Dive Brief:

• The Arizona Republic recently reported that Grand Canyon University's recent conversion to a nonprofit university adds up to approximately $7.5 million in lost revenue, most of which would have gone to fund school districts in the state. 
• Because nonprofits entities do not have to pay property taxes, the $9.2 million it paid last year will be reduced to $1.7 million — the amount that would be owed by parent company Grand Canyon Education. Reports show the $1.7 million is still one of the highest tax bills in Phoenix. 
• The paper reported the transition will lead to a $4 million loss for local school districts and $843,000 for local community colleges.

Dive Insight:

States and municipalities should expect to see more for-profit entities convert to nonprofit to escape some of the stigmas associated with for-profit education during the Obama administration, and there should be an alternative arrangement to help fund education in the state. Some expertsbelieve that ultimately, there won't be any for-profit institutions in the way we've come to know them, but rather a hybrid model influenced by the infamous Purdue-Kaplan deal which led to the creation of the online Purdue Global University.

But Arizona is already at the bottom of the pool when it comes to education funding: The state ranks 48th in per pupil funding growth — and student achievement is also in the bottom tier of states. K-12 education cuts since 2009 have been steep, leading to a six-day teacher walkout earlier this year, which ended with Gov. Doug Doucey signing a bill to approve 20% teacher raises over the next three years. 

One way to get ahead of lost revenue is to create more collaborationbetween K-12 districts and public institutions in the state to promote resource sharing and, where appropriate, joint service procurement to help save costs.