18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000. Capital/Debt Service. Admin Support (CPS Overhead) Gen. Operating $ CPS School Students

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1 PPF IN CHICAGO

2 CPS schools serving the same types of students as charters are receiving an average value of at least $3,000+ per child more when accounting for all funds/supports provided by the district 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Even, generously shifting up the assumed benefit of CPS Overhead to charter schools from 50% to 90%, adding another $2.1k PP, still leaves charter students at a deficit of $3k 50% ~10000* ~10000* Charter School Students CPS School Students Capital/Debt Service Admin Support (CPS Overhead) Gen. Operating $ *Note: Per the bottom-up budget analysis (Methodology 3) charters students receive ~$8.8k in Gen Op while traditional public school students receive ~$9.3k. The CPS PP value of $9.3k only includes magnet, quota, and selective enrollment schools to ensure a fair comparison.

3 METHODOLOGY OVERVIEW How was this analysis conducted

4 We utilized 3 different methodologies to better understand CPS funding of the different school-types in Chicago Methodologies In all cases, the goal was to derive what CPS should pay on average to each student all-in including Operational, Capital/Debt Service, Categorical Funding, etc. 1. ISBE OEPP/PCTC: Used ISBE calculator with pre-populated CPS financials to ascertain all-in equitable funding per student 2. CPS Budget Book: Used budget book to identify all-in funding, backing out specialized funding that would not reach the average student 3. CPS School Budgets: Using the school-by-school budgets and building back in the Capex/Debt Service portion, built up an estimate for average all-in student funding

5 Charter School ALL-IN PPF is approximately $10,000/student Work conducted around the Gates Compact and the PCTC Bill has clarified average PPF for charter students. This includes the following from CPS: Per Pupil Pension Contribution Facilities Supplement SGSA Security & Ops Categorical Funding This value is further confirmed by Methodology 3, when evaluating the CPS budget/school site TTL PPF including Categoricals ~$10,000 CHARTER SCHOOL FUNDING Current PPF ( ) TTL PPF Includes ~TITLE and all other Categorical Funding $1,800 Operating PPF provided from CPS to charters (this is an average of HS and ES funding) $7,934 Based on average funding per student funding received by CICS over past 3 years See Rows 8-21 of Appendix A for breakdown. According to ISBE, this is the value that can be compared with the PCTC value they approximate as equitable/fair PPF to Charter School Students

6 METHODOLOGY 1: ISBE OEPP/PCTC Understanding what the average student should receive

7 Using the ISBE calculator for OEPP/PCTC, CPS all-in PPF allocation to the average student should be approximately $13,000/student. Unlike the standard OEPP calculation, this value includes Capital/Debt Service, removes the pre-school student population, and is not based on ADA (Average Daily Attendence; CPS pays charter PP on enrollment per the charter law) Note: Standard OEPP for this same time period is $13,615 ISBE Calculator (w/cps 2011 Financials): ftp://ftpfinance.isbe.net/afr/2011/school%20districts/ _afr11.xls ISBE Calculator (Blank): Expenditures Posted to ISBE Calculation for 2012 OEPP/PCTC (Derived from 2010 Financial Data) Educational $ 4,716,929,602 Operations and Maintenance $ - Debt Service $ 383,887,344 Transportation $ - Municipal Retirement/Social Security $ - Tort Funds $ 75,004,040 Should add in Capital Expenditure - Depreciation Rate? TOTAL Expenditures $ 5,175,820,986 LESS RECEIPTS/REVENUES OR DISBURSEMENTS/EXPENDITURES NOT APPLICABLE TO THE REGULAR K-12 PROGRAM: $ 298,280,357 Adjusted TOTAL $ 4,877,540,629 Total Enrollment 404,151 Less PreSchool Students 24,232 Adjusted Enrollment 379,919 Fair Market PPF $ 12,838

8 Using the ISBE calculator for OEPP/PCTC, the difference between funding and charter funding per student is $3, $10,000 Charter $13,000 Non-Charter CPS Schools (ISBE Calculator) Charter Non-Charter CPS Schools (ISBE Calculator)

9 METHODOLOGY 2: CPS BUDGET BOOK Understanding what the average student should receive

10 Using the CPS budget book to recreate a fair all-in PPF estimate, PPF for the average student should be approximately $13,000. This analysis takes the overall 2013 Proposed Budget and backs out Early Childhood, Specialty School budgets (SPED), Non-Public School stipends, and a rough estimate of 10% administrative overhead required from the district. Note: Changing CPS overhead expense by a % point shifts PPF by $150/student CPS Budget - 000s (Source: CPS FY13 Budget Book) Reference (Pg. #) Total Budget (Includes Debt Service) $ 5,792,700 $ 5,804, Less Early Childhood Department $ 216,320 $ 208, Less Severe SPED Support Expenditures (Specialty Schools) $ 46,087 $ 62, : 39, : CPS FY12 Budget Book Less Non-Public School $ 23,238 $ 21,321 39, 46 Fair-Market Administrative Overhead Cost (10%) $ 579,270 $ 580,400 10% Adjusted Total $ 4,927,785 $ 4,930,557 TTL projected school population 404, , Less preschool 24,232 22, Less Specialty School students 2,450 2, Adjusted Total 377, ,820 Fair Market PPF $ 13,055 $ 13,085

11 Using the ISBE calculator for OEPP/PCTC, the difference between funding and charter funding per student is $3, $10,000 Charter $13,000 Non-Charter CPS Schools (CPS Budget Book) Charter Non-Charter CPS Schools (CPS Budget Book)

12 METHODOLOGY 3: CPS SCHOOL LINE-BY-LINE BUDGETS Understanding what the average student should receive

13 Methodology 3 is the most rigorous, and unlike the previous 2 methodologies, showcases the uneven distribution of CPS Overhead resources This methodology looks at individual CPS budgets by school type, department, office, etc. and averages across Due to the granularity of the data used, this is likely the most rigorous of the methodologies Included in the Non-Charter PP calculation are the following: Military, Traditional, Magnet/Gifted, and Selective school types CPS Capital/Debt Service PP (in gray) This methodology demonstrates that the differential in PPF is at least $3,000 and likely more

14 Note on CPS Overhead: CPS spends a considerable amount of Overhead ($1.6 Billion) that charter students have no access to CPS realizes 100% of the CPS Overhead PP at ~$4k Conservatively Charter students realize ~$2k of the CPS Overhead PP See Appendix B & C for details this discrepancy and on what is in vs. out for the charter PP calculation. 4,000 3,500 3,000 2,500 2,000 1,500 1, $1700 Charter School Students Admin Support (CPS Overhead) $3800 CPS School Students Admin Support (CPS Overhead)

15 Using school-by-school budgets to analyze all-in PPF for all schools within the district provides an approximate value of $14,000+. Note: Per this methodology, PPF for charters is still ~$10k

16 CONCLUSION -$3,000 / child

17 CPS students with similar profiles to charter school students are receiving a minimum of $3k more per child (and potentially more), when accounting for all district resources students at each school type are benefiting from $10,000 Charter $13,000 Non-Charter CPS Schools (CPS Budget Book) Non-Charter CPS Schools (CPS Budget Book) $10,000 $13,000 Charter 8000 Methodology Methodology Charter Non-Charter CPS Schools (CPS Budget Book) Charter Non-Charter CPS Schools (CPS Budget Book) $10,500 $14,700 Methodology 3 PPF Difference of $3,000+

18 APPENDICES Back up calculations/resources

19 CPS students with similar profiles to charter school students are receiving a minimum of $3k more per child (and potentially more), when accounting for all district resources students at each school type are benefiting from 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Even, generously shifting up the assumed benefit of CPS Overhead to charter schools from 50% to 90% still leaves charter students at a deficit of $3k ~10000* ~10000* Charter School Students CPS School Students Capital/Debt Service Admin Support (CPS Overhead) Gen. Operating $ *Note: Per the bottom-up budget analysis (Methodology 3) charters students receive ~$8.8k in Gen Op while traditional public school students receive ~$9.3k. The CPS PP value of $9.3k only includes magnet, quota, and selective enrollment schools to ensure a fair comparison.

20 Appendix A: Charter School PPF 1 CHARTER SCHOOL FUNDING 2 Historic PPF Current PPF Actuals Notes Notes TTL PPF including Categoricals $ 9,473 $ 9,734 ~TITLE and all other Categorical Passthrough Funding Operating PPF provided from CPS to charters $ 1,800 $ 7,673 Average 9 (CICS + UNO) 10 Number of Schools 23 Based on average passthrough/student received by CICS over past 3 years See Rows 8-21 for breakdown. According to ISBE, this is the value that can be compared with the PCTC value they approximate as equitable/fair PPF to Charter School Students $ 1,800 $ 7,934 Note Gates Note 11 Enrollment 12,929 ~25% of CPS charter enrollment in Average Tuition $ 6,232 $ 6,232 Pension $ 310 Contribution made according to CPS financials $ 310 Based on average passthrough/student received by CICS over past 3 years See Rows 8-21 for breakdown. According to ISBE, this is the value that can be compared with the PCTC value they approximate as equitable/fair PPF to Charter School Students PPF stays flat to previous year (currently an estimated reduction in PPF of 5-15% is being discussed) Assumes similar contribution made by CPS as in previous years Facilities $ 411 $ 725 Includes the increase from $425 to $750 facilities supplement for students in non-cps buildings. Note this value is overstated due to UNO and CICS being predominantly in non- 16 CPS facilities 17 Small Schools Supplement $ 54 $ - No longer provided by CPS SGSA $ 663 $ 663 Based on previous funding. 20 Security $ 4 $ 4 Based on previous funding. 21 Operations and Maintenance $ - $ - 22 $ 7,673 $ 7, ~TITLE and all other Categorical Passthrough Funding $ 1,800 Based on average passthrough/student received by CICS over past 3 years $ 1,800 Based on average passthrough/student received by CICS over past 3 years

21 Appendix B: CPS Overhead Analysis. Estimated percentage of CPS Overhead that charter students benefit from. FY 2012 Ending Budget FY 2013 Proposed Budget TTL $ 5,110,204,300 $ 5,232,221,731 CAPEX/DS $ 917,100,000 $ 572,100,000 $ 6,027,304,300 $ 5,804,321,731 CPS Overhead $ 1,457,408,095 $ 1,631,868,427 CPS Overhead as percent of Op Budget 29% 31% CPS Overhead as percent of TTL Budget 24% 28% Estimated benefit to charters (excludes offices and Depts that do not support charters or their students See Appendix C) $ 694,235,236 $ 748,088,653 Percent of Overhead that charter students benefit from 48% 46%

22 Appendix C (1): CPS Offices that charters see little to no benefit from removed from calculation of overhead support to charters Excluded: Excluded Continued: CPS Regional Networks Academic Learning & Support CPS Area Instructional Offices Supplemental Learning and Support - City Wide Intergovernmental Affairs Early Childhood Development - City Wide Communications Office Academic Learning & Support - City Wide Public and Community Affairs Office School Based Programs - City Wide Professional Learning Office Facility Operations & Maintenance Teaching & Learning Office - City Wide Student Transportation Services Curriculum & Instruction Office Facility Opers & Maint - City Wide Educational Tools & Technologies CPS Warehouse - City Wide "Magnet, Gifted & Talented" School Transportation - City Wide K-12 Advising Capital/Operations - City Wide K-12 Advising - City Wide Payroll Services Humanities Office Education General - City Wide Humanities Office - City Wide Principal Preparation and Development Pathways to College and Career External Affairs and Partnerships Academic Enhancement Academic Enhancement - City Wide Arts Youth Development and Positive Behavior Supports Youth Development and Positive Behavior Supports - City Wide LSC Relations LSC Relations - City Wide Talent Office Teachers Academy for Mathematics and Science (TAMS) Training - City Wide Human Capital Office - City Wide Network Support Leadership Development and Support - City Wide Early Childhood Development

23 Appendix C (1): CPS Offices that charters see little to no benefit from removed from calculation of overhead support to charters CPS Regional Network U02021 O'Hare Elementary Network $ 2.91 CPS Regional Network U02031 Ravenswood-Ridge Elementary Network $ 3.47 CPS Regional Network U02041 Fullerton Elementary Network $ 3.15 CPS Regional Network U02051 Austin-North Lawndale Elementary Network $ 3.45 CPS Regional Network U02061 Garfield-Humboldt Elementary Network $ 3.76 CPS Regional Network U02071 Fulton Elementary Network $ 3.01 CPS Regional Network U02081 Pilsen-Little Village Elementary Network $ 3.38 CPS Regional Network U02091 Burnham Park Elementary Network $ 2.95 CPS Regional Network U02101 Skyway Elementary Network $ 2.50 CPS Regional Network U02111 Midway Elementary Network $ 2.68 CPS Regional Network U02121 Pershing Elementary Network $ 2.80 CPS Regional Network U02131 Englewood-Gresham Elementary Network $ 2.74 CPS Regional Network U02141 Rock Island Elementary Network $ 3.23 CPS Regional Network U02151 Far South Side K-12 Network $ 2.17 CPS Regional Network U02221 North-Northwest Side High School Network $ 2.96 CPS Regional Network U02231 West Side High School Network $ 3.13 CPS Regional Network U02241 South Side High School Network $ 2.91 CPS Regional Network U02251 Southwest Side High School Network $ 2.60 CPS Regional Network U02261 Far South Side High School Network $ 1.66 CPS Area Instructional Office U05001 Area High School Instructional Office 25 $ 0.67 CPS Area Instructional Office U05011 Area Elementary Instructional Office 1 $ 1.37 CPS Area Instructional Office U05021 Area Elementary Instructional Office 2 $ 0.63 CPS Area Instructional Office U05031 Area Elementary Instructional Office 3 $ 1.12 CPS Area Instructional Office U05041 Area Elementary Instructional Office 4 $ 0.93 CPS Area Instructional Office U05061 Area Elementary Instructional Office 6 $ 0.82 CPS Area Instructional Office U05071 Area Elementary Instructional Office 7 $ 1.35 CPS Area Instructional Office U05081 Area Elementary Instructional Office 8 $ (0.07) CPS Area Instructional Office U05091 Area Elementary Instructional Office 9 $ 1.03 CPS Area Instructional Office U05101 Area Elementary Instructional Office 10 $ 0.76 CPS Area Instructional Office U05111 Area Elementary Instructional Office 11 $ 0.79 CPS Area Instructional Office U05121 Area Elementary Instructional Office 12 $ (0.07) CPS Area Instructional Office U05131 Area Elementary Instructional Office 13 $ 0.65 CPS Area Instructional Office U05141 Area Elementary Instructional Office 14 $ 0.89 CPS Area Instructional Office U05151 Area Elementary Instructional Office 15 $ 2.06 CPS Area Instructional Office U05161 Area Elementary Instructional Office 16 $ 1.42 CPS Area Instructional Office U05171 Area Elementary Instructional Office 17 $ 1.02 CPS Area Instructional Office U05181 Area Elementary Instructional Office 18 $ 0.94

24 Appendix C (2): CPS Offices that charters receive benefit from included in calculation of overhead support to charters Included: Law Office - City Wide School Safety and Security Office Safety and Security - City Wide Chief of Staff School Demographics and Planning Data Program Management Chief Education Officer Chief Instructional Office Knowledge Management & Quality Practices Assessment Assessment - City Wide High School Programs Department of Education to Careers Language & Cultural Education Language & Cultural Education - City Wide Special Education & Supports Office Special Education & Supports - City Wide Special Education Resource - City Wide Real Estate Nutrition Support Services Nutrition Support Services - City Wide Procurement and Contracts Office Business Diversity Chief Financial Officer Corporate Accounting Accounts Payable Treasury Pension & Liability Insurance - City Wide Information & Technology Services Information & Technology Services - City Wide Included Continued: Budget & Management Office Grants Management & Administration Office Grants Management & Administration - City Wide Consolidated Pointer Line Unit Control Accounts/Compensation - City Wide ECIA Projects Other Government Funded Portfolio Planning & Analytics New School Development - City Wide Literacy Literacy - City Wide Mathematics & Science Mathematics & Science - City Wide Multiple Pathways Multiple Pathways - City Wide Early College and Career Early College and Career - City Wide Academic Initiatives Academic Initiatives - City Wide CPS U13735 Department Sports and Driver Education - City Wide School Improvement Office School Improvement Office - City Wide Chief Administrative Office Office of Student Health & Wellness Family & Community Engagement Office School Support Center Strategy Management Office Accountability

25 Appendix C (2): CPS Offices that charters receive benefit from included in calculation of overhead support to charters Type Unit Unit Name (404,151 students) Junior ROTC U05261 Junior ROTC $ 4.17 Board of Education U10110 Board of Education $ 5.13 CPS Internal Department U10210 Law Office $ CPS Internal Department U10320 Inspector General $ 4.49 CPS Internal Department U10410 Chief Executive Officer $ 2.07 CPS Internal Department U10430 Department of Audit Services $ 2.78 CPS Internal Department U10440 Autonomy Office $ 2.06 CPS City Wide Department U10445 Autonomy Office - City Wide $ 7.99 CPS City Wide Department U10455 Law Office - City Wide $ CPS Internal Department U10610 School Safety and Security Office $ CPS City Wide Department U10615 Safety and Security - City Wide $ CPS Internal Department U10710 Chief of Staff $ 2.37 CPS Internal Department U10715 School Demographics and Planning $ 1.39 CPS Internal Department U10805 Data Program Management $ 0.44 CPS Internal Department U10810 Chief Education Officer $ CPS Internal Department U10815 Chief Instructional Office $ 4.40 CPS Internal Department U10950 Knowledge Management & Quality Practices $ - CPS Internal Department U11210 Assessment $ 1.83 CPS City Wide Department U11290 Assessment - City Wide $ CPS Internal Department U11320 High School Programs $ (0.09) CPS Internal Department U11410 Department of Education to Careers $ (0.08) CPS Internal Department U11510 Language & Cultural Education $ 5.90 CPS City Wide Department U11540 Language & Cultural Education - City Wide $ CPS Internal Department U11610 Special Education & Supports Office $ CPS City Wide Department U11670 Special Education & Supports - City Wide $ CPS City Wide Department U11675 Special Education Resource - City Wide $ CPS Internal Department U11910 Real Estate $ CPS Internal Department U12010 Nutrition Support Services $ 4.25 CPS City Wide Department U12050 Nutrition Support Services - City Wide $ CPS Internal Department U12210 Procurement and Contracts Office $ 6.76 CPS Internal Department U12280 Business Diversity $ 0.61 CPS Internal Department U12310 Chief Financial Officer $ 1.40 CPS Internal Department U12410 Corporate Accounting $ CPS Internal Department U12430 Accounts Payable $ 2.68