Thursday, November 14, 2013

A New Funding Method to Stem Virtual School Corruption

In the past few months, we have posted on a series of funding scandals involving virtual charter schools.  A new policy and research guide by Bruce Baker and Justin Bathon digs far deeper than my posts and the legislative responses-which have been to simply pull the plug in some instances. The guide starts with the question of: based on actual costs, what is the appropriate level of funding for virtual schools?  It then offers recommendations, such as paying virtual schools after students complete courses rather than based on basic enrollment.  This creative solution might go a long way to stemming corruption and perverse incentives.  Those intent on cheating the system can surely find ways to falsify data regarding course completion, but for the vast majority, anchoring funding to course completion does away with the incentive of enrolling students for the sake of enrolling them and then paying little attention to how their education progresses.

Baker and Bathon's full recommendations follow the jump.

1. [Online Education/Virtual School (OE/VS)] alternatives should be funded based on the instructional units provided to students to advance their progress toward program completion. Using brick-andmortar rates as the basis for funding online offerings is inappropriate; the scope of services provided by OE/VS alternatives varies so greatly that an offering is rarely, if ever, equivalent to that provided in a traditional setting offering a full complement of services.

2. Maximum subsidy rates for online instructional units should not exceed the costs of producing the same unit in the brick-and-mortar setting.

3. States should consider determining the average costs for various units of traditional brick-and-mortar courses, particularly at the secondary level, to provide a base for calculating state subsidies for full-time online program as well as for calculating for school district subsidies for supplemental online courses.

4. School districts continuing to provide services to full-time online students should be compensated for their costs.

5. States and local public school districts should conduct longitudinal studies to determine the relative effectiveness of OE/VS versus brick-and-mortar services to ensure that outcomes are at least comparable.

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