Charter Schools: The Vision of their Founders vs. Today’s Reality

Charter school operators and advocates persistently brand charter schools as “public charter schools” even though charter schools are, by definition, always privately managed. However, operation is paid for with tax dollars appropriated by 44 of the state legislatures along with some federal investment and the diversion of school district dollars.

The people who proposed the idea of charter schools 30 years ago imagined how these schools would work and what would be the widespread result for children. What if we compare what the founders of charter schools imagined with today’s reality?

The Thomas Fordham Institute is a sponsor of charter schools and one of the nation’s prominent cheerleaders for these institutions. Chester Finn, president emeritus of the Fordham Institute and Bruno Manno, an emeritus member of Fordham’s board and an advisor to the Walton Foundation, recently celebrated the history of charter schools on their 30th anniversary.  Finn and Manno praise Ted Kolderie, who enthused about charter schools in a 1990 report for the Minnesota Center for Policy Studies. Describing Kolderie as “arguably the foremost theoretician of chartering,” Finn and Manno quote his report:

“(O)ur system of public education is a bad system. It is terribly inequitable. It does not meet the nation’s needs. It exploits teachers’ altruism. It hurts kids. Instead of blaming people…we need to fix the system [and] organize public education in America on a new basis. The proposal outlined in this report is designed to introduce the dynamics of choice, competition and innovation into America’s public school system. How can we use the powerful idea of choice to improve our schools while retaining the essential purposes of public education? This report proposes a simple yet radical answer: allowing enterprising people—including teachers and other educators—to… create new public schools, and ultimately a new system of public education, [by having] the states…simply withdraw the local districts’ exclusive franchise to own and operate public schools. [We need to undertake] divestiture, or allowing the districts to get out of running and operating public schools altogether.”

Now, 30 years later, Finn and Manno brag about what they believe are charter schools’ strengths:

  • “The best charters consistently make greater student achievement gains than traditional public schools.”
  • “Chartering has… pioneered new forms of governance for public education, including statewide Recovery School Districts that restart low-performing schools as charter or charter-like schools….”
  • “Other charter-inspired governance models include ‘portfolio’ districts’… where districts transfer school governance to independent nonprofit organizations…”

They conclude: “Through a combination of choice, competition, and innovation, chartering has bettered the academic and life outcomes of K-12 students, thereby reducing inequality, widening opportunity, strengthening parents, and enhancing civil society.  These are remarkable accomplishments for a thirty-year period, worth protecting and cultivating… When dealing with so many complex institutions across so many different jurisdictions, the challenges of politics, resources, talent, and implementation were sure to be profound.  And when what’s being changed contains as many ingrained practices, hidebound regulatory regimes, and vested interests as American public schooling, these trials are even greater.”

Finn and Manno share a number of reforms they would like to see in charter schools: more attention to authorizing and quality control, need for more funding, and insufficient autonomy.  While they allege that the best charters improve student achievement, they don’t explore the problems with the academic studies they cite.  Neither do they discuss how few “best” charters there are in a sector where charter schools differ from each other and run the gamut of quality. They admit that, “charter promoters have sometimes been naive, occasionally self-interested, and often set in their ways.”

Now that charter schools have been around for 30 years, however, there is significant research demonstrating a whole range of problems on the ground, problems which Kolderie never imagined and which Finn and Manno neglect to mention.

First is the role of money and the absence of sufficient regulation in a sector which has been invaded by for-profit management and where 44 state legislatures, who are subject to lavish lobbying by charter sponsors and advocates, have failed to provide adequate oversight. After all, Kolderie defined  the very purpose of charter schools as escaping the constraints of public bureaucracy.  Jacobin Magazine published a recent interview with, Carol Burris, the executive director of the Network for Public Education, which recently published a report, Chartered for Profit Jacobin‘s reporter asked Burris how it is that so many charter schools—which state laws require to be sponsored by and operated as nonprofit organizations—have become the source of massive profits their operators.  Here is her reply:

“The original charter is secured by the nonprofit, which gets federal, local, and state funds, and then the nonprofit turns around and gives those funds to the for-profit company to manage the school… Now, some of these for-profits only provide a limited amount of services.  But an awful lot of them, especially some of the big chains like National Heritage Academy, operate using what is known as a ‘sweeps’ contract. The reason they’re called that is the for-profit operator sweeps every penny of the public money that a charter school gets into the for-profit management company to run the school. The for-profit then either directly provides services, from management services to cafeteria services, or they contract out with another for-profit company to provide services.  Either way, the goal is to run the charter school in such a way that there’s money left over. And the more money they save by doing things like hiring unqualified teachers and refusing to teach students with special needs, the more money is left at the end of the day.”

It is worth pointing out the irony that we would all be shocked if we discovered the principal of our public high school or our school district’s superintendent profiting from our tax dollars. While such activity is illegal in public schools, money in the charter school sector is handled very differently. Burris explains: “Individuals can become very wealthy if they run charter schools, whether for-profit or nonprofit. Eva Moskowitz, who’s in charge of Success Academy Charter Schools in New York City… pulls down a salary of nearly $1 million a year.  By comparison, the New York City public schools chancellor makes about $250,000 a year.” Burris continues: “A lot of this is possible simply because there’s so little oversight.  I was a public school teacher and then a high school principal.  Purchases had to go out to bid, and everything was very transparent.  I couldn’t contract with my Uncle Louie’s furniture company to buy desks. But you can in the charter school world… The charter school lobby says that this model is necessary for innovation. But what is it about the ability to commit fraud and avoid transparency that helps you to be more innovative?  The innovation that we’re seeing too often, sadly, is criminal manipulation.”

Second is the problem that charter schools are parasites on the public school districts where they are located. In some states, as was the case until recently in Ohio, school districts have to pay an additional charter school tuition fee right out of their own budget when children leave for a charter school.  But even in states where public school districts merely lose the state’s per-pupil basic aid when each child leaves, the school district suffers financially.  In a study published by In the Public Interest, economist Gordon Lafer documents that charter schools undermine the fiscal viability of Oakland, California’s public schools by pulling away $57.3 million annually in state per-pupil public school enrollment reimbursements: “To the casual observer, it may not be obvious why charter schools should create any net costs at all for their home districts…  When a new charter school opens, it typically fills its classrooms by drawing students away from existing schools in the district…  If, for instance, a given school loses five percent of its student body—and that loss is spread across multiple grade levels, the school may be unable to lay off even a single teacher… Plus, the costs of maintaining school buildings cannot be reduced…. Unless the enrollment falloff is so steep as to force school closures, the expense of heating and cooling schools, running cafeterias, maintaining digital and wireless technologies, and paving parking lots—all of this is unchanged by modest declines in enrollment.” At the same time, charter schools are less likely to enroll students with expensive special needs, which concentrates children who need expensive extra investment in their education in district public schools.

Third, neither the federal government nor the states have consistently protected students’ rights in charter schools.  For example, New York City’s Success Academy Charter Schools has established a reputation for a regimented, no-excuses school culture. For years, however, parents have complained that instead of helping students thrive, the school has established a pattern—for children who don’t fit the school’s culture or for children whose test scores will likely bring down the school’s overall average—of severely punishing the students or repeatedly suspending them until their parents pull them out of the school.  In March, Success Academies was fined $2.4 million by a federal district court for violating students’ rights: “Charter school network Success Academy, which touts its commitment to children ‘from all backgrounds,’ has been ordered to pay over $2.4 million on a Judgment in a case brought by families of five young Black students with learning and other disabilities who sued after the children were pushed out of a Success Academy school in Brooklyn.  Success Academy’s efforts to oust the children even included the creation of a ‘Got to Go’ list, as reported by the New York Times in October 2015, which singled out the students they wanted to push out, including the five child plaintiffs.”

And especially in the South, charter schools have too often violated students’ rights by increasing racial segregation. A 2017 study—by researchers Helen F. Ladd, John B. Holbein and Charles T. Clotfelter of Duke University reported:  “(W)e find that the state’s charter schools, which started out disproportionately serving minority students, have been serving an increasingly white student population over time. In addition, during the period, individual charter schools have become increasingly racially imbalanced, in the sense that some are serving primarily minority students and others are serving primarily white students.”

Thirty years after the first charter school in Minnesota, there is finally some support in Congress to begin reining in some of the most outrageous for-profit charter chains. The House Budget Resolution would disqualify charter schools managed for-profit from the U.S. Department of Education’s Charter Schools Program.

Chester Finn and Bruno Manno have been promoting the same lies for decades. Advocates need to continue to push hard to force the U.S. Department of Education, Congress, and legislators across the states to see what’s wrong with the glossy ideology that has blinded so many.

In “NY Times” Piece, Eve Ewing Ignores Economic Catastrophe for Public Schools of Charter School Expansion

I am a great fan of Eve Ewing’s book, Ghosts in the Schoolyard.  I have read the book twice, visited in Chicago some of the sites she describes, given the book to friends as a gift and blogged about it.  In that book, Ewing documents the community grief across Chicago’s South Side, where the now three decades old Renaissance 2010 “portfolio school plan” pits neighborhood public schools and charter schools in competition and closes the so-called “failing” neighborhood public schools when too many families opt for a charter school.

In a column published in Monday’s NY Times, Eve Ewing wants to make peace with charter schools.  She writes that we should allow families to choose and ensure that neighborhood schools and charter schools can all be well resourced and thriving. Ewing grasps for a third way—some sort of amicable compromise in a very polarized situation.

Ewing is a University of Chicago sociologist, and, in her column she examines many of the factors by which neighborhood public schools and charter schools have been compared and rated. She points out that academic quality is a mixed bag with neighborhood and charter schools sometimes besting each other in terms of student achievement. Then she wonders, “What would it look like if we built an education policy agenda dedicated to ensuring… resources for all students?

The problem in Ewing’s column this week is that she never identifies or addresses the matter of public funding for education. I assume she wants to equalize school funding across both sectors. But when charter schools compete for students with public schools, there are now two separate education sectors to split what has proven to be a fixed pot of money.  In every single place I know about where charter schools have been allowed to open up, this is a zero sum game.  A sufficient and growing body of research demonstrates that there is no way to split the funding both ways without cutting the funding that most states and local school districts have been budgeting for their public schools.

Bruce Baker, the school finance expert at Rutgers University, explains that one must consider more than the comparative test scores and students’ experiences in neighborhood schools and charters, and instead examine the impact of adding new charter schools into what he calls the entire educational ecosystem of the school district: “If we consider a specific geographic space, like a major urban center, operating under the reality of finite available resources (local, state, and federal revenues), the goal is to provide the best possible system for all children citywide….  Chartering, school choice, or market competition are not policy objectives in-and-of-themselves. They are merely policy alternatives—courses of policy action—toward achieving these broader goals and must be evaluated in this light. To the extent that charter expansion or any policy alternative increases inequity, introduces inefficiencies and redundancies, compromises financial stability, or introduces other objectionable distortions to the system, those costs must be weighed against expected benefits.” “In this report, the focus is on the host district, the loss of enrollments to charter schools, the loss of revenues to charter schools, and the response of districts as seen through patterns of overhead expenditures.”  In his report, Baker calls charter schools “parasites.”

One issue is that charter schools tend to serve fewer English language learners and fewer students with extremely severe disabilities, leaving behind in the neighborhood public schools the children whose needs are most expensive to serve.  Research by Mark Weber and Julia Sass Rubin at Rutgers University demonstrates, for example, that: “New Jersey charter schools continue to enroll proportionally fewer special education and Limited English Proficient students than their sending district public schools. The special education students enrolled in charter schools tend to have less costly disabilities compared to special education students in the district public schools…  (D)ata…  show that many charter schools continue to enroll fewer at-risk students than their sending district public schools.”

In Pennsylvania, the state funds special education in charter schools at a flat rate of $40,000 per student no matter whether the child is autistic, blind, a victim of severe multiple handicaps or impaired by a speech impediment.  Peter Greene reports that in Chester Upland, where a charter school is sucking up a mass of special education funding, in a court decision, Judge Chad Kenney declared: “The Charter Schools serving Chester Upland special education students reported in 2013-14… that they did not have any special education students costing them anything outside the zero to twenty-five thousand dollar range, and yet, this is remarkable considering they receive forty thousand dollars for each one of these special education students under a legislatively mandated formula.”

The biggest financial loss caused by the introduction of a charter sector into a school district is that it is not possible for the school district to recover the stranded costs when children exit to  charter schools.  In a groundbreaking 2018 report, the Oregon political economist, Gordon Lafer demonstrates that California’s Oakland Unified School District loses $57.3 million every year to charter schools.  Here’s how: “To the casual observer, it may not be obvious why charter schools should create any net costs at all for their home districts. To grasp why they do, it is necessary to understand the structural differences between the challenge of operating a single school—or even a local chain of schools—and that of a district-wide system operating tens or hundreds of schools and charged with the legal responsibility to serve all students in the community. When a new charter school opens, it typically fills its classrooms by drawing students away from existing schools in the district…  If, for instance, a given school loses five percent of its student body—and that loss is spread across multiple grade levels, the school may be unable to lay off even a single teacher… Plus, the costs of maintaining school buildings cannot be reduced…. Unless the enrollment falloff is so steep as to force school closures, the expense of heating and cooling schools, running cafeterias, maintaining digital and wireless technologies, and paving parking lots—all of this is unchanged by modest declines in enrollment. In addition, both individual schools and school districts bear significant administrative responsibilities that cannot be cut in response to falling enrollment. These include planning bus routes and operating transportation systems; developing and auditing budgets; managing teacher training and employee benefits; applying for grants and certifying compliance with federal and state regulations; and the everyday work of principals, librarians and guidance counselors.”

Lafer concludes: “If a school district anywhere in the country—in the absence of charter schools—announced that it wanted to create a second system-within-a-system, with a new set of schools whose number, size, specialization, budget, and geographic locations would not be coordinated with the existing school system, we would regard this as the poster child of government inefficiency and a waste of tax dollars. But this is indeed how the charter school system functions.”  In the same report, Lafer adds that in 2016-17, the San Diego Unified School District lost $65.9 million to charter schools.

In a subsequent report, Lafer explains: “Public school students in California’s West Contra Costa Unified School District are paying dearly for privately managed charter schools they don’t attend… Charter schools add $27.9 million a year to WCCUSD’s costs of running its own schools… That’s a net loss, after accounting for all savings realized by no longer educating the charter school students.”

The financial loss for any state’s public schools is not limited to  local school district budgets. There is substantial evidence that state legislatures do not create a separate budget line item funded with additional dollars to pay for school privatization; funding is instead sucked out of what used to be budgeted for the state’s public school districts. In his new book, Schoolhouse Burning, Derek Black traces how funding charter schools depleted public school funding in Ohio during the decade following the Great Recession in 2008: “While states were reducing their financial commitment to public schools, they were pumping enormous new resources into charters and vouchers—and making the policy environment for these alternatives more favorable. Charter schools, unlike traditional public schools, did not struggle during the recession. Their state and federal funding skyrocketed. Too often, financial shortfalls in public school districts were the direct result of pro-charter school policies… Ohio charter schools received substantial funding increases every year between 2008 and 2015. While public schools received increases in a few of those years, they were modest at best—in one instance just one-tenth the size of the charter school increase.” (Schoolhouse Burning, pp. 35-36)

In her brilliant 2018 book, Ghosts in the Schoolyard, what Eve Ewing examines is really the social impact in one South Side Chicago community of marketplace school choice in the form of the competition for students between neighborhood public schools and a growing charter school sector. The Renaissance 2010 charter school marketplace expansion was ultimately the economic driver of Chicago’s closure of 50 neighborhood public schools at the end of 2013. The growth of a Chicago charter school sector was a primary cause of the “ghost” neighborhood schoolhouses left abandoned across Chicago’s South Side.