Primary school students in a computer lab (Getty Images)
Emily Scolnick is a 2026 Dow Jones News Fund intern at Pennsylvania Capital-Star.
Nearly 70,000 students attend one of Pennsylvania’s 14 free online public schools. Over the past few years, lawmakers have worked to reform the institutions’ funding models and curb what they consider excessive spending.
But cybersecurity charter leaders say such efforts do more harm than good.
Although cybersecurity cards are free to families, Pennsylvania school districts pay student tuition directly to cyber schools. Tuition rates vary depending on the district and whether the student requires special education.
For this reason, according to Susan Spicka, the company’s executive director, cybersecurity card funding for a given year is directly tied to its registration. Education Voters in Pennsylvania.
In February 2025, state Auditor General Timothy DeFoor released a cybersecurity charter performance audit reportwhich found a huge enhance in revenue and cash reserves for several schools and called for radical changes to Pennsylvania’s cybersecurity charter funding model.
Cyber charters also underperformed academically, with many performing poorly well below the state average for knowledge of English, mathematics and science.
Pennsylvania’s 2024 budget included a significant adjustment cyber charter special education tuition. But current spending plan brought a sweeping round of funding changes and policy reforms to the Cyber Charter.
Cybersecurity Charter leaders stated that the changes are detailed in Act 47 of 2025resulted in a reduction in funding by USD 238 million in 14 schools, which is USD 60 million more than the legislator assumed Estimates at $178 million.
Act 47 included two other significant policy changes: a fresh rule stating that students who are chronically truant – those who have accumulated six or more unexcused absences – cannot transfer to cybersecurity schools without a judge’s approval, and a twice-yearly residency verification requirement designed to ensure that individual school districts pay appropriate amounts to their students enrolled in cybersecurity charters.
Rep. Peter Schweyer (D-Lehigh), who chairs the House Education Committee, expressed concerns that cybersecurity charters “spend money in a way that does not directly benefit students.”
“We have not reduced funding for education,” he said. “We are giving money from one type of school that has no results.”
Smaller schools are struggling
Leaders of seven compact and medium-sized public cybersecurity organizations recently released a report alleging that funding and policy changes have “led to shortages” among students and detailing what they call the “unintended consequences” of Act 47.
“There are economies of scale in the public cyber charter school sector that allow larger public cyber charter schools to absorb the cuts imposed by Act 47,” he said. report reads. “Meanwhile, smaller public cybersecurity schools (which are equally important to Pennsylvania’s public education landscape) are struggling to make ends meet.”
Erin Van Guilder, CEO Cyber Charter Insight PA Schoolshe said her school has laid off 58 employees since November. To reduce expenses, several schools have slowed or frozen hiring.
“We don’t replace anything that doesn’t need to be replaced [role]”, Michael Leitera, CEO School PA Distance Learning Cardhe said. “The last two years have not been good for our budget.”
He said the cuts also forced the school to put on hold plans to add a social worker to its staff.
Karla Johnson, CEO of Pennsylvania Leadership Charter Schoolstated that $9 million in lost funds would have gone to student and employee programs. The school is currently projecting an $8 million deficit for next year.
Registration problems
Commonwealth Charter Academy (CCA) is the largest cybersecurity charter in Pennsylvania, currently enrolling approximately 40,000 students. This is six times more than before the COVID-19 pandemic. Successful increases in student enrollment and district tuition funds have helped offset the school’s $120 million loss in state funds this year.
“There will be more cash inflow as more students enroll,” said Timothy Eller, director of branding and government relations at CCA. But the school continues to tardy its hiring pace and see where it can get money from what cash reserves it already has was subjected to inspection.
The balance in the school’s endowment fund – used primarily for long-term investments – was just over $180 million for the 2024-2025 fiscal year. revision. However, the unallocated general fund balance is only $830,000, which Eller said is a “one-time infusion of money.”
“We overpaid [cyber charters] for years,” said Rep. Joe Ciresi (D-Montgomery), a member of the House Education Committee. “There are good people who probably budgeted properly, that some of these changes hurt, but we’re not putting anyone out of business and we’re not trying to do that.”
As CCA student enrollment increases, smaller cybersecurity practice leaders recognize that increased enrollment is the best way to enhance revenue and offset changes in funding. However, according to publicly available enrollment data, nine cyber charter organizations have lost enrollment since the Covid-19 pandemic.
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“If you get less per student, you have to have more students to be fiscally solvent” – Malynda Maurer, CEO Central Pennsylvania Digital Education Foundationhe said.
Spicka said cyber charter leaders need to recognize their current market.
“If you run an online school and families don’t choose your school, then the cookie crumbles and they have to deal with that reality,” she said.
Policy changes
Cyber Charter leaders said the habitual truancy policy and increased frequency of residency verification also raise some concerns. Leitera said enrollment in distance learning PAs has dropped since January due to the furlough rule. The school expects another economic downturn next year, which could prevent it from reaching its student enrollment target – a number critical to financial stability.
Maurer stated that her school had to turn away truant students.
“We tend to admit students who are chronically truant because our program is designed to help kids re-engage with school. That’s our reputation,” she said.
CSW defendant question the leave policy in May.
Many Republican lawmakers have begun introducing legislation to improve aspects of Act 47.
Sen. Dawn Keefer (R-York) and Rep. Barbara Gleim (R-Cumberland) sent out memos seeking to repeal Gleim’s leave policy he wrote “removes decision-making power from parents and puts it in the hands of bureaucrats.” Her Bill he currently serves on the House Education Committee.
“[Truancy] it was simply attacked as a cyber issue,” Keefer said. “It all seemed one-sided. The cyber cards had no place at the table.”
Reps. Joe D’Orsie (R-York) and Sen. Jarrett Coleman (R-Lehigh) want to limit residency verification to an annual requirement. D’Orsie said lawmakers “want compliance, but we don’t want to confuse people filling out these forms.”
“It is extremely popular in our communities and among many members of the Senate, including many Senate Republicans, to bring control to this extremely expensive and incredibly hopeless area of public education,” Schweyer said. “I don’t think many members are making good faith arguments based on the facts and data before us.”
Current prospects
Cyber charter reform efforts are “moving in the right direction,” said John Armato, director of community relations for the Pottstown School District. Pottstown saw a $215,000 reduction in cyber charter spending this year, which allowed it to maintain access to guidance counselors.
Spicka said support for Act 47 was “overwhelming and bipartisan” during last year’s budget negotiations. He hopes lawmakers will continue to build on the reforms of the past two years.
This year’s state budget is supported by Democrats I propose another $75 million for cyber charter funding adjustments. Cybersecurity charter leaders say this decline, coupled with pre-existing funding uncertainty, could prove irreversible.
Leitera stated that the PA Distance Learning fund balance would not cover operating costs for the entire year. His school is projecting a 20% to 25% reduction in revenue for the 2026-27 school year, and the projected deficit – as low as $3 million to $4 million – could continue to grow.
As cyber charters grapple with the potential loss of more funding, Schweyer stressed that he and other lawmakers are working to hold institutions accountable for their spending and aid provide students with the best education possible.
He said recent reforms as well as fresh regulations aimed at ensuring well-being of cyber studentsthey continue to pursue this goal.
