April 8, 2014 Paul Kihn Deputy Superintendent Philadelphia School District Paul I read in an article in the Notebook that

t you are frustrated that there is a misconception about the $4,000 per student stranded costs at the two proposed new Renaissance charters. http://thenotebook.org/blog/147114/kihn-renaissancecharters-wont-get-extra-money The article quotes you as saying the District needs to do a much better job of getting the information out to the public. I have listed below a few questions concerning those reported costs. The answers to these questions could be helpful to the on-going public discussion about the proposed changes at these two schools; perhaps the District could post responses on the Districts website in the section where information on the Renaissance Initiative has been provided historically. See http://webgui.phila.k12.pa.us/offices/r/renaissance-schools. Joe Dworetzky Questions on Cost of Proposed Renaissance Charters: 1. How was the $4,000 per student in stranded costs calculated? Was there a methodological change from the past in calculating the cost? If not, why are the stranded costs so high? Renaissance charters historically had much lower per student cost because the District was able to shed the fixed costs of the school building and related infrastructure at the same time as it lost the revenues paid to the charter operator. Prior estimates were in the range of $1,000 to $1,500 per student not $4,000. 2. Please post a financial analysis of the incremental cost of the seats in the new Renaissance charters like the analysis produced last year for Alcorn, Kenderton and Pastorius. 3. What are the enrollment projections for the two schools and is growth capped in their charters? If growth in enrollment is anticipated, where will the students come from? Other District schools? In the past Renaissance charters became very expensive when the schools selected were underenrolled and significant numbers of new students needed to be added for the schools to be financially viable, particularly when those students were drawn from different catchment areas. (Last year, for example, the cost of Alcorn,

Pastorius and Kenderton was much higher than the historic cost of Renaissance Charters because of anticipated growth at the schools.) 4. Are the charter operators paying a full dollar-for-dollar reimbursement of all of the Districts facilities costs? Are the charter operators being given the chance to make their own maintenance and custodial arrangements? Snow removal? Utilities? If so, does the District have to absorb any costs for services not utilized by the charters? 5. In the selection of the schools or in the RFP process, did the District explore ways to reduce or offset the $4,000 cost per student? If so, what approaches were tried? If not, why not? 6. What is the overall, 5-year cost to the District of converting these schools? Would it be fair to assume that enrollment will be something like 600 students per school and the annual recurring cost will be $4,000 per student? If this is so, is it fair to estimate that the 5 year, all-in, cost to the District will be in the neighborhood of $24 million (600 * $4,000 * 5 * 2 = $24 million)? 7. Given the Districts financial condition, how does one justify the cost when it is, in the end, imposed on the students who are not going to the new charters?