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Financing Online Education and Virtual Schooling: A Guide for Policymakers and Advocates

This policy brief addresses considerations for state and local policymakers as they decide whether and how to finance supplemental online education alternatives and/or full-time virtual schools. The authors begin with a discussion of the sparse and inconsistent literature regarding the financing of new online models, and then present empirical illustrations for determining costs. They start with a top-down example, isolating typical cost components of brick-and-mortar schooling and then matching them to cost components of virtual models considered all-inclusive (although they typically provide far fewer services than their traditional counterparts). They offer an alternative cost analysis framework that can be used to add individual cost components in order to calculate total overall costs for virtual schools. After discussing general analytic issues that policymakers should consider as they develop finance policy, they offer model legislation for a uniform financing and accountability policy applicable to both supplemental and full-time online education.