Cutting Off Your Foot to Spite the Children

Carmen Eviction Would Harm MPS Bottom Line as Well as Kids

The state’s largest public school district, Milwaukee Public Schools, continues with its financial woes. Despite the narrow approval of a massive $252 million referendum just last month, Milwaukee Public Schools recently announced that substantial cuts to their budget will be required. These cuts could include over 280 staffing positions including nearly 150 teacher filled using pandemic-era funds; funds that are now ending. But while MPS continues to demonstrate a lack of financial management with taxpayer dollars, other decisions the board is considering that are designed to placate teachers unions are actually harming their bottom line.  

The Carmen Situation 

Recently, the MPS School Board began the process to consider forcing Carmen Schools to leave two buildings that it currently rents from the district. Carmen runs a network of charter schools in the city that historically have been some of the highest performing schools in the district. This was a sad day for those that saw hope for better collaboration between traditional public schools and charter schools. Carmen advocated for co-location of its schools within MPS, hoping to benefit both the public charter and public school students.  In 2015 when the partnership was approved, MPS billed it as an opportunity to “accelerate student achievement” and it was among Eight Big Ideas the district put forth by the district to improve student success. Now, that experiment is potentially coming to an end without clear reasons and could displace more than 1,000 students.  

As shown in the table below, Carmen High School South—one of the two to be evicted—is among the top five highest rated high schools in the district on the state report card, and the highest rank school that doesn’t have admission requirements 

Table 1. High School Report Card Scores, Milwaukee 

The schools are what are known as “non-instrumentality” charter schools. This means that, while MPS serves as the authorizer, the charter schools are run independently with non-unionized teachers. The loss of the school buildings, along with a generally unfriendly environment towards charter schools within MPS and as their authorizer, could force Carmen to seek out a different authorizer.  And, contrary to all the rhetoric about the “cost” of school choice to public schools, this would actually be a financial hit to MPS’s bottom line.

The Financial Impact 

According to Carmen’s contract with the district, the schools are provided with the same funding level as Wisconsin’s independent charter schools ($11,385) with a few additional changes. First, categorical aids—for instance, for students with disabilities—are added. With no details available to us on this aspect, I make the assumption that this is a wash for the district. MPS also takes a 1% “administrative fee” from the school, which would be approximately $113 dollars per student. The MPS revenue limit for 2023-24 was $12,660. This means in practice that MPS keeps a skim of $1,215 per Carmen student. Adding the administrative fee to that means that MPS gains approximately $1,328 for every student they’re no longer educating that attends Carmen.  

But there’s even more to the story. Carmen is also paying MPS to lease the space within the two buildings it collocates in. According to the lease documents, MPS will be paid $520,879 for the lease of Carmen Southeast and $270,810 for the lease of Carmen South High School for a total of $791,689 annually.  

The table below shows the total funding hole MPS would be potentially creating by evicting Carmen Schools. We use current enrollment at the two schools (1,075) to estimate the total amount of the skim and administrative fee.  

Table 2. Potential MPS Lost Revenue if Carmen is no longer part of the district

This would only serve to exacerbate what is already a dire financial situation for the district. As the district is already looking to shed teachers, this loss in revenue represents the salary of approximately 33 more teachers at average pay rates around the state.  

Shifting Positions on Chartering 

Carmen has long been a shining light for the possibilities of urban education in Milwaukee. But unfortunately, Carmen finds themselves the victim of a move away from support for charter schools from public school advocates.  A decade ago, President Obama supported record funding opportunities to expand charter school education based on his positive experience with the schools in Chicago.   But today, President Biden has placed onerous restrictions on the federal charter program and even proposed $40 million in funding cuts.  Charters have come to be seen by far too many as competitors for resources from traditional public schools—and public school proponents are desperate to preserve their monopoly.   

 This analysis shows that MPS’s irresponsible proposal to end Carmen’s facility agreements would harm not only the 1,000 Milwaukee families, but it would be a loss of apparently necessary funding for the district.  All those who care about urban education, school choice, or good governance should unite in urging MPS to abandon this wrong-headed path.  

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