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The Charter school movement

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Title:
The Charter school movement who controls its destiny?
Creator:
Anderson, Amy Berk
Place of Publication:
Denver, CO
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University of Colorado Denver
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English
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82 leaves : ; 28 cm

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Charter schools -- United States ( lcsh )
Education and state -- United States ( lcsh )
Charter schools ( fast )
Education and state ( fast )
United States ( fast )
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bibliography ( marcgt )
theses ( marcgt )
non-fiction ( marcgt )

Notes

Bibliography:
Includes bibliographical references (leaves 80-82).
Thesis:
Education
General Note:
School of Education and Human Development
Statement of Responsibility:
by Amy Berk Anderson.

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|University of Colorado Denver
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|Auraria Library
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All applicable rights reserved by the source institution and holding location.
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40326451 ( OCLC )
ocm40326451
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LD1190.E3 1998m .A53 ( lcc )

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Full Text
THE CHARTER SCHOOL MOVEMENT:
WHO CONTROLS ITS DESTINY?
by
Amy Berk Anderson
B.A., University of Wisconsin-Madison, 1990
A thesis submitted to the
University of Colorado at Denver
in partial fulfillment
of the requirements for the degree of
Master of Arts
Education
1998
I
1
I


This thesis for the Master of Arts
degree by
Amy Berk Anderson
has been approved
Date


Anderson, Amy Berk (M.A., Education)
The Charter School Movement: Who Controls its Destiny?
Thesis directed by Professor Rodney Muth
ABSTRACT
Charter schools are publically funded schools that can waive many of the restrictive and
bureaucratic rules and regulations that govern conventional public schools. The first
charter school legislation was passed in Minnesota in 1991. Since that time, nearly thirty
states have passed charter school legislation and hundreds of charter schools are
operating nationwide. President Clinton has called for 3,000 charter schools by the turn
of the century. As of September 1997 nearly 850 charter schools had been approved
nationwide; therefore, 2,150 more charter schools will need to open by the year 2000 in
order to meet the Presidents goal. What will it take to meet this goal and who will
influence the success and/or failure of this endeavor? This thesis explores the political
forces that influence the charter school movement (the views and actions of the
advocates, moderates, and critics), analyzes current charter school policies, and
recommends specific changes to state policies that would lead to an increase in the
number of charter schools.
This abstract accurately represents the content of the candidates the^isr
its publication.
Signed
Rodney Muth
m


CONTENTS
CHAPTER:
I. INTRODUCTION............................................1
Research Design .....................................7
Organization of the Study ...........................9
II. THE POLITICAL INFLUENCES ON THE
CHARTER SCHOOL MOVEMENT......................................11
Advocates................................................11
Positive Results ..................................13
Barriers ..........................................17
Moderates ...............................................20
Requirements for Charter School Laws...............21
Critics .................................................26
Concerns with Charter Schools......................26
Financial Supporters ....................................32
IV


CONTENTS (cont)
Policymakers.............................................33
Neutral Players........................................35
Summary ............................................... 38
III. A COMPARISON OF STATE CHARTER SCHOOL POLICIES .... 40
Key Findings from Table 3 T..............................43
Key Findings from Table 3.2............................. 46
Funding ...........................................46
Sponsorship/Caps ..................................47
Impact of Sponsorship and Finance Policies ..............48
Sponsorship...................................... 48
Funding ...........................................56
Summary .................................................63
IV. RECOMMENDATIONS............................................65
Arizona .................................................65
California...............................................67
Massachusetts ...........................................69
v


Michigan
71
Possibilities for Financing Charter School Facilities and Start-Up .. 73
Direct Allocation.................................74
Grants............................................74
Revolving Loan Fund...............................74
Lease Aid ........................................74
Incentives........................................75
Long Term Contracts ..............................75
Sub-Leasing ......................................75
Federal Commitment......................................76
Summary ................................................76
V. CONCLUSION/AREAS FOR FURTHER RESEARCH......................77
REFERENCES ..........................................................80
vi


TABLES
Table
3.1 Total Number of Charter Schools as of January, 1997
and Projections for the Future.........................................41
3.2 Selected Charter School Policies in Four States ........................45
Vll


CHAPTER I
INTRODUCTION
The term charter school stems from a metaphor that was used by an
educator named Ray Budde (Nathan, 1996a). He recommended that schools give
teachers charters~opportunities to create innovative programs in schools and
districtsand like the early explorers did when they traveled to new lands, the
teachers would report back their findings from these charters to the rest of the school
district. Chartering was an opportunity to pilot teaching and learning reforms that, if
successful, might then be used to benefit other schools within the district. In 1988,
the late A1 Shanker, former President of the American Federation of Teachers, took
Buddes idea one step further, recommending that entire schools should be chartered,
not just individual, independent programs.
Today, charter schools are publically funded schools that can waive many of
the restrictive and bureaucratic rules and regulations that govern conventional public
schools. Unlike conventional public schools, charter schools are held accountable, at
the school level, for achieving educational results, in exchange for the freedom from
various rules and regulations.
-1-


The charter school movement was designed to accomplish four goals (Nathan,
1996a):
1. To provide choice among public schools for families and their children.
2. To foster entrepreneurial opportunities for educators and parents to create
the kinds of schools they believe make the most sense.
3. To make schools explicitly responsible for improving achievement, as
measured by standardized tests and other measures.
4. To introduce carefully designed competition into public education.
In 1991, Minnesota became the first state to pass charter school legislation,
allowing a total of eight charter schools to be opened. This legislation evolved out of
several years of work, both within Minnesota and at the national level, to design,
promote, and implement public educational programs, schools, and initiatives; to give
parents more public school options; to offer non-traditional educational programs; to
deregulate education; and to involve parents and community members more in
schools. The following were among these earlier programs/initiatives (Nathan,
1996a).
1. The St. Paul Open School, the City As School in New York, and other
innovative schools created in the late 1960s/early 1970s by parents, teachers, and
community members. These schools were initiated at the grassroots level and
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pioneered ideas such as internship programs, site based decisionmaking, and
meaningful family involvement.
2. The national magnet school program, initiated by Congress in the mid-
1970s, allocated funding to states to create schools of choice within school districts as
a means of promoting racial integration and choice within communities. Charter
school advocates argue that this reform did not assist with deregulation, in fact they
believe it increased the bureaucracy in some ways; however, it did provide more
choices.
3. Alternative schools, created in the late 1970s/early 1980s, serving at-
risk/troubled students that were having a difficult time within the regular schools.
4. Minnesotas extensive, statewide, school choice program, created in the
late 1980s (with many other states following Minnesotas lead). This program
introduced ideas such as postsecondary options (allowing high school students to take
college level coursework, paid for through state funds that otherwise would have been
spent on these students at the high school level); options to attend other public
schools (allows students who are not succeeding at schools within their district to
transfer to schools in other districts with the money to pay for that students education,
following him/her to the new district); and open enrollment (allowing K-12 students
to attend a school in another district, with their funding following them to that district,
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as long at the receiving district has room and the transfer does not increase racial
segregation).
The popularity of Minnesotas and other states public school choice programs
led to increased public interest and support for public school options; however, the
opinion of a rising number of people at the time (educators, parents, legislators) was
that not enough districts were offering sufficient options for people to choose from
more choices of public schools were needed. Furthermore, some of the early pioneers
of innovative, grassroots school choice initiatives, such as those discussed above that
were started in the late 1960s/early 1970s, were frustrated with the increasing lack of
control they had at the school level over such factors as staffing and budgeting and
that the system needed to be further deregulated (Nathan, 1996a).
Minnesota Senator, Ember Reichgott, along with a group of education and
community advisors, introduced the first charter school legislation in 1990. This
legislation reflected the ideas of Ray Budde, A1 Shanker, national pioneers of
innovative schools of choice, and other education and community members from
Minnesota. Reichgotts bill passed the Senate that year but not the House. She
introduced a revised bill in 1991. The revised legislation primarily reflected the input
and concerns from groups that had lobbied against the 1990 bill, such as the
Minnesota Education Association (MEA) and the Minnesota School Board
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Association (MSBA). Eventually, the bill passed in both the Senate and the House
but not before further amendments, again reflecting the interests of the MEA, MSB A,
and others, had been madedespite significant protests from charter school advocates
that these changes were watering down the original intent of the legislation too much
(Nathan, 1996a).
Since 1991, Minnesotas charter law has changed significantly, and at the
national level the charter school movement has grown considerably. As of September
1997,27 states had passed charter school laws, 780 charter schools were operational
in those states, and 69 more had been approved to open (Center for Education
Reform, 1997). Charter schools are currently being evaluated at the national and state
levels to assess their effectiveness, are receiving financial support from federal, state,
and private sources, and are the topic of much public debate. The public (educators,
parents, policymakers, and others) is increasingly interested in learning more about
charter schools (e.g., whether they are more cost efficient than and/or if their students
are achieving at higher levels than their conventional counterparts, the types of
educational programs that are offered, whether parents and students are satisfied with
their charter schools, how to start a charter school, and so forth). Some data and a
plethora of anecdotal information, answering some of these questions, are now
available through a variety of sources such as reports from researchers evaluating
-5-


charter schools; books, articles, and guidebooks on charter schools; television reports
and debates discussing charter schools; and conferences on charter schools.
What is less certain is where the charter school movement is heading. What is
in store for the future? Will the number of charter schools continue to grow, and at
what pace? President Clinton has called for 3,000 charter schools to be established by
the year 2000 (RPP International & The University of Minnesota, 1997), but is this
realistic? In six years (1991-1997), 850 charter schools have been approved. If
President Clintons goal of 3,000 is reached, an additional 2,150 charter schools will
need to be approved by the year 2000. According to A Study of Charter Schools.
First Year Report, the expansion of charter schools is dependent on state and local
factors such as: (a) how many additional states enact charter school legislation, (b)
whether states with existing charter school laws will permit more charter schools to
be formed, and (c) whether policymakers and the public believe charter schools are
successful and worth expanding (RPP International & The University of Minnesota,
1997).
The purpose of this thesis is to: (a) explore the political forces that influence
the charter school movement; (b) analyze current charter school policies; and (c)
propose changes to state policies that reflect the interests of multiple stakeholders and
lead to an increase in the number of charter schools. My analysis of current policies
-6-


and recommended changes will focus on two charter school policy areas: sponsorship
and finance.
Research Design
Data for this thesis were obtained from several sources, including a review of
the literature, hands-on research, telephone interviews, and document review. The
overall purpose of this data collection and analysis was to learn: (a) how charter
school policies differ across the states; (b) who is supportive and/or critical of charter
schools and why; (c) what challenges have charter schools encountered in the areas of
funding and sponsorship; and (d) what state or federal policy actions, specifically
concerning funding and sponsorship, have facilitated the growth and/or the
suppression of the number of charter schools developed.
The literature review included national and state evaluations of charter
schools, a book on charter schools, articles from educational journals, newspapers,
policy briefs, and the Internet. These data provide a general overview of the charter
school movement, offer a national perspective on the activities and challenges of
charter schools, and describe the opinions/positions of those in favor of and/or
opposed to charter schools.
-7-


I conducted hands-on research with an existing charter school in Colorado
(P.S.l) and a charter school planning group (The Odyssey Schools charter school
application was approved by Denver Public Schools [DPS] in January 1998). I
wanted to work closely with charter schools so that I could gain a first-hand
understanding of the key issues and challenges that charter schools face. I spent many
hours with both of these charter schools writing a significant portion of Odysseys
charter school application (including its budget); fundraising for both schools;
participating in board meetings; developing student and sponsor evaluation tools for
P.S.l's student internship program; interacting with DPS school board members,
Superintendent, and staff to clarify charter school application requirements and
expectations and to respond to their questions about the application; investigating
potential facility sites for Odyssey; and involving parents and community members in
both of the schools. I now understand some of the significant issues and challenges
that charter school operators and planners experience and am confident that this
knowledge makes my recommendations for policy changes more credible.
Additionally, I recently prepared a report on charter school finance for the
Education Commission of the States (Anderson, Augenblick, & Myers, 1.997), that
required me to conduct phone interviews with charter school operators (people
working in charter schools), technical assistance providers (people working directly
-8-


with charter schools), state-level staff people (either the finance or charter school
person at the Department of Education), and charter school sponsors (school districts
or other entities sponsoring charter schools) in four states (Arizona, California,
Massachusetts, and Michigan). The purpose of this research was to inform
policymakers and others about charter school finance issues and to identify areas for
further research. In addition to the results from the interviews, the report contained an
analysis of charter school budgets that were collected from the interviewees. These
data describe how charter schools are funded in four states and discuss the financial
issues, challenges, and successes of selected charter schools in these states.
Organization of the Study
Chapter II discusses the political forces that have influenced the charter school
movementwho has been involved and what roles have these entities played in
shaping current charter school policiesand highlights the advantages and
disadvantages of charter schools that have been raised in the literature.
Chapter III compares charter school activities and policies, with an emphasis
on sponsorship and funding, across four states. Key findings from these data are
highlighted, including a comparison of the similarities and differences across state
-9-


policies, followed by a discussion of the influences that these policies have on the
charter school movement.
Chapter IV offers policy recommendations within the areas of sponsorship and
funding that could facilitate an increase in the number of charter schools. The
consequences of adopting these recommendations also are noted.
Chapter V discusses ideas for further research so that more can be learned
about charter schools, including their effectiveness, structures, activities, and how
they compare to non-charter schools. This Chapter also identifies the research area
that I am most interested in pursuing for my dissertation.
-10-


CHAPTER II
THE POLITICAL INFLUENCES ON THE
CHARTER SCHOOL MOVEMENT
As discussed in the introduction, the charter school movement evolved out of
several years of reforms aimed at increasing the choices of public schools available
for parents. Along the way, public school choice has had both proponents and
opponents, as have charter schools since they are a form of public school choice.
These individuals and groups have been key players in shaping the charter school
policies we have today. Some of the most vocal national players in the charter school
movement are discussed below.
Advocates
Advocates are organizations/individuals that are in favor of increasing the
number of charter schools and believe that when freed of bureaucratic rules and
regulations, charter schools are a viable solution to the problems facing public
education. These advocates influence the charter school movement by emphasizing
the positives of charter schools (what is working), discussing the impediments to
creating and implementing charter schools, and identifying how state and federal
-11-


policies could be modified to better support charter schools. Most advocates are not
currently part of the K-12 education establishment (with the exception of those
individuals that are operating, teaching, or sending their children to charter schools).
They may have been part of the establishment (e.g., as teachers or administrators) at
one point in their lives, but now they are primarily researchers in universities or
employed by think tanks or other types of educational policy and research
organizations. Many of the prominent players are cited below in the summary of the
literature. Chester Finn and Greg Vanourek are both employed by the Hudson
Institute, a conservative think tank; Louann Bierlein works for the Governor of
Louisiana and is a consultant to the Hudson Institute; and Joe Nathan runs the Center
for School Change at the Humphrey Institute for Public Policy at the University of
Minnesota. Other advocates that are not cited, but influence the movement include
Eric Premak, a California-based consultant who works directly with charter school
operators and offers advice nationally on charter school policy issues; and Ted
Kolderie, a Minnesota-based consultant who provides advice nationally on charter
school policy issues and coordinates the Charter Friends Network, a national group of
charter school technical assistance providers.
-12-


Positive Results
According to the literature written by advocates, charter schools are yielding
positive results, including serving diverse student bodies; engaging parents, teachers,
and communities in their schools; influencing non-charter public schools and
districts; improving student achievement; using resources more effectively; creating
innovative educational programs; and increasing accountability.
Serving Diverse Student Bodies. Charter schools are serving diverse students
from all ethnic and socioeconomic backgrounds and of multiple ability levels,
including children of all ages, races, and genders; children from private, public, and
home schools, children with learning disabilities, limited English proficiency, and
other special needs, and children from families in all income brackets. (Finn, Manno,
& Bierlein, 1996; Vanourek, Manno, Finn, & Bierlein, 1997).
Engaging Parents. Teachers, and Communities in their Schools. Charter
schools are attracting terrific, often unconventional teachers who fulfill many other
functions (besides teaching) within the schools. Teachers choose to work in charter
schools because they have more freedom and flexibility than they would in non-
charter schools, they like the smaller, family-like atmosphere charter schools offer,
they have more control over decisions and resources, and they believe that charter
schools force them to be more accountable (Vanourek et al., 1997).
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Parent and student satisfaction is high in charter schools and most charter
schools have waiting lists. Often, parents are involved in the creation of charter
schools, as founders. Parents choose charter schools because they are safer or more
orderly, have committed teachers, offer smaller classes, or encourage higher standards
and student performance. Charter schools benefit from high parent involvement and
find creative ways for all parents to participate (Finn et al., 1996).
Influencing Non-Charter Public Schools and Districts. Fair competition helps
stimulate improvement in public education systems, for example, after the
introduction of charter schools into several school systems, school boards and districts
created programs and options to respond to the interests and needs of parents. Parent
and teacher-supporters of innovative education programs have long been advocating
for district action without success and believe that the pressure of a potential charter
school forces some districts to act (Bierlein, 1996; Nathan, 1996b).
Improving Student Achievement. The Sacramento, California school board
recently extended the Bowling Green Charter Schools contract after students showed
improvements in achievement, attendance, and behavior. Five years ago, prior to
becoming a charter school, this school was one of the three lowest achieving schools
in the district (Nathan, 1996b).
-14-


Among students performing poorly in their previous school (according to
their parents), nearly half are now doing excellent or above average work in their
charter schools. The number of students doing excellent or good work rose 23%
for African-Americans and 22% for Hispanics after enrolling in charter schools and
similar gains were made for low income students of all races (Vanourek et al., 1997).
Vaughn Next Century Learning Center, a charter school in Los Angeles that
converted from a regular public school to a charter, reported that since becoming a
charter school their language arts scores improved from the 9th percentile to the 39th,
and their math scores increased from the 14th percentile to the 57th (Bierlein, 1996).
Using Resources More Effectively. Charter schools are avoiding putting up
costly new buildings or making expensive renovations to house students. Instead,
they are sharing resources with other community agencies (e.g., sharing a church
building with a congregation that does not need the building during the week or
utilizing local recreation centers or libraries instead of building a gym or library in the
school) or renting non-traditional facilities that are vacant in the community (e.g., one
school is housed in an old grocery store) (Nathan, 1996b).
By utilizing contracted services, charter schools are able to do more for less
and have money left over to commit to other needs. For example, the Fenton Avenue
School in California, a conversion school, contracted with a catering company to
-15-


manage their food services program instead of using the districts food service
program. The management team utilized practices that resulted in savings to the
school. These savings enabled the school to purchase additional equipment, increase
the salaries of the food staff, add additional staff people, and offer more food choices
to students (Finn et al., 1996).
Creating Innovative Educational Programs. Charter schools across the country
hardly resemble a one-size-fits-all model. The schools philosophies and approaches
vary considerably, they are each distinctive in important ways, and their innovations
are extensive. While it is true that many of the educational approaches that charters
are taking can be found in conventional schools around the country, there are not
enough of those conventional schools to keep up with the demands of families.
Charter schools provide the opportunity to bring those unique educational programs to
communities nationwide without having to rely on or wait for the school district to do
it (Finn et al., 1996).
Increasing Accountability. The charter that each school negotiates with its
sponsoring agency must designate areas in which students will increase their skills
and overall academic performance and identify how that performance will be
measured. Charters typically have terms of three to five years. Schools that fail to
meet the terms of their contract may be closed by the sponsoring agency (Nathan,
-16-


1996a). Teachers believe that charter schools encourage them to be more accountable
than their peers teaching in conventional schools. Charter schools have higher
academic and personal conduct standards for all studentsthey are expected to take
responsibility for their own learning and behavior (Finn et al., 1996).
Barriers
According to the advocates, significant barriers prevent increasing the number
of charter schools. If policy changes are not enacted to address these barriers, they
believe fewer charter schools will open and, therefore, it would be less likely that the
number of charter schools operating in the United States would increase to the level
proposed by President Clinton. These barriers include weak charter school laws,
insufficient funding, lack of resources for facilities and start-up, and limited
sponsoring entities.
Strong versus Weak Charter Laws. More charter schools are operating in
states that have stronger charter school laws. Laws are stronger in states that give
charter schools more autonomy, for example, they do not limit the number of schools
permitted, they do allow blanket waivers, permit multiple entities to sponsor charter
schools, encourage educators and community members to start charter schools, and so
forth. Weak laws may limit the number of schools that can be approved, only allow
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teachers to start charter schools, or permit only one sponsoring agency (Bierlein &
Mulholland, 1995). The charter school concept will reach its potential only if the
details of charter legislation are right and more states adopt the policies and practices
found in strong laws (Nathan, 1996a).
Funding. Most charter schools do not receive their share of public education
funds. Because of sticky negotiations, overhead charges, and lack of autonomy, most
charter schools wind up with less money per pupil than their conventional school
counterparts. Serious support of charter schools will entail revising many aspects of
public education finance (Firm et al, 1996).
Facilities and Start-Up. Most charter schools cannot access local money to
construct or renovate buildings. Instead, they must raise additional funds or pay for
their facilities expenses out of their general operating budget. The absence of capital
funding, lack of access to conventional school facilities, and limited start-up money to
cover initial equipment, planning, and operations is the most significant issue charter
schools face (Nathan, 1996a). The recent arrival of some federal funds for charter
school start-up has provided modest relief to a limited number of schools. No state
has yet proposed a serious solution to the start-up funding problem (Finn et al., 1996).
Sponsorship. In addition to the local school board, states need to give at least
one other group the authority to sponsor charter schools. Often local school districts
-18-


are not in favor of charter schools, so if they are the only entity approving charter
schools, fewer schools will be chartered in those anti-charter school districts. Too,
having additional entities, such as a university, sponsor charter schools facilitates
partnerships between K-12 and higher education and introduces competition into the
system (Nathan, 1996a).
School boards should not be bypassed but instead need to be reformed into
community agencies that oversee charter schools proactively. These agencies will
ensure that every child has access to a school, that parents have information on
schools and can make informed choices, and that a connection exists between what
children are taught at different levels of education across schools. Charter school
laws need to transform local boards from operators of a bureaucracy into managers of
a system of individual schools, each with its own mission, clientele, and basis of
accountability (Millot, Hill, & Lake, 1996).
Charter school advocates are organized and committed to seeing this reform
succeed. They write about charter schools in educational journals, newspapers, and
books; host discussion groups on the Internet; produce manuals and guides to assist
charter school organizers; lobby at the state and national level; present at conferences;
and so forth. Charter school advocates will continue to push for policy changes that
-19-


facilitate the continued growth and success of charter schools as fully autonomous
entities.
Moderates
Moderates include primarily educational associations (National Education
Association, American Federation of Teachers, National School Boards Association,
National Association of Secondary School Principals, and so forth) that support
charter schools only if certain criteria are met. Moderates, for example, are typically
more in favor of what the advocates call weaker charter schools laws because these
laws blend features of the existing educational system (e.g., collective bargaining,
hiring certified teachers) with features of the charter movement (e.g., encouraging
choice, allowing teachers to start new schools). Also, controls remain in the laws that
moderates support (e.g., caps on the total number of charter schools permitted). Some
of these entities have developed position papers on charter schools, detailing what
must be present in a charter school law in order for their associations to support it.
Over the years, at least one of these organizations has changed its position on charter
schools. The National Education Association (NEA) was not originally supportive of
charter schools and spent a considerable amount of time fighting charter legislation
(Nathan, 1996a). Over time, however, the NEA and others have warmed up to the
-20-


idea of charter schools, if, as discussed above, the schools adhere to specified rules
and regulations.
Charter schools can become change agents within public school
systems by charting new and creative ways of teaching and learning.
Or they can allow unprepared people to start schools and undermine
education. Whether charter schools are a positive or negative force
depends on how state charter laws are written and applied. (NEA,
1993, p. 2)
Requirements for Charter School Laws
As the quote above exemplifies, moderates are more likely to support charter
schools in a given state if that states legislation includes certain features, such as
setting an appropriate length for the charter contract, ensuring the use of
standards/assessments, limiting the number of charters that can be approved; allowing
sponsorship only by school districts; using collective bargaining, hiring only certified
teachers; making all information available to the public, providing equal access and
opportunity for all children, establishing a representative governance structure, and
limiting who can apply for a charter.
Length of Charter. Charter schools should be chartered for no more than five
years. As experiments, charter schools need time to prove themselves, to be
periodically assessed, and to measure progress towards meeting their educational
goals (NEA, 1993).
-21-


Standards/Assessments. Charter schools must ensure that their students meet
challenging state standards and offer the same assessment measures (e.g., tests) as
regular public schools (AFT, 1996). Given the deregulated nature of charter schools,
they more than regular public schools, should have clear goals, a plan for achieving
those goals, and mechanisms for measuring progress towards meeting those goals
(NEA, 1993). In addition to the NEA and the AFT, the Council of Chief State School
Officers (CCSSO), the National Association of Secondary School Principals
(NASSP), and the National School Board Association (NSBA) all agree that charter
schools should participate in all state and district assessment and reporting programs
(Koprowicz, Medler, & Weston, 1996).
Limiting the Number of Schools. Given that charter schools are experimental,
states should limit the number of charter schools approved. Doing this, provides an
opportunity for field testing the idea before expanding a practice that may not be
educationally sound (NEA, 1993).
Sponsorship. If charter schools are going to have an opportunity to influence
other public schools, there must be a connection to the local district. Charter schools
should have the approval of local school districts (AFT, 1996). Local school boards
should grant final approval to charter schools. Keeping this decision at the local level
reinforces local control and accountability of charter schools (NEA, 1993).
-22-


Collective Bargaining. Charter school laws should protect the rights of
employees to bargain. Charter schools should be used as opportunities to strengthen
the collective bargaining process, expanding the possibilities of bargaining into new
areas (NEA, 1993). Collective bargaining assures the rights of teachers. Charter
school employees should be covered by the collective bargaining agreement. Charter
school laws that are designed to destroy the collective bargaining rights of teachers
serve a political, not an educational, purpose (AFT, 1996).
Certified Teachers. Charter schools should be required to hire certified
teachers. Although certification does not ensure that someone will be a good teacher,
it does ensure a minimum level of competency. Teachers in charter schools may
either have their certification already or be in the process of obtaining alternative
certification (AFT, 1996). According to the CCSSO and the NSBA, charter schools
should not have complete control over their staffing decisions (Koprowicz et al.,
1996). Charter schools must hire only certified teachers. Hiring uncertified teachers
lowers the standards of the education profession (NEA, 1993).
Public Information. Just as other public agencies must do, charter schools
should be required to make information available to the public, including
demographic information on students and staff, the number of special needs students
served, annual financial records, results of achievement tests, attendance rates, student
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mobility rates and staff turnover, parental outreach efforts, and graduation rates.
Meetings of charter school boards should also be open to the public, similar to
meetings of regular school district boards (AFT, 1996).
Equal Access & Participation. Charter schools should not be allowed to
charge tuition or fees. This will prevent lower income families from being able to
attend the schools and/or participate in school activities (AFT, 1996 & NEA, 1993).
Recruiting parents to sign contracts guaranteeing a certain level of participation in the
school are a common feature in charter schools. This requirement may prevent the
enrollment of children from disadvantaged populations. Parent involvement should
not be used as a proxy for race or class-based screening. Charter school legislation
should ensure the widest participation of students and prohibit the development of a
system that chooses the best students from the system to attend charter schools and
leaves the others behind in failing schools (AFT, 1996). Charter laws should require
that charter schools be as ethnically diverse as the broader communities in which they
are located. Charter school applications should specify how the school will recruit
students from diverse backgrounds. Charter schools should not increase racial and
socioeconomic segregation (NEA, 1993).
Governance. It is essential that practitioners and representative community
members are involved in the governance of charter schools. This must be spelled out
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in law or charter schools may end up being undemocratic, dominated by non-
educators, top-down, or not representative of the communities they serve (NEA,
1993). Charter school advocates argue that a benefit of charter schools is the greater
role that teachers can play in the governance of their schools; however, an
examination of various states charter school legislation fails to demonstrate that
teachers will have a fundamentally different role and/or be assured greater
professionalism in charter schools (AFT, 1996).
Applicant Qualifications. A charter school should be nonsectarian,
nonreligious, and not home-based. Charter school applications should be submitted
by licensed, public school educators in conjunction with parents and community
members but should not include those running for-profit businesses. A school
converting to charter status must have at least two-thirds of the teachers sign the
charter application or 20 percent of the teachers in that district (NEA, 1993). The
AFT and the NSBA both oppose the idea of having home schools apply to become
charter schools, the NSBA does not agree that for-profit organizations should be
allowed to become charter schools, and the AFT and the NSBA both agree that
private schools should not be allowed to become charter schools (Koprowicz et al.,
1996). Moderates have tremendous political influence, so if charter legislation does
not include the qualities specified above, it is very likely that these associations will
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band together and put political pressure on legislators to oppose amendments to
existing laws and/or prevent the passing of new charter laws.
Critics
A vocal group of charter school critics is emerging. Many of these individuals are the
same people who are critical of school choice and see charter schools as another arm
of the school choice movement. Critics of the charter school movement are primarily
university researchers and/or district leaders (e.g., superintendents) who fear that
charter schools will not spark innovation and improve the public system, as advocates
contend, but instead will drain resources from the public schools and lead to an
inequitable and inconsistent educational system.
Concerns with Charter Schools
The most vocal charter school critics are not supportive of school choice in
any form, including charter schools. They tend to raise issues and concerns about the
negative impacts choice can have on communities and schools. Central to their
arguments are the following issues.
Competition. Competition alone will not improve instruction. It is unclear
how the introduction of competition will make teachers better teachers or improve the
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amount of resources available for teachers to utilize in their classrooms (Molnar,
1996). Charter school advocates argue that parents will choose a school for their
child based on the quality of that schools educational program. This assumes that
parents know an effective school program when they see one. Parents choose schools
for many reasons other than the schools academic program, including location, child-
care availability, work schedules, and after-school activities. So, if a charter school is
not convenient, even if the educational program is fantastic, parents still may not
choose to send their child there. Plus, the idea that a market-driven system will
automatically create a multitude of options for families, especially in low income
areas, is unrealistic (Molnar, 1996). A free market isnt always free and doesnt
necessarily guarantee a better product (Wagner, 1996, p. 70). School choice by itself
has not produced significant improvements. Often, parents do not get their first choice
of school and the majority of the schools seem virtually interchangeable and mediocre
(Wagner). Competition and the creation of new charter schools is leading to
segregation in our society and making it more difficult for us to create school systems
that work. It is unrealistic to manage effectively thousands of schools. Fixing existing
schools must be the priority (ASCD, 1997). It is doubtful that a small number charter
schools will create a market environment large enough to encourage over 85,000
public schools to change (Garcia & Garcia, 1996).
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Equity. Charter schools are not adequately serving the needs of children with
disabilities. Children requiring special education services have been turned away from
charter schools and charter school operators lack sufficient knowledge of federal and
state special education laws and procedures (McKinney, 1996). School choice,
including charter schools, can lead to racial and economic segregation. The people
who benefit from choice are those who are most aggressive, resourceful, and
committed. The wealthier, more highly educated families will flee neighborhood
schools for schools of choice, leaving the lower income families behind.
Neighborhood schools will have difficulty sustaining such a loss (ONeil, 1996).
Others worry that charter schools will become dumping grounds for students who
have been unsuccessful in the conventional public education system (Caudell, 1997).
A growing concern emerging out of charter schools is that low income families will
not have the time or financial resources to commit to charter schools; therefore, these
families will be denied access to charter schools (McGree, 1995). Students suffer
with an experiment such as charter schools. Students in charter schools risk
educational disruption, that their non-charter school peers do not, when a charter
school fails to live up to the terms of its contract. Those children must then be
transferred to a new school or remain in a school that is failing to educate them
properly (Caudell, 1997). Introducing competition into public education goes against
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the purpose of public education which is to transmit democratic values and ensure
equity for all (Garcia & Garcia, 1996, p. 35).
Duplicating the System. Charter legislation simply creates another layer of
bureaucracy. Eventually, charter schools will evolve into a bureaucratic system, with
rules and regulations, duplicating the current public education system. States should
fix the existing system instead of creating new ones (Caudell, 1997). If bureaucracy
is one of the problems of public schools, then we should focus on fixing the system
and making it less bureaucratic rather than abandoning public schools by creating
charter schools (Garcia & Garcia, 1996).
Vouchers. Charter schools are a foot in the door of vouchers. Charter
schools are leading this country towards an increasingly privatized system of
education (Caudell, 1997). Charter schools, like private school vouchers, are built on
the assumption that our society can be held together solely by pursuing our self-
interests and fulfilling our individual purposes (Molnar, 1996).
Student Achievement. It is difficult to measure the overall impact choice has
had on students, or the system as a whole, and little evidence is available indicating
that students in schools of choice are learning more than those who remain in
neighborhood schools (Fuller, 1996). Advocates claim that charter schools integrate
reforms that have been tried over the past decade; however, little evidence exists that
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these reforms have had a positive impact on student achievement (Garcia & Garcia,
1996).
Accountability. Many charter laws allow just about anyone to open a charter
school. This is analogous to letting anyone who wants to provide health care to do so,
regardless of their background and/or expertise in the field (Molnar, 1996). By
freeing charter schools of the legal requirements placed on public schools, they do not
have to operate in open meetings or otherwise be open to public scrutiny. This makes
it difficult for the public to hold charter schools accountable~they lack the
information to do so (Molnar, 1996).
Lack of Innovation. Foes of charter schools believe that charter schools will
be no more innovative than existing schools, which taken as a whole are not very
innovative (AFT, 1996).
Teacher Oualifications/Unions. States that allow uncertified teachers to teach
in charter schools are providing a disservice to their students. Virtually any adult in
these states, regardless of background, can teach or administer a charter school. For
charter school advocates, charter schools provide an opportunity to break up teachers
unions and lower wages as an education reform strategy. Just as is seen in private
schools and universities, lower wages may drive some of the best teachers into other
professions (Molnar, 1996). It remains to be seen whether teachers will play a more
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significant role and have greater autonomy in charter schools (Garcia & Garcia,
1996).
Resource Drain/Impact on System. Charter schools drain resources from other
public schools. Public funding needs to be concentrated on improving instruction and
increasing student achievement, not creating new schools. Charter schools spread the
resources too thin, with too little going to any one place (Molnar, 1996). Charter
schools are freed from excess regulations while public schools are expected to teach
an expanding curriculum and meet increased state or federal mandates. Legislators
have been so willing to fund charter schools yet they have been unwilling to fund
regular public education at the rate of inflation (Garcia & Garcia, 1996).
Sponsorship. Few of the institutions authorized to sponsor charter schools
have the expertise or the resources to effectively oversee the charter schools they
sponsor. As a result, the number of charter schools that use their resources
irresponsibly, or are mismanaged, such as the Edutrain charter school that was shut
down in California, will likely increase (Molnar, 1996).
More often than in the past, critics are being invited to educational
conferences to debate the merits of charter schools with advocates (ASCD, 1997).
Previously, charter school panels at conferences were often composed primarily of
advocates, providing overviews of charter schools and promoting their pro-charter
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agendas. This was primarily because the advocates were the people who knew most
about what was happening in charter schools at that time. Now, many others, for and
against charter schools, have become involved in the debate and have begun to take a
closer look at charter schools. As the number of charter schools grows, it is likely
that successes will accompany failures. The advocates will tout the successes and the
critics will discuss the failures.
Financial Supporters
These are public agencies and private foundations that allocate funds
specifically for charter schools and/or have funded large research projects on charter
schools. Most charter schools rely on some foundation support for start-up and/or
capital expenditures and it is unlikely that, as the number of charter schools grow,
foundations will be able or willing to fund all the needs that charter schools have
typically relied on foundations to fund (Anderson et al., 1997). To date, some of the
larger, national financial supporters of charter school efforts include the following.
1. The United States Department of Education has a national charter schools
office, allocates funding to states for charter school start-ups, funds a national
evaluation and other research studies on charter schools.
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2. The Pew Charitable Trusts provided the funding for the Hudson Institutes
national charter school study.
3. The Walton Family Foundation provides direct funding to charter schools
for planning and implementation.
Policymakers
The charter school movement has received support from both Democratic and
Republican policymakers, which is one reason why the movement has grown so much
over the last couple of years (Nathan, 1996a). In general, it is a reform that both
liberals and conservatives seem to be willing to explore. According to a 1996 survey,
Policy-Makers Views on the Charter School Movement (Nathan & Power, 1996),
legislators introduce charter school legislation for several reasons, including:
1. To help youngsters who have not succeeded in existing schools
2. To provide opportunity for educational entrepreneurs
3. To expand the range of public schools available
4. To increase overall student achievement
5. To encourage the existing public education system to improve
6. To provide an alternative, rather than a prelude, to vouchers
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When asked how legislators would strengthen charter laws, the most frequent
recommendations given were:
1. Give charter schools the same per-pupil allocation as other public schools
2. Permit more than one organization to sponsor a charter school
3. Eliminate the cap on the number of charter schools
4. Give charter schools a great deal of independence from local districts
5. Provide some start-up funds
This survey was conducted by one of the leading charter school advocates in
this nation, Joe Nathan, so the results are probably biased towards his perspective.
For example, some legislators would disagree with some of the frequent
recommendations listed above. Four members of Colorados House Education
Committee voted against amending Colorados Charter School Act in 1997. One
reason given for voting against the changes was that results on the success of charter
schools to date were not yet available. This legislator said he supported charter
schools, but he was uncomfortable making changes to the current legislation until he
knew more about the success, or lack thereof, of existing charter schools under
current law (Anderson, 1997).
The response from this legislator is evidence that policymakers are interested
now in results as opposed to advocacy. Much of the discussion on charter schools up
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to this point has centered on issues relating to advocacyincreasing opportunity,
giving people choices, meeting the needs of the community, making the system more
accountable, and so forth. Now, people want to know if it is working. This is a
transition from advocacy to evidenceare charter schools actually accomplishing
what they hoped and/or promised they would? Policymakers are looking to
researchers and the charter schools themselves to provide this information. As more
information about charter schools is made available, legislators will have the data they
need in order to make informed decisions about the future of charter schools.
However, data can be interpreted in many ways, so the combination of the data with
the lobbying efforts of the advocates, moderates, and critics will influence how
legislators vote on future adjustments to and/or the creation of new charter laws. The
advocacy and personal interest side of the charter movement will not disappear in this
age of evidence; however, the opinions and interests of the advocates, moderates, and
critics will need to be balanced with the data.
Neutral Players
Others are involved in the charter movement, theoretically as non-biased/non-
partisan entities. For example, results from RPP International and the University of
Minnesotas (U of M) national charter school evaluation (contracted through the U.S.
-35-


Department of Education, RPP is continuing to work on the evaluation but the U of M
is not) will be seen as more neutral or balanced than results from The Hudson
Institutes National Study on Charter Schools or a study that Alex Molnar (a critic)
would conduct on charter schools. Primarily because RPP has not come out
publically supporting or opposing charter schoolsthey are taking a non-biased, data-
based lookeven though they may have some researchers working on the report who
are clearly advocates of charter schools (e.g., Wayne Jennings, a director of a charter
school in St. Paul, Minnesota, or Eric Premack, one of the advocates discussed
above). The data from the evaluation will be looked at by policymakers and others
interested in learning more about the effectiveness and impact of charter schools.
The following are some key findings from A Study of Charter Schools (RPP &
U of M, 1997):
1. Charter schools serve diverse student population.
2. The percentage of special education students served in charter schools is
lower than the national average (about 7 percent of students in charter schools versus
about 10 percent of students in regular schools receive special education services). An
exception to this is in Minnesota and Wisconsin where a higher percentage of special
education students are being served in charter schools.
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3. Charter schools serve a smaller proportion of Limited English Proficient
students than do other public schools.
4. Most charter schools enroll about the same proportion of low income
students, on average, as other public schools.
5. Charter schools are founded for diverse reasons. Newly created schools
often seek to achieve a new educational vision while conversion schools are more
likely to seek autonomy.
6. Lack of start-up funding is the most frequently mentioned problem that
charter schools face.
In addition to the RPP study, the U.S. Department of Education is funding two
other research studies: (a) How Charter Schools Serve Students with Disabilities,
being conducted by the Research Triangle Institute; and (b) Charter School
Accountability, being conducted by the Center on Reinventing Public Education.
Initial results from these studies will not be available until January 1998, at the
earliest.
The Education Commission of the States (ECS) and the National Conference
of State Legislatures (NCSL) are two organizations that also influence the charter
school movement. Both of these entities are designed to be neutral, serving
policymakers across the political spectrum; however, the type of information that
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these entities provide on the topic of charter schools will likely influence legislators
decisions about and/or understandings of key charter school issues. Overall, the
publications that ECS has produced on charter schools lean more towards advocating
for charter schools than remaining neutral (e.g., Louann Bierlein, an advocate, wrote
two policy briefs on charter schools for ECS-Bierlein & Fulton, 1996, and Bierlein,
1996). Most recently, however, ECS and NCSL jointly completed a document, The
Charter School Roadmap (Banks & Hirch, 1997), that looks at both sides of the
charter school debate and walks policymakers through the various decisions that they
need to make when considering charter school legislation. Both of these
organizations host large annual meetings and several events during the year in
addition to their publications. Policymakers from across the nation attend these
sessions and over the last few years, charter schools have been covered in these
meetings at different capacities. Since policymakers get information on charter
schools from these organizations, it is important to consider them key players in the
charter school movement.
Summary
This section discussed the political players that influence the charter school
movement, provided an overview of their key positions/opinions about charter
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schools, and reviewed how these positions/opinions are expressed in the literature on
charter schools as pros and cons for the movement. It also provided an overview of
the many issues that have surfaced since the inception of the charter school movement
and forecasted some of the emerging issues, such as the shift from advocacy-based
data to evidence-based data. All of the groups discussed in this section-advocates,
moderates, critics, funders, policymakers, and neutral playerswill continue to be
involved in this movement. The level and type of involvement will depend largely on
the type of legislation passed and the success of charter schools. In order to reach his
goal of 3000 charter schools by the year 2000, President Clinton will need to be
updated on the positions, findings, and interests of each of these groups and determine
whether collaborating with these groups will help him reach his goal.
The remainder of this thesis focuses on two specific policy areas: sponsorship
and funding. The next chapter compares charter school activities and policies with an
emphasis on sponsorship and funding across four states.
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CHAPTER III
A COMPARISON OF STATE CHARTER SCHOOL POLICIES
The composition of charter school policies influences the number of charter
schools within a given state and/or the number that will be approved in the future. As
discussed in the previous chapter, significant political forces encourage policymakers
to adopt policies that reflect certain viewpoints. These forces have been instrumental
in influencing existing policies and will continue to be influential in the future. For
example, the Milwaukee Teachers Education Association recently challenged the
legality of charter schools, and won, when an attempt to increase the autonomy given
to charter schools was proposed in the legislature (Center for Education Reform,
1997). This chapter examines how many charter schools currently exist and in which
states, projects how many charter schools each state must approve in order to reach
Clintons goal of 3000, and compares existing state policies, in four states, across
several areas.
Table 3.1 provides a list of current states with charter school laws, identifies
how many charter schools each state has approved, and projects, based on current
percentages, how many charter schools each of those states will need to approve in
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order to reach President Clintons goal of 3000 charter schools by the year 2000. A
discussion of the key findings from the data follows the table.
TABLE 3.1
TOTAL NUMBER OF CHARTER SCHOOLS AS OF JANUARY. 1997
AND PROJECTIONS FOR THE FUTURE
(A) Total number of Charter Schools approved as of September, 1997 (B) Percent of total charter schools currently approved1 (C) Projected number of schools needed per state to reach Clintons goal of 30002
Alaska 15 2% 60
Arizona 254 30% 900
Arkansas 0 0% 0
California 132 16% 480
Colorado 49 6% 180
Connecticut 12 1% 30
Delaware 7 1% 30
Washington, DC 4 0% 0
Florida 40 5% 150
Georgia 21 2% 60
Hawaii 2 0% 6
1 States with 0% in this column have less than 1% of the total number of the nations
charter schools.
2 These numbers reflect an assumption that each states percentage of total charter
schools would remain consistent with current percentages (those displayed in column
B).
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TABLE 3.1 (cont)
TOTAL NUMBER OF CHARTER SCHOOLS AS OF JANUARY. 1997
AND PROJECTIONS FOR THE FUTURE
(A) Total number of Charter Schools approved as of September, 1997 (B) Percent of total charter schools currently approved (C) Projected number of schools needed per state to reach Clintons goal of3000
Illinois 8 1% 30
Kansas 7 1% 30
Louisiana 6 1% 30
Massachusetts 25 3% 90
Michigan 135 16% 480
Minnesota 29 3% 90
New Hampshire 0 0% 0
New Jersey 16 2% 60
New Mexico 5 0% 18
North Carolina 34 4% 120
Pennsylvania 6 1% 30
Rhode Island 2 0% 6
South Carolina 3 0% 12
Texas 20 2% 60
Wisconsin 17 2% 60
Wyoming 0 0% 0
TOTAL 849 100% 3,012
Source: The Center for Education Reform, 1997 (column A only)
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Key Findings from Table 3.1
Arizona (the state with the most charter schools) has nearly twice as many
more charter schools as Michigan (the state with the second highest total number of
charter schools). There have been 254 charter schools approved in Arizona (30
percent of all charter schools nationwide) and 135 in Michigan (16 percent of all
charter schools nationwide). California has the third highest number of charter
schools, 132, which is also 16 percent of all charter schools nationwide.
Several factors may contribute to why Arizona has so many more charter
schools than the other states: (a) the law in Arizona provides the most autonomy to
charter schools; (b) there are no restrictions on who can start charter schools (e.g.,
private companies may start a charter school); (c) multiple entities may sponsor
charter schools; and (d) many charter schools per year may be approved.
If no other states were to pass charter school legislation between now and the
year 2000, six of the 27 states would need to approve most of the charter schools
(2310 out of 3000). These states, in order of the number of charter schools that would
need to be approved, are: (1) Arizona, 900; (2&3) California and Michigan, 480 each;
(4) Colorado, 180; (5) Florida, 150; and (6) North Carolina, 120.
If each of these 27 states were to agree to meet President Clintons goal of
3000 charter schools by the turn of the century, then they would need to set state goals
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for the year 2000 that reflect the numbers found in column C above. Whether states
will have the capacity to oversee so many charter schools and/or whether interest
exists within each of these states to start so many more schools is yet to be
determined; however, Table 3.1 does illustrate that it is possible to reach Clintons
goal if states reach their individual goals.
Table 3.2 provides the following information on four states (Arizona,
California, Massachusetts, Michigan): (a) the total number of students attending
charter schools; (b) the procedure for funding charter schools; (c) the amount of basic
state aid allocated to charter schools and how much that amounts to per pupil; (d) any
additional funds allocated to charter schools for specific purposes; (e) how charter
schools are sponsored; and (f) the maximum number of charter schools states are
allowed to approve (caps). Following Table 3.2, key findings from the data are
highlighted, specifically how states compare to one another; and issues or questions
raised by these data are discussed, including who supports these policies (e.g.,
advocates, moderates, critics, and myself) and why (the impact the policies have on
practice/implementation). The focus of this analysis is on the sponsorship and
funding of charter schools.
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TABLE 3.2
SELECTED CHARTER SCHOOL POLICIES IN FOUR STATES
AZ CA MA MI
Year charter law was passed 1994 1992 1993 1993
Actual state funds transferred to charter schools in FY 97 $69,700,000 $138,689,527 $34,700,000 $68,750,000
Total number of students attending charter schools in FY 97 21,000 42,332 5,465 12,500
Average state support per charter school pupil in FY 97 $3,319 $3,276 $6,349 $5,500
Projected capital funding for charter schools in FY 1998 $4,000,000 $0 $0 $0
Reimbursements to districts losing students to charter schools in FY 97 $0 $0 $30,600,000 $0
Additional state support for charter school start-up/ implementation $1,000,000 $0 $250,000 $0
Entity/ies eligible to sponsor charter schools in state local boards, state board, state board for charter schools local boards state board or jointly by local school committee, teachers union, & state board local boards, independent school boards, universities, community colleges
Caps on number of charter schools allowed in state no cap for local boards, max. of 25/yr for each of the state boards cap of 100 for state, but state board has sought waivers to get around this cap cap of 37 state board approved (or 2%of statewide public school population), cap of 13 on local approved schools no cap on those approved by boards or colleges, cap of 150 (by year 1999) for university approved schools
Sources: RPP International and the University of Minnesota, 1997; Anderson et al., 1997; Center for Education
Reform, 1997
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Kev Findings from Table 3.2
Funding
Arizona is the only state, of the four, that provides funding to charter schools
for capital expenditures. Each charter school receives $146/K-8 pupil and $219/high
school pupil. Finding and securing funding for facilities has been a considerable
challenge for charter school operators (Anderson et al., 1997; Finn et al., 1996; RPP
& The University of Minnesota, 1997), so Arizona charter schools have an advantage
that the other states charter schools do not.
Both Arizona and Massachusetts allocate state funds to charter schools for
start-up (this is in addition to federal start-up money that all states with charter school
laws, except New Mexico, receive and allocate to charter schools). Arizona provides
a total of $1 million (grants of up to $100,000 per school over two years time), and
Massachusetts allocates a total of $250,000 per year (grants averaging $8-12,000 per
year over a two year period). Just as with the facilities funding, finding and securing
funding for start-up has been a challenge for charter schools (Anderson et al., 1997;
Finn et al., 1996; RPP & The University of Minnesota, 1997). States, such as Arizona
and Massachusetts, that have allocated state funding for charter school start-ups are
providing resources for their charter schools that extend beyond what other states
charter schools receive.
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Massachusetts is the only state of the four that reimburses school districts for
losses of enrollment, for up to three years, when a student leaves a district school to
attend a charter school. Districts that are below the states foundation level3 are
reimbursed for 100 percent of their projected losses and those above the foundation
level are reimbursed for a portion of their real losses. Massachusetts decided to
provide this reimbursement to offset any temporary drain of resources a district would
experience from transitioning a student from a district school to a charter school
(Anderson et al., 1997).
Sponsorship/Caps
California is the only state that limits sponsorship to one entity--the local
district. The other three states allow multiple entities to sponsor charter schools.
Massachusetts just passed legislation this year allowing local sponsorships.
Previously, only the state board was permitted to sponsor charter schools (Center for
Education Reform, 1997).
All four states have limited the number of charter schools that can be
approved; however, Arizona allows for many more schools to be approved than the
3 State set funding formulas determine the amount of funding school districts will
receive. In most states these formulas set the allowable spending level that includes a
base per pupil amount and adjustments to account for special needs. The combination
of the base amount and the adjustments is the foundation level (Anderson et al.,
1997).
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other three states. California has exceeded its state cap of 100 schools and
Massachusetts is nearing its cap of 37 schools. All 25 schools approved in
Massachusetts thus far are sponsored by the state board. The legislation allowing
local sponsorship just went into effect this year so charter schools are not operating
yet under local sponsorship (Center for Education Reform, 1997).
Impact of Sponsorship and Finance Policies
State policies, and the components that legislators choose to include in those
policies, impact communities in different ways. Each of the four states discussed
above have policies that differ from each other. As a result, the charter schools in
those states may function quite differently across states and in some cases, charter
schools in one state may have advantages that schools in another state do not have.
The differences across sponsorship and finance policies are highlighted below along
with a discussion about how different policies influence practice. The views of
advocates, moderates, and critics about certain policies are also noted.
Sponsorship
The entities permitted to sponsor charter schools vary across the four states.
Charter schools in Arizona may be sponsored by one of three entities: (a) the State
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Board for Charter Schools; (b) the State Board of Education; and (c) a local school
district. The rationale for having multiple sponsors is to provide an alternative to the
local school district for charter school sponsorship. This is necessary, advocates
believe, in order to trigger competition and encourage innovation (Nathan, 1996a).
Californias charter schools must be sponsored by a local school district. The
rationale for this arrangement is to encourage a relationship between charter schools
and other public schools in the area and to support the notion of local control. The
writers of the legislation, influenced heavily by moderates, believed that in order for
charter schools to influence other public schools, they must be connected to the
district. In states where charter schools are sponsored by non-district entities, charter
schools operate in isolation (AFT, 1996).
Massachusetts charter schools may be sponsored either by the State Board of
Education or by a local partnership between the local school committee (board) and
the local teachers union. The rationale for this arrangement is a combination of the
two rationales described above for California and Arizona. Until recently (1997
legislative session), Massachusetts charter schools could only be sponsored by the
State Board.
Charter schools in Michigan may be sponsored either by a local school board,
independent school board (county/regional board), community college, or a
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university. The rationales for involving the two types of school boards are consistent
with the rationale described for district sponsorship in the California example. The
independent school board arrangement provides another within the system option
for applicants, ensuring a connection to local districts and providing an opportunity
for charter schools to influence conventional public schools that extend beyond those
located in the immediate community in which the school resides. Allowing
community colleges and universities to sponsor charter schools fosters a connection
between higher education and K-12 education, provides an option beyond the K-12
education bureaucracy, and encourages innovation and competition.
Arizonas law is touted as the strongest by advocates of the charter school
movement (Center for Education Reform, 1997) because it provides the most
autonomy and allows two other entities, besides the local school boards, to sponsor
charter schools. Arizona was also the state that, among the four states, had the most
charter schools. Advocates argue that there is a correlation between the strength of a
states charter law and the number of charter schools~the stronger the charter law, the
more charter school activity (Center for Education Reform, 1997).
Moderates, who are most interested in keeping charter school activity
connected closely to local districts, are less in favor of Arizonas legislation and more
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in favor of the legislation in California. California is serving the largest number of
students among the four states, but does not have the most schools.
The critics are less concerned about who sponsors charter schools (with the
exception of ensuring that, whoever it is, the sponsoring entity has the capacity to
oversee the charter school[s] it sponsors, according to Molnar, 1996). If critics
support activity related to charter schools at all (which many, such as Alex Molner, do
not), they would rather see a state ease into the charter school movement (such as
Massachusetts has done when compared to the other three states) than to move foil
speed ahead (like Arizona). This is to allow time for research to emerge that
demonstrates the effectiveness of charter schools, before experimenting on children
and/or draining resources from the other public schools for an unproven approach
(ASCD, 1997).
An Example. My experience working with a charter school in Denver and
trying to get another one approved by the Denver Public Schools (DPS) has led me to
agree with the advocates on the issue of sponsorship. I believe that it is important to
have an entity, besides the local school district, that is authorized to approve and
oversee charter schools. This is because DPS has not shown much interest and/or
support for charter schools. Many applicants have attempted to apply for charters and
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have either been turned down or become so frustrated with the system that they
decided not to apply at all for a charter.
Two charter schools are currently operating in Denver-Pioneer, which the
district started, and P.S.l, which was started by parents, teachers, and community
members. The Edison project has received tentative approval to open a charter school
in Denver, pending their ability to secure funding to renovate their building. And, the
group I have been working with submitted its application to DPS in December, 1997.
Assuming Edison raises its funding and our application is approved, we would be the
fourth charter school in Denver. However, we have yet to be approved and have had
to jump over significant hurdles and wrestle with the district to get this far. For
example, the district had told us that charter school applications for the 1998 school
year would be due December 1,1997. The district did not have any guidelines in
writing to which we could referjust those from previous years. Each time we asked
for guidelines, DPS said that none were available. We were the only group seeking a
charter in Denver and had met with the school board and the superintendent over the
summer to discuss our plans and to clarify deadlines, so they knew who we were and
when we planned to submit an application. In August, 1997, the DPS Board met to
discuss its charter school guidelines (finally, we had been asking for this information
since January, 1997) and decided to change the deadline for 1998 charter school
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applications. The new deadline was August 29,1997 for draft applications and
October 1,1997 for final applications. We learned of this decision August 15,1997
when we received the board minutes. This left us with a few weeks to pull together a
draft and six weeks to complete our final application.
Changing the deadline gave us two months less than we thought we had to
work on our application. We almost decided to give up and apply next year since it
was not feasible to pull it all together so quickly. Instead, we decided to ask for an
extension. We received press in both of the major Denver papers, highlighting our
struggle, and were granted an extension by the DPS Board, changing the deadline for
our application to December 1,1997. This is just one example of what we have had
to do in order to just apply to become a charter school. If we had had the opportunity
to go directly to the state board or to a university for sponsorship, we would have
done it in a second, primarily because we did not receive any meaningful
encouragement, support, or consistent guidance from the district, despite the large
numbers of parents and others who support the opening of our school.
Caps. States place caps on the number of charter schools that can be approved
in order to limit growth and make the chartering process more manageable for
sponsoring entities. The charter school movement is still youngschools need time to
pilot the concept, plus starting small is better because fewer people are affected if
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something goes wrong (NEA, 1993). Advocates argue that caps prohibit competition.
If only a few charter schools can be approved, districts and schools will not feel
pressured to make changes in order to attract or retain students and staff (Nathan,
1996a).
Arizona does not set an ultimate cap on the number of charter schools that
may be approved; however, it does limit the number of schools that can be sponsored
annually by each of the state boards to 25 per board. An unlimited number of charter
schools may be approved by local school district sponsors.
As noted in Table 3.1, California has exceeded its states charter school cap
(cap of 100 yet 132 schools have been approved). Will California continue to seek
waivers from the state board to allow more charter schools to open? It seems silly to
have a cap that is not enforced, yet I do not know if it is politically more feasible to
exceed the cap than it is to try and change it. Issuing waivers, such as being done now
to get around the cap, does not require the statutory change that permanently raising
the cap would. For example, if a bill was presented to alter the cap level, the
moderates and critics would be more likely to lobby against an increased cap.
Advocates support increasing the cap because that would likely result in an increase
in the number of charter schools in California (since an overall larger number of
schools would be permitted to open).
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Massachusetts increased its state cap in 1997 from 25 to 37. If it wanted to
approve more charter schools, it had to increase its cap since the maximum number of
charter schools, 25, had already been approved by the 1997 legislative session. The
new cap allowed 12 more charter schools to be approved. This is the first year that
local entities, school district in collaboration with the union, may sponsor charter
schools. Locally approved charter schools in Massachusetts may only be conversion
schools (meaning they converted from a regular school to become a charter school)
and only 13 are allowed statewide. The creation of these local partnerships are due, in
part, to lobbying efforts by moderates. Previously, the State Board of Education was
the only entity permitted to sponsor charter schools-something that moderates clearly
do not support--and now districts and unions may sponsor schools (Anderson et al.,
1997). It will be interesting to see if twelve more are approved this year causing the
state legislature to have to consider the cap issue again next year.
Michigan does not limit the number of charter schools that can be approved by
school districts, but it does limit the number of charter schools that can be approved
by universities at 150. As of July, 1997, 68 charter schools (out of a total of 115
charter schools at that time) were sponsored by 6 different universities (Michigan
Department of Education, 1997); therefore, 82 more schools could be sponsored by
universities before reaching the cap of 150.
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Funding
Each of the four states funds its charter schools differently. In Arizona,
schools sponsored by one of the state boards receive their funding directly from the
state. The level of funding is based on the same formula that the state uses to fund
school districts. Schools sponsored by school districts receive their funding from the
district-state funding flows from the state to the district to the school. Charter
schools and districts negotiate the amount of money districts may withhold to cover
services provided (some districts withhold a portion of state funding in exchange for
services they provide to charter schools) along with any additional local money (tax
levies) districts may share with charter schools (Anderson et al., 1997).
How the Four States Fund Charter Schools. Californias charter schools are
entitled to an amount of funding that is equivalent to what other schools within the
district receive. Funding flows from the state through the district to the school. Just
as is the case with district sponsored schools in Arizona, Californias charter schools
negotiate how much money the district withholds and/or shares (Anderson et al.,
1997).
Massachusetts charter schools receive their funding directly from the state.
Schools receive different amounts of funding per student based on the community in
which the student resides. The average cost per student is based on a combination of
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individual student costs. Individual student costs are set by the foundation level and
are adjusted for the student characteristics of the district in which the student resides
(Anderson et al., 1997).
Funding for Michigans charter schools flows from the state through the
sponsor to the school. Sponsors may withhold 3 percent for administrative costs.
Any extra services and/or benefits are negotiated between the charter school and its
sponsor. Charter schools receive the same amount of state aid per pupil as district
schools receive, however that amount may not exceed the statewide average.
The Funding Debate. Funding for charter schools is a hotly debated issue,
primarily among advocates and critics. Advocates argue that charter schools are able
to do more for less, meaning they receive less money (e.g., Colorado districts are
authorized by statute to provide a minimum of 80 percent of the per pupil operating
revenue for a student attending a charter schools, whereas conventional schools
receive 100+ percent for each student) than conventional public schools yet they are
expected to demonstrate better student results or they will lose their charter. Despite
the fact that they can do more for less, advocates argue that charter schools need more
money, especially to cover start-up expenses, and that states need to adjust their
school funding formulas to ensure that charter schools receive their equitable share of
state education funding (Finn et al., 1996).
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Critics, on the other hand, argue that charter school reformers claimed that
charter schools would not cost more money; however, they keep coming back each
year asking for more money, further draining resources from the conventional public
schools (Molnar, 1996). Massachusetts is the only one of the four states discussed in
Table 3.1 to recognize the financial impact that students leaving district schools for
charter schools might have on school districts. Reimbursing districts for up to three
years for projected and/or actual losses of students gives the districts time to reassess
their situations and adjust staffing and/or classroom configurations to reflect the
changes in student enrollment. What this also means is that the state of
Massachusetts is potentially paying double for every charter school studentthe
district that lost the student gets what it would have received for that student had
he/she stayed, and the students actual per pupil allocation follows him/her to the
charter school (Anderson et al., 1997).
Funds for Start-Up and Facilities. Several studies of charter schools have
found that funding start-up is the most significant challenge that charter school
organizers face (Anderson et al 1997; Finn et al., 1996; Nathan, 1996a; RPP
International & The University of Minnesota, 1997). The challenges differ between
-conversion schools and new schools, primarily in the area of facilities. Conversion
schools typically remain in the same school building they were housed in before they
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became a charter school, so they do not have to locate and/or finance a facility for
their school, nor do they usually have to pay much (if anything) to lease their
building. Schools starting as charter schools rarely receive a building from the state
or local school district. Instead, these schools must locate and usually renovate a
facility to house their school and once operational, pay sometimes up to 15 percent of
their general operating budget to lease the facility (Anderson et al., 1997).
All charter schools (conversion and new) have the challenges of paying for
initial planning and covering cash flow needs until they receive their first payment
(Per Pupil Operating Revenue) from the state or district. This differs from a regular
public school which usually receives money from the district to plan and pay for the
opening of a new school. Like any new school opening, charter school organizers
need to spend considerable time, before the school opens, doing things like planning
the curriculum, hiring and training staff, ordering equipment, recruiting students, and
so forth. They also must open their doors at the beginning of the school year, often
before they receive their first payment from the state or district. The payments charter
schools receive are their share of the Per Pupil Operating Revenue. The schedule for
paying out these funds may be inconvenient for charter schools (e.g., one school that I
interviewed for the ECS study did not receive its first check from the district until
Novembernearly three months after the school year started). This means, in addition
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to planning money, charter schools often need to have some start-up funding to cover
initial items like rent, salaries, and other general operating expenses.
Arizona is the only state, of the four displayed in Table 3.2, that provides
funding to assist charter schools with capital expenditures4 million per year which
translates to $146 per K-8 charter school pupil and $219 per charter school high
school pupil. Both Arizona and Massachusetts allocate state funding to help cover
start-up expenditures. Charter schools in Arizona may use this money as they wish,
and many have used it to supplement facility expenses. Massachusetts specifies that
the money needs to be used to support expenses associated with special education.
All states with charter schools may also apply for federal charter school funding. The
funding states receive is passed on directly to charter schools to cover start-up
expenses. Each state decides whether it wants to specify how charter schools may use
the federal money and funding amounts vary from state to state and from school to
school. California has chosen to allocate its federal funds in the form of loans, while
the other three states give the money to charter schools in the form of grants.
Massachusetts specifies that charter schools must use $10,000 of the grant they
receive to develop an accountability plan, $7 per pupil for standardized test
administration; and the remainder is unrestricted. Usually the start-up money that
schools receive is not sufficient to cover their needs, especially their facility expenses;
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therefore, many charter school organizers have used their own personal money to
cover start-up, have taken out loans, or have secured funding from private foundations
(Anderson et al., 1997).
An Example. I have firsthand experience dealing with the financial challenges
associated with starting a charter school. We were told by DPS that they would not
provide us with a facility for our charter school, nor had they provided P.S.l or the
Edison Charter School with a facility. They did, however, provide a building and new
furniture and equipment for Pioneer (the charter school started by the district) when it
opened in the Fall of 1997. The most promising facility my charter planning group
has found so far will require at least $100,000 in renovations to bring it up to code
and to transition the facility from an office building to a school. P.S. 1 is currently
raising $2.5 million to renovate a new facility since the one they have been housed in
is going to be tom down. In Colorado, charter schools do not automatically receive
any of the state funding that flows to districts for capital expenditures nor do they
necessarily benefit from local tax levies raised by districts to support capital needs.
Districts have the authority to decide whether or not they will share these funds with
charter schools. Some districts, such as Jefferson County, have shared these resources
with charter schools, while others (DPS) have not. Therefore, schools like mine and
P.S.l must raise these capital funds from private sources and/or attempt to take out a
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loan from a private lender. This raises two additional problems: (1) foundations are
often hesitant to fund capital expenses because they would rather support the
programming aspects of a school, and (2) new charter schools do not have a track
record yet so private lenders, if they will fund a charter school at all, often require
individuals who are starting the school to personally guarantee the loan, meaning that
if something happened, these individuals would be personally responsible for paying
back the loan. Also, by taking out a loan, the charter school must then allocate
resources from its operating budget to cover loan payments.
Competition for Scarce Resources. So, unlike a conversion school or a
conventional school, a new charter school must dedicate general operating dollars to
pay for leasing its facility and often repaying loans associated with renovating the
facility. And, all charter schools, unlike their conventional public school
counterparts, must also find resources to pay for other, non facility costs associated
with starting a new school or transitioning a conventional school to a charter school.
States, such as Colorado and Minnesota, are finding it difficult to fund K-12
education, given the existing enrollment and school configurations, at a level that is
consistent with the rate of inflation (Augenblick & Myers, 1996,1997). Adding more
charter schools does not necessarily increase the need for basic state funding since the
students are technically transferring from one school to another (so enrollment does
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not increase); however, funding required to renovate charter school facilities and/or
support planning and other start-up needs (such as Arizona and Massachusetts have
done) would require additional K-12 education state funding. When it comes to
additional money for K-12 education it becomes very political. Charter schools must
compete with other education advocates (e.g., special education, unions, early
childhood, technology, etc.) for those additional dollars. Because of this political
struggle, those pushing for the creation of more charter schools are going to have to
be creative and find other mechanisms, besides relying on public resources, to fund
their start-up and other ongoing operational needs.
Summary
State policies, especially in the areas discussed within this chapter
(sponsorship, including caps, and finance) can have an impact on the number of
charter schools approved within a given state and/or influence the quality of the
programs and facilities that charter schools are able to offer. States that limit the
number of charter schools that can be approved or allow only a single entity to
sponsor a charter school will likely have fewer charter schools overall. Furthermore,
states that provide extra funding for charter school start-up and/or facilities are
helping their charter schools provide better facilities for their students (than can be
provided on per pupil operating revenues alone) and/or alleviating some initial cash
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flow problems that could distract administrators and others from the task at hand-
student learning. Some states may want fewer charter schools in which case they will
enact policies to ensure that only a select number of schools open. Other states will
enact policies that allow them to have many charter schools. Locally, the success of
charter schools (or lack thereof) will guide many of these policy decisions. Federal
support and pressure may also help to influence whether more or less charter schools
will be approved. The combination of President Clintons national goal and increased
levels of federal funding for charter school start-up and implementation should lead to
an increase in the number of charter schools; however, it will be up to states to decide
whether they want these resources, whether they support Clintons goal, and/or
whether they want charter schools to be small, pilot projects or to represent a critical
massto be the impetus for large scale school reform.
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CHAPTER IV
RECOMMENDATIONS
How can state charter school policies change in order to reflect a commitment
towards meeting President Clintons goal of 3,000 charter schools by the turn of the
century? Obviously, all 3,000 charter schools are not going to come solely from the
four states discussed in this thesis; however, ways can be found so that these four
states could modify their policies and/or improve their practice of overseeing charter
schools that would likely result in an increase, not only in the number of schools but
also in the quality of schools.
Arizona
Arizonas charter school law enables a large number of schools to be
approved, it provides extra financial support to help charter schools obtain facilities
and pay for other start-up expenses and it allows three entities to approve charter
schools. These are all areas that facilitate and support an increasing number of charter
schools; however, in order to reach President Clintons goal, Arizona may need to
adjust its cap levels. If Arizona was to set a goal of 900 charter schools by the year
2000 (as discussed in Table 3.1) it would need to approve another 646 schools. Given
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the current structure, the state boards would be able to approve a maximum of 150
schools (25 per year per board x 3 years) which would mean that district sponsors
would have to approve the remaining 496 schools. To date, most charter schools in
Arizona have been sponsored by state entities, not districts (Anderson et al., 1997), so
it is unlikely that 900 schools would be approved unless Arizona increases its caps to
allow the state boards to sponsor more schools per year. Increasing the caps for these
state boards does raise a concern. Based on what I learned conducting research for
the ECS charter school finance study (Anderson et al., 1997), I know that the staffs
for these boards are currently very small (one or two people plus the board itself). I
am not confident that two staff people and a part-time board have the capacity to
oversee hundreds of charter schools effectively. Concerns have been raised by Alex
Molnar and others that Arizonas charter schools are too freesponsoring agencies
lack the capacity to hold charter schools accountable to the terms of their contract
(e.g., Edutrain school that shut down for mismanagement and financial problems,
ASCD, 1997). The state boards need to have a plan for ensuring accountability in the
schools they sponsor and for providing technical assistance and other services to the
schools as needed.
While Arizona certainly has the potential to approve more schools than other
states at this point and would be able to approve even more schools if it chose to raise
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its cap, it is unlikely that Arizona will ever have 900 charter schools. As of
1993/1994 Arizona had a total of 1133 public schools in the entire state (NCES,
1995) so for the state to have 900 charter schools it would mean that either it would
nearly double the number of total schools in the state or the majority of its schools
would become charter schools which seems very unlikely.
Initially, no financial implications or political consequences for implementing
this recommendation should exist. It only requires that the boards and their staff
members dedicate time to this issue. Eventually, if the boards decide that they do lack
the capacity and require more staff, for example, then there will be a need for more
state money (or a reallocation of existing resources) to support the changing staff
needs. Also, as the number of charter schools increases, the amount of state aid
allocated for facilities and start-up will need to increase to support the growing
number of charter schools with facility and start-up requirements. See Possibilities
for Financing Charter School Facilities and Start-Up later in this chapter for potential
strategies for funding charter school facilities and start-up expenses that do not rely
solely on public dollars.
California
I recommend several changes to Californias charter school law. First, I
recommend that the state allow another entity, besides school districts, to sponsor
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charter schools. I believe this is important for two reasons: (a) to encourage
competition; and (b) to give people who have innovative ideas and strong
qualifications another option for charter school sponsorship if they live in a district
that is anti-charter. California does have an appeals process that allows charter
applicants that have been turned down by there home district to appeal the decision to
a county district. This step is critical. I do not recommend that any state adopt a
charter school sponsorship policy that does not include an appeals process.
Second, I recommend that California lifts its cap on the number of charter
schools permitted to be approved. More charter schools are approved already than are
technically allowed by statute. If the goal is to increase the number of charter schools,
then policymakers have to make a commitment to changing the law to reflect an
interest in having more charter schools. Increasing the cap to at least 480 (as
discussed in Table 3.1) would enable California to maintain the level of charter
schools needed to reach President Clintons national charter school goal. California
has over 7700 schools (NCES, 1995) so it is not out of the question that it could have
480 schools that are charter schools. This would mean that approximately 6 percent
of its total schools would be charter schools.
Third, I recommend that the California legislature explore options for
supporting the facility and start-up needs of charter schools. See Possibilities for
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Financing Charter School Facilities and Start-Up later in this chapter for potential
strategies for funding charter school facilities and/or start-up expenses that do not rely
solely on public dollars.
The consequences of making these changes are political. Moderates will not
support an alternative sponsor because they want charter schools to be approved by
local school districts. Moderates and critics may also object to an increased cap
because it increases the risk of having ineffective, negligent, and/or poorly run charter
schools (the more schools you have, the greater the chance that some of them will be
bad). The only financial consequence of these recommendations would occur only if
the legislature decided to allocate funds to support facilities and/or start-up
expenditures. The amount would depend on the level of commitment and type of
program that the state established.
Massachusetts
I recommend two policy changes to Massachusetts charter school law. First,
I recommend they rethink their allocation for reimbursing districts that lose students
to charter schools. The state spent nearly as much reimbursing districts as it did
educating children attending charter schools. I would like to see a portion of the $30
million that currently is being spent to reimburse districts going instead towards
alleviating charter school facility and start-up needs. The state needs to look into the
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actual loss incurred when a student leaves a district for a charter school. I do not
know the answer to this question, nor was I able to find it in my research; however, I
doubt that the loss amounts to an amount nearly equivalent to the entire per pupil
operating revenue for every child attending a charter school, for three years time.
Second, I recommend that Massachusetts raise its caps for both types of
charter schools (state and locally sponsored). The caps are too low to reach the level
of charter schools the state would need to have in order to support President Clintons
plan90 schools (see Table 3.1); however, if the cap is raised, then the state board,
just as in Arizona, needs to assess its capacity to effectively sponsor a growing
number of charter schools and make adjustments as necessary. I am not familiar with
the staffing situation at the state board in Massachusetts. Currently, that board is
overseeing 25 charter schools and has the authority to oversee a maximum of 37
schools. If it is only a couple of staff people and the board itself, which handles all
education issues (as opposed to just charter school issues like the Arizona State Board
for Charter Schools), I question whether they will have the capacity to oversee an
increasing number of charter schools, unless they have sufficient human resources in
place. Such as is the case in Arizona, Massachusetts state board may be responsible
for overseeing schools from across the state.
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The goal of 90 charter schools for Massachusetts seems reasonable. If
Massachusetts had 90 charter schools that would mean about 5 percent of its total
schools would be charter schools since the state has about 1800 public schools
(NCES, 1995).
The consequences of making these changes are both financial and political.
School districts will fight efforts to reduce the impact funds they receive. Obviously,
they do not want to lose that money; however, if that money was eliminated and/or
reallocated towards something else, there would be financial implications. Moderates
are also likely to fight efforts to increase caps, especially on the schools sponsored by
the state board.
Michigan
I have two policy issues that I recommend that Michigan addresses. First,
committing resources towards funding charter school facility and start-up needs.
Currently, Michigan does not allocate any state dollars for this purpose, yet if the
number of charter schools is going to increase, the state needs to play a role in
supporting that increase. See Possibilities for Financing Charter School Facilities
and Start-Up later in this chapter for potential strategies for funding charter school
facilities and/or start-up expenses that do not rely solely on public dollars.
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Second, Michigan may want to revisit the cap level it has set for university
sponsored schools. As of July, 1997, 60 percent of the charter schools had been
sponsored by universities and the rest had been sponsored by school districts
(Michigan Department of Education, 1997). If this continues to be the ratio (60:40) in
the future, then the cap on university-sponsored charter schools would need to be
raised to at least 288 (or 60 percent of 480 schools as discussed in Table 3.1) in order
to meet President Clintons national goal. The state, if interested in meeting the
national goal, will need to revisit this issue and determine whether more or less
schools are being approved by universities or districts and adjust the cap, as
necessary. If Michigan approved 480 charter schools, then about 14 percent of
Michigans public schools would be charter schools. The total number of public
schools in the state is about 3400 (NCES, 1995). This is a higher percentage of
charter schools to regular schools than Michigan and California would have, however,
it is much lower than what Arizona would need to achieve. Fourteen percent does not
seem unrealisticdefinitely challengingbut doable it the state so desired.
If the state did choose to support facility and start-up needs, it would require
an additional commitment of state dollars. The amount would depend on the level of
commitment and type of program that the state established.
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Possibilities for Financing Charter School Facilities and Start-Up
States are already strapped when it comes to funding K-12 education, so
asking for more money to support charter school capital and start-up needs is very
difficult and very political. Allocating money for this purpose likely means taking that
money away from something else. How do policymakers decide which is more
important? This is an issue with which policymakers will have to grapple as they
make decisions whether or not to provide this support to charter schools. Advocates
will argue that other schools have access to capital funds and when a new school is
starting in a school district, the district pays for the planning and start-up, so why
should a charter school not get equal treatment? Critics will argue that more money
for charter schools means less money for other public schoolsschools that are
already having a difficult time making ends meet with what the existing resources.
One option that policymakers may want to consider is examining ways that
they can help meet the needs of charter schools without footing the entire bill. The
following are some examples of approaches that states might take to supporting
charter schools facilities and start-up needs. Some involve states fully funding the
effort while others encourage partnerships and sharing the financial burden with
others.
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Direct Allocation
This is how Arizona currently supports the facility needs for charters schools
in its state. Every charter school automatically receives a lump sum of money per
student for facilities.
Grants
In addition to the federal funding available for charter school start-ups, states
can allocate state funds for this purpose (such as in Arizona and Massachusetts).
States may decide to: (a) offer competitive grants to help charter schools with
planning and initial cash flow needs; or (b) give every charter school a set amount of
money for this purpose.
Revolving Loan Fund
California distributes its federal charter school start-up money in the form of
loans, instead of grants. When schools repay these loans, the repaid funds can then be
turned around and loaned to new schools. States may want to consider setting up a
similar type of revolving loan fund, but with state funds.
Lease Aid
Minnesota passed lease-aid legislation this year for charter schools. The state
reimburses charter schools for a portion of the amount they pay each year to lease
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their facilities. This enables charter schools to use more money on instruction and
other needs and less on facilities.
Incentives
States may want to consider giving private lenders incentives for financing
charter schools (e.g., tax breaks). Or offer incentives to public agencies/institutions
(e.g., universities, city buildings) to offer their vacant facilities to charter schools for
reduced costs.
Long Term Contracts
Lenders and foundations are more likely to support a charter school if it sees
that there is a commitment from the state or school district to fund (through basic aid)
that school over several years. For example, a lender would be more interested in
funding a school that has a contract (charter) for 10 years than one that has a contract
for two years.
Sub-Leasing
States can allow charter schools to sublease part of their school space to other
organizations if the school does not need all the space. This is a way for charter
schools to share the cost of their facilities with others.
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Federal Commitment
The federal government has committed substantial resources to getting the
charter school movement off the ground. States may apply to the U.S. Department of
Education (ED) for grants to support charter school start-up and early
implementation. In 1997, Congress allocated over $50 million dollars to support this
effort and the President just signed a bill in November, 1997 to increase that amount
to $80 million dollars for 1998. This funding will help schools considerably and may
relieve some of the pressure on states to fund charter school start-up expenditures.
However, despite the level of federal funding, states do need to address the issue of
facilities.
Summary
States need to decide if they want to support President Clintons goal of 3,000
charter schools by the year 2000. If they do decide that they want more charter
schools, then they will need to make changes, such as those recommended within this
chapter, that reflect this commitment. Changes will need to be made that extend
beyond the areas (sponsorship and finance) and/or states highlighted in this thesis.
Some of the other policy areas that need to be considered for changes, along with
recommendations for further charter schools research are discussed in Chapter V.
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CHAPTERV
CONCLUSION/AREAS FOR FURTHER RESEARCH
This thesis recommends changes to existing charter school sponsorship and
finance policies. Other policy changes may also trigger an increase in the number of
charter schools. Additional research is needed in order to determine what other
policies may need to be adjusted. As discussed in Chapter II, legislators and others
are becoming more interested in seeing evidence of charter school success before they
change policies and/or commit additional resources to this movement.
The first area of research that is needed is to expand the work started in this
thesis by looking at more states policies and experiences in the areas of sponsorship
and finance. Each states charter school law is different from the next, so the
approaches states have taken and the impact these decisions have had on charter
schools is important and useful data to extract. These data can be used to modify or
improve charter school laws nationwide since bill drafters often look to other states
policies for guidance when they are creating or modifying laws in their own states.
A second area of research would be to conduct a study similar to this one, but
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to look at different policy issues that may or may not influence the number of charter
schools approved. For example, some other areas include:
1. Who has the authority to start a charter school teachers only, anyone but private
companies, anyone?
2. Are only conversion schools allowed, can private schools convert to a charter
schools, can home schools convert to charter schools?
These issues, and the political forces that influence the issues, are central to
the number of charter schools a state will have. If the individuals/groups that are
permitted to start a charter school are limited, the number of charter schools that can
be opened are probably also limited; however, if we open up charter schools to any
group, then how do we assure a quality education?
A third area of research would be to look more in-depth at the issue of
sponsorship. States are using multiple approaches for sponsoring charter schools.
Which, if any, seem to be more effective and why?
The final area of research I would like to discuss is the area I hope to pursue
for my dissertation. I am interested in taking a more comprehensive look at charter
school finance than I was able to do in the ECS paper. Specifically, I want to look at
charter school revenues and expenditures in Colorado and attempt to compare these
revenues and expenditures with similarly situated conventional schools and/or
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districts. I feel that this study is important because there are so many rumors
circulating regarding how charter schools are spending their money, how charter
schools are costing districts money, and so forth. There are no data, however, that I
have seen to support these rumors. If we knew the answers to these questions,
policymakers would be better able to make informed decisions about funding charter
schools.
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REFERENCES
American Federation of Teachers. (1996). Charter School Laws: Do They Measure
up? Washington, DC: Author.
Anderson, A.B. (1997). Summary of My Experience as an Intern in the Colorado
House of Representatives During the 1997 Legislative Session. Unpublished
manuscript.
Anderson, A.B., Augenblick, J., & Myers, J. (1997). Charter School Finance:
Policies. Activities, and Challenges in Four States. Denver, CO: Education
Commission of the States.
Association for Supervision and Curriculum Development. (1997, August). Debating
Charter Schools: Will They Revitalize or Undermine Public Education?
Education Update. 39. (5).
Augenblick, J., & Myers, J. (1997). Profile of Changes in Colorado School Funding
1988-89 to 1995-96. With a Comparison of 1995-96 to 1993-94 and to 1994-
95. Denver, CO: Augenblick & Myers, Inc.
Augenblick & Myers, Inc. (1996). An Analysis of Changes in School Funding in
Minnesota Over the Past 20 Years. St. Paul, MN: Minnesota School Boards
Association
Banks, D., & Hirsch, E. (1997). The Charter School Roadmap. Denver, CO:
Education Commission of the States.
Bierlein, L. (1996). Charter Schools: Initial Findings. Denver, CO: Education
Commission of the States.
Bierlein, L., & Fulton, M.F. (1996). Emerging Issues in Charter School Financing.
Denver, CO: Education Commission of the States.
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Bierlein, L., & Mulholland, L.A. (1995). Charter School Update & Observations
Regarding Initial Trends and Impacts. Tempe, AZ: Arizona State University,
Morrison Institute for Public Policy.
Caudell, L.S. (1997, Spring). The Northwest Has Spawned a Handful of Charter
Schools, but Educators and Legislators Across the Region are Joining the
Debate. Northwest Education Magazine. 5-7.
Center for Education Reform. (1997). The Charter School Workbook. Your
Roadmap to the Charter School Movement Washington, DC: Author.
Finn Jr., C., Manno, B.V., & Bierlein, L. (1996). Charter Schools in Action: What
Have We Learned? Indianapolis, IN: Hudson Institute.
Fuller, B. (1996, October). Is school choice working? Educational Leadership. 54
(2), 37-40.
Garcia, G.F., & Garcia, M. (1996). Charter Schools-Another Top Down Innovation.
Educational Researcher. 25181. 34-36.
Kaprowicz, C., Medler, A., & Weston, M. (1996). Charter Schools: What is It That
Everyone is Supporting? Unpublished manuscript.
McGree, K. (1995). Charter Schools: Early Learnings. Insights on Educational
Policy and Practices. Austin, TX: Southwest Educational Development
Laboratory.
McKinney, J.R. (1996, October). Charter Schools: A New Barrier for Children with
Disabilities. Educational Leadership. 54(21 22-24.
Michigan Department of Education. (1996, February). Michigan Public School
Academy Listing. Lansing, MI: Author.
Millot, M.D., Hill, P.T., & Lake, R. (1996, June 5). Charter Schools: Escape or
Reform? Education Week., p.15.
Molnar, A. (1996, October). Charter Schools: The Smiling Face of Disinvestment.
Educational Leadership. 54 (2), 9-15.
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Nathan, J. (1996a) Charter Schools: Creating Hope and Opportunity for American
Education. San Francisco, CA: Jossey Bass.
Nathan, Joe. (1996b) Early Lessons of the Charter School Movement. Educational
Leadership. 54(21.16-20.
Nathan, J., & Power, L. (1996, April). Views on the Charter School Movement
Minneapolis, MN: University of Minnesota, Hubert H. Humphrey Institute for
Public Affairs, Center for School Change.
National Education Association. (1993). NEA Action Plan for Shaping Charter
Schools: Criteria for Charter Schools. Washington, D.C.: Author.
National Center for Education Statistics (NCES). (1995). Digest of Education
Statistics. (ED Publication No. NCES 95-029). Washington, DC: U.S.
Department of Education, Office of Educational Research and Improvement.
O'Neil, John. (1996, October). New Option, Old Concerns. Educational Leadership.
54(2), 6-8.
RPP International, & University of Minnesota. 09971. A Study of Charter Schools:
First Year Report. (ED Publication No. SAI 97-3007). Washington, DC: U.S.
Department of Education.
Vanourek, G., Manno, B.V., Finn, C. E., & Bierlein, L.A. (1997, June). Charter
Schools As Seen bv Those Who Know Them Best: Students. Teachers, and
Parents. Washington, DC: Hudson Institute.
Wagner, T. (1996, October). School Choice: To What End? Phi Delta Kappan. 78
(1), 70-71.
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Full Text

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THE CHARTER SCHOOL MOVEMENT: WHO CONTROLS ITS DESTINY? by Amy Berk Anderson B.A., University of Wisconsin-Madison, 1990 A thesis submitted to the University of Colorado at Denver in partial fulfillment of the requirements for the degree of Master of Arts Education 1998

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This thesis for the Master of Arts degree by Amy Berk Anderson has been approved Date

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Anderson, Amy Berk (M.A., Education) The Charter School Movement: Who Controls its Destiny? Thesis directed by Professor Rodney Muth ABSTRACT Charter schools are publically funded schools that can waive many of the restrictive and bureaucratic rules and regulations that govern conventional public schools. The first charter school legislation was passed in Minnesota in 1991. Since that time, nearly thirty states have passed charter school legislation and hundreds of charter schools are operating nationwide. President Clinton has called for 3,000 charter schools by the turn of the century. As of September 1997 nearly 850 charter schools had been approved nationwide; therefore, 2,150 more charter schools will need to open by the year 2000 in order to meet the President's goal. What will it take to meet this goal and who will influence the success and/or failure of this endeavor? This thesis explores the political forces that influence the charter school movement (the views and actions of the advocates, moderates, and critics), analyzes current charter school policies, and recommends specific changes to state policies that would lead to an increase in the number of charter schools. This abstract accurately represents the content of the candidate's thes end its publication. RodneyMuth iii

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CONTENTS CHAPTER: I. INTRODUCTION ............................................ 1 Research Design ......................................... 7 Organization of the Study ................................. 9 II. THE POLITICAL INFLUENCES ON THE CHARTER SCHOOL MOVEMENT ............................ 11 Advocates ............................................. 11 Positive Results . . . . . . . . . . . . . . . . . 13 Barriers . . . . . . . . . . . . . . . . . . . . 17 Moderates ............................................. 20 Requirements for Charter School Laws ................. 21 Critics ................................................ 26 Concerns with Charter Schools ....................... 26 Financial Supporters ..................................... 32 IV

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CONTENTS ( cont) Policymakers ........................................... 33 "Neutral" Players ........................................ 35 Summary ............................................... 38 III. A COMPARISON OF STATE CHARTER SCHOOL POLICIES .... 40 Key Findings from Table 3;1 ............................... 43 Key Findings from Table 3.2 ............................... 46 Funding ......................................... 46 Sponsorship/Caps ................................. 4 7 Impact of Sponsorship and Finance Policies .................. 48 Sponsorship ....................................... 48 Funding ......................................... 56 Summary .............................................. 63 IV. RECOMMENDATIONS ..................................... 65 Arizona ............................................... 65 California .............................................. 67 Massachusetts .......................................... 69 v

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Michigan .............................................. 71 Possibilities for Financing Charter School Facilities and Start-Up .. 73 Direct Allocation .................................. 74 Grants ........................................... 74 Revolving Loan Fund ............................... 74 Lease Aid ....................................... 74 Incentives ........................................ 75 Long Term Contracts .............................. 75 Sub-Leasing ..................................... 75 Federal Commitment ..................................... 76 Summary .............................................. 76 V. CONCLUSION/AREAS FOR FURTHER RESEARCH ............ 77 REFERENCES ..................................................... 80 VI

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TABLES Table 3.1 Total Number of Charter Schools as of January, 1997 and Projections for the Future .................................... 41 3.2 Selected Charter School Policies in Four States ...................... 45 Vll

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CHAPTER I INTRODUCTION The term "charter school" stems from a metaphor that was used by an educator named Ray Budde (Nathan, 1996a). He recommended that schools give teachers "charters" --opportunities to create innovative programs in schools and districts--and like the early explorers did when they traveled to new lands, the teachers would report back their findings from these charters to the rest of the school district. Chartering was an opportunity to pilot teaching and learning reforms that, if successful, might then be used to benefit other schools within the district. In 1988, the late Al Shanker, former President ofthe American Federation of Teachers, took Budde's idea one step further, recommending that entire schools should be chartered, not just individual, independent programs. Today, charter schools are publically funded schools that can waive many of the restrictive and bureaucratic rules and regulations that govern conventional public schools. Unlike conventional public schools, charter schools are held accountable, at the school level, for achieving educational results, in exchange for the freedom from various rules and regulations. -1-

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The charter school movement was designed to accomplish four goals (Nathan, 1996a): 1. To provide choice among public schools for families and their children. 2. To foster entrepreneurial opportunities for educators and parents to create the kinds of schools they believe make the most sense. 3. To make schools explicitly responsible for improving achievement, as measured by standardized tests and other measures. 4. To introduce carefully designed competition into public education. In 1991, Minnesota became the first state to pass charter school legislation, allowing a total of eight charter schools to be opened. This legislation evolved out of several years of work, both within Minnesota and at the national level, to design, promote, and implement public educational programs, schools, and initiatives; to give parents more public school options; to offer non-traditional educational programs; to deregulate education; and to involve parents and community members more in schools. The following were among these earlier programs/initiatives (Nathan, 1996a). 1. The St. Paul Open School, the City As School in New York, and other innovative schools created in the late 1960s/early 1970s by parents, teachers, and community members. These schools were initiated at the grassroots level and -2-

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pioneered ideas such as internship programs, site based decisionmaking, and meaningful family involvement. 2. The national magnet school program, initiated by Congress in the mid1970s, allocated funding to states to create schools of choice within school districts as a means of promoting racial integration and choice within communities. Charter school advocates argue that this reform did not assist with deregulation, in fact they believe it increased the bureaucracy in some ways; however, it did provide more choices. 3. Alternative schools, created in the late 1970s/early 1980s, serving at risk/troubled students that were having a difficult time within the regular schools. 4. Minnesota's extensive, statewide, school choice program, created in the late 1980s (with many other states following Minnesota's lead). This program introduced ideas such as postsecondary options (allowing high school students to take college level coursework, paid for through state funds that otherwise would have been spent on these students at the high school level); options to attend other public schools (allows students who are not succeeding at schools within their district to transfer to schools in other districts with the money to pay for that students education, following him/her to the new district); and open enrollment (allowing K-12 students to attend a school in another district, with their funding following them to that district, -3-

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as long at the receiving district has room and the transfer does not increase racial segregation). The popularity of Minnesota's and other states' public school choice programs led to increased public interest and support for public school options; however, the opinion of a rising number of people at the time (educators, parents, legislators) was that not enough districts were offering sufficient options for people to choose frommore choices of public schools were needed. Furthermore, some of the early pioneers of innovative, grassroots school choice initiatives, such as those discussed above that were started in the late 1960s/early 1970s, were frustrated with the increasing lack of control they had at the school level over such factors as staffing and budgeting and that the system needed to be further deregulated (Nathan, 1996a). Minnesota Senator, Ember Reichgott, along with a group of education and community advisors, introduced the first charter school legislation in 1990. This legislation reflected the ideas of Ray Budde, Al Shanker, national pioneers of innovative schools of choice, and other education and community members from Minnesota. Reichgott's bill passed the Senate that year but not the House. She introduced a revised bill in 1991. The revised legislation primarily reflected the input and concerns from groups that had lobbied against the 1990 bill, such as the Minnesota Education Association (MEA) and the Minnesota School Board -4-

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Association (MSBA). Eventually, the bill passed in both the Senate and the House but not before further amendments, again reflecting the interests of the MEA, MSBA, and others, had been made--despite significant protests from charter school advocates that these changes were watering down the original intent of the legislation too much (Nathan, 1996a). Since 1991, Minnesota's charter law has changed significantly, and at the national level the charter school movement has grown considerably. As of September 1997, 27 states had passed charter school laws, 780 charter schools were operational in those states, and 69 more had been approved to open (Center for Education Reform, 1997). Charter schools are currently being evaluated at the national and state levels to assess their effectiveness, are receiving financial support from federal, state, and private sources, and are the topic of much public debate. The public (educators, parents, policymakers, and others) is increasingly interested in learning more about charter schools (e.g., whether they are more cost efficient than and/or if their students are achieving at higher levels than their conventional counterparts, the types of educational programs that are offered, whether parents and students are satisfied with their charter schools, how to start a charter school, and so forth). Some data and a plethora of anecdotal information, answering some of these questions, are now available through a variety of sources such as reports from researchers evaluating -5-

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charter schools; books, articles, and guidebooks on charter schools; television reports and debates discussing charter schools; and conferences on charter schools. What is less certain is where the charter school movement is heading. What is in store for the future? Will the number of charter schools continue to grow, and at what pace? President Clinton has called for 3,000 charter schools to be established by the year 2000 (RPP International & The University of Minnesota, 1997), but is this realistic? In six years (1991-1997), 850 charter schools have been approved. If President Clinton's goal of3,000 is reached, an additional2,150 charter schools will need to be approved by the year 2000. According to A Study of Charter Schools. First Year Report, the expansion of charter schools is dependent on state and local factors such as: (a) how many additional states enact charter school legislation, (b) whether states with existing charter school laws will permit more charter schools to be formed, and (c) whether policymakers and the public believe charter schools are successful and worth expanding (RPP International & The University of Minnesota, 1997). The purpose of this thesis is to: (a) explore the political forces that influence the charter school movement; (b) analyze current charter school policies; and. (c) propose changes to state policies that reflect the interests of multiple stakeholders and lead to an increase in the number of charter schools. My analysis of current policies -6-

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and recommended changes will focus on two charter school policy areas: sponsorship and finance. Research Design Data for this thesis were obtained from several sources, including a review of the literature, hands-on research, telephone interviews, and document review. The overall purpose of this data collection and analysis was to learn: (a) how charter school policies differ across the states; (b) who is supportive and/or critical of charter schools and why; (c) what challenges have charter schools encountered in the areas of funding and sponsorship; and (d) what state or federal policy actions, specifically concerning funding and sponsorship, have facilitated the growth and/or the suppression of the number of charter schools developed. The literature review included national and state evaluations of charter schools, a book on charter schools, articles from educational journals, newspapers, policy briefs, and the Internet. These data provide a general overview of the charter school movement, offer a national perspective on the activities and challenges of charter schools, and describe the opinions/positions of those in favor of and/ or opposed to charter schools. -7-

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I conducted hands-on research with an existing charter school in Colorado (P.S.l) and a charter school planning group (The Odyssey School's charter school application was approved by Denver Public Schools [DPS] in January 1998). I wanted to work closely with charter schools so that I could gain a first-hand understanding of the key issues and challenges that charter schools face. I spent many hours with both of these charter schools writing a significant portion of Odyssey's charter school application (including its budget); fundraising for both schools; participating in board meetings; developing student and sponsor evaluation tools for P .S.l's student internship program; interacting with DPS school board members, and staff to clarify charter school application requirements and expectations and to respond to their questions about the application; investigating potential facility sites for Odyssey; and involving parents and community members in both of the schools. I now understand some of the significant issues and challenges that charter school operators and planners experience and am confident that this knowledge makes my recommendations for policy changes more credible. Additionally, I recently prepared a report on charter school finance for the Education Commission of the States (Anderson, Augenblick, & Myers, 1.997), that required me to conduct phone interviews with charter school operators (people working in charter schools), technical assistance providers (people working directly -8-

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with charter schools), state-level staff people (either the finance or charter school person at the Department of Education), and charter school sponsors (school districts or other entities sponsoring charter schools) in four states (Arizona, California, Massachusetts, and Michigan). The purpose of this research was to inform policymakers and others about charter school finance issues and to identify areas for further research. In addition to the results from the interviews, the report contained an analysis of charter school budgets that were collected from the interviewees. These data describe how charter schools are funded in four states and discuss the financial issues, challenges, and successes of selected charter schools in these states. Organization of the Study Chapter II discusses the political forces that have influenced the charter school movement--who has been involved and what roles have these entities played in shaping current charter school policies--and highlights the advantages and disadvantages of charter schools that have been raised in the literature. Chapter III compares charter school activities and policies, with an emphasis on sponsorship and funding, across four states. Key findings from these data are highlighted, including a comparison of the similarities and differences across state -9-

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policies, followed by a discussion of the influences that these policies have on the charter school movement. Chapter IV offers policy recommendations within the areas of sponsorship and funding that could facilitate an increase in the number of charter schools. The consequences of adopting these recommendations also are noted. Chapter V discusses ideas for further research so that more can be learned about charter schools, including their effectiveness, structures, activities, and how they compare to non-charter schools. This Chapter also identifies the research area that I am most interested in pursuing for my dissertation. -10-

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CHAPTER II THE POLITICAL INFLUENCES ON THE CHARTER SCHOOL MOVEMENT As discussed in the introduction, the charter school movement evolved out of several years of reforms aimed at increasing the choices of public schools available for parents. Along the way, public school choice has had both proponents and opponents, as have charter schools since they are a form of public school choice. These individuals and groups have been key players in shaping the charter school policies we have today. Some of the most vocal national players in the charter school movement are discussed below. Advocates Advocates are organizations/individuals that are in favor of increasing the number of charter schools and believe that when freed of bureaucratic rules and regulations, charter schools are a viable solution to the problems facing public education. These advocates influence the charter school movement by emphasizing the positives of charter schools (what is working), discussing the impediments to creating and implementing charter schools, and identifying how state and federal -11-

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policies could be modified to better support charter schools. Most advocates are not currently part ofthe K-12 education establishment (with the exception of those individuals that are operating, teaching, or sending their children to charter schools). They may have been part of the establishment (e.g., as teachers or administrators) at one point in their lives, but now they are primarily researchers in universities or employed by think tanks or other types of educational policy and research organizations. Many of the prominent players are cited below in the summary of the literature. Chester Finn and Greg V anourek are both employed by the Hudson Institute, a conservative think tank; Louann Bierlein works for the Governor of Louisiana and is a consultant to the Hudson Institute; and Joe Nathan runs the Center for School Change at the Humphrey Institute for Public Policy at the University of Minnesota. Other advocates that are not cited, but influence the movement include Eric Premak, a California-based consultant who works directly with charter school operators and offers advice nationally on charter school policy issues; and Ted Kolderie, a Minnesota-based consultant who provides advice nationally on charter school policy issues and coordinates the Charter Friends Network, a national group of charter school technical assistance providers. -12-

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Positive Results According to the literature written by advocates, charter schools are yielding positive results, including serving diverse student bodies; engaging parents, teachers, and communities in their schools; influencing non-charter public schools and districts; improving student achievement; using resources more effectively; creating innovative educational programs; and increasing accountability. Serving Diverse Student Bodies. Charter schools are serving diverse students from all ethnic and socioeconomic backgrounds and of multiple ability levels, including children of all ages, races, and genders; children from private, public, and "home" schools, children with learning disabilities, limited English proficiency, and other special needs, and children from families in all income brackets. (Finn, Manno, & Bierlein, 1996; V anourek, Manno, Finn, & Bierlein, 1997). Engaging Parents. Teachers. and Communities in their Schools. Charter schools are attracting terrific, often unconventional teachers who fulfill many other functions (besides teaching) within the schools. Teachers choose to work in charter schools because they have more freedom and flexibility than they would in non charter schools, they like the smaller, family-like atmosphere charter schools offer, they have more control over decisions and resources, and they believe that charter schools force them to be more accountable (Vanourek et al., 1997). -13-

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Parent and student satisfaction is high in charter schools and most charter schools have waiting lists. Often, parents are involved in the creation of charter schools, as founders. Parents choose charter schools because they are safer or more orderly, have committed teachers, offer smaller classes, or encourage higher standards and student performance. Charter schools benefit from high parent involvement and find creative ways for all parents to participate (Finn et al., 1996). Influencing Non-Charter Public Schools and Districts. Fair competition helps stimulate improvement in public education systems, for example, after the introduction of charter schools into several school systems, school boards and districts created programs and options to respond to the interests and needs of parents. Parent and teacher-supporters of innovative education programs have long been advocating for district action without success and believe that the pressure of a potential charter school forces some districts to act (Bierlein, 1996; Nathan, 1996b ). Improving Student Achievement. The Sacramento, California school board recently extended the Bowling Green Charter School's contract after students showed improvements in achievement, attendance, and behavior. Five years ago, prior to becoming a charter school, this school was one of the three lowest achieving schools in the district (Nathan, 1996b ). -14-

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Among students performing "poorly" in their previous school (according to their parents), nearly half are now doing "excellent" or "above average" work in their charter schools. The number of students doing "excellent" or "good" work rose 23% for African-Americans and 22% for Hispanics after emolling in charter schools and similar gains were made for low income students of all races (V anourek et al., 1997). Vaughn Next Century Learning Center, a charter school in Los Angeles that converted from a regular public school to a charter, reported that since becoming a charter school their language arts scores improved from the 9th percentile to the 39th, and their math scores increased from the 141h percentile to the 57th (Bierlein, 1996). Using Resources More Effectively. Charter schools are avoiding putting up costly new buildings or making expensive renovations to house students. Instead, they are sharing resources with other community agencies (e.g., sharing a church building with a congregation that does not need the building during the week or utilizing local recreation centers or libraries instead of building a gym or library in the school) or renting non-traditional facilities that are vacant in the community (e.g., one school is housed in an old grocery store) (Nathan, 1996b ). By utilizing contracted services, charter schools are able to do more for less and have money left over to commit to other needs. For example, the Fenton Avenue School in California, a conversion school, contracted with a catering company to -15-

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manage their food services program instead of using the district's food service program. The management team utilized practices that resulted in savings to the school. These savings enabled the school to purchase additional equipment, increase the salaries of the food staff, add additional staff people, and offer more food choices to students (Finn et al., 1996). Creating Innovative Educational Programs. Charter schools across the country hardly resemble a one-sizefits-all model. The schools' philosophies and approaches vary considerably, they are each distinctive in important ways, and their innovations are extensive. While it is true that many of the educational approaches that charters are taking can be found in conventional schools around the country, there are not enough of those conventional schools to keep up with the demands of families. Charter schools provide the opportunity to bring those unique educational programs to communities nationwide without having to rely on or wait for the school district to do it (Finn et al., 1996). Increasing Accountability. The charter that each school negotiates with its sponsoring agency must designate areas in which students will increase their skills and overall academic performance and identify how that performap.ce will be measured. Charters typically have terms of three to five years. Schools that fail to meet the terms of their contract may be closed by the sponsoring agency (Nathan, -16-

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1996a). Teachers believe that charter schools encourage them to be more accountable than their peers teaching in conventional schools. Charter schools have higher academic and personal conduct standards for all students--they are expected to take responsibility for their own learning and behavior (Finn et al., 1996). Barriers According to the advocates, significant barriers prevent increasing the number of charter schools. If policy changes are not enacted to address these barriers, they believe fewer charter schools will open and, therefore, it would be less likely that the number of charter schools operating in the United States would increase to the level proposed by President Clinton. These barriers include "weak" charter school laws, insufficient funding, lack of resources for facilities and start-up, and limited sponsoring entities. "Strong" versus "Weak" Charter Laws. More charter schools are operating in states that have "stronger" charter school laws. Laws are stronger in states that give charter schools more autonomy, for example, they do not limit the number of schools permitted, they do allow blanket waivers, permit multiple entities to sponsor charter schools, encourage educators and community members to start charter schools, and so forth. Weak laws may limit the number of schools that can be approved, only allow -17-

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teachers to start charter schools, or permit only one sponsoring agency (Bierlein & Mulholland, 1995). The charter school concept will reach its potential only if the details of charter legislation are right and more states adopt the policies and practices found in strong laws (Nathan, 1996a). Funding. Most charter schools do not receive their share of public education funds. Because of sticky negotiations, overhead charges, and lack of autonomy, most charter schools wind up with less money per pupil than their conventional school counterparts. Serious support of charter schools will entail revising many aspects of public education finance (Finn et al, 1996). Facilities and Start-Up. Most charter schools cannot access local money to construct or renovate buildings. Instead, they must raise additional funds or pay for their facilities expenses out of their general operating budget. The absence of capital funding, lack of access to conventional school facilities, and limited start-up money to cover initial equipment, planning, and operations is the most significant issue charter schools face (Nathan, 1996a). The recent arrival of some federal funds for charter school start-up has provided modest relief to a limited number of schools. No state has yet proposed a serious solution to the start-up funding problem (Finn et al., 1996). Sponsorship. In addition to the local school board, states need to give at least one other group the authority to sponsor charter schools. Often local school districts -18-

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are not in favor of charter schools, so if they are the only entity approving charter schools, fewer schools will be chartered in those "anti-charter school districts." Too, having additional entities, such as a university, sponsor charter schools facilitates partnerships between K-12 and higher education and introduces competition into the system (Nathan, 1996a). School boards should not be bypassed but instead need to be reformed into community agencies that oversee charter schools proactively. These agencies will ensure that every child has access to a school, that parents have information on schools and can make informed choices, and that a connection exists between what children are taught at different levels of education across schools. Charter school laws need to transform local boards from operators of a bureaucracy into managers of a system of individual schools, each with its own mission, clientele, and basis of accountability (Millot, Hill, & Lake, 1996). Charter school advocates are organized and committed to seeing this reform succeed. They write about charter schools in educational journals, newspapers, and books; host discussion groups on the Internet; produce manuals and guides to assist charter school organizers; lobby at the state and national level; present at conferences; and so forth. Charter school advocates will continue to push for policy changes that -19-

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facilitate the continued growth and success of charter schools as fully autonomous entities. Moderates Moderates include primarily educational associations (National Education Association, American Federation of Teachers, National School Boards Association, National Association of Secondary School Principals, and so forth) that support charter schools only if certain criteria are met. Moderates, for example, are typically more in favor of what the advocates call "weaker" charter schools laws because these laws blend features of the existing educational system (e.g., collective bargaining, hiring certified teachers) with features of the charter movement (e.g., encouraging choice, allowing teachers to start new schools). Also, controls remain in the laws that moderates support (e.g., caps on the total number of charter schools permitted). Some of these entities have developed position papers on charter schools, detailing what must be present in a charter school law in order for their associations to support it. Over the years, at least one of these organizations has changed its position on charter schools. The National Education Association (NEA) was not originally supportive of charter schools and spent a considerable amount of time fighting charter legislation (Nathan, 1996a). Over time, however, the NEA and others have warmed up to the -20-

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idea of charter schools, if, as discussed above, the schools adhere to specified rules and regulations. Charter schools can become change agents within public school systems by charting new and creative ways of teaching and learning. Or they can allow unprepared people to start schools and undermine education. Whether charter schools are a positive or negative force depends on how state charter laws are written and applied. (NEA, 1993, p. 2) Requirements for Charter School Laws As the quote above exemplifies, moderates are more likely to support charter schools in a given state if that state's legislation includes certain features, such as setting an appropriate length for the charter contract, ensuring the use of standards/assessments, limiting the number of charters that can be approved; allowing sponsorship only by school districts; using collective bargaining, hiring only certified teachers; making all information available to the public, providing equal access and opportunity for all children, establishing a representative governance structure, and limiting who can apply for a charter. Length of Charter. Charter schools should be chartered for no more than five years. As experiments, charter schools need time to prove themselves, to be periodically assessed, and to measure progress towards meeting their educational goals (NEA, 1993). -21-

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Standards/Assessments. Charter schools must ensure that their students meet challenging state standards and offer the same assessment measures (e.g., tests) as regular public schools (AFT, 1996). Given the deregulated nature of charter schools, they more than regular public schools, should have clear goals, a plan for achieving those goals, and mechanisms for measuring progress towards meeting those goals (NEA, 1993). In addition to the NEA and the AFT, the Council of Chief State School Officers (CCSSO), the National Association of Secondary School Principals (NASSP), and the National School Board Association (NSBA) all agree that charter schools should participate in all state and district assessment and reporting programs (Koprowicz, Medler, & Weston, 1996). Limiting the Number of Schools. Given that charter schools are experimental, states should limit the number of charter schools approved. Doing this, provides an opportunity for field testing the idea before expanding a practice that may not be educationally sound (NEA, 1993). Sponsorship. If charter schools are going to have an opportunity to influence other public schools, there must be a connection to the local district. Charter schools should have the approval oflocal school districts (AFT, 1996). Local school boards should grant final approval to charter schools. Keeping this decision at the local level reinforces local control and accountability of charter schools (NEA, 1993). -22-

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Collective Bargaining. Charter school laws should protect the rights of employees to bargain. Charter schools should be used as opportunities to strengthen the collective bargaining process, expanding the possibilities ofbargaining into new areas (NEA, 1993). Collective bargaining assures the rights of teachers. Charter school employees should be covered by the collective bargaining agreement. Charter school laws that are designed to destroy the collective bargaining rights of teachers serve a political, not an educational, purpose (AFT, 1996). Certified Teachers. Charter schools should be required to hire certified teachers. Although certification does not ensure that someone will be a good teacher, it does ensure a minimum level of competency. Teachers in charter schools may either have their certification already or be in the process of obtaining alternative certification (AFT, 1996). According to the CCSSO and the NSBA, charter schools should not have complete control over their staffmg decisions (Koprowicz et al., 1996). Charter schools must hire only certified teachers. Hiring uncertified teachers lowers the standards of the education profession (NEA, 1993). Public Information. Just as other public agencies must do, charter schools should be required to make information available to the public, including demographic information on students and staff, the number of special needs students served, annual financial records, results of achievement tests, attendance rates, student -23-

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mobility rates and staff turnover, parental outreach efforts, and graduation rates. Meetings of charter school boards should also be open to the public, similar to meetings of regular school district boards (AFT, 1996). Equal Access & Participation. Charter schools should not be allowed to charge tuition or fees. This will prevent lower income families from being able to attend the schools and/or participate in school activities (AFT, 1996 & NEA, 1993). Recruiting parents to sign contracts guaranteeing a certain level of participation in the school are a common feature in charter schools. This requirement may prevent the enrollment of children from disadvantaged populations. Parent involvement should not be used as a proxy for race or class-based screening. Charter school legislation should ensure the widest participation of students and prohibit the development of a system that chooses the best students from the system to attend charter schools and leaves the others behind in failing schools (AFT, 1996). Charter laws should require that charter schools be as ethnically diverse as the broader communities in which they are located. Charter school applications should specify how the school will recruit students from diverse backgrounds. Charter schools should not increase racial and socioeconomic segregation (NEA, 1993). Governance. It is essential that practitioners and representative community members are involved in the governance of charter schools. This must be spelled out -24-

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in law or charter schools may end up being undemocratic, dominated by non educators, top-down, or not representative of the communities they serve (NEA, 1993). Charter school advocates argue that a benefit of charter schools is the greater role that teachers can play in the governance of their schools; however, an examination of various states' charter school legislation fails to demonstrate that teachers will have a fundamentally different role and/or be assured greater professionalism in charter schools (AFT, 1996). Applicant Qualifications. A charter school should be nonsectarian, nonreligious, and not home-based. Charter school applications should be submitted by licensed, public school educators in conjunction with parents and community members but should not include those running for-profit businesses. A school converting to charter status must have at least two-thirds of the teachers sign the charter application or 20 percent ofthe teachers in that district (NEA, 1993). The AFT and the NSBA both oppose the idea of having home schools apply to become charter schools, the NSBA does not agree that for-profit organizations should be allowed to become charter schools, and the AFT and the NSBA both agree that private schools should not be allowed to become charter schools (Koprowicz et al., 1996). Moderates have tremendous political influence, so if charter legislation does not include the qualities specified above, it is very likely that these associations will -25-

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band together and put political pressure on legislators to oppose amendments to existing laws and/or prevent the passing of new charter laws. Critics A vocal group of charter school critics is emerging. Many of these individuals are the same people who are critical of school choice and see charter schools as another arm of the school choice movement. Critics of the charter school movement are primarily university researchers and/or district leaders (e.g., superintendents) who fear that charter schools will not spark innovation and improve the public system, as advocates contend, but instead will drain resources from the public schools and lead to an inequitable and inconsistent educational system. Concerns with Charter Schools The most vocal charter school critics are not supportive of school choice in any form, including charter schools. They tend to raise issues and concerns about the negative impacts choice can have on communities and schools. Central to their arguments are the following issues. Competition. Competition alone will not improve instruction. It is unclear how the introduction of competition will make teachers better teachers or improve the -26-

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amount of resources available for teachers to utilize in their classrooms (Molnar, 1996). Charter school advocates argue that parents will choose a school for their child based on the quality of that school's educational program. This assumes that parents know an effective school program when they see one. Parents choose schools for many reasons other than the school's academic program, including location, child care availability, work schedules, and after-school activities. So, if a charter school is not convenient, even if the educational program is fantastic, parents still may not choose to send their child there. Plus, the idea that a market-driven system will automatically create a multitude of options for families, especially in low income areas, is unrealistic (Molnar, 1996). "A free market isn't always free and doesn't necessarily guarantee a better product" (Wagner, 1996, p. 70). School choice by itself has not produced significant improvements. Often, parents do not get their first choice of school and the majority of the schools seem virtually interchangeable and mediocre (Wagner). Competition and the creation of new charter schools is leading to segregation in our society and making it more difficult for us to create school systems that work. It is unrealistic to manage effectively thousands of schools. Fixing existing schools must be the priority (ASCD, 1997). It is doubtful that a small number charter schools will create a market environment large enough to encourage over 85,000 public schools to change (Garcia & Garcia, 1996). -27-

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Equity. Charter schools are not adequately serving the needs of children with disabilities. Children requiring special education services have been turned away from charter schools and charter school operators lack sufficient knowledge of federal and state special education laws and procedures (McKinney, 1996). School choice, including charter schools, can lead to racial and economic segregation. The people who benefit from choice are those who are most aggressive, resourceful, and committed. The wealthier, more highly educated families will flee neighborhood schools for schools of choice, leaving the lower income families behind. Neighborhood schools will have difficulty sustaining such a loss (O'Neil, 1996). Others worry that charter schools will become dumping grounds for students who have been unsuccessful in the conventional public education system (Caudell, 1997). A growing concern emerging out of charter schools is that low income families will not have the time or fmancial resources to commit to charter schools; therefore, these families will be denied access to charter schools (McGree, 1995). Students suffer with an experiment such as charter schools. Students in charter schools risk educational disruption, that their non-charter school peers do not, when a charter school fails to live up to the terms of its contract. Those children must then be transferred to a new school or remain in a school that is failing to educate them properly (Caudell, 1997). Introducing competition into public education goes against -28-

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the purpose of public education which is to "transmit democratic values and ensure equity for all" (Garcia & Garcia, 1996, p. 35). Duplicating the System. Charter legislation simply creates another layer of bureaucracy. Eventually, charter schools will evolve into a bureaucratic system, with rules and regulations, duplicating the current public education system. States should fix the existing system instead of creating new ones (Caudell, 1997). If bureaucracy is one of the problems of public schools, then we should focus on fixing the system and making it less bureaucratic rather than abandoning public schools by creating charter schools (Garcia & Garcia, 1996). Vouchers. Charter schools are a "foot in the door ofvouchers." Charter schools are leading this country towards an increasingly privatized system of education (Caudell, 1997). Charter schools, like private school vouchers, are built on the assumption that our society can be held together solely by pursuing our self interests and fulfilling our individual purposes (Molnar, 1996). Student Achievement. It is difficult to measure the overall impact choice has had on students, or the system as a whole, and little evidence is available indicating that students in schools of choice are learning more than those who remain in neighborhood schools (Fuller, 1996). Advocates claim that charter schools integrate reforms that have been tried over the past decade; however, little evidence exists that -29-

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these reforms have had a positive impact on student achievement (Garcia & Garcia, 1996). Accountability. Many charter laws allow just about anyone to open a charter school. This is analogous to letting anyone who wants to provide health care to do so, regardless oftheir background and/or expertise in the field (Molnar, 1996). By freeing charter schools of the legal requirements placed on public schools, they do not have to operate in open meetings or otherwise be open to public scrutiny. This makes it difficult for the public to hold charter schools accountable--they lack the information to do so (Molnar, 1996). Lack oflnnovation. Foes of charter schools believe that charter schools will be no more innovative than existing schools, which taken as a whole are not very innovative (AFT, 1996). Teacher Qualifications/Unions. States that allow uncertified teachers to teach in charter schools are providing a disservice to their students. Virtually any adult in these states, regardless of background, can teach or administer a charter school. For charter school advocates, charter schools provide an opportunity to break up teachers unions and lower wages as an education reform strategy. Just as is seen in private schools and universities, lower wages may drive some of the best teachers into other professions (Molnar, 1996). It remains to be seen whether teachers will play a more -30-

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significant role and have greater autonomy in charter schools (Garcia & Garcia, 1996). Resource Drain/Impact on System. Charter schools drain resources from other public schools. Public funding needs to be concentrated on improving instruction and increasing student achievement, not creating new schools. Charter schools spread the resources too thin, with too little going to any one place (Molnar, 1996). Charter schools are freed from excess regulations while public schools are expected to teach an expanding curriculum and meet increased state or federal mandates. Legislators have been so willing to fund charter schools yet they have been unwilling to fund regular public education at the rate of inflation (Garcia & Garcia, 1996). Sponsorship. Few of the institutions authorized to sponsor charter schools have the expertise or the resources to effectively oversee the charter schools they sponsor. As a result, the number of charter schools that use their resources irresponsibly, or are mismanaged, such as the Edutrain charter school that was shut down in California, will likely increase (Molnar, 1996). More often than in the past, critics are being invited to educational conferences to debate the merits of charter schools with advocates (ASCD, 1997). Previously, charter school panels at conferences were often composed primarily of advocates, providing overviews of charter schools and promoting their "pro-charter" -31-

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agendas. This was primarily because the advocates were the people who knew most about what was happening in charter schools at that time. Now, many others, for and against charter schools, have become involved in the debate and have begun to take a closer look at charter schools. As the number of charter schools grows, it is likely that successes will accompany failures. The advocates will tout the successes and the critics will discuss the failures. Financial Supporters These are public agencies and private foundations that allocate funds specifically for charter schools and/or have funded large research projects on charter schools. Most charter schools rely on some foundation support for start-up and/or capital expenditures and it is unlikely that, as the number of charter schools grow, foundations will be able or willing to fund all the needs that charter schools have typically relied on foundations to fund (Anderson et al., 1997). To date, some of the larger, national financial supporters of charter school efforts include the following. 1. The United States Department of Education has a national charter schools office, allocates funding to states for charter school start-ups, funds a national evaluation and other research studies on charter schools. -32-

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2. The Pew Charitable Trusts provided the funding for the Hudson Institute's national charter school study. 3. The Walton Family Foundation provides direct funding to charter schools for planning and implementation. Policymakers The charter school movement has received support from both Democratic and Republican policymakers, which is one reason why the movement has grown so much over the last couple of years (Nathan, 1996a). In general, it is a reform that both liberals and conservatives seem to be willing to explore. According to a 1996 survey, Policy-Makers' Views on the Charter School Movement (Nathan & Power, 1996), legislators introduce charter school legislation for several reasons, including: I. To help youngsters who have not succeeded in existing schools 2. To provide opportunity for educational entrepreneurs 3. To expand the range of public schools available 4. To increase overall student achievement 5. To encourage the existing public education system to improve 6. To provide an alternative, rather than a prelude, to vouchers -33-

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When asked how legislators would strengthen charter laws, the most frequent recommendations given were: 1. Give charter schools the same per-pupil allocation as other public schools 2. Permit more than one organization to sponsor a charter school 3. Eliminate the cap on the number of charter schools 4. Give charter schools a great deal of independence from local districts 5. Provide some start-up funds This survey was conducted by one of the leading charter school advocates in this nation, Joe Nathan, so the results are probably biased towards his perspective. For example, some legislators would disagree with some of the frequent recommendations listed above. Four members of Colorado's House Education Committee voted against amending Colorado's Charter School Act in 1997. One reason given for voting against the changes was that results on the success of charter schools to date were not yet available. This legislator said he supported charter schools, but he was uncomfortable making changes to the current legislation until he knew more about the success, or lack thereof, of existing charter schools under current law (Anderson, 1997). The response from this legislator is evidence that policymakers are interested now in results as opposed to advocacy. Much of the discussion on charter schools up -34-

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to this point has centered on issues relating to advocacy--increasing opportunity, giving people choices, meeting the needs of the community, making the system more accountable, and so forth. Now, people want to know if it is working. This is a transition from advocacy to evidence--are charter schools actually accomplishing what they hoped and/or promised they would? Policymakers are looking to researchers and the charter schools themselves to provide this information. As more information about charter schools is made available, legislators will have the data they need in order to make informed decisions about the future of charter schools. However, data can be interpreted in many ways, so the combination of the data with the lobbying efforts of the advocates, moderates, and critics will influence how legislators vote on future adjustments to and/or the creation of new charter laws. The advocacy and personal interest side of the charter movement will not disappear in this age of evidence; however, the opinions and interests of the advocates, moderates, and critics willneed to be balanced with the data. "Neutral" Players Others are involved in the charter movement, theoretically as non-biased/non partisan entities. For example, results from RPP International and the University of Minnesota's (U ofM) national charter school evaluation (contracted through the U.S. -35-

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Department of Education, RPP is continuing to work on the evaluation but the U of M is not) will be seen as more neutral or balanced than results from The Hudson Institute's National Study on Charter Schools or a study that Alex Molnar (a critic) would conduct on charter schools. Primarily because RPP has not come out publically supporting or opposing charter schools--they are taking a non-biased, data based look--even though they may have some researchers working on the report who are clearly advocates of charter schools (e.g., Wayne Jennings, a director of a charter school in St. Paul, Minnesota, or Eric Premack, one of the advocates discussed above). The data from the evaluation will be looked at by policymakers and others interested in learning more about the and impact of charter schools. The following are some key findings from A Study of Charter Schools (RPP & U ofM, 1997): 1. Charter schools serve diverse student population. 2. The percentage of special education students served in charter schools is lower than the national average (about 7 percent of students in charter schools versus about 1 0 percent of students in regular schools receive special education services). An exception to this is in Minnesota and Wisconsin where a higher percentage of special education students are being served in charter schools. -36-

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3. Charter schools serve a smaller proportion of Limited English Proficient students than do other public schools. 4. Most charter schools enroll about the same proportion of low income students, on average, as other public schools. 5. Charter schools are founded for diverse reasons. Newly created schools often seek to achieve a new educational vision while conversion schools are more likely to seek autonomy. 6. Lack of start-up funding is the most frequently mentioned problem that charter schools face. In addition to the RPP study, the U.S. Department of Education is funding two other research studies: (a) How Charter Schools Serve Students with Disabilities, being conducted by the Research Triangle Institute; and (b) Charter School Accountability, being conducted by the Center on Reinventing Public Education. Initial results from these studies will not be available until January 1998, at the earliest. The Education Commission of the States (ECS) and the National Conference of State Legislatures (NCSL) are two organizations that also influence the charter school movement. Both of these entities are designed to be "neutral," serving policymakers across the political spectrum; however, the type of information that -37-

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these entities provide on the topic of charter schools will likely influence legislators' decisions about and/or understandings of key charter school issues. Overall, the publications that ECS has produced on charter schools lean more towards advocating for charter schools than remaining neutral (e.g., Louann Bierlein, an advocate, wrote two policy briefs on charter schools for ECS--Bierlein & Fulton, 1996, and Bierlein, 1996). Most recently, however, ECS and NCSL jointly completed a document, The Charter School Roadmap (Banks & Birch, 1997), that looks at both sides of the charter school debate and walks policymakers through the various decisions that they need to make when considering charter school legislation. Both of these organizations host large annual meetings and several events during the year in addition to their publications. Policymakers from across the nation attend these sessions and over the last few years, charter schools have been covered in these meetings at different capacities. Since policymakers get information on charter schools from these organizations, it is important to consider them key players in the charter school movement. Summary This section discussed the political players that influence the charter school movement, provided an overview of their key positions/opinions about charter -38-

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schools, and reviewed how these positions/opinions are expressed in the literature on charter schools as pros and cons for the movement. It also provided an overview of the many issues that have surfaced since the inception of the charter school movement and forecasted some of the emerging issues, such as the shift from advocacy-based data to evidence-based data. All of the groups discussed in this section--advocates, moderates, critics, funders, policymakers, and neutral players--will continue to be involved in this movement. The level and type of involvement will depend largely on the type of legislation passed and the success of charter schools. In order to reach his goal of3000 charter schools by the year 2000, President Clinton will need to be updated on the positions, findings, and interests of each of these groups and determine whether collaborating with these groups will help him reach his goal. The remainder of this thesis focuses on two specific policy areas: sponsorship and funding. The next chapter compares charter school activities and policies with an emphasis on sponsorship and funding across four states. -39-

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CHAPTER III A COMPARISON OF STATE CHARTER SCHOOL POLICIES The composition of charter school policies influences the number of charter schools within a given state and/or the number that will be approved in the future. As discussed in the previous chapter, significant political forces encourage policymakers to adopt policies that reflect certain viewpoints. These forces have been instrumental in influencing existing policies and will continue to be influential in the future. For example, the Milwaukee Teachers' Education Association recently challenged the legality of charter schools, and won, when an attempt to increase the autonomy given to charter schools was proposed in the legislature (Center for Education Reform, 1997). This chapter examines how many charter schools currently exist and in which states, projects how many charter schools each state must approve in order to reach Clinton's goal of3000, and compares existing state policies, in four states, across several areas. Table 3.1 provides a list of current states with charter school laws, identifies how many charter schools each state has approved, and projects, based on current percentages, how many charter schools each of those states will need to approve in -40-

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order to reach President Clinton's goal of3000 charter schools by the year 2000. A discussion of the key findings from the data follows the table. TABLE3.1 TOTAL NUMBER OF CHARTER SCHOOLS AS OF JANUARY. 1997 AND PROJECTIONS FOR THE FUTURE (A) (B) (C) Total number of Percent of total charter Projected number of Charter Schools schools currently schools needed per state approved as of approved1 to reach Clinton's goal September, 1997 of30002 Alaska 15 2% Arizona 254 30% Arkansas 0 0% California 132 16% Colorado 49 6% Connecticut 12 1% Delaware 7 1% Washington, DC 4 0% Florida 40 5% Georgia 21 2% Hawaii 2 0% 1 States with 0% in this column have less than 1% of the total number of the nation's charter schools. 2 These numbers reflect an assumption that each state's percentage of total charter schools would remain consistent with current percentages (those displayed in column B). -4160 900 0 480 180 30 30 0 150 60 6

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TABLE 3.1 ( cont) TOTAL NUMBER OF CHARTER SCHOOLS AS OF JANUARY. 1997 AND PROJECTIONS FOR THE FUTURE (A) (B) (C) Total number of Percent of total charter Projected number of Charter Schools schools currently schools needed per state approved as of approved to reach Clinton's goal September, 1997 of3000 Illinois 8 1% 30 Kansas 7 1% 30 Louisiana 6 1% 30 Massachusetts 25 3% 90 Michigan 135 16% 480 Minnesota 29 3% 90 New Hampshire 0 0% 0 New Jersey 16 2% 60 New Mexico 5 0% 18 North Carolina 34 4% 120 Pennsylvania 6 1% 30 Rhode Island 2 0% 6 South Carolina 3 0% 12 Texas 20 2% 60 Wisconsin 17 2% 60 Wyoming 0 0% 0 TOTAL 849 100% 3,012 Source: The Center for Education Reform, 1997 (column A only) -42-

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Key Findings from Table 3.1 Arizona (the state with the most charter schools) has nearly twice as many more charter schools as Michigan (the state with the second highest total number of charter schools). There have been 254 charter schools approved in Arizona (30 percent of all charter schools nationwide) and 13 5 in Michigan (16 percent of all charter schools nationwide). California has the third highest number of charter schools, 132, which is also 16 percent of all charter schools nationwide. Several factors may contribute to why Arizona has so many more charter schools than the other states: (a) the law in Arizona provides the most autonomy to charter schools; (b) there are ilo restrictions on who can start charter schools (e.g., private companies may start a charter school); (c) multiple entities may sponsor charter schools; and (d) many charter schools per year may be approved. If no other states were to pass charter school legislation between now and the year 2000, six of the 27 states would need to approve most of the charter schools (2310 out of3000). These states, in order of the number of charter schools that would need to be approved, are: (1) Arizona, 900; (2&3) California and Michigan, 480 each; (4) Colorado, 180; (5) Florida, 150; and (6) North Carolina, 120. If each of these 27 states were to agree to meet President Clinton's goal of 3000 charter schools by the turn of the century, then they would need to set state goals -43-

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for the year 2000 that reflect the numbers found in column C above. Whether states will have the capacity to oversee so many charter schools and/or whether interest exists within each of these states to start so many more schools is yet to be determined; however, Table 3.1 does illustrate that it is possible to reach Clinton's goal if states reach their individual goals. Table 3.2 provides the following information on four states (Arizona, California, Massachusetts, Michigan): (a) the total number of students attending charter schools; (b) the procedure for funding charter schools; (c) the amount of basic state aid allocated to charter schools and how much that amounts to per pupil; (d) any additional funds allocated to charter schools for specific purposes; (e) how charter schools are sponsored; and (f) the maximum number of charter schools states are allowed to approve (caps). Following Table 3.2, key findings from the data are highlighted, specifically how states compare to one another; and issues or questions raised by these data are discussed, including who supports these policies (e.g., advocates, moderates, critics, and myself) and why (the impact the policies have on practice/implementation). The focus ofthis analysis is on the sponsorship and funding of charter schools. -44-

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TABLE3.2 SELECTED CHARTER SCHOOL POLICIES IN FOUR STATES AZ CA MA MI Year charter law was passed 1994 1992 1993 1993 Actual state funds transferred to $69,700,000 $138,689,527 $34,700,000 $68,750,000 charter schools in FY 97 Total number of students attending 21,000 42,332 5,465 12,500 charter schools in FY 97 Average state support per charter $3,319 $3,276 $6,349 $5,500 school pupil in FY 97 Projected capital funding for $4,000,000 $0 $0 $0 charter schools in FY 1998 Reimbursements to districts losing $0 $0 $30,600,000 $0 students to charter schools in FY 97 Additional state support for charter $1,000,000 $0 $250,000 $0 school start-up/ implementation Entity/ies eligible to sponsor charter local boards, local boards state board or local boards, schools in state state board, jointly by local independent state board for school school boards, charter schools committee, universities, teachers union, community & state board colleges Caps on number of charter schools no cap for local cap of 1 00 for cap of37 state no cap on those allowed in state boards, max. of state, but state board approved approved by 25/yr for each of board has (or2%of boards or the state boards sought waivers statewide colleges, cap of to get around public school 150 (by year this cap population), 1999) for cap of 13 on university local approved approved schools schools Sources: RPP International and the University of Minnesota, 1997; Anderson et al., 1997; Center for Education Reform, 1997 -45-

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Key Findings from Table 3.2 Funding Arizona is the only state, of the four, that provides funding to charter schools for capital expenditures. Each charter school receives $146/K.-8 pupil and $219/high school pupil. Finding and securing funding for facilities has been a considerable challenge for charter school operators (Anderson et al., 1997; Finn et al., 1996; RPP & The University of Minnesota, 1997), so Arizona charter schools have an advantage that the other states' charter schools do not. Both Arizona and Massachusetts allocate state funds to charter schools for start-up (this is in addition to federal start-up money that all states with charter school laws, except New Mexico, receive and allocate to charter schools). Arizona provides a total of $1 million (grants of up to $100,000 per school over two years time), and Massachusetts allocates a total of$250,000 per year (grants averaging $8-12,000 per year over a two year period). Just as with the facilities funding, fmding and securing funding for start-up has been a challenge for charter schools (Anderson et al., 1997; Finn et al., 1996; RPP & The University ofMinnesota, 1997). States, such as Arizona and Massachusetts, that have allocated state funding for charter school start-ups are providing resources for their charter schools that extend beyond what other state's charter schools receive. -46-

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Massachusetts is the only state of the four that reimburses school districts for losses of enrollment, for up to three years, when a student leaves a district school to attend a charter school. Districts that are below the state's foundation level3 are reimbursed for 100 percent of their projected losses and those above the foundation level are reimbursed for a portion of their real losses. Massachusetts decided to provide this reimbursement to offset any temporary drain of resources a district would experience from transitioning a student from a district school to a charter school (Anderson et al., 1997). Sponsorship/Caps California is the only state that limits sponsorship to one entity--the local district. The other three states allow multiple entities to sponsor charter schools. Massachusetts just passed legislation this year allowing local sponsorships. Previously, only the state board was permitted to sponsor charter schools (Center for Education Reform, 1997). All four states have limited the number of charter schools that can be approved; however, Arizona allows for many more schools to be approved than the 3 State set funding formulas determine the amount of funding school districts will receive. In most states these formulas set the allowable spending level that includes a base per pupil amount and adjustments to account for special needs. The combination of the base amount and the adjustments is the foundation level (Anderson et al., 1997). -47-

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other three states. California has exceeded its state cap of I 00 schools and Massachusetts is nearing its cap of 3 7 schools. All 25 schools approved in Massachusetts thus far are sponsored by the state board. The legislation allowing local sponsorship just went into effect this year so charter schools are not operating yet under local sponsorship (Center for Education Reform, 1997). Impact of Sponsorship and Finance Policies State policies, and the components that legislators choose to include in those policies, impact communities in different ways. Each of the four states discussed above have policies that differ from each other. As a result, the charter schools in those states may function quite differently across states and in some cases, charter schools in one state may have advantages that schools in another state do not have. The differences across sponsorship and fmance policies are highlighted below along with a discussion about how different policies influence practice. The views of advocates, moderates, and critics about certain policies are also noted. Sponsorship The entities permitted to sponsor charter schools vary across the four states. Charter schools in Arizona may be sponsored by one of three entities: (a) the State -48-

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Board for Charter Schools; (b) the State Board of Education; and (c) a local school district. The rationale for having multiple sponsors is to provide an alternative to the local school district for charter school sponsorship. This is necessary, advocates believe, in order to trigger competition and encourage innovation (Nathan, 1996a). California's charter schools must be sponsored by a local school district. The rationale for this arrangement is to encourage a relationship between charter schools and other public schools in the area and to support the notion of local control. The writers of the legislation, influenced heavily by moderates, believed that in order for charter schools to influence other public schools, they must be connected to the district. In states where charter schools are sponsored by non-district entities, charter schools operate in isolation (AFT, 1996). Massachusetts' charter schools may be sponsored either by the State Board of Education or by a local partnership between the local school committee (board) and the local teachers union. The rationale for this arrangement is a combination of the two rationales described above for California and Arizona. Until recently (1997 legislative session), Massachusetts' charter schools could only be sponsored by the State Board. Charter schools in Michigan may be sponsored either by a local school board, independent school board (county/regional board), community college, or a -49-

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university. The rationales for involving the two types of school boards are consistent with the rationale described for district sponsorship in the California example. The independent school board arrangement provides another "within the system" option for applicants, ensuring a connection to local districts and providing an opportunity for charter schools to influence conventional public schools that extend beyond those located in the immediate community in which the school resides. Allowing community colleges and universities to sponsor charter schools fosters a connection between higher education and K-12 education, provides an option beyond the K-12 education bureaucracy, and encourages innovation and competition. Arizona's law is touted as the "strongest" by advocates of the charter school movement (Center for Education Reform, 1997) because it provides the most autonomy and allows two other entities, besides the local school boards, to sponsor charter schools. Arizona was also the state that, among the four states, had the most charter schools. Advocates argue that there is a correlation between the strength of a state's charter law and the number of charter schools--the stronger the charter law, the more charter school activity (Center for Education Reform, 1997). Moderates, who are most interested in keeping charter school activity connected closely to local districts, are less in favor of Arizona's legislation and more -50-

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in favor of the legislation in California. California is serving the largest number of students among the four states, but does not have the most schools. The critics are less concerned about who sponsors charter schools (with the exception of ensuring that, whoever it is, the sponsoring entity has the capacity to oversee the charter school[ s] it sponsors, according to Molnar, 1996). If critics support activity related to charter schools at all (which many, such as Alex Molner, do not), they would rather see a state ease into the charter school movement (such as Massachusetts has done when compared to the other three states) than to move full speed ahead (like Arizona). This is to allow time for research to emerge that demonstrates the effectiveness of charter schools, before experimenting on children and/or draining resources from the other public schools for an unproven approach (ASCD, 1997). An Example. My experience working with a charter school in Denver and trying to get another one approved by the Denver Public Schools (DPS) has led me to agree with the advocates on the issue of sponsorship. I believe that it is important to have an entity, besides the local school district, that is authorized to approve and oversee charter schools. This is because DPS has not shown much interest and/or support for charter schools. Many applicants have attempted to apply for charters and -51-

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have either been turned down or become so frustrated with the system that they decided not to apply at all for a charter. Two charter schools are currently operating in Denver--Pioneer, which the district started, and P.S.1, which was started by parents, teachers, and community members. The Edison project has received tentative approval to open a charter school in Denver, pending their ability to secure funding to renovate their building. And, the group I have been working with submitted its application to DPS in December, 1997. Assuming Edison raises its funding and our application is approved, we would be the fourth charter school in Denver. However, we have yet to be approved and have had to jump over significant hurdles and wrestle with the district to get this far. For example, the district had told us that charter school applications for the 1998 school year would be due December 1, 1997. The district did not have any guidelines in writing to which we could refer--just those from previous years. Each time we asked for guidelines, DPS said that none were available. We were the only group seeking a charter in Denver and had met with the school board and the superintendent over the summer to discuss our plans and to clarify deadlines, so they knew who we were and when we planned to submit an application. In August, 1997, the DPS Board met to discuss its charter school guidelines (finally, we had been asking for this information since January, 1997) and decided to change the deadline for 1998 charter school -52-

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applications. The new deadline was August 29, 1997 for draft applications and October 1, 1997 for final applications. We learned of this decision August 15, 1997 when we received the board minutes. This left us with a few weeks to pull together a draft and six weeks to complete our final application. Changing the deadline gave us two months less than we thought we had to work on our application. We almost decided to give up and apply next year since it was not feasible to pull it all together so quickly. Instead, we decided to ask for an extension. We received press in both of the major Denver papers, highlighting our struggle, and were granted an extension by the DPS Board, changing the deadline for our application to December 1, 1997. This is just one example of what we have had to do in order to just apply to become a charter school. If we had had the opportunity to go directly to the state board or to a university for sponsorship, we would have done it in a second, primarily because we did not receive any meaningful encouragement, support, or consistent guidance from the district, despite the large numbers of parents and others who support the opening of our school. Caps. States place caps on the number of charter schools that can be approved in order to limit growth and make the chartering process more manageable for sponsoring entities. The charter school movement is still young--schools need time to pilot the concept, plus starting small is better because fewer people are affected if -53-

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something goes wrong (NEA, 1993). Advocates argue that caps prohibit competition. If only a few charter schools can be approved, districts and schools will not feel pressured to make changes in order to attract or retain students and staff (Nathan, 1996a). Arizona does not set an ultimate cap on the number of charter schools that may be approved; however, it does limit the number of schools that can be sponsored annually by each of the state boards to 25 per board. An unlimited number of charter schools may be approved by local school district sponsors. As noted in Table 3.1, California has exceeded its state's charter school cap (cap of 100 yet 132 schools have been approved). Will California continue to seek waivers from the state board to allow more charter schools to open? It seems silly to have a cap that is not enforced, yet I do not know if it is politically more feasible to exceed the cap than it is to try and change it. Issuing waivers, such as being done now to get around the cap, does not require the statutory change that permanently raising the cap would. For example, if a bill was presented to alter the cap level, the moderates and critics would be more likely to lobby against an increased cap. Advocates support increasing the cap because that would likely result in an increase in the number of charter schools in California (since an overall larger number of schools would be permitted to open). -54-

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Massachusetts increased its state cap in 1997 from 25 to 3 7. If it wanted to approve more charter schools, it had to increase its cap since the maximum number of charter schools, 25, had already been approved by the 1997legislative session. The new cap allowed 12 more charter schools to be approved. This is the first year that local entities, school district in collaboration with the union, may sponsor charter schools. Locally approved charter schools in Massachusetts may only be conversion schools (meaning they converted from a regular school to become a charter school) and only 13 are allowed statewide. The creation of these local partnerships are due, in part, to lobbying efforts by moderates. Previously, the State Board of Education was the only entity permitted to sponsor charter schools--something that moderates clearly do not support--and now districts and unions may sponsor schools (Anderson et al., 1997). It will be interesting to see if twelve more are approved this year causing the state legislature to have to consider the cap issue again next year. Michigan does not limit the number of charter schools that can be approved by school districts, but it does limit the number of charter schools that can be approved by universities at 150. As of July, 1997,68 charter schools (out of a total of 115 charter schools at that time) were sponsored by 6 different universities (Michigan Department of Education, 1997); therefore, 82 more schools could be sponsored by universities before reaching the cap of 150. -55-

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Funding Each of the four states funds its charter schools differently. In Arizona, schools sponsored by one of the state boards receive their funding directly from the state. The level of funding is based on the same formula that the state uses to fund school districts. Schools sponsored by school districts receive their funding from the district--state funding flows from the state to the district to the school. Charter schools and districts negotiate the amount of money districts may withhold to cover services provided (some districts withhold a portion of state funding in exchange for services they provide to charter schools) along with any additional local money (tax levies) districts may share with charter schools (Anderson et al., 1997). How the Four States Fund Charter Schools. California's charter schools are entitled to an amount of funding that is equivalent to what other schools within the district receive. Funding flows from the state through the district to the school. Just as is the case with district sponsored schools in Arizona, California's charter schools negotiate how much money the district withholds and/or shares (Anderson et al., 1997). Massachusetts' charter schools receive their funding directly from the state. Schools receive different amounts of funding per student based on the community in which the student resides. The average cost per student is based on a combination of -56-

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individual student costs. Individual student costs are set by the foundation level and are adjusted for the student characteristics of the district in which the student resides (Anderson et al., 1997). Funding for Michigan's charter schools flows from the state through the sponsor to the school. Sponsors may withhold 3 percent for administrative costs. Any extra services and/or benefits are negotiated between the charter school and its sponsor. Charter schools receive the same amount of state aid per pupil as district schools receive, however that amount may not exceed the statewide average. The Funding Debate. Funding for charter schools is a hotly debated issue, primarily among advocates and critics. Advocates argue that charter schools are able to do more for less, meaning they receive less money (e.g., Colorado districts are authorized by statute to provide a minimum of 80 percent of the per pupil operating revenue for a student attending a charter schools, whereas conventional schools receive 100+ percent for each student) than conventional public schools yet they are expected to demonstrate better student results or they will lose their charter. Despite the fact that they can do more for less, advocates argue that charter schools need more money, especially to cover start-up expenses, and that states need to adjust their school funding formulas to ensure that charter schools receive their equitable share of state education funding (Finn et al., 1996). -57-

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Critics, on the other hand, argue that charter school reformers claimed that charter schools would not cost more money; however, they keep coming back each year asking for more money, further draining resources from the conventional public schools (Molnar, 1996). Massachusetts is the only one ofthe four states discussed in Table 3.1 to recognize the financial impact that students leaving district schools for charter schools might have on school districts. Reimbursing districts for up to three years for projected and/or actual losses of students gives the districts time to reassess their situations and adjust staffmg and/or classroom configurations to reflect the changes in student enrollment. What this also means is that the state of Massachusetts is potentially paying double for every charter school student--the district that lost the student gets what it would have received for that student had he/she stayed, and the student's actual per pupil allocation follows him/her to the charter school (Anderson et al., 1997). Funds for Start-Up and Facilities. Several studies of charter schools have found that funding start-up is the most significant challenge that charter school organizers face (Anderson et al, 1997; Finn et al., 1996; Nathan, 1996a; RPP International & The University of Minnesota, 1997). The challenges differ between .-conversion schools and new schools, primarily in the area of facilities. Conversion schools typically remain in the same school building they were housed in before they -58-

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became a charter school, so they do not have to locate and/or finance a facility for their school, nor do they usually have to pay much (if anything) to lease their building. Schools starting as charter schools rarely receive a building from the state or local school district. Instead, these schools must locate and usually renovate a facility to house their school and once operational, pay sometimes up to 15 percent of their general operating budget to lease the facility (Anderson et al., 1997). All charter schools (conversion and new) have the challenges of paying for initial planning and covering cash flow needs until they receive their first payment (Per Pupil Operating Revenue) from the state or district. This differs from a regular public school which usually receives money from the district to plan and pay for the opening of a new school. Like any new school opening, charter school organizers need to spend considerable time, before the school opens, doing things like planning the curriculum, hiring and training staff, ordering equipment, recruiting students, and so forth. They also must open their doors at the beginning of the school year, often before they receive their first payment from the state or district. The payments charter schools receive are their share of the Per Pupil Operating Revenue. The schedule for paying out these funds may be inconvenient for charter schools (e.g., one school that I interviewed for the ECS study did not receive its first check from the district until November--nearly three months after the school year started). This means, in addition -59-

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to planning money, charter schools often need to have some start-up funding to cover initial items like rent, salaries, and other general operating expenses. Arizona is the only state, of the four displayed in Table 3.2, that provides funding to assist charter schools with capital expenditures--4 million per year which translates to $146 per K-8 charter school pupil and $219 per charter school high school pupil. Both Arizona and Massachusetts allocate state funding to help cover start-up expenditures. Charter schools in Arizona may use this money as they wish, and many have used it to supplement facility expenses. Massachusetts specifies that the money needs to be used to support expenses associated with special education. All states with charter schools may also apply for federal charter school funding. The funding states receive is passed on directly to charter schools to cover start-up expenses. Each state decides whether it wants to specify how charter schools may use the federal money and funding amounts vary from state to state and from school to school. California has chosen to allocate its federal funds in the form of loans, while the other three states give the money to charter schools in the form of grants. Massachusetts specifies that charter schools must use $10,000 of the grant they receive to develop an accountability plan, $7 per pupil for standardized test administration; and the remainder is unrestricted. Usually the start-up money that schools receive is not sufficient to cover their needs, especially their facility expenses; -60-

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therefore, many charter school organizers have used their own personal money to cover start-up, have taken out loans, or have secured funding from private foundations (Anderson et al., 1997). An Example. I have firsthand experience dealing with the fmancial challenges associated with starting a charter school. We were told by DPS that they would not provide us with a facility for our charter school, nor had they provided P. S .1 or the Edison Charter School with a facility. They did, however, provide a building and new furniture and equipment for Pioneer (the charter school started by the district) when it opened in the Fall of 1997. The most promising facility my charter planning group has found so far will require at least $100,000 in renovations to bring it up to code and to transition the facility from an office building to a school. P.S. 1 is currently raising $2.5 million to renovate a new facility since the one they have been housed in is going to be tom down. In Colorado, charter schools do not automatically receive any of the state funding that flows to districts for capital expenditures nor do they necessarily benefit from local tax levies raised by districts to support capital needs. Districts have the authority to decide whether or not they will share these funds with charter schools. Some districts, such as Jefferson County, have shared these resources with charter schools, while others (DPS) have not. Therefore, schools like mine and P.S.l must raise these capital funds from private sources and/or attempt to take out a -61-

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loan from a private lender. This raises two additional problems: (1) foundations are often hesitant to fund capital expenses because they would rather support the programming aspects of a school, and (2) new charter schools do not have a track record yet so private lenders, if they will fund a charter school at all, often require individuals who are starting the school to personally guarantee the loan, meaning that if something happened, these individuals would be personally responsible for paying back the loan. Also, by taking out a loan, the charter school must then allocate resources from its operating budget to cover loan payments. Competition for Scarce Resources. So, unlike a conversion school or a conventional school, a new charter school must dedicate general operating dollars to pay for leasing its facility and often repaying loans associated with renovating the facility. And, all charter schools, unlike their conventional public school counterparts, must also fmd resources to pay for other, non facility costs associated with starting a new school or transitioning a conventional school to a charter school. States, such as Colorado and Minnesota, are fmding it difficult to fund K -12 education, given the existing enrollment and school configurations, at a level that is consistent with the rate of inflation (Augenblick & Myers, 1996, 1997). Adding more charter schools does not necessarily increase the need for basic state funding since the students are technically transferring from one school to another (so enrollment does -62-

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not increase); however, funding required to renovate charter school facilities and/or support planning and other start-up needs (such as Arizona and Massachusetts have done) would require additional K-12 education state funding. When it comes to additional money for K-12 education it becomes very political. Charter schools must compete with other education advocates (e.g., special education, unions, early childhood, technology, etc.) for those additional dollars. Because of this political struggle, those pushing for the creation of more charter schools are going to have to be creative and find other mechanisms, besides relying on public resources, to fund their start-up and other ongoing operational needs. Summary State policies, especially in the areas discussed within this chapter (sponsorship, including caps, and finance) can have an impact on the number of charter schools approved within a given state and/or influence the quality of the programs and facilities that charter schools are able to offer. States that limit the number of charter schools that can be approved or allow only a single entity to sponsor a charter school will likely have fewer charter schools overall. Furthermore, states that provide extra funding for charter school start-up and/or facilities are helping their charter schools provide better facilities for their students (than can be provided on per pupil operating revenues alone) and/or alleviating some initial cash -63-

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flow problems that could distract administrators and others from the task at handstudent learning. Some states may want fewer charter schools in which case they will enact policies to ensure that only a select number of schools open. Other states will enact policies that allow them to have many charter schools. Locally, the success of charter schools (or lack thereof) will guide many ofthese policy decisions. Federal support and pressure may also help to influence whether more or less charter schools will be approved. The combination of President Clinton's national goal and increased levels of federal funding for charter school start-up and implementation should lead to an increase in the number of charter schools; however, it will be up to states to decide whether they want these resources, whether they support Clinton's goal, and/or whether they want charter schools to be small, pilot projects or to represent a critical mass--to be the impetus for large scale school reform. -64-

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CHAPTER IV RECOMMENDATIONS How can state charter school policies change in order to reflect a commitment towards meeting President Clinton's goal of3,000 charter schools by the turn ofthe century? Obviously, all3,000 charter schools are not going to come solely from the four states discussed in this thesis; however, ways can be found so that these four states could modify their policies and/or improve their practice of overseeing charter schools that would likely result in an increase, not only in the number of schools but also in the quality of schools. Arizona Arizona's charter school law enables a large number of schools to be approved, it provides extra financial support to help charter schools obtain facilities and pay for other start-up expenses and it allows three entities to approve charter schools. These are all areas that facilitate and support an increasing number of charter schools; however, in order to reach President Clinton's goal, Arizona may need to adjust its cap levels. If Arizona was to set a goal of 900 charter schools by the year 2000 (as discussed in Table 3.1) it would need to approve another 646 schools. Given -65-

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the current structure, the state boards would be able to approve a maximum of 150 schools (25 per year per board x 3 years) which would mean that district sponsors would have to approve the remaining 496 schools. To date, most charter schools in Arizona have been sponsored by state entities, not districts (Anderson et al., 1997), so it is unlikely that 900 schools would be approved unless Arizona increases its caps to allow the state boards to sponsor more schools per year. Increasing the caps for these state boards does raise a concern. Based on what I learned conducting research for the ECS charter school fmance study (Anderson et al., 1997), I know that the staffs for these boards are currently very small (one or two people plus the board itself). I am not confident that two staff people and a part-time board have the capacity to oversee hundreds of charter schools effectively. Concerns have been raised by Alex Molnar and others that Arizona's charter schools are "too free"--sponsoring agencies lack the capacity to hold charter schools accountable to the terms of their contract (e.g., Edutrain school that shut down for mismanagement and financial problems, ASCD, 1997). The state boards need to have a plan for ensuring accountability in the schools they sponsor and for providing technical assistance and other services to the schools as needed. While Arizona certainly has the potential to approve more schools than other states at this point and would be able to approve even more schools if it chose to raise -66-

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its cap, it is unlikely that Arizona will ever have 900 charter schools. As of 1993/1994 Arizona had a total of 1133 public schools in the entire state (NCES, 1995) so for the state to have 900 charter schools it would mean that either it would nearly double the number of total schools in the state or the majority of its schools would become charter schools which seems very unlikely. Initially, no financial implications or political consequences for implementing this recommendation should exist. It only requires that the boards and their staff members dedicate time to this issue. Eventually, if the boards decide that they do lack the capacity and require more staff, for example, then there will be a need for more state money (or a reallocation of existing resources) to support the changing staff needs. Also, as the number of charter schools increases, the amount of state aid allocated for facilities and start-up will need to increase to support the growing number of charter schools with facility and start-up requirements. See "Possibilities for Financing Charter School Facilities and Start-Up" later in this chapter for potential strategies for funding charter school facilities and start-up expenses that do not rely solely on public dollars. California I recommend several changes to California's charter school law. First, I recommend that the state allow another entity, besides school districts, to sponsor -67-

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charter schools. I believe this is important for two reasons: (a) to encourage competition; and (b) to give people who have innovative ideas and strong qualifications another option for charter school sponsorship if they live in a district that is "anti-charter." California does have an appeals process that allows charter applicants that have been turned down by there home district to appeal the decision to a county district. This step is critical. I do not recommend that any state adopt a charter school sponsorship policy that does not include an appeals process. Second, I recommend that California lifts its cap on the number of charter schools permitted to be approved. More charter schools are approved already than are technically allowed by statute. If the goal is to increase the number of charter schools, then policymakers have to make a commitment to changing the law to reflect an interest in having more charter schools. Increasing the cap to at least 480 (as discussed in Table 3.1) would enable California to maintain the level of charter schools needed to reach President Clinton's national charter school goal. California has over 7700 schools (NCES, 1995) so it is not out of the question that it could have 480 schools that are charter schools. This would mean that approximately 6 percent of its total schools would be charter schools. Third, I recommend that the California legislature explore options for supporting the facility and start-up needs of charter schools. See "Possibilities for -68-

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Financing Charter School Facilities and Start-Up" later in this chapter for potential strategies for funding charter school facilities and/or start-up expenses that do not rely solely on public dollars. The consequences of making these changes are political. Moderates will not support an alternative sponsor because they want charter schools to be approved by local school districts. Moderates and critics may also object to an increased cap because it increases the risk of having ineffective, negligent, and/or poorly run charter schools (the more schools you have, the greater the chance that some of them will be bad). The only financial consequence of these recommendations would occur only if the legislature decided to allocate funds to support facilities and/or start-up expenditures. The amount would depend on the level of commitment and type of program that the state established. Massachusetts I recommend two policy changes to Massachusetts' charter school law. First, I recommend they rethink their allocation for reimbursing districts that lose students to charter schools. The state spent nearly as much reimbursing districts as it did educating children attending charter schools. I would like to see a portion of the $30 million that currently is being spent to reimburse districts going instead towards alleviating charter school facility and start-up needs. The state needs to look into the -69-

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actual loss incurred when a student leaves a district for a charter school. I do not know the answer to this question, nor was I able to find it in my research; however, I doubt that the loss amounts to an amount nearly equivalent to the entire per pupil operating revenue for every child attending a charter school, for three years time. Second, I recommend that Massachusetts raise its caps for both types of charter schools (state and locally sponsored). The caps are too low to reach the level of charter schools the state would need to have in order to support President Clinton's plan--90 schools (see Table 3.1); however, ifthe cap is raised, then the state board, just as in Arizona, needs to assess its capacity to effectively sponsor a growing number of charter schools and make adjustments as necessary. I am not familiar with the staffing situation at the state board in Massachusetts. Currently, that board is overseeing 25 charter schools and has the authority to oversee a maximum of 3 7 schools. If it is only a couple of staff people and the board itself, which handles all education issues (as opposed to just charter school issues like the Arizona State Board for Charter Schools), I question whether they will have the capacity to oversee an increasing number of charter schools, unless they have sufficient human resources in place. Such as is the case in Arizona, Massachusetts' state board may be responsible for overseeing schools from across the state. -70-

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The goal of 90 charter schools for Massachusetts seems reasonable. If Massachusetts had 90 charter schools that would mean about 5 percent of its total schools would be charter schools since the state has about 1800 public schools (NCES, 1995). The consequences of making these changes are both financial and political. School districts will fight efforts to reduce the impact funds they receive. Obviously, they do not want to lose that money; however, if that money was eliminated and/or reallocated towards something else, there would be financial implications. Moderates are also likely to fight efforts to increase caps, especially on the schools sponsored by the state board. Michigan I have two policy issues that I recommend that Michigan addresses. First, committing resources towards funding charter school facility and start-up needs. Currently, Michigan does not allocate any state dollars for this purpose, yet if the number of charter schools is going to increase, the state needs to play a role in supporting that increase. See "Possibilities for Financing Charter School Facilities and Start-Up" later in this chapter for potential strategies for funding charter school facilities and/or start-up expenses that do not rely solely on public dollars. -71-

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Second, Michigan may want to revisit the cap level it has set for university sponsored schools. As of July, 1997, 60 percent of the charter schools had been sponsored by universities and the rest had been sponsored by school districts (Michigan Department ofEducation, 1997). Ifthis continues to be the ratio (60:40) in the future, then the cap on university-sponsored charter schools would need to be raised to at least 288 (or 60 percent of 480 schools as discussed in Table 3.1) in order to meet President Clinton's national goal. The state, if interested in meeting the national goal, will need to revisit this issue and determine whether more or less schools are being approved by universities or districts and adjust the cap, as necessary. If Michigan approved 480 charter schools, then about 14 percent of Michigan's public schools would be charter schools. The total number of public schools in the state is about 3400 (NCES, 1995). This is a higher percentage of charter schools to regular schools than Michigan and California would have, however, it is much lower than what Arizona would need to achieve. Fourteen percent does not seem urirealistic--defmitely challenging--but doable it the state so desired. If the state did choose to support facility and start-up needs, it would require an additional commitment of state dollars. The amount would depend on the level of commitment and type of program that the state established. -72-

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Possibilities for Financing Charter School Facilities and Start-Up States are already strapped when it comes to funding K-12 education, so asking for more money to support charter school capital and start-up needs is very difficult and very political. Allocating money for this purpose likely means taking that money away from something else. How do policymakers decide which is more important? This is an issue with which policymakers will have to grapple as they make decisions whether or not to provide this support to charter schools. Advocates will argue that other schools have access to capital funds and when a new school is starting in a school district, the district pays for the planning and start-up, so why should a charter school not get equal treatment? Critics will argue that more money for charter schools means less money for other public schools--schools that are already having a difficult time making ends meet with what the existing resources. One option that policymakers may want to consider is examining ways that they can help meet the needs of charter schools without footing the entire bill. The following are some examples of approaches that states might take to supporting charter schools' facilities and start-up needs. Some involve states fully funding the effort while others encourage partnerships and sharing the financial burden with others. -73-

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Direct Allocation This is how Arizona currently supports the facility needs for charters schools in its state. Every charter school automatically receives a lump sum of money per student for facilities. Grants In addition to the federal funding available for charter school start-ups, states can allocate state funds for this purpose (such as in Arizona and Massachusetts). States may decide to: (a) offer competitive grants to help charter schools with planning and initial cash flow needs; or (b) give every charter school a set amount of money for this purpose. Revolving Loan Fund California distributes its federal charter school start-up money in the form of loans, instead of grants. When schools repay these loans, the repaid funds can then be turned around and loaned to new schools. States may want to consider setting up a similar type of revolving loan fund, but with state funds. Lease Aid Minnesota passed lease-aid legislation this year for charter schools. The state reimburses charter schools for a portion of the amount they pay each year to lease -74-

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their facilities. This enables charter schools to use more money on instruction and other needs and less on facilities. Incentives States may want to consider giving private lenders incentives for fmancing charter schools (e.g., tax breaks). Or offer incentives to public agencies/institutions (e.g., universities, city buildings) to offer their vacant facilities to charter schools for reduced costs. Long Term Contracts Lenders and foundations are more likely to support a charter school if it sees that there is a commitment from the state or school district to fund (through basic aid) that school over several years. For example, a lender would be more interested in funding a school that has a contract (charter) for 10 years than one that has a contract for two years. Sub-Leasing States can allow charter schools to sublease part of their school space to other organizations if the school does not need all the space. This is a way for charter schools to share the cost of their facilities with others. -75-

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Federal Commitment The federal government has committed substantial resources to getting the charter school movement off the ground. States may apply to the U.S. Department of Education (ED) for grants to support charter school start-up and early implementation. In 1997, Congress allocated over $50 million dollars to support this effort and the President just signed a bill in November, 1997 to increase that amount to $80 million dollars for 1998. This funding will help schools considerably and may relieve some of the pressure on states to fund charter school start-up expenditures. However, despite the level of federal funding, states do need to address the issue of facilities. Summary States need to decide ifthey want to support President Clinton's goal of3,000 charter schools by the year 2000. If they do decide that they want more charter schools, then they will need to make changes, such as those recommended within this chapter, that reflect this commitment. Changes will need to be made that extend beyond the areas (sponsorship and finance) and/or states highlighted in this thesis. Some of the other policy areas that need to be considered for changes, along with recommendations for further charter schools research are discussed in Chapter V. -76-

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CHAPTERV CONCLUSION/AREAS FOR FURTHER RESEARCH This thesis recommends changes to existing charter school sponsorship and finance policies. Other policy changes may also trigger an increase in the number of charter schools. Additional research is needed in order to determine what other policies may need to be adjusted. As discussed in Chapter II, legislators and others are becoming more interested in seeing evidence of charter school success before they change policies and/or commit additional resources to this movement. The first area of research that is needed is to expand the work started in this thesis by looking at more states' policies and experiences in the areas of sponsorship and finance. Each state's charter school law is different from the next, so the approaches states have taken and the impact these decisions have had on charter schools is important and useful data to extract. These data can be used to modify or improve charter school laws nationwide since bill drafters often look to other states' policies for guidance when they are creating or modifying laws in their own states. A second area of research would be to conduct a study similar to this one, but -77-

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to look at different policy issues that may or may not influence the number of charter schools approved. For example, some other areas include: 1. Who has the authority to start a charter school --teachers only, anyone but private companies, anyone? 2. Are only conversion schools allowed, can private schools convert to a charter schools, can home schools convert to charter schools? These issues, and the political forces that influence the issues, are central to the number of charter schools a state will have. If the individuals/groups that are permitted to start a charter school are limited, the number of charter schools that can be opened are probably also limited; however, if we open up charter schools to any group, then how do we assure a quality education? A third area of research would be to look more in-depth at the issue of sponsorship. States are using multiple approaches for sponsoring charter schools. Which, if any, seem to be more effective and why? The fmal area of research I would like to discuss is the area I hope to pursue for my dissertation. I am interested in taking a more comprehensive look at charter school finance than I was able to do in the ECS paper. Specifically, I want to look at charter school revenues and expenditures in Colorado and attempt to compare these revenues and expenditures with similarly situated conventional schools and/or -78-

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districts. I feel that this study is important because there are so many rumors circulating regarding how charter schools are spending their money, how charter schools are costing districts money, and so forth. There are no data, however, that I have seen to support these rumors. If we knew the answers to these questions, policymakers would be better able to make informed decisions about funding charter schools. -79-

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REFERENCES American Federation ofTeachers. (1996). Charter School Laws: Do They Measure up? Washington, DC: Author. Anderson, A.B. (1997). Summazy ofMy Experience as an Intern in the Colorado House ofRepresentatives During the 1997 Legislative Session. Unpublished manuscript. Anderson, A.B., Augenblick, J., & Myers, J. (1997). Charter School Finance: Policies. Activities. and Challenges in Four States. Denver, CO: Education Commission of the States. Association for Supervision and Curriculum Development. (1997, August). Debating Charter Schools: Will They Revitalize or Undermine Public Education? Education Update. 39, (5). Augenblick, J., & Myers, J. (1997). Profile of Changes in Colorado School Funding 1988-89 to 1995-96. With a Comparison of 1995-96 to 1993-94 and to 199495. Denver, CO: Augenblick & Myers, Inc. Augenblick & Myers, Inc. (1996). An Analysis of Changes in School Funding in Minnesota Over the Past 20 Years. St. Paul, MN: Minnesota School Boards Association Banks, D., & Hirsch, E. (1997). The Charter School Roadmap. Denver, CO: Education Commission of the States. Bierlein, L. (1996). Charter Schools: Initial Findings. Denver, CO: Education Commission of the States. Bierlein, L., & Fulton, M.F. (1996). Emerging Issues in Charter School Financing. Denver, CO: Education Commission of the States. -80-

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Bierlein, L., & Mulholland, L.A. (1995). Charter School Update & Observations Regarding Initial Trends and Impacts. Tempe, AZ: Arizona State University, Morrison Institute for Public Policy. Caudell, L.S. (1997, Spring). The Northwest Has Spawned a Handful of Charter Schools, but Educators and Legislators Across the Region are Joining the Debate. Northwest Education Magazine, 5-7. Center for Education Reform. (1997). The Charter School Workbook. Your Roadmap to the Charter School Movement Washington, DC: Author. Finn Jr., C., Manno, B.V., & Bierlein, L. (1996). Charter Schools in Action: What Have We Learned? Indianapolis, IN: Hudson Institute. Fuller, B. (1996, October). Is school choice working? Educational Leadership. 54 (2), 37-40. Garcia, G.F., & Garcia, M. (1996). Charter Schools--Another Top Down Innovation. Educational Researcher. 25(8), 34-36. Kaprowicz, C., Medler, A., & Weston, M. (1996). Charter Schools: What is It That Everyone is Supporting? Unpublished manuscript. McGree, K. (1995). Charter Schools: Earlv Learnings. Insights on Educational Policv and Practices. Austin, TX: Southwest Educational Development Laboratory. McKinney, J.R. (1996, October). Charter Schools: A New Barrier for Children with Disabilities. Educational Leadership 54(2), 22-24. Michigan Department of Education. (1996, February). Michigan Public School Academy Listing. Lansing, MI: Author. Millot, M.D., Hill, P.T., & Lake, R. (1996, June 5). Charter Schools: Escape or Reform? Education Week., p.15. Molnar, A. (1996, October). Charter Schools: The Smiling Face of Disinvestment. Educational Leadership. 54 (2), 9-15. -81-

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Nathan, J. (1996a) Charter Schools: Creating Hope and Opportunity for American Education. San Francisco, CA: Jossey Bass. Nathan, Joe. (1996b) Early Lessons of the Charter School Movement. Educational Leadership. 54(2), 16-20. Nathan, J., & Power, L. (1996, April). Views on the Charter School Movement Minneapolis, MN: University of Minnesota, Hubert H. Humphrey Institute for Public Affairs, Center for School Change. National Education Association. (1993). NEA Action Plan for Shaping Charter Schools: Criteria for Charter Schools. Washington, D.C.: Author. National Center for Education Statistics (NCES). (1995). Digest of Education Statistics. (ED Publication No. NCES 95-029). Washington, DC: U.S. Department of Education, Office of Educational Research and Improvement. O'Neil, John. (1996, October). New Option, Old Concerns. Educational Leadership. 54(2), 6-8. RPP International, & University ofMinnesota. (1997). A Study of Charter Schools: First Year Report. (ED Publication No. SAl 97-3007). Washington, DC: U.S. Department of Education. Vanourek, G., Manno, B.V., Finn, C. E., & Bierlein, L.A. (1997, June). Charter Schools As Seen by Those Who Know Them Best: Students. Teachers. and Parents. Washington, DC: Hudson Institute. Wagner, T. (1996, October). School Choice: To What End? Phi Delta Kappan. 78 (1), 70-71. -82-