Charter School Financial Impact Analysis

The equalization/funding of charters has remained a topic in Jeffco Schools.  While we do support the charter schools doing great work, the funding issue, questionable “equality” discussion and promises to the community not being honored for the 2012 mill and bond is certainly a concern.  Ensuring that ALL Jeffco children are served appropriately is our primary concern. 


We have been provided with the following document with a full detailed analysis of the issue:





MAY 2014


Prepared by:


Don Oatman

A Jefferson County Citizen


You can view the full report here: 



Here is the conclusion as well as the recommendation:


  • The use of the State Finance Act and mill levy override per pupil amounts as a basis for increasing resources available to the charter schools is overly simplistic and appears to have been arrived at with no evaluation of the overall financial impact on the District. This lack of a financial analysis to support a major financial decision is not consistent with Board of Education Policy DA, Fiscal Management Goals.
  • Based upon the budget materials and the Attachments included with the analysis, the current per pupil cost for operating the charter schools is similar to, or slightly greater than the similar per pupil costs being incurred by the District for operating schools.
  • Because this analysis indicates that charter schools currently spend slightly more on a per pupil basis than the District for similar services, any increase in the resources for charter schools will not equalize the available resources for charter schools, but result in charter schools having resources in excess of those available to the District schools. Based on the 2013-2014 funded count, each one million dollar increase to charter schools will result in an additional $159 per funded pupil for the charter schools.
  • Any action by the Board of Education to increase the resources available to the charter schools will ultimately be at the expense of the overall District and those students not enrolled in charter schools
  • The current process for allocating resources to the charter schools and the billing for infrastructure services seems to be fair and does not indicate a need for additional resources beyond those provided by the current relationship between the District and the charter schools.
  • Any action by the Board of Education to increase the resources available to the charter schools without undertaking an independent review of the actual financial impact of this decision will be reflective of a lack of compliance with Board of Education Policy DA, Fiscal Management Goals.
  • The Board of Education does not hold the charter schools to the same level of fiscal accountability required of all District schools and departments. In fact, it could be concluded that the Board of Education may not be exercising its fiduciary responsibly as it pertains to charter schools.
  • The charter schools are receiving a significant benefit from the bond program for which they have no financial responsibility.
  • The practice of providing loans to charter schools based on limited information and providing this benefit interest free with no formal agreement that clearly identifies the obligations of the charter schools represents a lack of effective financial management on the part of the Board of Education.
  • Charter schools are not truly independent as they have the ability to take advantage of numerous opportunities that are embedded in the infrastructure services provided by the District, some of which are included in the District billing structure for charter schools. These include: 
    • Use of the District PeopleSoft financial system which provides the capability to support all financial operations for financial services such as accounting, accounts payable, payroll, purchasing, accounting for assets, and inventories;
    • Provision of student data information and support for the charter schools to include the reporting required by CDE; 
    • Use of District purchasing contracts to include those involving cooperative purchasing arrangements; 
    • All charter schools use the District Purchase Card process;
    • Charter schools use the District lottery student selection process for those charter schools that are oversubscribed;
    • Charter schools can participate in the District school lunch program;
    • Most charter schools are covered by District commercial insurance for all risks to include torts, theft, damage or destruction of assets and injuries to employees;
    • Charter school students have the opportunity to participate in athletics/activities at District schools if a program is not offered at the charter school;
    • Citizens and charter school staff and parents have access to the Financial Transparency component of the District; and
    • Charter school employees can avail themselves of optional employee benefits offered by the District to include life insurance, dental insurance, and tax sheltered annuities.



Based on the above conclusions, it is suggested that the Board of Education:

  • Maintain the current fiscal relationship with the charter schools;
  • Develop financial policies and procedures pertaining to the charter schools;
  • Upgrade the financial oversight of the charter schools to include a review of the budget process and require a separate, standard process for the provision of financial information as part of the charter school renewal activity;
  • Establish a formal process for reviewing the audited Annual Financial Reports for the charter schools;
  • Establish a policy and standard language for agreements involving the lending of resources to the charter schools, to include payment of a variable interest rate based upon the rates being earned by the District investment program; and
  • Establish a fiscal impact assessment on District finances as part of the review of any new charter school requests.



Don Oatman Background


Don Oatman has over 40 years of experience in public administration.  He started as Fiscal Control Officer with the City of Lakewood in 1970 when the city was first incorporated and became the first Director of Finance for Lakewood.  He spent two years as a consultant working with city and county governments and was then hired by the Jefferson County School District as Executive Director of Business Services.  Don spent 20 years with Jeffco, retiring as Deputy Superintendent for Support Services.  Since retirement, Don has been working with a national consulting firm and has been involved in over 35 school district projects in 18 different states.  Don has a BSBA degree in accounting from the Rochester Institute of Technology, an MSBA degree in economics from the University of Denver, and is a CPA.