Charter Schools

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Editors: Neil J. Salkind and Kristin Rasmussen
Date: 2008
Encyclopedia of Educational Psychology
Publisher: Sage Publications, Inc.
Document Type: Topic overview
Pages: 7
Content Level: (Level 5)

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Charter Schools

Charter schools are public schools that are allowed greater autonomy than traditional public schools in exchange for increased accountability for meeting specific educational goals. Individual states' charter school laws vary tremendously, but charter schools generally operate as deregulated public schools, using public funds to support programs founded by parents, educators, community groups, or private organizations. State laws identify public entities like local school boards, universities, or state boards of education to evaluate proposals and grant a limited number of charters or contracts for establishing schools.

Charter schools are often launched to focus on a unique educational vision (e.g., Montessori), gain autonomy from embattled local districts, or serve a special population (e.g., children at risk of expulsion). The degree of autonomy enjoyed by charter schools varies but usually involves school-level decision-making authority over curriculum design, schedules, budget outlays, and hiring. The same entities that authorize charter schools are responsible for monitoring and ultimately closing charter schools that fail to demonstrate evidence of success by the end of a time period established by the charter, usually 3 to 5 years. Before discussing the potential and challenges of charter schools, it is useful to understand the origins of the charter school movement, the relationship of charter schools to the broader issue of school choice, and the popularity of charter schools.

The Charter School Movement

The charter school movement is young but has gained popularity as a mechanism for encouraging innovation and providing public school choice. The paragraphs that follow trace the growth of charter schools from their humble beginnings in Minnesota to their place today in mainstream public education.

Origins of the Charter School Concept

The earliest mention of the term charter school can be traced to the 1970s when a New England educator suggested that new educational approaches could be explored through contracts given to small groups of teachers. The idea was publicized in the late 1980s when a former president of the American Federation of Teachers suggested that local school boards could "charter" a school with union and teacher approval. Philadelphia dubbed their schools-within-schools initiative in the late 1980s "charter schools." In 1991, Minnesota passed the first charter school law developing a program to provide opportunity, choice, and responsibility for results. The following year, California followed suit.

Charter Schools and School Choice

The charter school concept has joined the ranks of school choice designs, including magnet schools, open enrollment, vouchers, and tax credits. Over the past 10 years, states and school districts have expanded opportunities for parents to use public funds to choose the schools their children attend in attempts to improve the quality of education available to students, particularly in urban areas.

Supporters contend that school choice can improve the public education available to all children based on two crucial factors. First, public school choice levels the playing field for less affluent families. Parents with financial resources can choose their children's schools through investing in private education or by virtue of the neighborhoods in which they choose to Page 131  |  Top of Articlelive. School choice provides educational alternatives for families without these resources. Second, school choice proponents argue that competition among public schools serves the diverse needs of students more efficiently than a system requiring students to attend neighborhood schools. Market forces would, in theory, force all schools to improve in order to survive. When parents have the opportunity to choose strong schools, less effective schools lose students and ultimately close. These arguments have led to increasing popularity of school choice programs in general and charter schools in particular.

Criticism of School Choice

In spite of support for school choice from across the political spectrum, the concept is not without its detractors. Charter schools are a target of criticism because they are a prominent and growing example of the popularity of school choice programs. Detractors' concerns revolve around possible cultural isolation and racial resegregation in schools of choice as well as potential detrimental effects for students left behind in neighborhood schools.

A more balanced view suggests that school choice is not inherently good or bad, but its effects depend on policy decisions and their implementation. Big city school districts find themselves in a quandary for a way to gain consensus on a strategy for school reform. Charter schools are appealing because they appear to be a way out, but opponents' concerns should alert policymakers to potential drawbacks. Problems can be minimized through well-reasoned policy decisions in addressing the monumental challenges of improving the public education.

Popularity of Charter Schools

In spite of the controversy surrounding school choice, the popularity of charter schools has grown tremendously in a short period of time. Charter schools are a recent phenomenon, with the first school established just 15 years ago and the average age for all charter schools standing at only 5 years. Even so, they have quickly become a small but growing part of the mainstream educational system. In 2005, charter school laws were on the books in 40 states and the District of Columbia. Although laws varied dramatically from state to state, more than 3,000 charter schools were operating in the 2004–2005 school year. Estimates of the number of children attending charter schools range from 750,000 to 1 million, or roughly 2% of all public school students. Nationally, the number of charter schools grew faster in 2004–2005 than in any of previous four years, adding almost 500 new schools. The states that opened the largest numbers of new charter schools were California, Colorado, Florida, Michigan, Minnesota, Ohio, and Wisconsin.

Great disparity exists among states in terms of the number of charter schools. With more than 500 charter schools in operation, California and Arizona top all other states in terms of sheer numbers. In fact, six states (Arizona, California, Florida, Michigan, Ohio, and Texas) account for almost two thirds of charter schools and charter school students. On the other hand, Washington, D.C. charter schools have the largest share of public school students of all states at almost one in four. In fact, although the total number of schools pales in comparison, a much higher portion of public school students in Washington, D.C., Delaware, and Colorado attend charter schools than in Texas or California.

Potential and Challenges of Charter Schools

The growth in charter schools comes from optimism that they can address many of the difficulties facing public education. Supporters anticipate that the autonomy afforded charter schools will foster innovation and ultimately lead to the development of better schools. Furthermore, they argue that increasing the number of schools from which parents can choose will lead to more balanced ethnic diversity across schools and improved educational outcomes. The hope and reality of each of these expected benefits of charter schools are explored in more detail in the paragraphs that follow.

Innovation in Charter Schools

Charter school supporters foresee innovation emerging from charter schools because of the autonomy they enjoy across many areas, including personnel, curricula, and schedules. Employees of charter schools do not typically belong to local teachers' unions and are considered at-will employees who can be fired for poor performance or compensated for superior service. In addition, alternative certifications may be an option for charter school teachers, bringing skilled individuals into Page 132  |  Top of Articleschools who may not otherwise consider teaching. Such an environment would be conducive to novel teaching methods, but the National Education Association argues that less stringent teaching credentials will lead to inferior educational quality. In addition, the association contends that charter school employees should have the same collective bargaining rights as any public school employees.

Flexibility to differ from district-mandated curricula contributes to the potential for innovation in charter schools. Many charter schools adopt specific curricular programs ranging from character education to technology themes. Freedom for charter schools to set their own schedules allows them to offer variations such as year-round schooling, extended days, or block schedules. In addition, many offer grade configurations unavailable in neighborhood schools, such as kindergarten through eighth or even twelfth grade. Charter schools are also more likely to use structures allowing student groups to remain with the same teacher for more than one year (called looping). Such unique programs are unlikely to be available in traditional public schools, giving parents real choice in finding the best schools to fit their children's needs.

Diversity in Charter Schools

As envisioned by school choice advocates, charter schools have the potential to create better school options for low-income and minority children in urban areas. Nationally, charter schools serve a higher proportion of minority and low-income students relative to traditional public schools primarily because more charter schools exist in urban areas. About a third of states require charter schools' ethnic composition to mirror that of their districts, and some require random processes like lotteries for admission when demand exceeds available seats. However, achieving racial targets is not a fundamental aspect of charter school operation as it is for magnet schools. In fact, some charter schools incorporate cultural heritage themes (e.g., African- or Native Hawaiian-based curricula), which results in less diversity within a given school.

Charter schools' success in providing viable alternatives for all parents is hindered because the families who would most benefit from the availability of public school alternatives often lack resources to take advantage of them. First, transportation or before- and after-school care can seem to be matters of convenience, but they are vitally important to some families' livelihoods. Because few states provide transportation to charter schools, they are out of reach of those without a means of providing it themselves. As evidence of this, studies have shown that lower-income parents rate so-called convenience factors as more important, whereas higher-income parents placed more weight on a school sharing their philosophy.

Second, parents need information to understand and evaluate school options, and limited information access may create hurdles for the most disadvantaged students' families. Schools with a first-come first-served enrollment policy likely hinder families with less timely or sophisticated means of gathering information. As evidence of this dilemma, studies indicate that parents who participate in school choice have higher education levels than those who have a choice but fail to pursue it.

Finally, the reality of parental decision making can hamper efforts to increase racial diversity in schools. Studies suggest that parents report being most concerned about educational quality, but their behavior demonstrates a preference for schools that are close to home where their children are in the racial majority and the school body mirrors their own family's socioeconomic status. In fact, household race has been shown to be the strongest predictor of the racial composition of the charter school selected.

One largely unexplored aspect of diversity in charter schools is the degree to which they serve students with special needs. On average, charter schools enroll a somewhat smaller proportion of special education students nationally than traditional public schools. Once again, the data differ from state to state, with New Mexico and Ohio serving a larger proportion of students with special needs. This disparity stems from differences in goals established for charter schools in individual states. For example, some states emphasize charter schools serving students at risk of failure, which would tend to overrepresent students with special needs in charter schools. However, the concern exists that students who need additional services may be steered away from charter schools in a manner that would be discriminatory.

Educational Outcomes in Charter Schools

Charter school advocates claim that educational outcomes will improve as a result of creating alternatives to traditional public schools. However, the contradictory research findings on the academic success of Page 133  |  Top of Articlecharter schools are staggering. Most studies on both sides of the debate suffer from serious methodological or data limitations. As with all educational research, identifying a reasonable comparison group is a major challenge. Two methods of creating comparison groups are reasonable but come with their own limitations. First, charter school attendees can be compared to students at comparable nearby schools. The problem is in controlling for the fundamental differences between parents who take advantage of choice when it is available and those who do not. Second, charter school attendees who won seats in a lottery can be compared to students who were not chosen. This design controls for the self-selection problem identified previously but limits analysis to schools with long waiting lists, which in itself introduces bias.

The tremendous variety of charter school laws across the country creates another fundamental challenge for researchers. Simply lumping together all charter schools regardless of their program or population and comparing them to the average public school is fraught with problems. Some charter schools target poor and disadvantaged students or students at risk of failure. Others seek to provide enrichment opportunities for students who excel. Some charter schools are funded comparably to nearby public schools, but most receive much less money. Finally, some charter schools operate in supportive local environments, whereas others must expend resources to defend their schools from antagonistic school districts or teachers' unions. Clearly, considering all charter schools as members of a homogeneous population is an oversimplification at best.

In spite of the difficulties, high-profile studies have been conducted attempting to answer questions about the educational success of charter schools. In 2004, the American Federation of Teachers and the National Assessment of Educational Progress reported that charter school students had lower achievement than public school students and that charter schools had a larger achievement gap between those who were and were not eligible for free and reduced lunch, a common proxy for family socioeconomic status. A subsequent Harvard University study encompassing 99% of charter school enrollments compared charter schools with schools students would most likely otherwise attend. This study found that charter school students were more likely than students in matched schools to be proficient in reading and math on state exams. Similarly, two national organizations with opposing views on charter schools reviewed existing charter school research and released contradictory findings in the spring of 2005.

As a result of the confusion in reconciling research on charter schools, the National Charter School Research Project is attempting to provide a balanced perspective and has committed to reviewing all available studies on the subject of charter school attendance and academic achievement. In all fairness, the state of research on charter schools is not surprising given the youth of the charter movement and the great disparity in programs across states. Definitive findings will come from an established body of work finding consistent results across settings and research designs. Such a body of knowledge is necessary to create a firm foundation for policy decisions, but it accumulates slowly over time.

Charter School Accountability

In exchange for increased autonomy, the charter school bargain requires increased accountability for results. However, differences in states' charter school laws lead to dramatic disparity across states in their respective charter schools' goals, standards of success, and consequences for failure. Generally speaking, charter schools can be closed if demand is low, if they fail to uphold their financial and operational commitments, or if they fail to satisfy the terms of their charter agreements. Even so, relatively few charter schools have been closed. During the 2004–2005 school year, only 65 charter schools, or 2% of the total, closed their doors in 17 states and the District of Columbia. As with all aspects of charter schools, the volume of closures varied from state to state, ranging from no closures in 15 states to 21 schools closed in California.

Both sides of the charter school debate attempt to use charter school closings to bolster their arguments. Supporters maintain that the small number of closures is a sign of charter schools' success, whereas opponents argue that few closures mean too many schools remain in operation regardless of performance. Whenever a charter school does close, supporters claim it is simply evidence that accountability works and consequences are real. Detractors contend that a closure is evidence of inherent flaws in the charter school concept. Ideology aside, closing a charter school is often difficult because even poorly performing charter schools can be tremendously popular with parents, especially when other available public schools are even worse.

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Unfortunately, the autonomy enjoyed by charter schools allows room for misbehavior by inept and unscrupulous school leaders. Such was the case in the summer of 2004 when a for-profit, multisite Education Management Organization (EMO) in California faced closure of more than 60 campuses serving almost 10,000 students. In spite of overwhelming numbers, the California Charter School Association helped find new schools with little disruption for students. Students were distributed across California in small schools, and most were accommodated in one of the state's other charter schools. Although it is easy to place blame on the school management company, the local district contributed to the problem by failing to exercise oversight and ignoring ongoing poor performance.

To avoid public debacles like this, some states and the National Association of Charter School Authorizers are pushing pro-accountability standards for authorizing and monitoring charter schools. With tighter reins, intervention is possible before a problem grows to such a scale. For example, steps can be taken to strengthen a troubled school or make management changes at the first signs of problems. As counterintuitive as it may sound, some advocates suggest that the availability of more charter schools would reduce the impact of school closings because competition would draw students away from weak schools before a charter is revoked.

The Future of Charter Schools

In order for charter schools to realize their promise, advocates admit that many obstacles must be overcome. Charter schools have the potential to significantly increase the number of schools from which parents can choose, but a sufficient number of schools must be available to have an impact on the market. Achieving the scale necessary to successfully serve more than a small fraction of public school students requires changes to state laws, equitable funding, and plans for expanding proven models.

Charter School Growth

Even with their popularity to date, the future growth of charter schools is in question because of limits established in many states. Lawmakers often place limits on the growth of charter schools in their states as a means of political compromise. Twenty-seven states have restrictions on the growth of charter schools, most placing a ceiling on the number of new charter schools that may open statewide, in cities, or under specific authorizing agencies. Other states limit growth by setting a maximum number of students enrolled in charter schools or limiting district spending on charter schools. Under constraints in place in 2005, only 725 more schools would be allowed across the country, and almost half of these (340) would be in California. Other leaders in the number of charter schools taken together, Michigan, Ohio, and Texas, are permitted just 29 additional schools under existing legislation.

Although legislative change will be required for the growth of charter schools to continue, pressure to lift existing limits may come from converting failing public schools to charter status. Specifically, provisions of the sweeping No Child Left Behind (NCLB) legislation allow low-performing schools to convert to charter status as part of their restructuring plans. If a school fails to achieve adequate yearly progress for 5 years in a row, it must be restructured in one of five ways: reopen as a charter school, replace the staff, contract with a private company for operations, allow state takeover, or implement some other major governance change. In the 2004–2005 school year, about 400 schools in 14 states have reached the 5-year mark, with another 750 schools in 31 states only 1 year away from reaching the limit. Even before NCLB would force restructuring, several districts, including Denver, New Orleans, San Diego, and Chicago, are beginning to convert failing schools to charter status.

The primary benefit of converting failing schools to charter status is the opportunity for new staff and a new program with the flexibility to address unique student needs. Not surprisingly, drawbacks exist to converting failing schools to charter status. In an attempt to find an easy solution to dealing with school failure, school districts could simply make the switch to charter status without making any substantive changes in the school operations. This strategy could buy time but would be unlikely to improve the school quality to benefit students. An honest commitment to restructuring a failing school as a charter school requires substantial district resources, from recruiting potential managers, administering the charter application and negotiation process, and involving the community to monitoring start-up and ongoing operations.

Funding Charter Schools

Funding inequities pose as serious a challenge to the future growth of charter schools as state caps. Page 135  |  Top of ArticleAttempting to compare charter school funding to other public schools is fraught with many of the same issues as evaluating outcomes. For example, each state structures funding differently depending on student populations served and funding sources available. Furthermore, charter schools often pay for services not included in traditional public school budgets (transportation, oversight, etc.), and some districts provide services at no cost to district-run schools but not to charter schools (assessment, insurance, and services for students with special needs, etc.). Complicating matters, school district financial recordkeeping is not very sophisticated, so fiscal data are not readily available and accessible to researchers.

In spite of these issues, research that accounts for these methodological challenges makes it clear that the greatest funding inequity for charter schools comes from lack of access to incremental local budget dollars above state funds and from restrictions on funding for facilities. A 2005 study released by the Thomas B. Fordham Institute found charter schools underfunded relative to other district-run schools in the vast majority of communities examined, with the discrepancies being larger in most big urban school districts. The gap in 2002–2003 ranged from equity in Minnesota and New Mexico to gaps of more than 25% in Missouri, Wisconsin, Georgia, Ohio, California, and South Carolina. On a per-pupil basis, the average discrepancy is $1,801, which translates to almost a half-million-dollar shortfall every year for an average-sized charter school.

Achieving Scale in Charter Schools

In order for charter schools to become a serious force for improving education nationally, a sufficient number must exist to serve as viable competition for traditional public schools and to provide options for more than a fraction of students. Some charter school advocates laud the grassroots nature of many charter schools started by groups of committed teachers or parents. However, this approach alone is unlikely to produce the scale necessary to affect the quality of schooling nationwide.

One way of expanding the availability of proven charter school models is through EMOs. Most EMOs are for-profit companies like Edison Schools and Nobel Learning Communities, but most for-profit EMOs have yet to show a profit. Nonprofit EMOs like Aspire Public Schools exist as well. At present, only 10% of charter schools are operated by EMOs, and they tend to be larger than the average charter school. As with all aspects of charter schools, however, striking differences exist across states, with some restricting such organizations from operating in their territory by law. Alaska and Minnesota have no EMOs operating charter schools, whereas three quarters of Michigan charters are operated by EMOs, the largest proportion of any state. EMOs offer many resources for charter schools, including a leadership training ground, expertise and management systems, economies of scale, incentive and capacity to sustain schools over a period of time, and investments for research and development and possibly facilities.

Other designs attempt to merge the best of both worlds by leveraging the resources and support of experienced charter school organizers while maintaining the spirit of the independent charter school. Some examples include KIPP Academies in Houston and the Bronx, Minnesota New Country School/EdVisions, and High Tech High. KIPP Academies hope to help open 200 schools across the country by 2010. They are not part of an EMO because each school operates as an independent entity following the basic principles espoused by KIPP in its training and ongoing support programs. Minnesota New Country School/EdVisions is a high school design run by teacher cooperatives with learning through a personalized, project-based curriculum. The organization hopes to start 15 new secondary schools over 5 years with help from The Bill and Melinda Gates Foundation. High Tech High is a proven charter school model incorporating a rigorous personalized math, science, and technology curriculum with ties to the adult world. In 2006, The Bill and Melinda Gates Foundation awarded High Tech High $7.5 million over 3 years for new middle and high schools in California.

Replicating successful school models is likely to be the future direction for achieving charter school growth. Many envision fewer for-profit EMOs as well as a smaller proportion of individual start-up schools. Significant high-profile support exists for expanding the reach of charter schools. Organizations like The Bill and Melinda Gates Foundation are focusing on replication grants for expanding "successful" charter schools. The foundation's funding of charter schools is part of its ongoing commitment to fostering innovative educational programs and encouraging public engagement in improving education. The bulk (80%) of the support of the Walton Family Foundation, Page 136  |  Top of Articlewhich is devoted to education funding, is directed to charter schools. Their efforts range from direct support of new charter schools to funds for charter school management companies, technical assistance organizations, advocacy groups, and research. The founder of the Gap clothing store, Donald Fisher, is also an active contributor to charter schools. These influential philanthropists seem to share advocates' optimism in the potential for charter schools to improve education.

Future of Charter Schools

The charter school movement has gained popularity because of its potential to expand public school choice and improve public education. Predicted charter school benefits include innovation, higher-quality education, diversity, and accountability. The future of charter schools depends on policies that mitigate concerns about the possible downside of school choice. At the same time, further growth of charter schools requires individual states authorizing additional schools, equitable funding for charter schools relative to other district schools, and plans for achieving widespread growth of proven models. Although it is too early to declare charter schools a success or failure and intense study is just now beginning, charter schools' presence in mainstream public education and their high-profile support suggest that they are here to stay.

                                   Angela K. Murray

Further Readings

Betts, J., & Hill, P. T. (Eds.). (2006). Key issues in studying charter schools and achievement: A review and suggestions for national guidelines [Online]. Retrieved November 24, 2006, from

Finn, C. E., & Hassel, B. C. (2005). Charter school funding: Inequity's next frontier. Washington, DC: Thomas B. Fordham Foundation.

Hamilton, L. S., & Guin, K. (2005). Understanding how families choose schools. In J. R. Betts & T. Loveless (Eds.), Getting choice right: Ensuring equity and efficiency in educational policy (pp. 40-60). Washington, DC: Brookings Institution Press.

Hassel, B. C. (2006). Charter schools: Mom and Pops or corporate design. In P. E. Peterson (Ed.), Choice and competition in American education (pp. 149-160). Lanham, MD: Rowman & Littlefield.

Lake, R. J., & Hill, P. T. (Eds.). (2005). Hopes, fears, & reality: A balanced look at American charter schools in 2005 [Online]. Retrieved November 25, 2006, from

Manno, B. V. (2006). Charter school politics. In P. E. Peterson (Ed.), Choice and competition in American education (pp. 149-160). Lanham, MD: Rowman & Littlefield.

Source Citation

Source Citation   

Gale Document Number: GALE|CX2660600045