Pa. cyber schools increase assets Report draws criticism from local districts
A new report from Education Voters of Pennsylvania has unveiled what local superintendents are calling “alarming financial trends” within the state’s four largest cyber charter schools.
According to the report, released last week, from 2018 to 2022, Agora Cyber Charter School, Commonwealth Charter Academy, Reach Cyber Charter School, and Pennsylvania Cyber Charter School (PA Cyber) collectively reported about a 90,000% increase in their assets. The revelation has sparked calls from public school districts for urgent legislative reforms and forensic audits to address the financial disparities and questionable spending patterns associated with these institutions.
The report scrutinized federal tax returns and annual financial reports for the schools. In 2018, the combined net assets of these schools were $566,858. By 2022, the figure had ballooned to over $486 million, the report states.
“Pennsylvania law mandates that school districts send cyber charter schools far more funding than they need to educate students. Cyber charter schools are awash in excess funding that is in plain sight,” said Susan Spicka, executive director of Education Voters of PA. “State lawmakers must finally take steps to align cyber charter tuition payments with the cost of providing an online education. This will help ensure that school property taxes are invested in providing educational opportunities for students, not packed in cyber charter asset hoards or wasted on advertising.”
The report details that CCA has purchased 29 buildings since 2018, amounting to a total expenditure of $88.7 million. These properties, which include office buildings and commercial spaces, have assessed values totaling $43.1 million.
Also detailed in the report was extensive spending on advertising and promotional activities by the cyber charter schools. Through Right to Know requests, Education Voters of Pennsylvania obtained more than 1,800 pages of invoices revealing that over $21 million was spent on advertising and gift cards during the 2022-23 school year alone. Commonwealth Charter Academy was the largest spender, with $8.3 million allocated to advertising.
Such spending practices have drawn sharp criticism from public school officials. “Districts such as Jim Thorpe Area, which pays $3 million or more in cyber charter costs, are unable to do what they need to do for their students due to budgetary constraints while outrageous amounts of wasted money keep going to cyber charter schools year after year,” Robert Presley, Jim Thorpe superintendent said. “On top of these wasted taxpayer funds, these schools are some of the worst performing schools in the state, and they are not audited or required to adhere to all the regulations traditional public schools are.”
The financial revelations have prompted calls for legislative action to reform the funding model for cyber charter schools. The report recommends that state lawmakers cap the amount of money spent on each cyber charter school student to $8,000, which could potentially save the state close to $500 million annually.
Dr. Christina Fish, Lehighton superintendent, expressed her shock at the financial disparities revealed in the report during a recent school board workshop. “According to statistics provided by the Pennsylvania School Boards Association at a recent advocacy day in Harrisburg, Commonwealth Charter Academy had a $305 million fund balance in 2022,” Fish said. “It was projected to be $500 million in 2023. I found these numbers shocking. That is $500 million in the hands of just one cyber charter school. We always talk about our fund balance and what we can and can’t do so it’s staggering to see what these charter schools can hold.”
The report concludes by urging lawmakers to enact funding reforms that align cyber charter tuition payments with actual educational costs, conduct thorough audits, return the proceeds from any sales of charter school properties to taxpayers, and impose a moratorium on new cyber charter schools until all existing ones have valid charters.