After just one year of operation, Berkeley Unified School District’s first and only charter school is facing financial troubles from significant deferrals in state funding.
Revolutionary Education and Learning Movement middle and high schools — home to 212 middle schoolers and 208 high school students this school year — will be given forwarded tax revenue from the district before Sept. 30 to offset deferred state funding, which will not be received until after the fiscal year ends in June.
“The district is the recipient of all the money from the state,” said board member Karen Hemphill. “The easiest way to explain this is to liken it to a payroll advance — REALM will be getting this money in the future from the state, but we are just forwarding it to get them through this school year.”
Both the district and the charter school — which gets its funding directly from the state — had their funds deferred, but REALM, which opened in 2011, has not yet had sufficient time to build up an emergency fund to cover debts while waiting for state money, she said.
“Schools closing down in February just isn’t good for anybody — not for staff, not for students, not for the community,” Hemphill said.
At last Wednesday’s board meeting, REALM asked the district for a $500,000 loan with interest. Instead, the district decided to forward the school three months of tax revenue in advance, with each month’s worth of tax revenue amounting to about $90,000, said district spokesperson Mark Coplan.
“The district isn’t taking any risk here,” Coplan said. “The board is forwarding them three months of their own tax revenue — money that they are legally entitled to.”
REALM Principal Victor Diaz said that the financial situation is exacerbated further with state budget cuts and that the consequences will be drastic for the school if Gov. Jerry Brown’s tax hike does not pass in November.
“Class sizes will have to go up, teachers may not get raises and we might have to cut back on our contributions to health care benefits — it will be catastrophic,” Diaz said.
The charter school’s share of property tax is distributed based on the average daily attendance of students throughout the year. Because REALM did not have 200 additional students per middle and high school, as projected for this school year, funding was lower than expected. Currently, student attendance is increasing by about 100 students per year.
REALM will need a loan in October for $268,000 and $407,000 to make it through to the end of the school year. Though the state is projected to pay the schoolmore than $900,000 for general-purpose funding, $515,000 of that payment will be deferred until after the fiscal year.
In light of the situation, Diaz said cooperation between the district and the charter school is key.
“I think it should be a reciprocal relationship,” he said. “They should be able to bend a little bit, support the facilities, support us financially. Some people think that charters get a free ride … that’s not true.”
Diaz said it is hard to plan for future budget holes because the money that the school has been promised is not readily available to be spent.
“We’re fortunate that the board is being understanding,” he said. “The school board understands that this is not us making bad business decisions.”
Contact D.J. Sellarole at [email protected].
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