2012-12-06 / Business News

Charters chart big-growth course


Charter Schools, USA students in a computer lab. 
COURTESY PHOTO Charter Schools, USA students in a computer lab. COURTESY PHOTO Charter schools — tuition-free schools funded by taxpayers, reviewed for quality by a nonprofit oversight board and often managed by a for-profit business or a public agency — have exploded with growth in Southwest Florida.

The epicenter appears in Lee County, where 14 percent of almost 84,000 public school students, or about 11,400, are now enrolled in 23 charter schools, according to school district numbers and a report published last month by the National Alliance for Public Charter Schools. Those statistics tie the county at 18th in the nation and put it near the top of Florida school districts serving children in public charters, behind Miami-Dade and Broward counties.

Say what you will about their quality — school performance ratings are strong in some areas, and spotty or poor in others — the charter business appears to be booming.

HAGE HAGE “We’ve been in Lee for about 10 years, and our original involvement was based on fast growth — so it was a quantity issue, rather than the quality issues you find in urban cores,” says Jon Hage, president and CEO of Charter Schools, USA, a for-profit business that operates six schools in Lee County, and 48 schools across five states.

But now it’s a quality issue in Lee and other Florida communities, as well, he argues — although school district figures show that charter schools in general are not more likely to produce exceptional students than traditional public schools.

In Collier and Charlotte counties, charter school interest has ranged from lukewarm to cautious. Collier County offers three charter schools with two more coming next year already approved by the Collier school district. Currently, only 844 of Collier’s 44,300 public school students attend a charter. A Collier school district spokesman, Joe Landon, would not comment on their performance or quality.

ELLIOTT ELLIOTT Charlotte, meanwhile, has one — Edison Collegiate High School, with 380 of the county’s 15,800 public school students. “There was a charter school many years ago that did not do well, and that may be a reason we don’t have more now,” says Diane Junaeu, principal of Edison Collegiate, whose first graduating class of seniors — about 85 — will receive their diplomas in May. The school started with 100 freshmen in 2009, and added roughly 100 students each year because the results have been good.

Advantages promote growth

In the eyes of Mr. Hage at Charter Schools, USA, charters are succeeding nowadays — his company’s, at least — not because of growth needs but because they have some advantages, and thus the educations they provide are equal to or better than traditional public school educations in the eyes of consumers (the parents and students).

His is not the only voice to cite distinct advantages for charters. Since charters don’t have to meet the stringent building codes of public schools, the brick and mortar cost is less expensive. And if they aren’t building their own, they can lease, officials say.

In addition, the schools tend to be neighborhood institutions not restricted by minority-enrollment marching orders that traditional public schools must follow (for the most part, it’s first comefirst served).

Another significant advantage is smaller class size — sometimes.

“That’s why so many people come away from public schools — it’s the biggest issue,” explains Elizabeth Elliott, a professor of education at FGCU who sat on the governing board of the four Cape Coral charter schools when they got under way in the last decade. At the time, the city borrowed the money and built them, then leased them to the management teams.

But that may have changed somewhat since she and others helped Terry Stewart, then Cape Coral city manager and now Fort Myers Beach city manager, create a charter alternative to the school district’s traditional schools.

Now, only about half of charter schools in Lee have smaller class sizes than other public schools. And only a quarter (six) have been given the coveted highperforming designation of schools that receive A grades from the state at least two years running. Three of those are Cape Coral municipal charter schools.

That points to another advantage: parent involvement.

“One of the core principals in establishing charter schools is that there has to be parental involvement at and with the school for the child to continue to qualify to go to school there,” says Mr. Stewart.

“All the studies about education will tell you that one of the prime indicators of success is parental involvement.”

In the end, even their champions can express ambivalence.

“I’ve seen them do good work,” says Professor Elliott. “They’re not all bad. They’ve taken the pressure off school districts with increasing populations who can’t afford to build buildings. And they tend to be in neighborhoods or communities (where their students live).”

And if they’re no good, they don’t last.

“When a public school is poor, it goes on for 50 years,” says Mr. Hage. “When a charter school is poor, it gets closed down. And that’s as it should be.”

How it actually works

Quality may be an arguable point, but this isn’t: Lee County offers a business model detailing both the complications and the successes that overseeing charter schools can entail.

For any charters, there has to be a nonprofit or public agency that applied for a charter, and that signed a contract with the school board.

Sometimes the school district pays the governing board, which hires staff and secures a facility.

“However, what is more common is for the nonprofit governing board to contract with a third party to run the school, and in most cases these contractors are for-profit corporations,” explains Jeff McCullers, director of grants and the program liaison of the public charter schools division in the Lee County schools.

For-profit businesses managing charters in the county come from Florida (Charter Schools, USA, based in Fort Lauderdale, with six); Tennessee (Accelerated Learning Solutions Inc., with two schools); Massachusetts (Nonpublic Educational Services Inc.) and Oklahoma (Advanced Academics Inc.) with one school each.

In addition, a specially appointed Cape Coral board, a public agency, oversees four schools; an Ohio nonprofit, EdVantages Inc., has three schools; and Goodwill Industries Inc., has one school, along with Edison State College.

Watching all of that in its various stripes and spots is the county’s school district. In fiscal year 2012, it paid out $71.68 million to the schools, which receive most of their money based on a state mandated price for each FTE student, or full-time equivalent student.

School districts that oversee charters are allowed by state law to hold back 5 percent of fees that charter schools are entitled to receive for their service as overseers, but it’s never as easy as it sounds, says Dr. McCullers.

“There are numerous obligations for which districts receive no reimbursement,” he explains. “For example, the staff time cost of reviewing charter applications is considerable. In the current round, 19 different employees have provided dedicated time to this process in reviewing applications, preparing application analyses and summaries, communicating with applicants and maintaining the web-based information system used by applicants an reviewers.”

Then there’s the oversight.

“The fiscal year-12 district investigation that led to the closing of Richard Milburn Academy in Fort Myers used over 200 hours of staff time. These closures have required an enormous contribution of time from school board attorneys, cabinet members, and many department staff members. Major changes in budgeting, billing, programming, reporting, mail and other courier service, student support staff scheduling, inventory, mainframe account security, District e-mail account management, and warehouse operations have been required. Numerous inquiries from the media have taken up more staff time.”

That’s probably what it takes to rank number three in Florida and number 18 in the country for the percentage of students attending charter schools instead of traditional public schools.

But it still stands in sharp contrast to the top dogs in the charter-school world.

New Orleans, ranked at number one, sends 76 percent of its public school children to charters, for example, followed by Detroit and Washington, D.C., both at 41 percent; Kansas City, Mo., at 37 percent; Flint, Mich., at 33 percent; and Gary, Ind., along with St. Louis tied at 31 percent.

Although Southwest Florida education issues may differ significantly from those in such urban centers, growth appears to be possible in both environments.

Charter Schools, USA, grew by 40 percent last year, with 10 new schools in Florida, says Mr. Hage.

He predicts similar growth again this year. ¦ >> Jon Hage, president Charter Schools, USA:

How the for-profit company works:

“We have a nonprofit board. They hire us, we’ll come in, we help develop the school, we find a builder, we put together a whole plan, and we operate the school for the board. The board pays for the schools.

“(When we build a school) We have to follow local codes that a private school would have to follow — but not the public schools. That allows us to go in and build schools in more efficient and effective ways.

“Our average school is built in about six months. The average school-district school in the state takes 30 months, with average costs 2½ times ours.

“The average ‘kid station’ for us costs $10,000. The state average is about $22,000 to $25,000.”

How money is leveraged:

“So we’ll go to market and sell tax-exempt bonds, and they will help finance schools under long-term debt. We’re a larger operator and we do things in the marketplace a small mom and pop would have a harder time doing.

“We’re the largest seller of charter school bonds in the United States — we sold $60 million last week.

“Banks like Oppenheimer & Co., or Lord Abbett & Co. — all the major banks that buy bonds — they’ll look to this as a major place to buy debt.

“After the school is built and students show up, we will borrow the debt for the school, and the school will eventually pay it off. “ >> Professor Elizabeth Elliott, advice for parents shopping for schools:

“Research what the charter school has, as opposed to public schools. What services to do they offer, what curriculum do they use? There are different ones. I would want to see how the curriculum compares to what’s being taught in public schools.

“I would also want to see where the charter is in district school grades compared to other schools. Where they are in AYP — it’s called Adequate Yearly Progress, and it’s public record. Are they equal to or better than other public schools?

“So I would do my homework — look at class size, teacher qualifications, those types of things.”

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