What is a charter school?
_ A charter school is a public school that operates under a contract, or charter, entered into between the school’s organizer and a charter school authorizer.
_ Charter schools must have open enrollment policies and may not charge tuition.
_ A charter may only be awarded by an authorizer to a nonprofit corporation.
_ Like traditional public schools, public charter schools may elect to enter into contracts with for-profit education service providers for instructional, tutoring, professional development, financial and accounting services.
As it grapples with aging buildings, the Vigo County School Corp. has developed a sweeping facility plan that calls for some new construction, consolidation, repurposing and closing of facilities.
The plan includes one new high school to replace two aging high schools, and closure of four elementary schools, among many other components.
Currently, it is working on financing and other aspects of the plan, which would take several years to carry out.
But another lingering question remains: What happens to the four elementary schools slated for closure as part of that plan? The school district has not yet offered specifics about potential use of the closed elementary schools.
One factor that can’t be ignored is a controversial state law, passed more than a decade ago, that requires districts to make closed or vacant buildings available to charter schools for $1 before selling them to other buyers.
The aim of the so-called “$1 law” has been to give charter schools, which do not receive property taxes for facilities, access to vacant buildings.
The bill is controversial because traditional public school districts do not want to give facilities to schools that will compete for students.
Charter school supporters say that since they can’t levy local property taxes to pay for buildings, they’ve needed tools like the dollar law for facilities.
Some opponents of the $1 law argue if a district is trying to be more efficient and cut costs by consolidating and closing schools, the law can create a disincentive to do so. “I believe the law should be changed,” said VCSC Superintendent Chris Himsel. “Schools are a taxpayer asset, and taxpayers should benefit from that asset even if it is no longer needed.”
Specifically, Himsel said, school corporations should have the opportunity to partner with other taxing agencies for the use of the property or it should have the opportunity to sell the property at market value and use the proceeds to offset other expenses.
The law has had revisions since it was initially passed.
And this year, Indiana lawmakers passed legislation calling for school districts to share property taxes levied for operations with charters in their district, starting in 2028.
The sharing of operations fund revenue, which covers transportation, utilities and capital projects, would be phased in over four years.
The property tax revenue sharing comes into play when certain criteria are met.
In addition, effective in 2028, districts statewide that have operating referendums approved by taxpayers would also have to share revenue with charters.
Charters, which are public schools, will also continue to receive $1,400 per pupil through the state’s Charter and Innovation Network School Grant over the next two school years.
Should the law be repealed?
State Rep. Tonya Pfaff, D-Terre Haute, says Indiana’s so-called “$1 law” forces school districts to offer closed school buildings to charter operators for a dollar, even though Hoosiers paid for those buildings.
“That simply doesn’t make sense,” she stated. “Local taxpayers invested in that infrastructure, and giving it away for next to nothing fails basic fairness.”
The legislation needs to be changed “so that local governments get first dibs, and private or charter operators only get the property after open competition at fair market value,” Pfaff said.
State Sen. Greg Goode, R-Terre Haute, also weighed in on the legislation.
“The dollar law has long puzzled me,” he stated. “This calendar year, I have been quietly reaching out to people in my district and across the state to hear different perspectives, and I think it is fair to re-evaluate this law.”
Ownership of school facilities belongs to Indiana taxpayers “and the custodians of these valuable assets are school corporations,” Goode said. “I am working with partners on both sides of the political aisle in the legislature on some common sense updates that will help communities and school corporations. I fully anticipate introducing legislation and as with every bill on which I take the lead, it will have bi-partisan co-sponsorship.”
Charter supporters weigh in
State Rep. Bob Behning, R-Indianapolis and chair of the House Education Committee, said he supports those who say the law should remain in place until charter schools have parity with traditional public schools as far as property tax dollars following the student. Currently, a traditional public school student generates state tuition support plus a statewide average of about $4,000 to $4,500 per student in local property tax revenue that supports operating expenses, including capital projects and transportation.
“None of those (property tax) dollars are available to charter school students,” Behning said.
Charter schools are public schools, he said. “Why don’t they deserve to have the same amount of money” to educate a child, he asked.
Behning said that in his mind, parity means those local property tax dollars should follow the student.
He also suggests that if a school district is providing a quality education strongly supported by the community, no charter would want to locate in that community unless they believe they can offer something better.
“I think sometimes it’s a fear of the unknown and not a fear of reality,” Behning said.
The focus should be on what is best for the student, Behning said. “Let’s not look at entities, but let’s look at what is in the best interest of the child.”
Scott Bess, president of the Indiana Charter Innovation Center, has a similar viewpoint.
“If and when we have complete sharing, where all dollars associated with a child follow the student, then I think at that point, the need for the $1 law kind of goes away,” Bess said. At that point, “The charter school would have complete access to local property taxes, just like the district does.”
However, as the law stands now, it would not address major capital needs for charters, he said. Without adequate facility funding, the $1 law remains important for charters.
Also, it would not affect districts unless more than 100 students within that district, or 2% of the district’s spring enrollment, attended a charter. (Virtual charters and adult high schools are not eligible).
The property tax revenue sharing would also be phased in, starting in 2028. “We have many charter schools around the state that won’t get anything under this property tax sharing law because the district they are located in doesn’t meet the criteria,” Bess said.
A former board member of a public school district, Bess said he understands the concern of district officials who prefer a charter not locate in their community.
The $1 law passed because charters haven’t received property tax dollars and must meet education and operations costs through their state tuition support funding, he said.
The state recognized charters were “at a huge disadvantage in being able to have a facility,” he said.
Under the $1 law, if there are facilities already paid for by taxpayers and a school district doesn’t see a need for it anymore, then it should be available to a public charter school to use for educational purposes, Bess said.
According to a blog published by The Indiana Mind Trust in April, “The 124th Indiana General Assembly was the most successful session for charter schools since the passage of the original charter school law in 2001. Many advocates have spent years working to advance funding parity legislation.”
It also wrote, “The Mind Trust was proud to support legislation that will ensure Indiana charter school students have access to fair funding, quality transportation, and affordable facilities.”
The Mind Trust is an education nonprofit that supports charter schools.
ISBA advocates for $1 law repeal
Terry Spradlin, Indiana School Boards Association executive director, said ISBA supports repeal of the “$1 law,” especially given the new legislation that requires districts to share property tax and operating referendum dollars with charters, starting in 2028, if criteria are met. ISBA supports local decision-making and control over what is best for a district and community, he said. The $1 law “supersedes and takes away that local discretion and decision-making.”
It also can create a competitive disadvantage for school districts trying to become more cost efficient through such efforts as building consolidation, he said.
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