The $450 million scam on taxpayers

With school districts stressed by PA’s inadequate education funding, they must make sure every penny is spent wisely.  Cyber charter schools, however, are a huge cost to districts and wisdom doesn’t factor into the equation.

School districts spent $450 million last year on cyber charter schools. The state’s cyber charter sector – the second largest in the country – continues to grow as does the tremendous amount of money that school districts must pay to cybers. In southeast Pennsylvania alone, the tab for cyber charters was over $132.5 million – a $42 million increase in the past five years.

If cyber charter schools were a sound educational investment, maybe they’d be worth the millions spent. But PA’s cyber charter schools have consistently been among the lowest performing in the state, with 90% of them languishing in the bottom fifth of schools statewide last year. No cyber school has ever met the state performance standards set in 2013.

They waste tax dollars, ‘upload’ funding out of every school, and districts still have to pay them.  

So where is that $450 million going? Much of it goes to for-profit cyber charter management companies who in turn use it on marketing, lobbying and executive compensation. Take Agora Cyber Charter, for instance.

They paid the majority of their revenue to K12 Inc, an out-of-state for-profit cyber charter manager. K12 runs around 20,000 TV commercials a year for Agora. They’ve spent over $1.3 million on lobbying in PA since 2007. And K12’s executives were handsomely rewarded in 2016 with over a million dollars each. In spite of all that spending, Agora scored in the bottom 1% of schools statewide last year.

Meanwhile, districts across PA were slashing budgets and raising local taxes. Once again, the state failed to adequately fund districts, with just a $200 million increase last year to be distributed through the new funding formula, the vaunted, but as-yet impotent, shared vision of both state Republicans and Democrats for sensible education funding. 

Legislators claim that resources are too scarce to back the formula with adequate funds. They need look no further than the cyber sector for hundreds of millions being wasted that could instead be put towards this best path forward.
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