Myths and Facts: Public Cyber Charter Schools

Summary

Myths and misinformation obscure the facts about Pennsylvania’s public cyber charter school students. Proposed cuts to cyber students will force the closure of up to nine of Pennsylvania’s 14 public cyber schools, terminating cyber education for tens of thousands of kids and threatening the vitality of cyber education in Pennsylvania.

Cyber Charter Enrollment

MYTH: Cyber charter schools discriminate when enrolling students.

FACT: Cyber charter school students are more likely to be homeless or from low-income families, students of color, and have special education needs.

• Cyber schools are public schools and may not turn away students who choose to enroll.
• The Pennsylvania Department of Education (PDE) reports 20.7 percent of students enrolled in public schools for the 2024–25 school year had special education needs. For the commonwealth’s nearly 65,000 charter cyber students, the percentage was significantly higher, 30.4 percent (over 19,550) were students with disabilities.¹
• In 2024–25, approximately 2,300 were English Language Learners.²
• Cyber charter schools serve more homeless students than brick-and-mortar public schools.
  • In the 2023–24 school year (latest data available), more than 2,500, or 4.25 percent, of cyber charter students qualified as homeless compared with 2.65 percent of traditional public school students.³
• Approximately 50 percent of all cyber charter students come from low-income backgrounds, with one cyber charter school in its most recent annual report showing 95 percent of its students were from low-income households.⁴
• When school districts refuse to pay tuition to cyber schools, Pennsylvania’s most vulnerable student population suffers.

Cyber Charter Spending

MYTH: Cyber charter schools should not spend money on buildings.

FACT: Pennsylvania law requires public cyber charter schools to occupy physical buildings, and cyber schools need physical space to deliver services.

• State law requires cyber charter schools to operate a physical administrative office within the commonwealth where student records are maintained.⁵
• The same law requires cyber charter schools to administer annual standardized tests at a physical location. Cyber schools must rent space on a short-term basis (several hours per day for several weeks in a row) to accommodate test-taking.
• Furthermore, cyber instruction requires a significant data infrastructure housed at a physical location, and warehouse facilities are essential for storing and distributing technology to Pennsylvania’s 65,000 cyber students and their teachers.
• Similar to Pennsylvania’s 29 Intermediate Units—which educate district students offsite and receive payment from school districts for educational services—cyber charter schools educate district students offsite and receive tuition payments from school districts in exchange for educating cyber students.
• While cyber charter schools deliver instruction virtually, owning and/or leasing office space, classrooms, and warehouse space is necessary to meet students’ needs.
  • Cyber charter schools need classroom and meeting spaces for teachers to plan, prepare, and deliver instruction. Teachers often provide instruction from a physical, regional cyber school office.
  • Special education and tutoring services are provided on-site for cyber charter students. Some cyber programs offer a blend of hybrid and in-person instruction for students pursuing subjects such as performing and fine arts.

Cyber Charter Funding

MYTH: Cyber charter schools take money away from public schools.

FACT: Public cyber charter schools are public schools, funded by federal, state, and local tax dollars.

• Although cyber charter schools are public schools, they are not funded equitably and receive less state funding per pupil than students attending school district cyber programs.
• On average, cyber charter schools receive approximately $14,000 per non-special education pupil paid by public school districts. Those same school districts spend nearly $24,000 per student on their in-house cyber charter programs.⁶
• The law empowers school districts to raise and collect taxes, but cyber charters are prohibited from doing so. Thus, cyber schools are dependent on school districts to pay per pupil tuition to cover the expense of educating students who choose to attend cyber charter schools.

MYTH: Public cyber charter schools receive excessive funding.

FACT: The 2024 Pennsylvania budget cut $190 million in funding to special education students who attend cyber charter schools but failed to impose the same cuts to district students attending in-house cyber programs.

• Equitable funding for public schools must include holding district cyber programs to the same standards and funding formula as cyber charter schools.
• The 2024–25 state budget took a step further and provided $100 million to school districts to reimburse them for tuition paid to cyber schools.⁷
• The full extent of the budget cuts to cyber charter schools went into effect on January 1, 2025; thus, the financial impact on students has not yet been fully realized. Further cuts to cyber charter schools will hurt kids and families and will marginalize Pennsylvania’s most vulnerable student population: children of color, English language learners, and homeless kids from low-income families.

MYTH: Pennsylvania has an equitable funding formula.

FACT: Pennsylvania has thrown money at school districts but has failed to fix the funding formula.

• Pennsylvania’s annual budget attempts to address inequitable funding by allocating hundreds of millions in block grants to school districts. This is a band-aid approach that does not fix the underlying problem.
• The 2024–25 state budget cut $190 million from cyber charter schools, while at the same time, school districts were rewarded with $100 million in compensation for tuition paid to cyber schools based on the number of students who exited brick and mortar public schools in favor of cyber education, giving districts more money for students they no longer educate, and cutting funding to cyber schools for the students they enroll.
• The same budget increased education funding to district schools by $1.3 billion, representing the second-largest increase ever.⁸ Furthermore, Gov. Josh Shapiro is looking to increase school district appropriation funding by another $700 million in 2025–26.⁹
• Pennsylvania must identify and implement a new funding formula that prioritizes a student-centered, fair funding approach based on enrollment and student need.

MYTH: Pennsylvania has fixed the funding formula as required by the 2023 Commonwealth Court ruling.

FACT: Pennsylvania continues to rely heavily on the outdated “hold harmless” provision, which guarantees school districts the same amount of funding as the previous school year, regardless of enrollment.

• Despite shrinking enrollments, a 2023 study by EdChoice shows Pennsylvania as one of only seven states to reward districts using hold harmless historical allocations, which, in the 2019–20 school year, resulted in only 11.2 percent of funding flowing through the fair funding formula.¹⁰
• Pennsylvania must move toward funding students, not systems. A funding formula tied to enrollment would provide a more equitable distribution of dollars for students in Pennsylvania.
• The Commonwealth Court mandated that “every student receive a meaningful opportunity to succeed,” but did not order increased funding, nor did the order require a specific plan for addressing inequity.¹¹
• However, since the court case was filed in 2013, public education spending has increased by 74 percent, or $7.1 billion, with only a fraction ($799,352,960) flowing through the fair funding formula.¹²
• Lawmakers must reform school finance to ensure education funding follows the child, whether to a district cyber program or an off-site cyber charter school.
• Increasing funding to schools and/or districts with growing populations and reducing funding to districts and/or schools with shrinking populations would improve operational efficiency and ensure that cyber charter students receive the same level of funding as students enrolled in public school district cyber programs.
  • Cyber enrollment grows year over year across Pennsylvania, while brick-and-mortar public school district enrollment shrinks. Yet, charter students receive a fraction of state funding compared to students attending school district cyber programs.
  • Public school district enrollment has declined by 300,000 students from the 1999–2000 to the 2024–25 school year, while charter and cyber charter schools gained 157,500 students.¹³

Cyber Charter Reserve Funds

MYTH: Cyber charter schools hoard reserve funds.

FACT: Cyber charter school reserve funds total approximately $500 million, compared to public school districts, which hold more than $13.2 billion in reserves.

• The same funding formula that allows school districts to amass billions in reserve funds pushes cyber charter schools to guard millions in reserve funds.
• Like public school district reserves, cyber charter reserve funds consist of assigned, unassigned, and committed funds. While the intent for assigned funds may be for capital improvements, reserve funds are fungible, allowing cyber charter schools to repurpose their use.
• There are 14 public cyber charter schools in Pennsylvania, collectively holding $500 million in reserve funds, which account for nearly half of all charter school reserve funds (brick and mortar, plus cyber charter schools).
  • Eleven of the 14 cyber schools (79 percent) hold reserve funds above the 20 percent recommended threshold, compared with nearly 57 percent of school districts that are above the threshold.
  • For all charter schools, approximately 35 percent are over the 20 percent expenditure threshold.¹⁴
• Cyber charter schools have unique needs, experience frequent enrollment fluctuation, and cannot rely on districts to pay tuition on time. Thus, revenue is uncertain, which means reserve funds are imperative to ensure the continual delivery of educational services.
  • School districts are notorious for refusing to pay cyber charter tuition, forcing cyber schools to rely on reserve funds to keep their doors open.
  • Cyber charter schools receive less per student funding than district schools.

Cyber Charter Academic Outcomes

MYTH: Cyber students score lower on standardized tests than district students.

FACT: Cyber charter students score higher on standardized tests than students enrolled in district cyber programs.

• Very few public school districts report standardized test scores for students enrolled in district cyber programs. This lack of transparency allows districts to obscure academic outcomes for in-house cyber students.
• Of the few districts that do report their cyber program standardized test scores, PDE considers five in-house cyber schools to be low-achieving.
• Cyber students are required to take standardized tests in person rather than online. This is a barrier to testing for students who are accustomed to learning remotely.
• In-person testing is disruptive for students and burdensome for families.
  • Depending on the student and grade level, testing may take place over several days or weeks.
  • A parent or caregiver must transport the cyber student to a testing location—which may be at a regional location that is not close to home—and must wait several hours until testing is complete.
  • Students spend several hours testing at unfamiliar locations, while under the direction of unfamiliar adults.
  • For many families, test participation means time away from work for parents and leads to a high number of families opting out of the arduous testing process.
• Students who opt out automatically receive a non-proficient test score. When a school’s test participation falls below 95 percent, each non-tested student receives a score of non-proficient. This directly lowers the school’s overall PSSA score and artificially deflates proficiency rates.
• Students transferring to a new school tend to score lower on standardized tests.
  • While nearly 65,000 students currently attend cyber charter schools, a vast majority have attended three or four schools before determining that a cyber school is the best fit. This results in lower standardized test scores for newly transferred students.

Summary

Pennsylvania’s public cyber charter schools provide a vital service to the 65,000 students who have opted for cyber education, despite receiving millions less in funding than district cyber programs. Cyber education must be protected from targeted cuts, and lawmakers should enact a new funding formula that prioritizes a student-centered, fair funding based on enrollment and student need.

---

[1] Pennsylvania Department of Education, Special Education Data Reporting: “Special Education and Total Enrollment by LEA: 2008–2024,” Contracted Vendor – Penn State University, June 6, 2025, https://penndata.hbg.psu.edu/Additional-Reports.

[2] Pennsylvania Department of Education, Enrollment: English Learners: “2024–2025 EL Student Counts by LEA and School,” October 1, 2024, https://www.pa.gov/agencies/education/data-and-reporting/enrollment#accordion-f7c3e07aed-item-e2a748804f.

[3] Pennsylvania Department of Education, Elementary and Secondary Education – Homeless Education, accessed September 15, 2025, https://www.pa.gov/agencies/education/programs-and-services/instruction/elementary-and-secondary-education/homeless-education#accordion-155c5bcdfc-item-9af9b59fe9; see also Pennsylvania Department of Education, Homeless Education: “McKinney-Vento Homeless Education Assistance Improvements Act of 2001,” accessed September 15, 2025, https://www.pa.gov/agencies/education/programs-and-services/instruction/elementary-and-secondary-education/homeless-education/mckinney-vento-act.

[4] Pennsylvania Department of Education, Charter Schools – Reports, Data, and Resources: “Charter School Annual Reports,” accessed September 15, 2025, https://www.pa.gov/agencies/education/programs-and-services/instruction/elementary-and-secondary-education/charter-schools/reports-data-and-resources#accordion-e391f9ddab-item-5666722322.

[5] Pennsylvania Department of Education, Basic Education Circular: “Cyber Charter Schools,” September 28, 2023, https://www.pa.gov/agencies/education/resources/policies-acts-and-laws/basic-education-circulars-becs/purdons-statutes/cyber-charter-schools#:~:text=In%20terms%20of%20facilities%2C%20the,must%20be%20provided%20to%20PDE.

[6] Pennsylvania Department of Education, Charter Schools – Funding: “Charter School Tuition Rates (2023–24),” accessed September 15, 2025, https://www.pa.gov/agencies/education/programs-and-services/instruction/elementary-and-secondary-education/charter-schools/charter-school-funding. Pennsylvania Department of Education, AFR Data: Summary- Level, accessed September 15, 2025, https://www.pa.gov/agencies/education/programs-and-services/schools/grants-and-funding/school-finances/financial-data/summary-of-annual-financial-report-data/afr-data-summary-level.

[7] Pennsylvania Office of the Governor, “Governor Shapiro, Legislative Leaders, Teachers, and Students Celebrate Historic Budget Investments in Public K-12 Education at Amanda E. Stout Elementary School in Reading,” news release, August 9, 2024, https://www.pa.gov/governor/newsroom/2024-press-releases/governor-shapiro–budget-investments-in-public-k-12-education-at;

[8] Sen. Michele Brooks et al., Act No. 55 of 2024 (Senate Bill 700), Pennsylvania General Assembly, Regular Session 2023–24, July 11, 2024, https://www.legis.state.pa.us/cfdocs/billInfo/billInfo.cfm?sYear=2023&sInd=0&body=S&type=B&bn=0700.

[9] Pennsylvania Department of Education, School Finances, Education Budget: “2025–26 Proposed Summary of State Appropriations,” February 2025, https://www.pa.gov/agencies/education/programs-and-services/schools/grants-and-funding/school-finances/education-budget.

[10] Martin F. Lueken, “How States Protect Funding for K–12 Public Schools,” EdChoice, November 2023, https://www.edchoice.org/wp-content/uploads/2023/11/Hold-Harmless-POLICY-SCAN-1.pdf.

[11] William Penn School District et al. v. Pa. Department of Education et al., No. 587 M.D. 2014, (Pennsylvania Commonwealth Court, February 7, 2023), 773–77, https://www.pacourts.us/Storage/media/pdfs/20230207/214401-587md2014–memorandumopinionfiled(feb.7)reduced.pdf.

[12] Pennsylvania Department of Education, Education Budget: ”Cyber Charter Transition,” accessed September 15, 2025, https://www.pa.gov/agencies/education/programs-and-services/schools/grants-and-funding/school-finances/education-budget#:~:text=The%20Enacted%202024%2D25%20fiscal,paid%20to%20cyber%20charter%20schools.

[13] Pennsylvania Department of Education, Enrollment: “Public School Enrollment Reports,” accessed September 15, 2025, https://www.pa.gov/agencies/education/data-and-reporting/enrollment#accordion-cb5f3bee47-item-9b3fcf9ab9; Pennsylvania Department of Education, Charter Schools – Reports, Data, and Resources: “Enrollment Data,” accessed September 15, 2025, https://www.pa.gov/agencies/education/programs-and-services/instruction/elementary-and-secondary-education/charter-schools/reports-data-and-resources.

[14] Rachel Langan, “Rethinking School District Reserve Funds as Students Return to Class,” Commonwealth Foundation, August 25, 2025, https://commonwealthfoundation.org/research/rethinking-school-district-reserve-funds/.