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Charter School Expenses

Using the same data set discussed here and here, I calculated the total expenses per pupil at 58 New York City charter schools for the 2007-08 school year.  Here is the workbook with my calculations.

The total expenses for the 58 schools was $236,230,149.  The total enrollment was 17,680.  This comes out to a per pupil calculation of $13,361.  The average school expenses per pupil was $13,520.  The median school was $12,948.  For the 2007-08 school year, the “base funding” per pupil, i.e. the fixed amount per pupil received from the DOE, was $11,023.  So spending on the average student was $2,338 above the base amount.

These numbers, from what I understand, include all expenses by the charter school, including the value of services rendered by a CMO (Charter Management Organization).  Through a friend, I asked an auditor the following question:

“When does an audit for a school need to reflect the value of free rent and other free services rendered by a CMO? In other words, can the CMO and/or Friends Of organization just give a school lots of free stuff including rent, accounting help, etc. and the school can ignore those benefits in their audit?”

The answer:
“The School has to record fair value of these services when incurred.  The school cannot ignore these services and is required to recognize the value as long as it meets certain criteria. The service requires specialized skill; like accounting, legal, design, architect, carpenter, etc.., and the service would typically need to be purchased if not contributed. You should also recognize services that ‘enhance or create a nonfinancial asset’ like services (skilled or non skilled) to constructing a building.  Donated facilities like rent should also be recognized at fair value not what they would have charged the school.”

In other words, if these audits were completed correctly, these expenses should include an estimated value of the services rendered by the CMO’s for the benefit of the school.  To be clear, since DOE space is given free to traditional public schools, it is not included in expense calculations for schools that are housed in public space.

As always, I encourage charter school operators and other readers to help me to further improve this analysis.

Here are some additional notes:

1. I subtracted out Kipp To College costs because these amounts are not used for current students.  This is their alumni program.
2. I averaged across KIPP schools for per pupil expenses.  KIPP seems to run some network-wide expenses through KIPP Academy.
3. The data is missing for Bronx Charter School for the Arts because I have a bad copy of the Statement of Activities.
4. I removed  The New York Center for Autism.
5. I included fundraising expenses.

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