Organization Analysis of the Charter School Movement in America:

Three Organizational Models – Teacher-led, KIPP and Private-Public Charter

LPO 3452-02: Dr. Chris Quinn Trank

Cynthia Cook, Rui Huang, Brie Hunt, Jonathan Sawyer 12/2011

History and Context of the Charter Movement:

Ray Budde, a professor at the University of Massachusetts with an interest in organizational theory, is credited with originating the charter concept (Kolderie, 2005). Professor Budde coined the name “charter” and presented his ideas on reorganizing school districts in a paper, “Education by Charter”, in 1974. At that time, the paper received little attention (Kolderie, 2005). Budde’s charter concept centered on the role of and relationship between teachers and school boards and the belief that the charter concept would empower teachers and provide them with the freedom needed to create new educational programs (Lee, 2011).

During the 1980’s, interest increased in education reform. In 1983, a committee, The National Commission on Excellence in Education, was commissioned by President Ronald Reagan to evaluate the educational system within the United States. The committee produced a report called A Nation at Risk: The Imperative for Educational Reform, which was presented to “the Nation and the Secretary of Education” (The National Commission on Excellence in Education, 1983).

In the beginning pages of A Nation at Risk: The Imperative for Educational Reform, the chairman of the committee writes, “The Commission deeply believes that the problems we have discerned in American education can be both understood and corrected if the people of our country, together with those who have public responsibility in the matter, care enough and are courageous enough to do what is required” (The National Commission on Excellence in Education, 1983). This report served as a call to action to better the educational system in the United States in order to remain competitive in commerce, industry, science, and technology (The National Commission on Excellence in Education, 1983).

Professor Budde remained interested in his charter concept and his ideas began to receive more attention. In 1988, his work Education by Charter: Restructuring School Districts was published (Lee, 2011). Al Shanker, American Federation for Teachers President, expanded upon Professor Budde’s ideas and John Rollwagen, CEO of Cray Research, created a committee of the Citizens’ League in Minnesota to further modify the charter school concept (Kolderie, 2005). Rollwagen’s Citizens’ League brought Al Shanker to Minnesota in 1988 (Kolderie, 2005). This led to the first version of the charter concept, modified from Professor Budde’s original idea, being passed through the Minnesota Legislature (Kolderie, 2005). It was signed into law by the governor of Minnesota in 1991 (Kolderie, 2005). Two charter schools were formed in Minnesota that year (National Education Association, 2011). California passed a similar version in 1992 and six more states followed suit in 1993 (Kolderie, 2005).

The charter school concept continued to evolve through the 1990s. In 1994, the “federal charter school grant program” was introduced by United States Senator Joseph Lieberman, legislation was adopted, and support was received from the Clinton Administration (Kolderie, 2005). Professor Ray Budde published another charter school concept paper in 1996 entitled “Strengthen School-based Management by Chartering All Schools” (Kolderie, 2005).

By 2004, there were almost 3,000 charter schools in the United States, with approximately 750,000 students enrolled (National Education Association, 2011). One third of those 3,000 schools were in operation for three years or less (National Education Association, 2011). By 2010, 41 states, and the District of Columbia, had enacted chartering laws (Education Evolving, 2011).

General Strategy, Structure and Capabilities of Charter Schools:

The strategies, structures and capabilities of charter schools vary greatly from one school to another. Strategies can differ based upon the reasons for the creation of a charter school and the specific needs of its stakeholders. Charter schools can be fertile grounds for innovation in teaching and learning and, as such, new and different organizational structures are sometimes modeled. Large variability exists between the depth and breadth of capabilities a charter school has to draw upon, often dependent upon its resources. However, there are common features among charter school strategies, structure, and capabilities that are generalizable across the charter school movement.

Charter schools are the largest vehicle for school choice (CREDO, 2009). They provide an alternative to traditional schools and are free from many of the regulations that public schools face (InfoUSA, 2011). The National Education Association (NEA) believes that charter schools have the potential to facilitate education reforms and “develop new and creative teaching methods that can be replicated in traditional public schools for the benefit of all children” (National Education Association, 2011). Every year, more than 365,000 students are placed on charter school waitlists, which demonstrates a very strong demand for charter schools (National Education Association, 2011).

Charter schools are distinct legal entities governed by a charter rather than by regular public school regulations (Hart, 2000). The charter defines the goals and methods for measurement of the success of the school (Hart, 2000). It acts as a “performance contract” and outlines the charter school’s mission and program, and defines the students that will be serviced by the school (InfoUSA, 2011). The school is accountable for progress, as guaranteed and outlined within its charter (Hart, 2000). It is held accountable to the school’s sponsors, parents, and to the public for its academic results and fiscal practices (InfoUSA, 2011). States enact legislation to determine the framework within which charter schools will operate (Hart, 2000). The reasons for creating charter schools may include: educational vision, autonomy, and to serve a certain population (InfoUSA, 2011).

While traditional public school oversight is through school districts and school boards composed of democratically elected members, charter schools are often free to appoint or elect anyone (Lee, 2011). However, some states do have rules governing who can serve on a charter board (Lee, 2011). While teachers and parents may be on a charter’s board making decisions about curriculum and budgets, they may be doing so alongside private stakeholders such as corporations or charter management organizations (Lee, 2011). Additionally, charitable foundations may have a place on the board or exert influence over the board due to financial donations (Lee, 2011).

Charter schools are public schools financed by public money and may be “created or converted from existing public schools under the direction of educators, parents, community members or private concerns” (Hart, 2000). As publicly funded schools, charter schools are not allowed to charge tuition (Lee, 2011). The main source of funding for charter schools is per-pupil based funding (Nelson, Muir, & Drown, 2000). The method of determining the per-pupil funding amount varies greatly from state to state (Nelson, Muir, & Drown, 2000). In some states, it is an average per-pupil expenditure; in others, it is based upon the average revenue or expenses in a district; and in still others, the chartering agency and the school negotiate an amount (Nelson, Muir, & Drown, 2000). The majority of states with charter schools also provide additional funds for at-risk students, but that amount varies widely from state to state (Nelson, Muir, & Drown, 2000).

While traditional public schooling is available to all children in the United States, charter schools are schools of choice and, therefore, must market their schools to recruit students (Lee, 2011). Marketing and the reputation of a charter school can lead to a greater number of students than can be admitted. In this case, a random lottery is held to determine who will be enrolled. The reasons for choosing a charter school may include: high academic standards, small class size, educational philosophy, and an innovative approach to education (InfoUSA, 2011). Additional factors that may influence the decision to choose a charter school are: curricular focus, geographic location, safety, and school culture (CREDO, 2009).

Environment of Education Reform and Issues Faced:

The need for U.S. school reform has been widely recognized for years. The No Child Left Behind law was signed by President George W. Bush in 2002 (Dillon, 2011). This law required all schools to administer yearly reading and math tests and required schools to increase the proportion of passing students yearly, until reaching a 100% pass rate requirement in 2014 (Dillon, 2011). The schools that did not reach the required standards were labeled as “failing” which could, eventually, result in the termination of principals and staff (Dillon, 2011). Unfortunately, an unintentional result of this law appears to be that schools have been forced to “teach to the test”.

The current political climate has increased pressure and scrutiny upon all schools, including charter schools (CREDO, 2009). Charter schools were a topic of discussion in the presidential campaigns of both Barack Obama and John McCain in 2008 (Education Evolving, 2011). In 2009, President Obama announced a $4.35 billion Race to the Top fund to provide discretionary funding and incentives for K-12 education reform (Duncan, 2009). The goals of the fund were to: reverse states’ “dumbing down” of academic standards, track growth in learning and instruction, boost the quality of teachers and principals, and turn around the lowest-performing schools (Duncan, 2009). As further evidence of the support charter schools receive from the current administration, The Race to the Top Executive Summary specifically addresses charter schools. A section within the summary outlines the expectations of states to ensure “successful conditions for high-performing charter schools and other innovative schools” (U.S. Department of Education, 2009).

Charter schools are expected to play an increasingly important role in U.S. education and in education funding opportunities. Statements made by U.S. Education Secretary Arne Duncan indicate that charter schools will take a prominent position in education reform policies (CREDO, 2009). In 2011, President Obama gave states input in how the No Child Left Behind standards are implemented and enforced (Dillon, 2011). President Obama took these measures because it was determined that holding schools accountable to No Child Left Behind encouraged states to lower their standards and to focus solely upon test preparation (Dillon, 2011). This is often referred to as “teaching to the test”. As a result, the focus schools place upon math and reading has led to much less time and attention being spent on non-tested material such as history, art, and foreign languages (Dillon, 2011).

Serious questions have been raised by researchers and study groups over potential management issues within charter schools. Specifically, issues surrounding accountability, authority, and oversight appear to be of particular concern.

In 2004, the U.S. Department of Education reported in its Evaluation of the Public Charter Schools Program: Final Report that charter school authorizers lack the ability to oversee school operations, the authority to implement and enforce sanctions, and rarely make use of their authority to revoke or not renew a charter (National Education Association, 2011).

In 2005, the Government Accountability Office (GAO) report Charter Schools: To Enhance Education’s Monitoring and Research, More Charter School-Level Data Are Needed determined that there is little accountability in the oversight of federal charter schools, insufficient data is available to evaluate charter school performance, and measures are not in place to make sure schools receive their allocated federal funds in a reasonable amount of time (National Education Association, 2011).

In addition to management issues, charter schools also face criticism over the validity of their random lottery selection process. Critics point to low ratios of students with disabilities and English language learner students within charter schools, as compared to traditional public schools (New York State United Teachers union, 2010).

A report produced by the New York State United Teachers union in 2010 provides criticism of the charter movement with the union’s beliefs that many charter schools have placed profits, financial interests, and business interests ahead of students (New York State United Teachers Union, 2010). The New York State United Teachers union includes charter and traditional public school teachers throughout New York state (New York State United Teachers Union, 2010). The report noted several key findings including:

1.  Greater financial accountability is needed. Lapses in oversight have resulted in “instances of misallocation of funds; ethical lapses; no-bid contracts; conflicts of interest; and profiteering at student and public expense (New York State United Teachers Union, 2010).”

Examples of financial and business mismanagement cited within the report include: paying board members for additional services including consultant fees and accounting service fees

  1. Charter operators awarding contracts to companies they control
  2. A charter school director took a teaching staff on a 5-day Caribbean retreat and paid for all expenses including lodging, food, and alcohol
  3. Misappropriation of funds including purchases of big ticket items that were delivered to employees’ homes

2.  The New York State United Teachers union asserts that students with disabilities and those that are English language learners are under-enrolled and under-represented in charter schools (New York State United Teachers Union, 2010).

  1. As an example, the Harlem Success Academy enrolled 13 students with disabilities, out of a total enrollment of 944. This equals a 1.3% enrollment rate, when schools in the district usually have a 15% enrollment rate of special education students.
  2. Parents of special needs children have claimed that they have been encouraged to withdraw their children because of a lack of sufficient resources to address their needs.
  3. 3.8% of charter students are English language learners, while traditional public schools have an English language learner population of 14.2%

The report concludes that charter schools are “failing to proportionately enroll English language learners and students who require special education services (New York State United Teachers Union, 2010).”

Charter schools also face concern over the actual validity and effectiveness of the school model. Critics cite low test scores, inexperienced teachers, and lack of proof that the charter school model, despite the overwhelmingly positive press it receives, is an improvement over the traditional public school.

The National Assessment Governing Board (NAGB) released an analysis of the performance of charter schools in 2004 in The Nation’s Report Card - 2003 National Assessment of Educational Progress (NAEP) (National Education Association, 2011). The NAGB found that, on average, charter school students score lower than traditional public school students; there isn’t any measurable difference between charter school students and students in traditional public schools within the same racial/ethnic subgroup; and charter school students eligible for free or reduced lunches score lower than their peers in traditional public schools (National Education Association, 2011).