In 2005, City Neighbors and Patterson Park Public, two charter schools in Baltimore, appealed the Baltimore schools' per student funding formula to the state board. The board ruled in their favor, and the Baltimore schools appealed the board's decision in the Court of Special Appeals, Maryland's second highest court. Early this month, the court ruled in favor of the charter schools, requiring Maryland school systems to spend as much money per student at charter schools as they spend at their traditional schools.

Charter schools are publicly funded, but they operate independently under contracts with local school boards. Of the 24 charter schools in the state of Maryland, 17 are located in the Baltimore schools system.

The Baltimore schools' per student funding formula differs between their traditional schools and charter schools. Traditional schools receive the equivalent of approximately $11,000 per student. Charter schools receive $5,859 per student in cash, with the remainder received in services provided to the schools by the Baltimore schools system, such as special education and food. City Neighbors and Patterson Park Public contend that this formula limits their ability to choose how to provide services to their students, and the court agreed.

After the court handed down its ruling, the Baltimore schools board met in executive session, issuing a vaguely worded statement. It reiterated that the Baltimore schools remain a strong supporter of charters schools, but believe the recent court ruling will hurt the traditional schools by imposing a financial hardship on the vast majority of them. The statement further noted that the ruling could result in traditional schools receiving less per student funding than the charter schools. Additionally, the statement said that the board is fully committed to complying with the law, but it leaves open the possibility of an appeal by stating that the Baltimore schools board 'feels obligated to fully consider its legal options.'

After the statement was released, City Neighbors board President Bobbi Macdonald stated that they were not asking for more money, only equity within the Baltimore schools system. City Neighbors attorney Will DuBois underscored the fact that both the state board and the court agreed on a funding model that achieves the parity sought by the two charter schools.

The charter schools hope to meet with the Baltimore schools to discuss the court's ruling. They would like to move forward with the Baltimore schools board toward the interest of all Baltimore schools students. Meanwhile, the Baltimore schools board Chairman Brian D. Morris stated that the Baltimore schools currently is analyzing the financial impact of the court's ruling.