rate in this scenario is 3.64% (as stated above) which multiplied by

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the Total Adjusted ADM (which now includes the Quality Grants 8,310): (2,949,965 + 8,310) *

3.64 = 107,681.

The Indirect cost, 107,681, is then subtracted from the Full Implementation (2,949,965) is

left with the difference of 2,850,594; the total funding available for the charter schools

projection. Keep in mind that the ADM is contingent on whether that amount is enrolled during

the 20-school day count in October. If the enrollment of students is less than the projected

ADM, the funds are then subtracted from the charter school’s funding. If the enrollment is

greater than the suggest ADM after the 20-school day count, the charter school receives more

funding. Mary Meade brought up an interesting point; she stated the 20-school day count can be

a huge disadvantage to some charter schools because some students might transfer to another

school during the 20-school day count and re-enroll after the 20-school day count. This will

result in funds being subtracted from the first school due to the change in ADM.

Business Partnership

The majority of the charter schools in Anchorage have partnerships with a lot of local

businesses. Since the majority of the charter school funding is from the ASD budget allotment,

if the charter schools needed more materials or just financial help in general, they rely heavily on

fundraising, parent & community involvement1, and business partnership(s). Below is a table of

each charter school in Anchorage and their business partners.

                                                            1 Parents are required to volunteer at their child’s school for a certain amount of hours per week. 

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Charter Schools in Anchorage Business Partners Alaska Native Cultural Charter School Boys and Girls Club, NE Community

Center Hope Worldwide

Eagle Academy Charter School First National Bank, Eagle River Family Partnership Charter School Credit Union 1

Machaus McDonalds, Abbott

Frontier Charter School N/A Highland Tech Charter School Behavior Matters LLC

Colin Gillam, Financial Advisor Rilke Schule German School of Arts and Science

Alaska Center for Ear , Nose, Throat (AGENT)

Babylon Language Institute of Alaska Bilikin Investment Group David Charles Gosse Photography J & A Hermann LLC Law Offices of Elliott Dennis Northern Smiles Orthodontist

Winterberry Charter School Anchorage Fine Department, Station #1

Behavior Matter LLC

Anchorage School District Funding

For the projected school year 2013-2014, the Anchorage School District projects its

revenues as follows: $355 million from State formula and grants, $245 million from local taxes

and revenue, $118 million from state pension payments, $70 million from federal grants and

programs and $45 million from the state debt service. Below is a graph from the Anchorage

School District that depicts the portion of each Revenue prospect.

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According to the Anchorage School District data, 85-88% of the school budget goes

towards teacher and support personnel salaries and benefits; the largest expenditure. The

salaries maintained a steady plateau with a slight increase in the past years but the benefits

increase 50% and higher during the same time the slight increase occurred for the salaries. Below

is a graph from the Anchorage School District website which depicts the percentage of funds that

are allocated towards teacher’s salaries.

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Despite flat salaries, benefit costs have increased by more than $25,000 for each full-time

employee ($15,000 to more than $40,000). The growth of the salaries, 5-6 percent, is a more

rapid rate than inflation. The increased expenses are mostly made up of health plan costs and

pension obligation. The district plans on presenting a proposed budget that aims towards

“reducing health and benefit costs growth the next few years in order to maintain class size a

core district support services.”

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Other Revenue and Funding

There are many resources and organizations available to charter schools across the

country to support the growing charter school movement. The U.S. Department of Education's

Office of Charter Schools Program (CSP) was established “to offer parents and their children

more choices among public schools and to give all students the opportunity to reach high

academic standards.” (CSP). To meet its mission to support the charter school program, and

increase public understanding of the program’s contribution to American education, CSP

provides federal funds to help create new high-quality charter schools, and reward high-quality

charter schools.

In awarding grants, the Department of Education’s CSP “must give preference to States

that have multiple chartering agencies, that ensures accountability of public charter schools for

reaching clear and measurable objectives, and that give public charter schools a high degree of

autonomy over their budgets and expenditures.” (CSP). Alaska, with its single authorizer,

would not be given funding preference.

The Alaska State Legislature amended House Bill 101, Sec. 14.03.263, to provide to a

charter school a “one-time grant equal to the amount of $500 for each pupil enrolled in the

charter school on October 1 of the year in which the school applies for the grant.”

SB 235 establishes a per-pupil in-state aid program with a nominal $1 dollar per pupil

per year. However, according to the Senate Bipartisan Working Group, “it is communities and

school districts which must arrange for them the means to provide the 10% local contribution

necessary to achieve the 90% federal match.”

In a memo (August 2007) obtained from the Anchorage Charter Schools Supervisor, it

was determined that Alaska EED had not spent all its federal dollars given to it in the past,

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indicating “that all is not being done to encourage new charter schools.” As a result, DOE

decided to pull Alaska’s status as a State Education Agency (SEA) participating in CSP, and

therefore cannot award grants to new charter schools. New charter schools may then apply for

federal grants directly to the DOE. However, according to Mary Meade, grants are usually not

given due to low points on the scoring rubrics.

School Bonds appear on almost every local election for voters’ approval. So far, none

of the local charter school has exercised their right to petition for school bonds, leaving that to

the Anchorage School District. Public school projects funded through bonds qualify for debt

reimbursement of 60-70% from the state. (ASD).

Revenue and Sustainability Options

Charter schools are just one of several choice school options available today, i.e. private

schools, home schools, and online learning. There are also various methods for sustainable

funding options. According to The Friedman Foundation for Educational Choice (2013), a

number of states in America are experiencing success with usage of vouchers, education savings

accounts, tax-credit scholarships, and individual tax credits/deductions (The Friedman

Foundation for Educational Choice [FFEC], 2013).

The voucher system would allow families to pay for private school for their children,

using the per student allotment typically allocated to public schools. This would include

religious and non-religious schools (FFEC, 2013). Implementation of the education savings

accounts would permit families to leave the public school system to participate in an alternative

form of education. A savings account that is authorized by the government would serve to hold

the public funds deposited for use by the families for specific purposes; such as tutoring, online

courses, private school tuition and fees, or higher education expenses (FFEC, 2013).

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The tax-credit scholarships provide tax credits to taxpayers that make donations to

nonprofit organizations who provide scholarships to private schools. Individual taxpayers and

businesses qualify. There are nonprofits that give scholarships to private schools, as well as

provide grants to public schools or assistance to students for transportation for attending

alternative schools (FFEC, 2013). Income tax relief, through individual tax credits and

deductions, is given to parents to pay for educational expenses; i.e., books, supplies, computers,

transportation, tutors, and tuition for private school (FFEC, 2013).

There are alternative ways of supporting choice schools like charter schools. It will

require identifying what system or groups of systems work best for the state and/or community.

Conclusion

The demand for alternative education is a growing movement in America. Choice

schools are one of several options available to families. Charters schools are showing more

growth is some states compared to others. It is believed that the limited number of authorizers

may be the cause of slow growth.

In Alaska, House Bill 93 was introduced by Representative Lynn Gattis (2013) to

increase the number of authorizes in the state, which is expected to spur the establishment of

more choice schools. There are arguments against HB 93, concern that the lotus of control

remain at the local school district level, or that funding for traditional public schools will be

impacted negatively with the passage of the bill (The Alaska State Legislature, 2013).

It is clear that more research is needed to better measure the impact choice schools have

on student achievement, what causes some charter schools to outperform some traditional public

schools and underperform others. Creative funding for alternative education is available for

consideration by communities willing to risk the change.

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Are the geographical constraints and population density in rural Alaska problematic for

charter school growth, or will charter schools positively impact traditional public schools by

creating competition? Regardless of the unknown, families are seeking to exercise choice in the

education of their students. Parents are voluntarily electing charter schools.

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References

Alaska Senate Bipartisan Working Group. (February 8, 2010). Senate Education Committee Moves Bill to Help Charter Schools. Press Release. Retrieved April 4, 2013 from

http://www.aksenate.org/press/020810_committee_moves_education_bill.pdf. Anchorage School District. (2012). ASD Tube Community [Video file]. Retrieved March 15, 2013

from http://www.asdk12.org/depts/staff_dev/ASDTubeCommunity/CharterSchools.asp. Anchorage School District. (2013). Retrieved March 28, 2013 from https://www.asdk12.org/. Anchorage School District. (2013). Where Does ASD's Money Come From? Retrieved March 12, 2013 from http://asdk12.org/budget/. Comeau, Carol. (Sept 10, 2001). ASD MEMORANDUM #36 (2001-2002). Anchorage School

District: Mission Statement and Goals. Retrieved March 01, 2013 from www.asdk12.org/school_board/archives/Arc2001-2002/.../H08M036.pdf. Cordero-Giorgana, Erick. House Majority Press. (Jan 30, 2013). Gattis Introduces Bill to

Enhance Public Charter Schools: HB 93 Allows Multiple Authorizers of Public Charter Schools in Alaska. Retrieved March 29, 2013 from http://www.housemajority.org/item.php?id=item20130130-33.

Gattis, L. (2013). Sponsor statement: House Bill 93 – Charter Schools [January 30, 2013]. Retrieved April 10, 2013 from http://housemajority.org/spon.php?id=28hb93. Holloway, S. J. State of Alaska Dept of Education and Early Development, (2001). Alaska's

Public School Funding Formula: A Report to the Alaska State Legislature. Retrieved March 14, 2013 from http://education.alaska.gov/publications/FundingFormulaSB36Report.pdf.

League of Women Voters. (March 2000). History of the Charter School Movement: What are

Charter Schools? Retrieved March 17, 2013 from http://www.dcwatch.com/lwvdc/lwv0003c.htm.

Meade-Olberding, M. (2012). All About Charter Schools [Video file]. Retrieved March 20, 2013

from http://www.asdk12.org/depts/staff_dev/ASDTubeCommunity/CharterSchools.asp. National Conference of State Legislatures. Charter Schools: Overview. Retrieved March 17, 2013 from http://www.ncsl.org/issues-research/educ/charter-schoolsoverview.aspx. National Education Association – Alaska. (n.d). School Choice. Retrieved March 12, 2013 from http://www.neaalaska.org/sites/default/files/SchoolChoice2013.pdf Public School Review. (2013). Alaska Blue Ribbon School. Retrieved on March 26, 2013 from

http://www.publicschoolreview.com/blueribbon_schools/stateid/AK. State of Alaska, Department of Education and Early Development. (2013). History of Alaskan

Charter Programs. Retrieved March 25, 2013 from http://www.eed.state.ak.us/ alaskan_schools/charter/pdf/history_of_alaskan_charter_schools.pdf.

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State of Alaska, Department of Education and Early Development. Retrieved March 10, 2013 from http://www.eed.state.ak.us/alaskan_schools/charter/ State of Alaska, Department of Education and Early Development. Retrieved March 10, 2013 from http://education.alaska.gov/faq.html#A2. The Alaska State Legislature. AS§14.03.250 & AS §14.03.260. Retrieved March 10, 2013 from http://www.legis.state.ak.us/basis/statutes.asp?title=14#14.03.250. The Alaska State Legislature. 22nd Legislature (2001-2002). AS§ 14.03.263. Charter school

grant program. Retrieved March 10, 2013 from http://www.legis.state.ak.us/basis/get_bill_text.asp?hsid=HB0101D&session=22.

The Alaska State Legislature (2013). House Bill 93 Letters Oppose. Retrieved April 10, 2013 From http://www.legis.state.ak.us/basis/get_document.asp?session=28&bill=HB93 The Center for Education Reform. (n.d.). Charter School Law. Retrieved March 10, 2013 from

http://www.edreform.com/issues/choice-charter-schools/laws-legislation/ The Center for Education Reform. (December 2011). The State of Charter Schools: What We

Know and What We Do Not Know About Performance and Accountability. Retrieved March 10, 2013 from http://www.edreform.com/wp-content/uploads/2011/12/StateOfCharterSchools_CER_Dec2011-Web-1.pdf.

The Center for Education Reform. (2013). Annual Charter School Law Report Card Issued.

Retrieved March 10, 2013 from http://www.edreform.com/wp-content/uploads/2013/01/CER CharterLaws2013_Chart_FINAL.pdf

The Friedman Foundation for Educational Choice (2013). The ABCs of School Choice. Retrieved April 10, 2013 from http://www.edchoice.org/CMSModules/EdChoice/File Library/965/The-ABCs-of-School-Choice---2013-edition.pdf

The National Alliance for Public Charter Schools. (2012). The Public Charter School

Dashboard. Retrieved April 7, 2013 from http://dashboard.publiccharters.org/dashboard/schools/page/overview/state/AK/year/2012

The National Alliance for Public Charter Schools. (January 2013). Measuring Up to the Model:

Ranking of Charter School Laws. (4th ed.). Retrieved April 7, 2013 from http://www.publiccharters.org/data/files/Publication_docs/NAPCS_2013%20Model%2Law%20Rrankings_20130211T204454.pdf.

Toma, E. & Zimmer, Ron. (2011). Two decades of charter schools: Expectations, reality, and the

future. Economics of Education Review, 31, p. 209-212. doi: 10.1016/j.econedurev.2011.10.001. U.S. Department of Education, Office of Innovation and Improvement, Charter School Program.

Retrieved March 11, 2013 from http://www2.ed.gov/about/offices/list/oii/csp/index.html?exp=0 U.S. Department of Education. (July 2004) Charter School Program. Title V, Part B: Non-

Regulatory Guidance. Retrieved March 11, 2013 from http://www2.ed.gov/programs/charter/nonregulatory-guidance.doc

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U.S. Department of Education. (n.d.). Title I — Improving the Academic Achievement Of The Disadvantaged. Retrieved March 11, 2013 from http://www2.ed.gov/policy/elsec/leg/esea02/pg1.html

Wikipedia. (n.d). Federal Charter School Program. Retrieved on March 21, 2013 from

http://en.wikipedia.org/wiki/Federal_Charter_school_program

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Appendix A

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Appendix B

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Appendix C

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Appendix D