FOR YOUR INFORMATION! Explanation of PDE Rate Calculation

In April 2011, several Philadelphia brick and mortar charter schools filed a Petition for Review in Commonwealth Court challenging the calculation of the rates in the manner inconsistent with the Charter School Law due to precipitous reductions in charter school rates for the School District of Philadelphia for two consecutive years.  The Commonwealth Court ruled that the guidelines promulgated by the PDE were “flagrantly in derogation” of the Charter School Law and “per se invalid”.  See First Philadelphia Charter School v. Com., Dept. of Educ., 159 M.D. 2017 (Pa. Comwlth. 2017), February 22, 2018, Opinion and Order of Judge Leadbetter.  The Court’s ruling means that payments by school districts to charter schools must be based on no less than the school district’s  prior year’s budgeted expenditures as is written in the Pennsylvania Charter School Law. Section 1725-A.  However, since 2012, PDE has calculated the payments based on actual expenditures and not the budgeted resulting in a mid-year adjustment.

As a result of the Commonwealth Court’s decision, the PDE then issued a notice rescinding its Guidelines for Form Completion, PDE-363, Funding for Charter Schools (July 2012) and also put forth its position that it will not recalculate rates for the 2017-2018 school year.  Pursuant to the review of the PDE’s website, for the 2017-2018 school year, the PDE recently acknowledged receipt of only PDE-363 rates forms from only 201 out of the 500 Commonwealth’s school districts.  Moreover, according to the PDE, if a school district did not complete and submit a PDE-363 Form to PDE, as per the PDE guidelines, the district’s final rates from the 2016-2017 school year were carried over as that district’s 2017-2018 rates.

With the recent rescission by the PDE, the Pennsylvania Coalition of Public Charter Schools and fourteen  cyber charter schools organized an effort to calculate the 2017-2018 statutory rates for all  school districts in the Commonwealth in accordance with the Charter School Law.  An independent consulting firm calculated the current year rates using Section 1725a of the Charter School Law.  Pursuant to the statutory calculation, the rates used are for no less than the budgeted total expenditure data from the PDE’s data compilation of district filed PDE 2028 budgets for the 2016-2017 school year.  Average Daily Membership figures were derived from the 2017-2018 district filed PDE-363 forms where available.  If PDE-363 forms were not available, as they should have been pursuant to PDE guidelines, then ADM figures were derived from PDE provided data from 2015-2016.


Section 1725-a. funding for charter schools.

Pursuant to the statute, non-special education students, the charter school shall receive for each student enrolled no less than the budgeted total expenditure per average daily membership of the prior school year, as defined in section 2501(20) minus the budgeted expenditures of the district of residence for nonpublic school programs; adult education programs; community/junior college programs; student transportation services; for special education programs; facilities acquisition, construction and improvement services and other financing uses, including debt service and fund transfers as provided in the manual of accounting and related financial procedures for Pennsylvania school systems established by the department. This amount shall be paid by the district of residence of each student.

The list from the above paragraph allows for seven (7) deductions:

  1. Nonpublic school programs (1500)
  2. adult education programs (1600)
  3. community/junior college programs (1700)
  4. student transportation services (2700)
  5. special education programs (1200)
  6. facilities acquisition, construction and improvement services (4000)
  7. other financing uses, including debt service and fund transfers (5000)

While we understand the recent PDE rescission around the Charter School Funding is causing all public Schools in the Commonwealth (traditional and charter) to make late fiscal year adjustments, the statute mandates the charter school tuition calculation method described in Section 1725-a.