Many philanthropists put improving public education at the top of their agenda, but for many years donors have struggled to have a real impact on sub-par schools. Too often, grants to support reform in existing schools have made little difference toward improving student performance.
Enter charter schools. Independently operated and free from many laws and regulations that constrict traditional district schools, charter schools strike many funders as one of the most effective ways to invest in public education. Nearly 18 years after the nation’s first charter law was passed in Minnesota, charter schooling remains one of the nation’s most promising efforts to produce more great public schools, especially for low-income and minority students. Forty states and the District of Columbia now have charter school laws, and more than 4,000 schools serve over 1.4 million students—about 3 percent of the nation’s public school population. Families continue to clamor for more charter schools, lining up on long waiting lists for the chance to enroll their children.
The Promise of Charter Schools
The promise of charter schools helps explain why philanthropists from coast to coast continue to play a vital role in the charter sector, as they have from the very beginning. Over the past 15 years, funders have supported school entrepreneurs during the critical start-up years. They have helped successful charter schools replicate themselves. They have backed organizations that exist to help charter schools succeed, and have educated state leaders about the need to foster a charter-supportive policy environment. And they have helped create an educational sector that liberates teachers and administrators from the constraints imposed by traditional district schools, allows more experimentation and innovation in the classroom, and provides public education choices for parents and students.
Many charter schools across the country have moved to the forefront in educational achievement, and some are producing astonishing results with traditionally underserved groups of students. The most successful have served as models for new charter schools and, in some areas, spurred innovation in traditional district schools.
New Opportunities, New Challenges
For all of its potential, the sector still faces many challenges. Though many funders remain excited by the possibilities of chartering, they nevertheless share a number of concerns about the state of the sector.
Quality. The quality of charter schools remains uneven. It is not uncommon to find charter schools among the very best of a city’s or state’s public schools—but also, sometimes, among the worst. And it has proven difficult for those who oversee charter schools to shut down those that are unsuccessful. Many funders wonder if they have done enough to insist on high quality in the schools they support.
Funding. Charter schools continue to be under-funded. Almost all states deny charter schools capital funding, forcing them to spend a portion of their operating funds on facilities. And in many states, charter schools receive less than 100 percent of the operating funds district schools receive.
Access. Access to charter schools varies greatly across the country. Ten states do not even permit charter schools, and the laws of many other states hinder the growth of truly independent charter schools. According to the Center for Education Reform, which publishes a charter school laws “report card” annually, only 21 states earn an “A” or a “B” for the quality of their charter laws.
Opposition. While charter schools have gained bipartisan support in many places, in others the political backlash against them has grown along with the sector. Even where charter schools are producing extraordinary results, they remain controversial due to the threat they pose to established interests. Opponents seek to limit the number of charter schools, restrict their autonomy, cut their funding, and place them under the authority of school districts and collective bargaining agreements.
To address these challenges and help the charter sector live up to its potential, a broader spectrum of private donors, foundations, education entrepreneurs, businesses leaders, and policymakers must take some new and different steps. Relying solely on the strategies and the players of the past is simply insufficient given the challenges of the future. Too much is at stake to allow charter schools to plateau, especially at a moment when charter schools are an option available to just 3 percent of public school students nationwide.
The Need for Small- and Mid-sized Funders
Today more than ever, the charter sector needs an influx of small- and mid-sized funders. Smart investments, even if modest, can be leveraged to produce big results. There is a widespread feeling among charter-sector donors that additional funders must be brought into the charter sector. No one can quantify precisely what it would cost to build the sector from its current size to its potential scale, but the price-tag would surely reach into the tens—perhaps even hundreds—of billions of dollars. Current donors see this need at all levels of the sector, from national organizations needing support for scaled-up efforts to individual schools just starting out.
Perhaps more important than funds, however, is the energy, vitality, and innovation that small- and mid-sized funders can bring to the charter sector. To encourage this new wave of smart, smaller funders, this guidebook offers chapter-by-chapter advice for relatively small donors, as well as examples of truly consequential, sub-six-figure charter-related grants.
The charter sector remains heavily influenced by the philanthropic community, which has played an enormous role since its beginning. Attentive to the promise of charter schools, in 2003 The Philanthropy Roundtable commissioned Jump-starting the Charter School Movement: A Guide for Donors. Today, given the challenge of growing the charter school sector while maintaining its quality, the Roundtable has commissioned a thoroughly revised guidebook, Investing in Charter Schools: A Guide for Donors, which builds on the earlier work while drawing heavily on recent developments in the charter sector and incorporating the advice of leading charter funders.
The goal is to offer donors new to the field the best ideas about the most effective ways they can support a high-quality charter school sector, both in their communities and across the country. To that end, the guidebook draws on the deep experience of many of the sector’s most active funders. It reflects their thinking about how private philanthropists can lift the charter school sector to a new level of excellence in the next 20 years. These funders have many different ideas about the best ways to support chartering. As a result, it does not offer a simple recipe for all donors to follow. Instead, it offers a menu of possibilities for readers to choose from, adapt, and implement.
A Word of Caution
Before considering charter-support strategies, a word of caution is in order: The charter school landscape differs vastly from state to state. Depending on each individual states charter law, funding formulas, flexibility, and authorizers (the organizations that license and oversee charter schools) can vary widely. New funders, especially those working in a specific city or state, must take the time to learn about the local landscape. They must investigate and become thoroughly familiar with the state’s charter laws—if the state has one.
Five Strategic Priorities
When making grants or investments in the charter school sector, donors naturally want to be strategic. They want to focus their funding on activities and organizations that can make a long-term difference for the success of chartering. How can funders target their resources to maximize their return on investment in a high-quality charter sector?
Taking the charter sector to the next level—in terms of both scale and quality—will require addressing these five strategic priorities:
Building a Robust Supply of High-quality New Schools: Since the first charter school opened in 1992, the number of charters nationwide has grown tremendously. But families continue to demand more charter schools, with waiting lists growing steadily longer and parents becoming ever more frustrated. How can donors help ensure that there are enough new charter schoolsand sufficient excellence among themto fulfill the demand for better schooling options?
Priming the Human Capital Pipeline: In charter schools, as in all schools, teachers and leaders are absolutely essential to student success. Yet charter schools face shortages of highly effective teachers and leaders, especially those who are prepared to work in their unique environments. Funders will have an important role to play over the next several years, supporting the development of a well-primed pipeline of talented human capital for charter schools and helping fund the development of innovative technologies that can decrease the dependence of the sector on finding ever more sources of talent.
Addressing Critical Operational Challenges: Severe operational challenges have made it difficult for charter schools to start and thrive. Obtaining adequate “back office” services, financing facilities and operations, and developing sound business and accountability plans are among the most prominent difficulties. Tackling these challenges would help more charter schools open, and help existing charter schools focus on creating great learning programs.
Defining and Improving Quality: Charter school authorizers are the organizations that grant charters and oversee charter schools. In theory, they exert quality control in chartering, screening out unqualified charter applicants, and holding schools accountable for results. But too few authorizers are equipped to perform these roles well. Beyond authorizers, there is minimal information available to the public about how well charter schools are doing. Donors can help by investing in the collection and dissemination of data on charter schools, and by establishing clear measures and standards of quality for charter grantees.
Forging Charter-friendly Public Policies: Charter school policy establishes the processes and conditions under which all of a state’s charter schools must operate. Yet in too many states, charter school policies are hindering the potential effectiveness and the scale of the charter sector. In other states, good policies are under attack by charter opponents. Charter advocates are rarely as well-organized or well-funded as those who challenge them. Public policy will remain a major factor in determining whether the charter school sector is able to capitalize on its successes so far and continue to grow with quality.
The bulk of Investing in Charter Schools is dedicated to a close examination of these five strategic priorities. The guidebook describes each strategic priority in detail and explains how funders are addressing it—or hope to. A concluding section pulls back for a broader view, examining the next phase of philanthropic support and suggesting a series of “Big Ideas” in need of funding.
The Philanthropy Roundtable is committed to helping donors achieve dramatic breakthroughs in the improvement of K-12 education—an area in which many charter schools have proven themselves especially effective. Today, the challenge is taking the charter sector to scale while maintaining high standards of quality. To address these evolving questions, the Roundtable commissioned Investing in Charter Schools. While we believe this guidebook will prove useful for experienced donors in the field, we also hope to reach new and potential donors—donors this guidebook may inspire to expand and enhance the charter sector.
Investing in Charter Schools: A Guide for Donors was prepared by Public Impact for The Philanthropy Roundtable. The guidebook was completed by Julie Kowal, Bryan C. Hassel, and Sarah Crittenden, with contributions from Dana Brinson and Jacob Rosch. This article is excerpted from Chapters I and II of the guidebook. The Roundtable will provide hard copies of the guidebook, free of charge, to qualified donors.
