Fiscal Explainer: Texas Charter School Funding Analysis
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Policy Brief

Fiscal Explainer: Texas Charter School Funding Analysis

Between 2015 and 2019, the inflation-adjusted funding gap between public charter schools and traditional public schools grew by about 36 percent—from $596 per pupil to $813 per pupil.

Aaron Garth Smith
Director of Education Reform
Jordan Campbell
Quantitative Analyst
Corey A. DeAngelis
Senior Fellow

Do Texas’ public charter schools receive more or less funding than public school districts? The following analysis of this oft-debated topic summarizes the state’s school finance system and highlights key revenue and trend data that identify differences in public charter funding allocations. This analysis finds that:

  • Public charters receive about $813 less state and local funding per pupil than public school districts, on average, representing a per-pupil funding disparity of 7 percent.
  • The primary driver of this overall disparity is facilities revenue. On average, public school districts raise $1,505 per pupil from local I&S (interest and sinking) dollars and also receive $105 per pupil in state debt funding. In comparison, public charters aren’t eligible for I&S dollars and receive an average of $196 per pupil in facilities support from the state.
  • On average, public charters generate about $692 per pupil more in M&O
    (maintenance and operations) dollars, which is likely driven by differences in how the small and mid-sized district allotment is calculated. However, this amount falls well short of bridging the revenue gap caused by facilities funding.
  • Between 2015 and 2019 the inflation-adjusted funding gap grew by about 36 percent—from $596 per pupil to $813 per pupil.
  • Regression analyses indicate that differences in several cost factors, including student demographics, do not explain the difference in funding between public charters and public school districts.
  • On average, public charters operating in Texas’ metro areas receive fewer dollars per pupil than public school districts operating in metro areas.
  • Public charters serve about 5.8 percent of Texas’ public education students in ADA (average daily attendance) and receive about 5.4 percent of state and local education dollars— $3.138 billion out of about $58.156 billion.

Reason Foundation’s data dashboard allows users to evaluate these trends, including statewide and local comparisons for several public school districts.

Full Fiscal Explainer: Texas Charter School Funding Analysis  

The interactive data dashboard is available here: Texas Charter School Funding Analysis

You can also find an infographic on Texas charter school funding here: Infographic – The Texas Charter Funding Gap