The way we fund enrollment in our LEAs structurally disadvantages DCPS, failing to fund it to serve the thousands of students who come through its doors midyear while generously allowing the charter sector to retain funds for the approximately 1,350 plus students who leave their schools midyear. The net effect is to provide the charter sector with at least a $20 million advantage relative to DCPS in terms of enrollment based funding each year.
The Council should address this structural unfairness in the budget for FY21.
It can do so without reducing funding for the charter sector but rather by basing DCPS budgeted enrollment on a figure that would prepare it to deal with the midyear mobility and churn it inevitably will confront and put it on equal footing with the charter sector.
DCPS is routinely budgeted for far fewer students than it actually serves during the year. In the most recent year for which we have data, FY19, the school budgets projected school enrollment at 48,924 and the total number of students served according to OSSE was 53,222,[1] or 4,298 higher. Indeed, DCPS sees thousands of students arrive midyear – 4,025 in SY 18-19 (and thousands though fewer depart midyear). In the process, DCPS sees a net gain after the October audit of on the order of 500 students each year.[2]
The city has tried to address this reality by adjusting the DCPS LEA enrollment to account for such shifts. For example, in FY19, the DCPS LEA budget was based on 50,221.[3], or around 1,300 over the sum of the school enrollment projections, but that still leaves around 3,000 midyear arrivals unfunded and reflects a very different treatment than that accorded to the charter sector as described below.
Meanwhile, virtually all of the schools with midyear entries over 5% of their audited enrollment are DCPS schools serving low income communities.[4] Schools with STAR ratings of 1 or 2 experience significantly higher levels of midyear entries than those with higher ratings.[5]
| STAR Rating | 1 | 2 | 3 | 4 | 5 |
|---|---|---|---|---|---|
| 2018-19 midyear entry percentage | 12.64 | 6.48 | 3.41 | 3.44 | 1.94 |
The challenges for DCPS, particularly for its schools serving low income communities, created by midyear entries and churn is enormous and unfunded.[6]
The charter sector experience is quite different. The charter sector sees very few arrivals midyear and typically sees a net reduction of on the order of 1,350 students midyear.[7] Charter sector funding is based on the October audit and charter LEAs retain the funding, including the facilities allocation, for the students who depart midyear.[8]
The city has considered whether and how to address this difference between the sectors and considered policies to ensure “the money follows the child” for years, but has yet to make a change. The money following the child, however, would lead to shifting budgets midyear and likely would create more disruption and distorted incentives than positive impact on the ground. The appropriate solution need not punish the charter sector for enrollment loss, but should provide for DCPS to contend with midyear churn and put the sectors on equal footing.
The Council could achieve both goals by basing DCPS LEA budgeted enrollment on the estimate for October plus the expected DCPS growth after the October audit (averaging 465 in the last two years for which we have data) plus the expected charter sector enrollment loss after the October audit (averaging 1,356) after October.
Under such an approach DCPS LEA budgeted enrollment for FY21 would be over 54,900 – 53,033[9] plus around 500 for midyear DCPS growth plus around 1,350 to offset charter midyear enrollment erosion for which charter LEAs are paid (for a total adjustment of around 1,850).
Conceptually, such an approach would not be a departure. In recent years, the city has used around a 1,300 adjustment. The city should merely increase that adjustment for FY21 to more fully account for the challenges and put the sectors on equal footing. It remains to be seen what adjustment will be built in to the Mayor’s budget for FY21, but whatever the Mayor proposes, the Council should ensure that the final budget as passed reflects an adjustment on the order of 1,850.
Taking that step would not fully close the gap in funding based on the total number of students served or the differences based on the total number of students arriving midyear. Nor would fully address the vast difference in the experiences and challenges between a system that absorbs thousands of students midyear and one that sees shrinking enrollment during the course of the year. Nor would it completely close the gap in the way DCPS and the charters are funded as the 1,850 adjustment would not account for the fact that charter LEAs also retain the facilities allocation for students departing midyear. But, such an approach would begin to close important gaps and begin to invest in DCPS to address the needs of its schools facing the greatest midyear churn.
[1] See here for DC School Report Card entry for DCPS.
[2] See here at 2018 and 2019 tabs for DCPS. Data from DC School Report Card dataset showing May entry and May exit data by school.
[3] Mayor’s Annual Budget documents, DCPS chapter, Enrollment Table, see here.
[4] See here at tab for STAR by May Entry Level. Note this workbook shows the schools for which both mobility and STAR data were available. The schools that were not included in the analysis are shown at the bottom of the May Entry by STAR Level tabs.
[5] See here at tabs for May Entry Level by STAR.
[6] See here for OSSE report on midyear mobility and the challenges it poses.
[7] See here at 2018 and 2019 tabs for DCPS. Data from DC School Report Card dataset showing May entry and May exit data by school.
[8] See here for a 2019 OSSE description of charter LEA funding.
[9] See C4DC blog and spreadsheet for SY20-21.