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The
Michigan Charter Schools Report
February 1999
Executive Summary
This report presents the results
of a year-long evaluation of public school academies—commonly
called “charter schools”—in nine counties in
the greater southeastern Michigan area (Lapeer, Livingston,
Genesee, Macomb, Oakland, Saginaw, St. Clair, Washtenaw, and
Wayne) and referred to throughout this report as the “study
area.” This summary presents our conclusions and recommendations.
The Michigan
Legislature, in the fiscal year (FY) 1995–96 appropriation
bill, required that two separate evaluations of the state’s
charter schools be undertaken. Through a competitive process,
Public Sector Consultants Inc. (PSC), and MAXIMUS, Inc., jointly
won one of the evaluation contracts. (Appendix A presents
information about the two companies. Appendix B lists the
charter schools in PSC/MAXIMUS’s study area and presents
certain pertinent information about them.) The other contract
was awarded to Western Michigan University (WMU), which addressed
identical research questions for charter schools in the western
and central parts of the state.
The study period is school year (SY) 1997–98,
although where possible we have updated the background data
for the schools with 1998–99 information. Note that most
financial data in the report are for SY 1996–97.
The first charter schools in Michigan opened
their doors in 1994, following a number of legislative and
judicial actions. At this writing, there are 138 charter schools
in the state, but the number changes frequently, as new schools
begin operations and some close their doors. PSC/MAXIMUS evaluated
55 schools in their assigned area, approximately half the
charter schools in operation in the state during SY 1997–98.
Conclusions
- Michigan’s approximately
140 charter schools come in all shapes and sizes. Some are
small (40–50 pupils), while a few are large (up to
1,200 pupils); some are brand new, while others have operated
as private schools for more than 20 years; some rely on
a “back-to-basics” curriculum, while others are
trying new approaches; some are functioning smoothly as
a organization, while others barely are surviving. This
wide variety is a key characteristic of Michigan’s
charter schools. It also means that arriving at specific
conclusions about charter schools is difficult, since nearly
every general statement has at least one exception.
- The demand for charter
schools by parents has not abated. In SY 1998–99, the
number of students attending Michigan charter schools is
up 50 percent from the prior year. Sharp increases probably
will continue during the next few years. Most schools we
visited report having a long waiting list, and many school
administrators report that one of their major concerns is
finding enough space to accommodate rising enrollment.
- In the PSC/MAXIMUS
study area, locating and renovating good building space
is the most difficult hurdle for charter schools. Many opened
in substandard buildings and had difficulty meeting fire
safety requirements. While most charter schools have adequate
operating revenue (supplied by the state), the state foundation
grant usually is not adequate to enable a school to build
a reserve sufficient to cope with major repairs, renovations,
or expansion plans, particularly in the early years. Some
schools we visited clearly are using substandard facilities.
New federal grant money will help but is far short of satisfying
need.
- Michigan’s charter
schools have been unable to access the financing options
available to traditional public schools. Only a small number
of schools in our study have been able to finance building
construction or renovation by pledging future state aid.
Some school operators have resorted to financing their facility
with personal assets.
- In many charter schools,
administrators feel isolated from other charter schools
and from the traditional education community. The support
provided by intermediate school districts (ISDs) to charter
schools varies widely across the region; some ISDs still
resist including charter schools in the services they provide
to other public schools. Although charter schools are intended
to be “laboratories”for new techniques that can
improve learning in all schools, the existing isolation
means that there is very little sharing of information among
charter and traditional public schools.
- In most cases, the
presence of a charter school has had very little effect
on the surrounding traditional school district. The most
common response of the surrounding district has been to
extend kindergarten to all day.(1)
- Some charter school
administrators, especially in the early years, are unprepared
to run an organization of the size and complexity of a public
school. The business side of the school, meeting a payroll
and finding an adequate facility, overwhelms some—and
in many cases, the school turns to an outside management
company to perform these functions—but at most schools,
this early turmoil abates after a year or two of operation.
- Early opponents of
charter schools were concerned that the academies would
attract or accept only the best and brightest public school
pupils—the “cream of the crop.” Our conclusion
is that this is occurring only rarely. In fact, based on
the finding that many of the charter-school parents we surveyed
for this study report that their children had been having
difficulty in their former, traditional school, we conclude
that if “creaming” takes place, it is that charters
tend to attract some of the most involved and motivated
parents. (Appendix C presents methodology and results of
parent and teacher surveys.)
- On the whole, parent
involvement is much higher at charter schools than at traditional
schools. The act of removing their child from a traditional
school and finding the right charter school tends to occur
among parents who are engaged in their child’s education.
Moreover, few charter schools provide transportation, so
most parents are at the school twice a day, dropping off
and picking up their child. Some schools go further and
require a certain number of hours each month from a parent.
As always, there are exceptions to this general observation:
Some charter school administrators still lament the inability
to get more parents actively involved in the school.
- The percentage of minorities
in the study-area charter schools is higher than in both
the state as a whole and the traditional public school districts
in which the charter schools are located. In SY 1997–98
minorities comprised 68 percent of study-area charter school
enrollment and 14 percent of the Michigan population; in
SY 1995–96 minorities comprised 66 percent of study-area
charter school enrollment and 54 percent of surrounding-district
enrollment. (We do not have data for the same year for both
the state and the surrounding districts.)
- For-profit management
companies are playing an increasing role in the charter
school movement. It is likely that in a few years the single,
independent charter school will be an exception. The effect
that multi-school (“chain”) management companies
have on education should be the subject of future research.
While management companies clearly address some of the business
issues facing schools—e.g., cash flow management, facility
financing, human resources management, regulatory compliance—they
also may reduce classroom innovation by applying a standard
setup for multiple schools. Recently, some individual charter
school administrators have established their own management
companies. This allows the school to opt out of the state
teacher-retirement system and, in some cases, permits the
school to borrow for start-up funds.
- Few charter schools
have the facilities or funds to provide food service for
their students. This is unfortunate because in most, the
vast majority of the children are eligible for free or reduced-price
lunch (e.g., their family income falls below a certain threshold
based on family size). State law requires K–12 school
districts to operate a lunch program, but most charter schools
in the PSC/MAXIMUS study are exempt from this requirement
because they do not serve all 13 grades.
- Michigan’s charter
schools are more an experiment in organization than an innovation
in curriculum or instruction. Experimental techniques are
used in some of the schools we visited, but, in general,
schools rely on common curriculum and pedagogical methods.
“Niche” charter schools are the notable exception—schools
that specialize, for example, in an ethnocentric curriculum
or hard-to-teach kids. What does distinguish most charter
schools from their traditional public counterparts is the
former’s application of site-based management and also
the relatively small setting in which it occurs. Site-based
management is the fundamental difference between charter
schools and traditional public schools.
- Compared to traditional
public schools, charter schools in Michigan have both financial
advantages and disadvantages. Charters do not have access
to debt millage to fund the purchase and renovation of school
buildings. Charters’ state aid is capped, which for
many means that the level of aid they receive is below that
received by the surrounding traditional public school district.
Charters also must pay their authorizer up to 3 percent
of all state revenue they receive. On the other hand, most
charter schools do not provide student transportation, they
concentrate on elementary grades (which generally are less
expensive to operate), and they employ younger, less experienced
teachers. Finally, charter schools are allowed to limit
the number of pupils they serve, an advantage not available
to traditional schools.
- There is a wide variation
in the finances of charter schools, at least in the study
area. Some are doing very well financially, with a large
operating fund balance, while others are struggling with
a small or negative balance. The most recent financial data
suggest that the two most important factors determining
a school’s financial condition are (1) the number of
years the school has been operating and (2) whether it is
independent or part of a multi-school management company.
A small, but significant, number of charter schools had
severe financial difficulties in the first year of operation,
but most problems decreased over time. On average, second-year
charter schools have an operating fund balance of about
6 percent of revenue, and third-year schools have a balance
of about 13 percent. In SY 1996–97, charter schools
run by a full-service management company had an average
fund balance of 17 percent, compared with a fund balance
of 5 percent for independent schools.
- There are serious questions
about the reliability of the state Michigan Educational
Assessment Program (MEAP) test as the primary measure of
charter school student achievement. It is difficult to refute
the argument of many study-area charter school administrators
that at least initially, the MEAP results reflect the performance
level of the students as they enter their schools. Moreover,
the MEAP does not have "face" validity among many
charter school administrators, who are concerned that the
test may have racial or gender bias, uses only one mode
of assessment, and largely is tangential to the objectives
they have set for their school.
- Overall, the level
of SY 1997–98 MEAP scores show charter schools below
the average of neighboring traditional schools. On average,
first-year charter schools score the lowest, while second-
and third-year schools perform at a level closer to the
average of traditional public schools. Although starting
at a lower point, the improvement in MEAP scores among the
charter schools is greater than among a comparison group
of traditional schools. (Appendix D presents certain MEAP/HSPT
testing and comparison results.)
- Attracting teachers
generally has not been a problem for study area charter
schools, but in many schools retaining teachers is an issue.
Some teachers leave after a year or two because either they
cannot adjust to their school’s teaching environment
(which may be much different from that of a traditional
school), or the school cannot financially reward experienced
teachers at the same rate as traditional schools. In general,
charter schools employ less experienced teachers at considerably
lower average pay.
- There is lack of agreement
on what the proper role should be for the authorizer (the
entity—a state university, public school district,
intermediate school district, or community college—under
which a charter school operates) of a charter school. Several
factors contribute to the problem. First, when the original
schools opened in 1994, the procedures and methods employed
by authorizers had to be created immediately, without prior
experience; since then, improvement has occurred as authorizers
learn and improve their process. Second, there is a potential
conflict between the authorizer’s two roles (regulating/monitoring
the charter school and assisting/guiding it). Finally, and
most important, there seems to be a considerable difference
in how the authorizers and the general public view the extent
to which an authorizer is responsible for a charter school’s
performance/conduct.
- The Michigan Department
of Education (MDE) has had a limited role in assisting charter
schools; for example, the state charter school office is
staffed with only one professional and an assistant. Because
of this limitation, the department’s role has been
restricted to categorizing and filing documents, answering
questions, and applying for federal charter school grants.
Many charter schools struggle to complete mandated paperwork
and as yet fail to fully know or understand the many requirements
imposed on any public institution in Michigan (financial
disclosure, open meetings, and so on).
- Charter schools are
having considerable trouble with state and federal special-education
requirements. Charter schools typically are so small that
the cost of providing specialized instruction for one or
two learning-disabled children is prohibitive. Equally important
is that some charter school administrators and parents do
not subscribe to the notion that public schools should be
required to make special provisions beyond that required
to accommodate physically disabled students.
- More time is needed
to fully assess the effect of charter schools on public
education. While the current study is a good first step,
assessing the quality of education in charter schools will
take a series of studies over many years.
Recommendations
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