Fiscal Impacts of Charter Schools: Lessons from New York

Abstract

This brief argues that charter school programs can have direct fiscal impacts on school districts for two reasons. First, operating two systems of public schools under separate governance arrangements can create excess costs. Second, charter school financing policies can distribute resources to or away from districts. Using the city school districts of Albany and Buffalo in New York, we demonstrate how fiscal impacts on local school districts can be estimated. We find that charter schools have had fiscal impacts on these two school districts. Finally, we argue that charter schools policies should seek to minimize any avoidable excess costs created by charter schools and ensure that the burden of any unavoidable excess costs is equitably distributed across traditional public schools, charter schools, and the state. We offer concrete policy recommendations that may help to achieve these objectives.

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