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Proposed Mayoral Academy Fiscal Impact Analysis

Proposed Mayoral Academy Fiscal Impact Analysis

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Published by PolitiFactRI
Allan Fung memo to the Cranston City Council on the financial impact of the proposed Cranston Mayoral Academy
Allan Fung memo to the Cranston City Council on the financial impact of the proposed Cranston Mayoral Academy

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Categories:Types, Letters
Published by: PolitiFactRI on Aug 31, 2011
Copyright:Attribution Non-commercial


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To: Cranston City CouncilFrom: Mayor Allan W. FungDate: August 9, 2011RE: Proposed Mayoral Academy Fiscal Impact Analysis
I. Background
Rhode Island General Law describes the state’s method for determining per-pupilfunding for public school districts, state-run schools, charter schools, mayoral academycharter schools and other independent public schools. Essentially, core public educationfunding for all public schools and districts in Rhode Island is comprised of revenue fromstate and local sources, the proportions of which vary by community depending oncommunity wealth and property tax capacity. Almost all public schools and districtsreceive other revenues as well, from federal, private or other sources.In June 2010, the mechanism for issuing Rhode Island state funds to public schoolsdistricts and independent public schools changed significantly. The new “fundingformula” is designed to ensure that all districts and public schools are funded based onactual enrollment, and in an amount that is responsive to fluctuations in student povertyrates. Student poverty is commonly associated with higher levels of educational needsand costs.Like many cities and towns in Rhode Island, Cranston’s level of state funding has beentoo low for more than a decade according to calculations of the new funding law. As aresult, Cranston will receive a higher allocation of state funds for education beginning inFY2012 with additional increases each year for the next seven years.
Figure 1:
Estimated State Funding Increases to Cranston School District: FY2012-2018.
FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018
2,349,234 4,698,468 7,047,702 9,396,936 11,746,170 14,095,404 16,444,638
Source: Office of Finance, Rhode Island Department of Education
II. Achievement First Mayoral Academies
On March 1, 2011, Achievement First and Rhode Island Mayoral Academies (RIMA)submitted an application to the Rhode Island Board of Regents proposing to open a“mayoral academy” charter school serving Cranston and Providence students. If approved, the mayoral academy would open in August 2012 with a maximum enrollmentof 88 students from Cranston and 88 from Providence, growing a grade each year.After five years, the mayoral academy would be required to undergo a charter renewal process to continue operations, at which point the Board of Regents would vote to renewthe charter and allow it to continue operating, or revoke the charter and close the school.
By state law, mayoral academies must offer urban and non-urban communities “an equalnumber of enrollments” (RIGL §16-77.4-1) though actual enrollment will depend on thenumber of applicants from each community. The maximum number of students whocould enroll from Cranston is shown in the table below.
Figure 2.
Maximum Cranston Enrollment in Achievement First Mayoral Academies: 5 Year Charter Term
FY2013 FY2014 FY2015 FY2016 FY2017 
Maximum CranstonAFMA Enrollment*88
Source: Proposal for Achievement First Mayoral Academies, March 1, 2011
* It is essential to note that Cranston enrollment into the mayoral academy may be lessthan (but not more than) the number above. In this case, funding for those students would be reduced from the estimates below on a per-pupil basis.If no Cranston families apply to attend the mayoral academy, it would not receive any of the designated funding for Cranston students.
III. Per- Pupil Funding for Achievement First Mayoral Academies
If we assume that Cranston students enroll into AFMA at maximum levels, and we alsoassume that 65% of Cranston students attending AFMA are from low-incomehouseholds, the school would be funded as follows:
Figure 3.
Funding for Cranston Students Who Choose to Attend Achievement First MayoralAcademies.
FY2013 FY2014 FY2015 FY2016 FY2017 
State share ($):Low-income student5,791 5,791 5,791 5,791 5,791State share ($): Non low-income student4,137 4,137 4,137 4,137 4,137Local share ($):Each student6,685 7,241 7,798 8,354 8,354Total Per Pupil ($):Low-income student12,476 13,032 13,589 14,145 14,145Per Pupil ($): Non low-income student10,822 11,378 11,935 12,491 12,491Enrolled Non Low-Income(35%):31 77 106 133 161Enrolled Low-Income(65%):57 142 196 246 299
Total CranstonEnrollment:88 219 302 379 460
Total Funding for Cranston StudentsAttending AFMA ($):1,046,945 2,727,229 3,929,050 5,141,552 6,240,406
Source: Office of Finance, Rhode Island Dept of Education
In summary, the revenue designated to serve Cranston students attending AFMA, per thenew formula, would range between approximately $1M in the school’s first year to$6.2M in the schools fifth year.
IV. Effects of AFMA Funding on Cranston School Department Funding
The amount of funding designated for Cranston students attending Achievement FirstMayoral Academies at maximum Cranston enrollment
does not equal 
the amount of revenue that would cease to go to the Cranston district.Just as the state funding for the district is being increased over the next seven years, theshift of state funds away from the district for Cranston students attending AFMA would be phased in over seven years.In other words, assuming the mayoral academy opens in FY2013 as scheduled, only one-seventh (1/7) of the state funding that would go to AFMA in its first year, or $76,390,could be considered a reduction in state funding for the Cranston district.Due to this phenomenon of the phase-in of additional state funds at the same time as thecreation of a new independent public school, there is no single year where revenue to theAchievement First Mayoral Academies has a net decrease on revenues to the Cranstondistrict. The state increase to the Cranston district is always larger than the fundingrequired for AFMA.
Figure 4.
 Net State Revenue for Cranston School District, Assuming Maximum CranstonEnrollment into Achievement First Mayoral Academies.+/(-)
FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 
State Shiftfor AFMA0(76,390) (228,177) (393,394) (658,276) (1,198,796)Local Shiftfor AFMA0 (588,280) (1,585,799) (2,354,996) (3,166,166) (3,842,840)Total Shiftfor AFMA0 (664,670) (1,813,956) (2,748,390) (3,824,442) (5,041,636)AddCranstonState AidIncrease2,349,234 4,698,468 7,047,702 9,396,936 11,746,170 14,095,404
Net toCranston2,349,234 4,033,798 5,233,746 6,648,546 7,921,728 9,053,768
Source: Office of Finance, Rhode Island Department of Education

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