Online class costs vary by district

BOISE – A quirk of Idaho’s new “Students Come First” school reform law means that online course providers will get far more state money for providing classes to students in some Idaho school districts than in others.

For example, an online provider could tap roughly $210 from the Boise district’s state funding stream for providing a student an online class, according to state estimates, while a provider sending the same online class to a student in Midvale could collect roughly $733 from that smaller district’s state funding.

“So I think if I were a provider, I would first concentrate on these districts where this credit is worth a lot more money,” Rep. Wendy Jaquet, D-Ketchum, who serves on the “Students Come First” technology task force charged with implementing the new laws, told state schools Superintendent Tom Luna during a task force meeting this week. “I wonder if you’ve explored the idea of a cap.”

The reform laws that Luna championed this year include a new focus on online learning and phasing in purchases of laptop computers or other computing devices for every Idaho high school student and teacher. A 2012 referendum will ask Idaho voters if they want to reject the new laws.

Luna said he didn’t think the funding-formula issue warranted changing the law.

“We’ll learn a lot once these laws are in place, and I think that’s what we want to do, is learn from actual application of the laws, not make changes based on what we think may happen,” he said. “I don’t think we’ve seen a perfect law yet.”

However, Luna agreed to bring the issue back for the task force to discuss at its next meeting in November.

The reform law allows secondary school students to enroll in any approved online class, with or without their school district’s permission, starting in fall 2012. Then the provider of the online class is entitled to two-thirds of that district’s state funding for the student for that class, while the district keeps one-third, to cover its costs for providing a classroom, a proctor or other fixed costs for the student, who likely would take the online class on campus during the school day.

The state sends funds to school districts based on “average daily attendance,” or ADA; the new formula is dubbed “fractional ADA.” It would apply unless the school district has a contract with the online provider setting a different payment amount.

But there are many factors that cause ADA amounts to vary from one school district to the next. Those include the size of a school district, to reflect economies of scale in larger districts and fixed costs in smaller districts; the distribution of students across different age categories from kindergarten to high school; and the experience level of the district’s teachers and administrators, which also triggers differences in state funding.

The result: For high school students, state funding per ADA varies from a low of $4,334 per student per year at the Idaho Virtual Academy, closely followed by the Caldwell School District at $4,757 per student, to a high of $17,595 per Midvale high school student. The South Lemhi school district gets $17,470 per high school student; Culdesac gets $16,897; Mullan gets $14,645.

State Department of Education finance chief Tim Hill calculated these figures for the 2009-’10 school year but says they’re a good basis for comparison.

The state’s largest school districts are on the low end for ADA. The Meridian School District gets just $4,843 per high school student; Boise gets $5,047; and Coeur d’Alene, Lakeland and Post Falls districts all come in just under $5,000. West Bonner and Lake Pend Oreille schools get $5,770 and $5,338, respectively.

When task force members questioned why those differences should be applied to payments to online course providers, Luna aide Jason Hancock told them, “That’s how the legislation reads. It’s just built around essentially what an ADA is worth … and it is different from district to district.” He said that’s why a subcommittee of the task force is looking into statewide contracts with online course providers, to secure lower rates for smaller districts that are more comparable to what larger districts would pay.

If parents choose an online class that costs more than the formula allocates for their school district, they will have to make up the difference.