A new report finds more Florida charter schools operating in the red, but it’s not necessarily a sign they’re in trouble.
Released this month, the annual report from the Florida Auditor General shows 12 percent of the 499 charter schools reviewed in the audit ended the 2012 fiscal year with a deficit, up from six percent of 445 schools the previous year.
The bulk of charter schools flagged were in Broward and Miami-Dade counties, which have the largest number of charters in the state. In Broward, 17 of 73 charters closed the year with a deficit. In Miami-Dade, it was 16 of 109 charters.
“It certainly is something we are aware of and paying attention to,’’ said Adam Miller, who oversees charters and school choice for the Florida Department of Education.
But the report looked at a particularly difficult year for both charter and traditional public schools, Miller noted. Lawmakers slashed $1 billion from the education budget in 2011, significantly reducing per-student funding and other dollars to charters and traditional public schools.
Another factor: a third of the charters audited were less than three years old. That’s important to note, Miller said, because new charters take some time to build reserves. They don’t receive as much public funding as district schools. And since most of them don’t get facilities funding, they have to dip into operation dollars to pay for buildings and other capital needs.
Broward schools’ chief auditor, Patrick Reilly, said a deficit is not always cause for alarm. Many charters “have the ability to obtain funding to operate or sponsors of the charter school provide funding, either as a loan or a donation, which allows the charter school to meet their current operating expenses,” he wrote.
But, he added, there’s still reason for concern because, eventually, the ability to obtain funding from other than normal revenue sources – primarily state funding for student enrollment – could dry up, leaving the charter unable to meet its payroll and other financial obligations.
It’s definitely something to watch, said Jim Horne, president of the Florida Alliance of Charter Schools. The findings aren’t surprising to charter advocates, given the tough climate for education funding, but they’re also not being dismissed.
“We certainly expected to see this,’’ especially with new charters, Horne said. “They’re always going to struggle at first – that’s the very nature of a startup.’’
At the same time, he said, “If there are schools that are being mismanaged or aren’t doing the job to meet the needs of students, then they need to be closed.”
Current law requires districts, which monitor charter schools, to report financial concerns to the state annually. The auditor general report recommended that the Legislature require districts to notify the state more frequently, something Miller agreed would help with oversight.
“We can get into the loop a little faster,’’ he said.
Some good news: The economy has improved and lawmakers increased the public education budget by $1 billion this year. In addition, charter schools received $91 million in capital outlay funding to help with building construction and maintenance. That should result in better audits, Miller said.