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North Carolina

North Carolina has the second largest state virtual school in the country, the North Carolina Virtual Public School. There are no full-time programs, although the State Board of Education established statute (115C-238.29A) in January, 2013 that sets the funding and requirement for statewide virtual charters.

Fully online schools

North Carolina’s SB8 (2011) significantly revised charter school law, but it did not specifically address the creation and operation of virtual charter schools. After more than a year of controversy and confusion, the North Carolina State Board of Education (SBE) approved policy on the procedures and operation of virtual charter schools (115C-238.29A). In January 2013, the SBE adopted policy that requires virtual charters to adhere to a significantly lower funding formula than brick-and-mortar schools, and maintain high graduation rates and low withdrawal rates. Funding for virtual charters will be based on the same funding amount as eight, full-year courses ($438 per course) at the NC Virtual Public School, or $3,504 per year (63% of average state funding). The state funding amount per pupil for brick-and-mortar schools is about $5,600, although base funding (before local contributions) ranges from $4,000 to $10,000. Virtual charters will not receive any local contributions .

Virtual charter schools must:

  • Maintain a 50:1 student-to-teacher ratio.
  • Keep graduation rates no less than 10% below the state average (about 80% in SY 2012-13) in any two of three years.
  • Not have a withdrawal rate higher than 15% in any two out of three years.
  • Only enroll students in grades 6-12.

All charters must be submitted to and approved by the SBE and the applicant must “submit a copy of the application to every local education agency (LEA) in North Carolina from which the virtual charter school may attract students.” Schools must complete a mandatory planning year, maintain a physical location in the state, and provide face-to-face, synchronous activities; this can include meetings with teachers, educational field trips, virtual field trips, conferencing sessions, or “asynchronous offline work assigned by the teacher of record.”

The 2013 statute stemmed from efforts in 2012 to open the North Carolina Virtual Academy (NCVA), an initiative of the North Carolina Learns nonprofit organization, which was given approval by Cabarrus County Public Schools to submit a charter application to the State Board of Education (SBE) postulating that SB8 effectively removed the moratorium on statewide full-time virtual charter schools. Before NCVA submitted its application for authorization, the SBE instructed its E-Learning Commission to develop guidelines and performance measures for virtual charter schools, delaying SBE action on the subsequent NCVA application. NCVA filed a lawsuit in March 2012, and an administrative law judge ruled that because the SBE failed to act on the NCVA application in a timely manner, the virtual charter school could open for SY 2012-13. Per the application, NCVA planned to enroll up to 2,750 students in its first year (at the state per pupil funding rate of $6,753). The case was appealed to superior court by the SBE, 89 of 115 school boards in the state, and the North Carolina School Boards Association. In June 2012, the court overturned the administrative judge, ruling that NCVA could not open and that only the SBE had the authority to determine which charters it will review and approve. Under state law, three entities can approve charter schools: the State Board of Education, a local school district, and the university system. However, a local school district or the university system can only give initial approval, and final approval must come from the State Board.

State virtual school

North Carolina’s state virtual school, the North Carolina Virtual Public School (NCVPS), has the second highest number of enrollments of any state virtual school, with 104,799 course enrollments in SY 2013-14, an annual increase of 11%.

In 2010, SB897 radically changed the NCVPS funding model. The law established an allotment formula to “create a sustainable source of funding that increases commensurate with student enrollment” and recognized “the extent to which projected enrollment in e-learning courses affects funding required for other allotments that are based on ADM.” The SBE implemented an initial NCVPS allotment formula in 2010 based on forward funding; the funding was reallocated from school districts to NCVPS based on district NCVPS course enrollments from the previous year with an adjustment for projected enrollment growth. The formula created controversy and was revisited in 2011 to rectify inequities between larger and smaller districts.

The funding formula reduced school district teacher allocations to cover NCVPS instructional costs, resulting in a reduction in the teacher pay allotment across North Carolina. A flat course fee (instructional fee) is assessed per district enrollment in NCVPS courses. Fees vary based on the course type: summer, semester, or year-long courses. The Department of Public Instruction (DPI) projects the cost of NCVPS enrollments for each district based on historical enrollment patterns, and in August, state allocation for teacher pay for the number of online courses is reduced by 75% of the cost of those enrollments. There is a reconciliation in February of each year, and districts that have enrolled less than 75% of the projected NCVPS enrollment are given a refund, so districts only pay for actual enrollments. If a district has exceeded its projection (enrolled 75 to 100% of actual enrollment), then additional funding is taken from the district and directed to NCVPS.

The legislation provided two additional sources of funds to operate NCVPS. The first is a $2 million reserve fund created by a reduction in the per-pupil allotment in grades 6-12. The reserve fund is available to a school district that wants to exceed 100% of its projection enrollments in NCVPS courses. Unused reserve funds carry over to the next fiscal year and are replenished annually by the school system allocation reduction up to the original $2 million level. The second is a reduction to school districts’ per-pupil allotment in grades 6-12 to create funding of $3.2 million for operation and administration of NCVPS.

The NCVPS formula offers a different approach to funding a state virtual school. It addresses concerns that students in state virtual school courses are being funded twice (via local district and state virtual school funds). The NCVPS formula does not, however, include two provisions that have been central to the growth of Florida Virtual School (FLVS). In Florida, the student right to choose a course from FLVS is in statute, and the number of students who can take a course from FLVS is not limited—therefore funding to FLVS is not limited either.

District programs

Legislation prohibits any state-funded entity from offering “elearning opportunities” without the approval of NCVPS: “All e-learning opportunities offered by state funded entities to public school students are consolidated under the North Carolina Virtual Public School program, eliminating course duplication.” State board policy also places similar restrictions on for-credit online courses supplied by vendors: “Any K-7 e-learning course or 8-12 course taken for credit toward a diploma must first be approved for credit by the NC Virtual Public School.” State policy also instructs NCVPS to “consider whether the course meets the SREB (Southern Regional Education Board) and/or iNACOL criteria for awarding credit.”

Though there are no significant district programs, the North Carolina School of Science and Mathematics (NCSSM) is a public, residential high school for gifted, high performing juniors and seniors that is offering a combination of online and face-to-face courses for its students. NCVPS has a Memorandum of Agreement with NCSSM that authorizes them to offer online course to students who qualify to attend the NCSSM but cannot be accommodated due to limited space.

Online learning policy history

2005: Session Law 2005-276  created the pilot for North Carolina Virtual Public School. Legislation prohibits any state-funded entity from offering “e-learning opportunities” without the approval of NCVPS. The legislation requires NCVPS to “prioritize e-learning course offerings for students residing in rural and low-wealth county LEAs.” State board policy also places similar restrictions on for-credit online courses supplied by vendors. State policy also instructs NCVPS to “… consider whether the course meets the SREB (Southern Regional Education Board) and/or iNACOL criteria for awarding credit …” SB897 (2010, also Session Law 2006-66 Section 7.16) created a sustainable funding formula for NCVPS. SB897 also prohibits other state funding going to NCVPS, places a 15% cap on operations with 85% going to teacher pay, limits courses to those for high school grades only, and does not allow physical education to be taught online. It also confirms that NCVPS will use funds generated by the new formula to provide online courses to all students who are enrolled in North Carolina’s public schools at no cost. Students must get permission to enroll in NCVPS courses through their local school district.

Session Law 2011-145 removes the cap on operating costs for NCVPS and removes prohibitions against offering physical education and offering courses to grades K-8. It also confirms that NCVPS will use funds generated by the new formula to provide online courses to all public school students at no cost to the student. Students must get permission to enroll in NCVPS courses from their school district. The new legislation also directs NCVPS to develop a plan to offer courses to non-public schools and out-of-state educational entities. It also provides an exemption from G.S. 66-58(c) that prohibits state-funded entities from competing with commercial companies.

2011: SB8 significantly revised charter school law in North Carolina, but it did not specifically address virtual charter schools.


last updated October 20, 2014

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