Worcester Cultural Academy Public Charter School gets $2M boost from public district

WORCESTER — When Worcester Cultural Academy Public Charter School opens its doors this fall to 200 students in kindergarten through fourth grade, it will do so with the help of $2 million in tuition paid by the city’s public school district, in the form of reduced state education funds.

Based on enrollment numbers, the district will continue to pay tuition toward the new charter school, while also receiving some transition aid from the state over a three-year period to help alleviate its costs.

The aid is meant to help the local school district adjust to the sudden loss of students in its schools and the state funding that comes from those students.

“Communities get twice their money back over a three-year period every time there is a year-over-year increase in total tuitions paid by a district,” a spokesperson for the Department of Elementary and Secondary Education said.

Since the district will suddenly have an additional $2 million in tuition that it previously didn’t have to pay, it will receive 100% of that funding back in transition aid. The aid will decrease to 60% in the second year, or $1.2 million; and 40% the third year, or $800,000.

Each year, if tuition paid to the charter school increases, a new three-year transition aid period will begin.

Worcester Cultural Academy is projecting that 40 additional students will enroll in its second year, costing the public school district an additional $800,000, and bringing the total tuition bill up to $2.8 million.

The district's reimbursement would be $2 million: 100% of the additional $800,000 in costs along with $1.2 million in reimbursement from the $2 million paid the previous year.

If student enrollment and tuition costs remain the same over the three-year period, the Worcester schools would pay $6 million in tuition and receive $4 million in reimbursement.

Tim Nicolette, executive director of the Massachusetts Charter Public School Association, described the state’s transitional aid program as one of “the most generous in the country.”

A spokesperson with the Massachusetts Charter Public School Association said the money the district receives is meant to be transitional aid, rather than a reimbursement. It is meant to help districts “transition” from the shifts in enrollment and the funding changes that come from those shifts.

The money being paid by the district to the charter school comes from state education Chapter 70 funds, which can increase or decrease depending on the number of students enrolled.

Since some students will no longer be educated in the Worcester Public School district but instead at the charter school, the Chapter 70 funds are following them to their new school, the charter association spokesperson said.

“If the kids were still being educated in the district, the state would still send the money to those district schools,” the spokesperson said. “It's the same as if kids left the district for another district because the family moved. State aid is based on enrollment; when enrollment goes down, for whatever reason, so does state funding.”

But Deputy Superintendent Brian Allen said that he found that point an “interesting perspective” when asked about the charter association’s response.

“If the students weren't in the charter school, where would they be?” Allen said.

Formula based on per-pupil basis

Part of the problem, he said, is that costs cannot be reduced on an “equal basis” as the transition aid formula is based on a per-pupil basis.

“Students aren’t all coming out of one classroom. If we're reducing whatever the number is, $15,000 per kid across the district, you're not getting $15,000 worth of savings by reducing that kid,” Allen said.

Students coming from the local school district are not all coming from a singular classroom but rather from across the city’s schools in different grades. It would also lead to a staffing reduction, which is also difficult to mitigate, Allen said.

If the district assessed the $800,000 Worcester Cultural Academy is projecting, that would be 10 teachers the city’s school district would lose.

A combination of having to shift classrooms and reducing the number of teachers, Allen said, could lead to crowded classrooms.

The state also hasn’t fully funded the reimbursement formula in the past, Allen said.

In fiscal 2021, the state underfunded the formula for the city’s school district by $750,000, and in fiscal 2022, it underfunded the district by $788,000. For the current fiscal year, the district was underfunded by $350,000.

“As it appears right now, the governor's budget fully funds reimbursement but that has not been the state's practice to fully fund that reimbursement amount,” Allen said.

The district also only receives 100% of that money reimbursed the first year, he said, adding, “You’re immediately losing money after that.”

The district also receives a facilities cost assessment, as well as potentially a transportation assessment, Allen said.

The tuition and facilities assessment cover the entirety of the charter school's costs. But the district will also receive reimbursement for the facilities assessment, which, the Department of Elementary and Secondary Education's website said, is "one-to-one reimbursement of the districts per pupil facilities tuition."

Transportation costs

But one area the district does not receive reimbursement is from transportation costs, of which charter schools have two options.

The first option is to use Worcester Public School district transportation, while the second is to seek their own transportation through a company, the cost of which is on the public school district.

Currently, the district pays a combined $2.2 million for Abby Kelley Foster Public Charter School and Learning First Charter Public School since neither uses the district's transportation.

While the district is unaware of the charter school's decision thus far, Allen said, the new Worcester Cultural Academy's decision could cost the district money it won't be reimbursed either way.

Even if the district were to provide transportation, he said, it may need to hire additional bus drivers, which would be an additional cost.

When asked about Worcester Cultural Academy's transportation plans, WCA Board Chair Pam Boisvert said that the charter school plans to coordinate the transportation of its students with the public school district.

"Cities and towns are required by state law to provide transportation for all students living in their communities," Boisvert said. "In addition, the millions of dollars in transitional assistance Worcester will receive from the state as WCA's enrollment increases is designed to cushion any potential impact on the city's school budget."

There have been concerns brought up by school administrators, and School Committee members, that the new charter school will have a major impact on the district’s budget, and make the money it received from the Student Opportunity Act meaningless.

Allen said that although the money received from the Student Opportunity Act is increasing “at a larger rate,” it would be more beneficial for all Worcester students if they weren’t losing funds from students leaving the district.

“Instead, we're creating a whole other school district, a whole other administrative overhead costs that would have otherwise gone into instructional cost centers for the Worcester students,” he said.

But the spokesperson from the charter association said the district’s aid has increased by over $100 million since 2019, due to the Student Opportunity Act, which is “far greater” than the financial impact that Worcester Cultural Academy will have on the district.

The spokesperson also pointed to studies that have shown that the state’s approach to reimbursement for public school districts “in fact ensures no negative impacts on district students.”

Particularly, they said, a recent Fordham study that examined charter schools from a national focus, found that the Massachusetts reimbursement formula led to greater charter attendance increases per-pupil expenditures in public schools and increased district teacher salaries.

But the district is not only concerned about the financial impact that the new charter school could have on the city’s school system, but the financial agreement between Worcester Cultural Academy and Old Sturbridge Village.

Administrators, School Committee members, Educational Association of Worcester members and other community leaders have been pushing back on the Board of Elementary and Secondary Education giving the new school a charter since last winter.

Worcester School Committee members voted to issue a letter calling for an investigation into the financial agreement between the charter school and museum by State Auditor Diana DiZoglio, Attorney General Andrea Campbell, Inspector General Jeffery Shapiro and Ethics Commission Executive Director Davis Wilson to investigate the financial agreement.

There are concerns about Chapter 70 state funds meant for education, being used to cover operating costs at Old Sturbridge Village, which will serve as the education management organization for Worcester Cultural Academy, as it currently does for Old Sturbridge Academy.

Allen previously raised concerns about the museum serving as the EMO for the charter schools, as there is no independence from the company or members of the board, he said, which could lead to a conflict-of-interest.

Since then, the Worcester School Committee joined the Educational Association of Worcester in its call to boycott the museum and not spend district funds sending students there on field trips, and the district said it would look for alternative places to send students in the future.

State lawmakers, including state Sens. Robyn Kennedy, Michael Moore and Anne Gobi, as well as state Reps. David LeBoeuf and Mary Keefe, have issued their own letter, similar to the School Committee letter, also calling for an investigation into the financial agreement between the charter school and museum by the same parties.

“The Worcester Public Schools remains concerned about the apparent conflict of interest and financial issues between Old Sturbridge Village and Worcester Cultural Academy,” said district spokesperson Dan O’Brien. “We appreciate that additional elected officials are joining the Worcester School Committee's request for a formal investigation from state agencies."

Boisvert, responding to the new calls for an investigation, as well as concerns about the financial relationship between Worcester Cultural Academy and Old Sturbridge Village, said that no Worcester Cultural Academy trustee has a “financial interest in, nor is an employee of either Old Sturbridge Academy.”

The new charter school, she said, is an independent entity, with each member approved by Department of Elementary and Secondary Education Commissioner Jeffrey C. Riley.

“The relationship between Worcester Cultural Academy and Old Sturbridge Village is strictly one of a management contract, ensuring that administrative costs will consistently be kept at a minimum,” Boisvert said. “WCA has a totally independent Board  of Trustees, fully accountable to DESE and Massachusetts Charter Public School policies.”

Worcester Cultural Academy will open this fall at 81 Plantation St. to 200 students in kindergarten through fourth grade.

This article originally appeared on Telegram & Gazette: Cultural Academy charter school gets $2M boost from public district