Star Ledger - Are N.J charter schools saving more money than they need?
By Adam Clark | NJ Advance Media for NJ.com
Email the author | Follow on Twitter
on September 27, 2015 at 8:09 AM, updated September 27, 2015 at 8:10 AM
Charter schools across New Jersey have built up savings so large that one school has more money saved than it needs for an entire year of operation, according to an analysis by the Newark-based Education Law Center.
But that doesn't mean that the schools are needlessly hoarding money, said the New Jersey Charter Schools Association.
The Education Law Center analyzed the most recently available audited school budgets of more than 80 charter schools. Nearly all of the schools had fund balances — the difference between revenues an expenses — larger than 2 percent, according to the analysis.
RELATED: Test your New Jersey back-to-school IQ
Public school districts are not allowed to have fund balances that are more than 2 percent of their budget, and The Education Law Center this week called on the state to impose the same cap on charter schools.
The money charter schools have beyond a 2 percent fund balance should be returned to the districts from which students came, said David Sciarra, executive director of the Education Law Center.
"The excess charter fund balance is available to provide desperately needed teachers, staff and programs for students in district schools," Sciarra said. "Since charters are public schools, they cannot be allowed to carry unlimited, excess surplus they don't need while the education of students who choose to attend district schools suffers from deep budget cuts."
The New Jersey Charter Schools Association called the Education Law Center report a "misguided assault on charter school viability."
Unlike school districts, charter schools do not receive money directly from property taxes or from the state. Instead, when a student leaves his or her home district for a charter school, the school receives a portion of the district's per-pupil expenses.
Charter schools need to build up larger fund balances to pay for facilities, the NJCSA said.
"The only way for a charter school to purchase or renovate a building is to accumulate a fund balance from their operating funds," the NJSCA said in a statement.
The fund balance must be large enough to give a school the opportunity for additional financing, including loans, the NJCSA said.
Any cap on the financial reserves of charter schools threatens their viability and their ability to provide academic opportunities for students, the NJCSA said.
Adam Clark may be reached at adam_clark@njadvancemedia.com. Follow him on twitter at @realAdamClark. Find NJ.com on Facebook.