California charter schools sue state for not funding additional students this year

Photo courtesy of Voices College-Bound Language Academies

Students at the Voices Morgan Hill charter school gather for a morning exercise emphasizing the importance of teamwork.

John Fensterwald

July 29, 2020

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Four growing charter school organizations are suing Gov. Gavin Newsom, State Superintendent of Public Instruction Tony Thurmond and the California Department of Education, charging that the state’s formula for funding K-12 schools during the pandemic will illegally deny payments for additional students in their schools.

Their schools are being underfunded by millions of dollars and their students’ constitutional rights are being violated, the lawsuit claims.

The schools and parents of their prospective students called for the courts to immediately force the state to reimburse the schools for newly enrolled students. If successful, the lawsuit, filed Monday in Superior Court in Sacramento, would benefit traditional school districts that also are not being reimbursed in the coming school year for growth in enrollment.

“The Legislature should immediately fix this, by funding public school students,” Jerry Simmons, attorney for the plaintiffs, said at a press conference Tuesday. “If it does not, we are confident that the courts will.”

That should not be necessary, H.D. Palmer, a spokesman for the California Department of Finance, wrote in an email Tuesday. It has been the “intent of the Administration” that the Legislature will address the issue in August, he wrote.

Until the coronavirus pandemic suddenly forced schools to close in March, the state had been funding schools based on students’ average daily attendance. Recognizing that many schools wouldn’t be able to keep in regular touch with students in the rough transition to remote learning, Newsom by executive order guaranteed that charter schools and school districts would be reimbursed for the remaining months of school based on their pre-pandemic attendance rates.

Looking ahead to fall with predictions that surges in the pandemic could cause disruptive switches between distance learning and in-person instruction, the Legislature and Newsom agreed to protect schools from gyrations in attendance. In the new state budget, they extended the 2019-20 attendance rates another year, to 2020-21.

The new funding system will shield districts with declining enrollment from financial loss but will hurt growing districts and charter schools — especially those bringing the lawsuit. Several had approval to open new schools and enroll large numbers of students in the fall, with the expectation of full funding.

Charter schools caught by surprise

The Legislature’s decision to base K-12 funding on pre-pandemic enrollment, announced days before passage of the budget in mid-June, blindsided them, Simmons said, and put them in an untenable position. Those with waiting lists conducted lotteries and registrations last spring and are now legally bound to serve students that the state will not pay for.

“Not funding public school students because their families have made an educational decision in their children’s best interest is inequitable and unconscionable,” said Juan Carlos Villasenor, founding principal of one of four Voices College-Bound Language Academies, a plaintiff in the lawsuit. Voices plans to open a new school in Stockton this fall and expand the number of grades in its Bay Area schools. Accommodating uncompensated new students will force cuts on the remaining schools, with layoffs of student service managers, special education paraprofessionals and an instructional coach at each school.

“The schools will have to spread money for existing kids. Hundreds of thousand of kids will be impacted by absorbing cuts and reductions,” Simmons said.

The other plaintiffs are the Fortune School, a TK-12 network of nine schools in Sacramento and San Bernardino, serving primarily Black students; John Adams Academy, “a TK-12 Classical leadership” network with campuses in Roseville, El Dorado Hills and Lincoln; and Sycamore Creek Community Charter School, a TK-8 charter school in Huntington Beach guided by the principles of Waldorf education.

Leaders from those schools made similar arguments. Sycamore Creek’s executive director, Sarah Bach, said that without tuition revenue for its planned expansion, it would have to fund twice as many students at 50% funding.

Fortune School is opening a new school in south Sacramento targeting Black students who have not been well served, said Fortune President and CEO Margaret Fortune. “I opened a network of schools to close the African American achievement gap by preparing kids for college in a different way. We enter into this lawsuit, not lightly. It’s the last thing that you want to do. But we will use every resource within our grasp to protect our children and our students.” The lawsuit, Samaiya Atkinds v. State of California, bears the name of a kindergartner who is enrolled in the new Sacramento school.

Although enrollment statewide has been gradually declining, some districts like Elk Grove, near Sacramento, have been growing and would also be adversely affected. Newsom acknowledged the unsolved problem but said maintaining school funding at current levels would allow for “stability” in a June 29 budget message.

“I urge members of the Legislature to pursue targeted solutions to these potential disruptions and will work with you in coming weeks to enact them,” he wrote.

The Legislature’s challenge is that any solution will likely require some double funding: paying tuition to charter schools for their new students and paying the districts where some of the students came from. Districts already facing added costs of the pandemic based their budgets on the assumption they’d get what they received last year.

Simmons and legislative staff haven’t estimated the cost of a fix, but it would be at least several hundred million dollars. Palmer indicated that the compromise would involve paying districts and charter schools for “planned growth.” ­That implies documentable pre-pandemic approvals for expansion and actions like hiring staff, enrolling students and finishing buildings — but not parents’ decisions to switch schools since the start of the pandemic.

Accurately documenting attendance might be hard to do anyway. Although school districts will be required to take daily attendance, including check-ins during distance learning, they will not be required this year to report the data to the state.

Simmons said the lawsuit should serve as a reminder not to delay. “The facts of this case are incredibly compelling. The state has an obligation to fund what it is obligated to fund, and students have a constitutional right” to an equal opportunity for an education, he said.

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