2017 Financial Analysis Review Released

Monday, July 9, 2018

Public Charter School Annual Financial Analysis Released

Washington, DC --Today DC PCSB released its annual, comprehensive assessment of finances at individual public charter schools.  Called the Financial Analysis Report (FAR) and completed with the assistance of the Office of the Chief Financial Officer (OCFO) and the Office of the State Superintendent of Education (OSSE), this assessment provides in-depth information about DC public charter schools’ finances and operations.

This report was created - and continues to improve -- with input from public charter school representatives, charter support organizations and parents.

This analysis has two sections:

  • A  financial analysis report for each and every nonprofit which runs a public charter school. 
  • A comprehensive look at financial markers of public charter school sector in Washington DC

While not included in the report, DC PCSB publishes additional information supplied by the schools, including their annual audits, and other financial information, all of which can be found on our website in the School Finances section.

Summary of Results

These are some of the top findings in this report:

  • Overall, total public charter school assets grew by $85 million or 7% over the year before with  $67 million (78%) of that growth due to an increased investment in property and equipment. Liabilities grew by more than $52 million, of which $41 million (79%) is attributed to long-term debt.  DC public charter schools strengthened their reserves in FY17, as total net assets grew by more than $33 million (7%) compared to FY16.
  • As enrollment increased by 7% in FY17, revenues grew by 6%, to $xx mm.  While DC funding increased by $58 million for the sector (to $xx), the sector received $9 million less in total grants and contributions.
  • Total functional expenses grew by $73 million, or 9%, compared to last year. Over $41 million (56%) of that growth is due to increased spending on personnel and students. Personnel expenses comprise about 62% of DC public charter schools’ expenses, as in previous years. However, personnel expenses range from 30% to 70% of expenses across schools.  In cases where the school uses a school management organization (SMO), the proportion of expenses spent on personnel is impacted by the level of staff support provided by the SMO.
  • In FY2017, schools received $3,124 per student in local facilities funding; this is about 15% of their total revenue per student, but occupancy expenses amount to 16% of expenses on average, with some schools spending as much as 30% of revenues on occupancy expenses.  The percent of expenses spent on occupancy is often higher as schools ramp up enrollment levels.

School Management Organizations

  • In FY17, 18 DC public charter schools operated with a SMO. These relationships are noted in the DC PCSB Observations section of each school’s Financial Report Card, as well as detailed more thoroughly in a supplementary Management Organization/Related Party table here.  The services provided by SMOs and related parties is also included in the report. A SMO is, according to the DC Code (cite), “an entity… with which the public charter school contracts to provide management or oversight services regarding the school’s expenditures, administration, personnel, or instructional methods. The term ‘school management organization’ does not include an entity with which a public charter school contracts solely to provide administrative support services, such as (A) payroll processing or information technology services; (B) academic support services; or (C) temporary management services recommended by the eligible chartering authority to improve the performance of a public charter school.” DC public charter schools receive a wide range of services from their management organizations, from facility management to instructional oversight.

The full report is available online.