Charter Schools: Taking Stock

In 2016, it will be a quarter century since Minnesota passed the nation’s first charter school law. Fifteen years ago, our book, Charter Schools in Action, foresaw this innovative governance and delivery system for education as a hopeful path to stronger student achievement and as an engine “to recreate the democratic underpinnings of public education and rejoin schools to a vigorous civil society.”

Today, 43 states and the District of Columbia have some 6,700 of these schools serving nearly three million students, almost six percent of U.S. public-school enrollment. They are the fastest-growing school-choice option in the land. They are also as close to a “disruptive innovation” as American K-12 education has seen to date, creating a new market and alternative delivery system that affords long-neglected families and their children access to potentially higher quality schools than they find within the traditional district structure.

It’s time to take stock of the charter movement—to review its progress and the challenges that lie ahead, what we’ve done right as well as where we’ve gone astray,  and what lessons can be distilled that may be beneficial going forward.

Mixed Motives

Charters and chartering had lots of parents, which meant this movement arose with different dreams, concepts and emphases.

That blurry, multi-purpose quality made it easier for the idea to spread. Plenty of people could find in it some goal or mission that they favored. Philanthropy boosted it, as did federal incentive payments. (Bill Clinton loved charters.) So did competitiveness and copy-cat tendencies among governors. And the fact that charters are not vouchers made it more palatable politically. (In several cases, union aversion to vouchers led them to tolerate charters.) But the mixed motives and interpretations also meant that charter laws and programs took different forms in different states. That’s been a mixed blessing.

The Good—and Not so Good

Charter schools today can fairly claim four strong positives.

• They enjoy widespread public support—almost seventy percent according to the annual Phi Delta Kappa poll, with 54 percent of respondents believing they provide a better education than traditional public schools.

• Charters mostly serve poor and minority kids who otherwise tend to be trapped in the worst urban schools. Over 56 percent of their students are Hispanic and African American students, versus 39 percent in district schools.

• Demand exceeds supply. The National Alliance for Public Charter Schools estimates some 586,000 individual children were on charter-school waiting lists in 2013.

• Charters play a significant role in the education systems of some cities. Most vivid is New Orleans, where charters enroll more than 90 percent of public school children. Charter enrollments reach 30 percent in a dozen districts and 20 percent in more than forty.

When it comes to academic performance, however, the charter track record is, in a word, mixed. Yet that glib statement doesn’t do justice to a galaxy of education institutions ranging from dismal to superb.

The soundest large-scale national analysis, published in 2013 by Stanford’s Center for Research on Education Outcomes (CREDO), examined twenty-five states (plus DC and New York City) comparing charter and otherwise-similar students in district-operated schools. Charter pupils had superior performance in 9 jurisdictions, worse in 3 and essentially the same in 15. The strongest charter advantage was in reading. Those getting the greatest boost from attending these new schools were black or Hispanic and poor. Elementary and middle charters, on average, did better than their counterpart district schools, while charter high schools did not.

The overall picture was brighter in 2013 than in CREDO’s 2009 review. And a still-newer 2015 CREDO analysis, examining charter schools in 41 urban communities,  found them, on average, achieving 40 additional days of learning growth in math and 28 days in reading compared to matched peers in district schools. The results were positive for nearly all pupil groups but especially minority and poor youngsters. Yet not everywhere:  CREDO found charters in eleven communities posting smaller learning gains than district schools in math and ten with lesser gains in reading.

Present Dilemmas

As we look ahead, chartering has surfaced a host of issues, dilemmas, and opportunities that deserve clear-headed consideration. We highlight ten key ones.

1. Authorizing

In hindsight, those present at the creation of the charter bargain (ourselves included) paid too little attention to how authorizing would work. And many states set this up badly. Some authorizers do great work (e.g. the District of Columbia’s Public Charter School Board, the Massachusetts Department of Education and the State University of New York) but too many others display mixed motives, are influenced by perverse incentives, and lack judgment, courage, or expertise. They’re also plagued by a shortage of solutions to schools’ various troubles—e.g., what to do with students when a school is closed, who “owns” its assets, who pays its debts and handles the residue of its contracts with staff and vendors?

Much has been done to make authorizing a rigorous undertaking—witness the work of the National Association of Charter School Authorizers. But weaknesses in many charter laws regarding authorizing and the animus of traditional districts toward charters have created a problem-plagued  authorizing environment where 90 percent of today’s thousand plus authorizers are the very districts that charters compete with for students—an inherent conflict of interest.

2. Funding

On average, charters receive fewer public dollars per student than district schools, and in many places no support for facilities. A 2014 study found the typical charter getting just 72 percent of what’s spent in nearby district schools. That $3,800 per pupil shortfall, nearly $1.6 million less in revenue for an average-size charter, is equivalent to the salaries and benefits of about thirty teachers. And from that tight budget, many charters must pay the rent for their facility.

The core funding problem is that charters typically get the same state allotments as other public schools but seldom local funds (often via property taxes). On average, they receive just $1,780 per pupil from local government sources while district schools take in $5,230. Philanthropy helps to a degree, yet district schools get even more money from nonpublic sources than charters do: $571 per pupil versus $552.

3. Freedom (and re-regulation)

Most charter schools never got the autonomy that the “charter bargain” promised. They’ve been plagued by large and small rules, mostly carried over from the regulatory regime of traditional district schools.

Recent years have also brought numerous examples of charter re-regulation, of government fishing expeditions pursuing supposed infractions used to justify more regulation, and clashes between state law and federal requirements. Too often, an error by a school has led states, districts, or authorizers to institute new oversight regimes applying to all charters. And the regulatory whip has also been wielded by political foes, usually in the name of “leveling the playing field so charters don’t have unfair advantages over district schools.” This contradicts the premise that charters are meant to be different—and freer.

4. School governance and leadership

Each charter school ordinarily has a nonprofit governing board, a promising arrangement but one that brings new dilemmas. For example, school founders often recruit their own boards, which end up more beholden to the leader’s—or outside operator’s—desires than to the needs of students, taxpayers, and other constituents. Board competence is a challenge, too, with schools needing many kinds of expertise, including strategy, finance, real estate, pedagogy, human resources, employment law, community relations, and stakeholder engagement. That’s hard to assemble with a five or seven member board for a single school serving 400 kids—and harder still for almost 7,000 such schools.

Another challenge is the school head’s role, which resembles that of a private school principal more than a typical public school leader. And profit-seeking management organizations contracting with schools to operate schools create other challenges when investor interests trump quality teaching and learning. .

Is a charter school best viewed (and governed) as a district in its own right or part of a traditional district? What happens when it enrolls students from other districts, even other states? And what to make of—and how to govern—charter “networks” functioning like virtual districts in their own right?

5. Political Tensions—and Enemies

Since their outset, charters received support from prominent politicians in both parties from city hall to the state capitol to the White House. Every President from George H.W. Bush to Barack Obama has been a charter fan. Yet they’re no perfect fit for either side. Conservatives fret that they’re not vouchers; instead,  they’re public schools under government’s thumb. And many GOP legislators represent suburban and rural districts that want no part of them or the kids apt to attend them. Plenty of Democrats are beholden to teacher unions that detest charters (though not as much as vouchers)—and resent their failure to bring many charter teachers into their ranks.

Then there’s the overwhelming majority of district school boards and superintendents who want no part of charters or won’t collaborate with them, often refusing to authorize them, and pressing lawmakers to limit them. And there are plenty of well-intentioned civic leaders, philanthropists, and education reformers who view charters as a sideshow, one that deflects energy and resources away from the majority of needy children who remain in district-operated schools.

6. Fractious Reformers

The expanding universe of education reformers also encompasses a range of opinion and disputation over the mission and value of charter schools. These differences often serve as proxies in arguments over fundamental philosophy and strategy. Among the durable disagreements: H ow much to rely on the marketplace for quality control versus government-driven standards-and-accountability mechanisms. And to what extend should charters focus exclusively on poor kids and low achievers versus serving a more diverse population, including gifted students and middle-class kids with specialized curricula?

7. Charters and the Larger System

Some early charter boosters viewed them as R & D sites for public education. Teacher union leader Al Shanker saw them as opportunities for teachers to design and run schools. This idea worked, up to a point, and some practices pioneered by charters entered the education mainstream and now enjoy widespread use within the charter sector. In a few communities—prominently including Denver, New York, Chicago, Cleveland and Spring Branch, Texas (near Houston)—the district has incorporated charters into its own reform strategies and eased their access to facilities and other resources.

Sadly, however,  most traditional districts and their self-interested stakeholders remain all but oblivious if not hostile toward charters, minimizing their numbers and preserving as much as they can of their old monopoly. Over the long haul, history won’t favor that stance. But for the foreseeable future, it leaves charters more in the role of supplying some children with alternatives than transforming the system that gave rise to the need for alternatives.

8. Advocacy

Perhaps no part of the charter world has changed as dramatically over the years as its advocacy apparatus. Today, a host of organizations educate the public and try to influence and build support for charters. They reach out to sundry constituencies and stakeholders, from the general public to policymakers to the families with children in these schools. And they don’t all shy away from electoral politics.

Most groups are nonprofit organizations existing on donor tax-deductible contributions. Within limits, they can lobby policy-makers directly. But a growing number are joined by entities whose main focus is lobbying and politics: 501c4 organizations and political action committees, free to spend limitlessly on lobbying for legislation, getting friendly candidates elected, advancing ballot initiatives, and more. Many in the charter world see political and electoral involvement as a necessary step in ensuring that charters are treated equitably and enabled to fulfill the  vision of greater autonomy in exchange for results-based accountability. But this political involvement almost inevitably leads to more  power struggles and sometimes rancorous politics..

9. Market Enablers

Creating a vibrant K-12 market involves more than offering school options to families. It includes building organizations, structures, rules, and routines—“market enablers”—that help the marketplace work efficiently and yield quality outcomes. Such enablers take many forms, including a strong policy environment; an ample and diverse supply of high-quality school options; transparent accountability systems that monitor performance; timely and comprehensible school information for parents and taxpayers; a fair and efficient school selection-and-enrollment system; transportation that makes more schools accessible to families; human capital pipelines and HR structures; a sufficiency of money following students to their chosen schools, weighted according to their needs; school-support and advocacy organizations supplying diverse services while also keeping all players honest; etc.

A well-functioning education marketplace intersects  such enablers in many ways.  But not everyone in the charter sector agrees. Some favor a minimalist approach that’s more akin to Eastern Europe’s hasty transition to a market economy than to a regulated marketplace replete with careful checks and balances. This tension will surely continue.

10. New Challenges

As the charter sector has emerged as a durable element of American public education and grown large in some places, a handful of issues come into focus that previously got scant attention. If, for example, charters come to educate many of a city’s children, who is responsible for the “education safety net”? Must every school be expected to meet all the education needs of every child, no matter how challenging? What about charters serving clienteles other than disadvantaged urban youngsters: middle class kids, gifted children, just girls or just boys, etc.? What about selective admissions? And how to resolve the discipline issue: must charters keep everyone they admit? Back in 1991 when Minnesota passed the first charter law—and in 2000 when we wrote about this new education phenomenon—issues such as these were beyond the visible horizon. Today, they’re on our doorstep.

Lessons Learned

It’s slightly embarrassing to acknowledge, with hindsight, that putting a charter sign on a school reveals surprisingly little other than that it’s a “school of choice” with some freedom to be different. Early advocates, ourselves included, were naïve about some key things.

We didn’t pay enough attention to authorizing and governance. We focused on quantity rather than quality. We assumed that a barely-regulated marketplace would provide more quality control than it has done. We didn’t demand enough funding—or facilities. We didn’t insist on sufficient autonomy—nailed into place, not just promised. We wanted the infusions of capital and entrepreneurialism that accompany the profit motive, but we didn’t take seriously enough the risk of profiteering.

The laudable impulse to concentrate first on poor minority kids trapped in abysmal schools contributed to charters getting the reputation for just being places for poor minority inner-city dwellers to attend. There’s a certain sameness across much of the charter world and (save perhaps for virtual schools) not enough real innovating. The “R&D” quality of charters has eroded, along with Shanker’s expectation  that charters would emerge mostly as teacher-created, teacher-run schools.

There are plenty of gaps to fill and oversights to correct. Yet the future holds so many new challenges and unresolved questions. .

Does the charter movement retain the nimbleness and audacity to take on these challenges or will it, like so many onetime reforms, ossify into a conventional interest group?

There’s reason for hope. This movement is still basically bipartisan, a rarity in today’s polarized policy world. Most charters are union-free and in some cases free from state licensure of principals and teachers. There has been remarkable demand, both by kids and families wanting to choose and by people and organizations wanting to start schools. We also have some fantastic proof points, demonstrating the capacity  of great schools to alter the life prospects of poor kids. Some “chains” of charters manage to demonstrate sustained and widespread quality while also illustrating the concept of virtual school systems.

This is not the first time—and won’t be the last—that a grand policy initiative has encountered bumps and yielded mixed results. When so many thousands of complex institutions are spread across thousands of jurisdictions, the challenges of politics, resources, talent, and implementation are profound, and all the more so when what’s being changed contains as many ingrained practices, hidebound regulatory regimes, and vested interests as public schooling. The pushback against charters has been intense. But their promoters have sometimes been naïve, too, and occasionally self-interested. And as we have noted, many of today’s challenges could not have been fully anticipated. In such circumstances, there’s no shame in acknowledging imperfection and incompleteness. Indeed, it would be shameful not to encourage recalibration and further experimentation.

Where it has worked well, the charter-school movement has worked so well that it amply deserves to be sustained and perfected. Where it hasn’t, policymakers should push back against its tendency to turn into a self-interested protector of mediocrity. Millions of children’s futures—and billions of tax dollars—are at stake.

– Chester E. Finn, Jr. and Bruno V. Manno

Chester E. Finn, Jr. is Distinguished Senior Fellow and President Emeritus at the Thomas B. Fordham Institute and a Senior Fellow at the Hoover Institution. He is a former Assistant U.S. Secretary of Education for Research and Innovation.

Bruno V. Manno is Senior Advisor in the K-12 Education Program with the Walton Family Foundation. He is former Assistant U.S. Secretary of Education for Policy and an emeritus board member of the Thomas B. Fordham Foundation.

The views expressed in this piece do not necessarily reflect the view of the Walton Family Foundation or the Fordham Institute.

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