PA’s unregulated cyber charter schools spent $21 million on advertising fees and gift cards

A new report highlights how much money Pennsylvania’s cyber charter schools spent on advertising fees, gift cards and more. 

$68,750 spent on advertising with minor league sports teams.

$220,000 spent on search engine optimization. 

$1.1 million spent on “Thank You” grocery gift cards. 

Those are some of the random expenses Pennsylvania homeowners and businesses are on the hook for thanks to the commonwealth’s outdated charter school laws, but it gets worse. 

A new report issued by the Education Voters of Pennsylvania on Thursday shines a light on the tens of millions of dollars Pennsylvania’s charter school operators spend on advertising fees, gift cards and other expenses. 

“If the public schools were spending money willy-nilly like this, if the public schools were throwing money at gift cards and advertising, people would be up in arms,” State Rep. Joe Ciresi (D-Delaware) said in an interview expressing disbelief over the findings of the report.

“People would be at school board meetings, screaming and yelling. They’d be held accountable. But these cybers aren’t being held accountable to the taxpayer dollar.”

Screenshot of an invoice from REACH Cyber Charter School obtained by Education Voters of PA via a right to know request.

Cyber charter schools cost Pennsylvania’s public schools close to $1 billion annually and the majority of their funding comes from school district property taxes because the state no longer helps local school districts to cover tuition costs. 

“Pennsylvania’s 25-year-old charter school law does not recognize the difference between brick and mortar charter schools that provide education in person and cyber charter schools that provide exclusively online education to students,” Susan Spicka, executive director of Education Voters of Pennsylvania, explained during a press conference on Thursday. 

“So consequently, the state law mandates that school districts send cyber charter schools far more funding than they need to educate students.”

The report found that cyber charter schools spent more than $21 million on advertising and gift cards for the 2022-2023 school year.  

Commonwealth Charter Academy spent $8.3 million on advertising during their year and three of the media and advertising firms they contracted with collected $1.1 million in agency fees, which is essentially a cost of doing business. 

It also highlights how revenues and assets for the state’s four largest cyber schools, Agora Cyber Charter School, Commonwealth Charter Academy, Pennsylvania Cyber Charter and Reach Cyber Charter, exploded from 2018 to 2022. These schools teach 75% of students enrolled in the state’s cyber charter schools  

Their assets and revenues grew by 92,000%. In 2018, they had a combined $566,858 in net assets and fund balances reported on their 990 forms. That number ballooned to over $486 million by 2022. 

Commonwealth Charter Academy, the state’s largest cyber charter school, is amassing its own real estate empire as well. The school has spent over $88 million purchasing 29 buildings since 2018. These properties include office buildings, parking lots and other commercial spaces and they’re being primarily paid for by taxpayers.   

The report calls on the Pennsylvania General Assembly to cap the amount of money spent on each cyber charter school student to $8,000, which would save Pennsylvania close to $500 million each year. Pennsylvania House Democrats passed a House Bill 1422, which was introduced by Ciersi, earlier this year. 

“You’re on a computer, you can’t have the same expenses as they do in brick and mortar [schools],” Ciresi  said. 

“I don’t care what anybody says. I’ll argue this until the cows come home. There is no way you have the same expenses as a brick and mortar school. None.”