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State officials: charter schools and Education Freedom Accounts are growing; department projects tens of millions more than governor’s HB1 estimate
Summary
Department of Education staff told the House Finance Division on April 2 that recent March 1 counts show charter-school enrollment and Education Freedom Account participation are higher than earlier agency estimates and that pending charter applications could add sizeable additional costs to the Education Trust Fund.
Mark Manganiello and Caitlin Davis of the Department of Education gave the committee updated, real‑time counts for charter schools and Education Freedom Accounts (EFA), noting the department’s March 1 enrollment snapshots showed higher usage than the agency had projected during the agency phase.
For charter schools, the department reported an estimated $70 million in state charter payments for fiscal 2026 and roughly $74 million for fiscal 2027 for existing, open charter schools. The department also provided an estimate for new and pending charter schools that could add another $5–$10 million in the biennium. “The cost we're projecting relative to these schools is between 5 and $10,000,000 for the two years of the biennium,” Manganiello said, and noted the governor’s HB1 recommendation for the Education Trust Fund was lower; department staff said the difference creates a roughly $22 million gap between the governor’s HB1 numbers and the department’s updated projection if all pending schools open and enroll as projected.
EFAs: the department supplied a March 1 count of EFA students (5,794) and updated projections to 6,500 students in fiscal 2026 and 7,500 in fiscal 2027 under current law, with corresponding cost estimates of about $34.8 million for fiscal 2026 and $41.1 million (department estimate) for fiscal 2027. Commissioner Gettleblue and staff explained the governor’s recommendation includes alternate scenarios and that a separate proposal to expand eligibility would raise costs further; department staff stated the governor’s estimate for a broader expansion was near $44 million for the biennium in one scenario discussed.
Why it matters: charter-school tuition and EFA payouts are computed on current-year enrollment and therefore require continuous updates; both programs carry Education Trust Fund obligations that the committee must budget for or cover by warrant. Committee members asked for an alternative surplus statement showing the department’s updated projections instead of the governor’s recommended numbers so lawmakers can see the fiscal impact of the department’s counts and pending openings.
Doubts and offsets: staff and lawmakers discussed that student movement between traditional public schools, charter schools, EFAs and home education programs can reduce district ADEMs; the department noted that the net effect is not a simple one-to-one offset to adequacy because charter students still generate additional charter tuition payments and other differentials. Manganiello said the department adjusted pending-school projections downward relative to the applicants’ own optimistic estimates and excluded charter-school closures from its projection because closures are sporadic and difficult to forecast.
Ending: Department staff offered to produce a comparative surplus statement for the committee that replaces the governor’s HB1 projections with the department’s updated charter and EFA figures so the committee can weigh possible additions or policy changes in the Education Trust Fund appropriation process.
