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New Code Curbs Education Commissioner's Power to Set Charter Tuition

Change meets some objections, but state BOE says it’s only bringing code in line with current laws

Department of Education Building

A seemingly routine change in how charter-school finances are regulated is proving anything but. The proposal is reviving arguments -- in court and out -- as to how much leeway the state should have in setting charter-school funding.

A proposal before the state Board of Education this month would eliminate the state education commissioner’s discretionary ability to limit the tuitions that charter schools may draw from local districts.

By law, districts are required to pay a charter school where their students are enrolled at 90 percent of the district’s per-pupil costs. At issue, however, is whether districts would be entitled through the commissioner to request reductions in tuition if a charter is retaining inordinate surpluses.

The question has been the subject of a protracted legal challenge from Piscataway schools, which took the state to court in 2012 for refusing to consider such a reduction in tuition for five of its students attending four area charter schools.

At one Plainfield charter, for instance, the surplus was close to $500,000 over the 2 percent limit placed on district schools, according to the complaint.

That case is now before state appellate court, after the Christie administration twice argued that it did not have such discretion.

But now the filing of new regulations -- including the state board’s vote last week to expedite the process -- has raised questions as to what powers the commissioner had all along, and what funding discretion should be in the hands of the state in the case of these alternative schools.

“Why even for appearance sake would you want to strip the commissioner of the discretion in this case?” said David Rubin, attorney for the Piscataway schools. “We aren’t demanding that he make any changes, but why not have the discretion?”

A spokesman for state Education Commissioner David Hespe said last week that the filing of the new regulations was only meant to align with state law adopted in 2000 that reenforced that districts fund charter schools at the 90 percent level. That law was an amendment to the state’s original charter statute adopted in 1995.

But he did say that the state wanted to provide more flexibility to charter schools, which face some constraints in how they can use the funding,

“Since charter schools are funded differently than traditional public schools … it would be good practice for charter schools to have surplus money available to cover potential unexpected or increased costs,” said spokesman David Saenz.

Rubin questioned the timing of the changes as the case moves to the appellate court for the second time. The first time, it was remanded back to the commissioner. He said the state law now cited has been on the books for 15 years, without any changes in regulation.

“The state board took no steps to repeal [current] regulations over the last 15 years, and not only that, twice readopted them,” he said.

Rubin, who said that legal briefs have been filed in the appellate case, promised that Piscataway and possibly others would be filing objections to the rules change before the board in the coming weeks.

“Since we already have a case pending in the appellate division, why not just let the court decide?” he said.

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