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Tennessee’s Charter School Sector Would Benefit from Public-Private Partnerships

Performance-based accountability is the hallmark of charter schools and reforms aimed at improving student learning.

Unlike all other public schools, charters must be proactive in their efforts to stay open. They must set and meet rigorous academic goals, and actually meet or exceed their state’s proficiency standards. Unlike the traditional public schools that intentionally remain under the radar, charter schools operate under intense scrutiny from teachers unions, the media, and lawmakers. In states with strong charter school laws that allow for objective oversight, it is clear that performance-based accountability is working.

In the $607 billion enterprise that is the U.S. K-12 education system, public-private partnerships have played, and continue to play an integral role.

Tennessee’s charter school law currently prohibits the non-profit boards of charter schools to contract with education management organizations (EMOs) for services. This is a major flaw in the Volunteer State’s law that is way outside the norm of best practice from almost every other state. In fact, only 10 states of the 43 that allow for charter schools limit a school’s autonomy to contract with EMOs, and these states are among the weakest for charter school laws in the country.

There are over a dozen high-quality management firms that are driven by capital operating in the public charter school sector. They are building public-private partnerships whose bottom line is for the greater good of the public interest. Their entire business model is predicated on student outcomes. If it’s not, they will lose business.

One such EMO, Charter Schools USA (CSUSA) has achieved outstanding results with all students—particularly low-income and minority students—that are significantly higher than the average academic achievement results for such students in the states where CSUSA operates. In Florida, for example, where around 70 percent of CSUSA schools operate, Hispanic and Black students, English Language Learners (ELL), and students who are economically disadvantaged attending CSUSA schools outperformed the state average by 11 percentage points in reading, 7 percentage points in mathematics, and 6 percentage points in writing each year for the past 8 years. (CSUSA also continues to show higher performance than the state with White students, too, and CSUSA’s total student population outperformed the state average by 6 percentage points in reading, 3 percentage points in mathematics, and 6 percentage points in writing. As a district, CSUSA earned an “A” academic average for 6 out of the last 7 years from the Department of Education.

Ninety-six percent of students completing 8th grade at National Heritage Academies partner schools go on to graduate from high school, well surpassing the national average for low-income students (70 percent) and all students combined (83 percent). Additionally, 37 percent go on to graduate college with their bachelor’s degree or higher, nearly five times higher than the national average rate (8 percent) for low-income students (NCES, 2013).

By law, education management organizations may only contract with the non-profit governing board of a charter school. These are public schools that are held to the same state standards, open meeting laws, and transparency. Open-enrollment policies must apply, and students that attend charter schools, regardless of the tax status of the organization that manages it, do so by choice.

Education management organizations bring investment and capital to the communities they serve, creating jobs, innovation, and cost-saving strategies. Most assume great financial risk on behalf of their non-profit clients to build infrastructure and facilities in communities that in any other industry would most likely not be considered ideal or open to business. In fact, like most charter schools, even those in public-private partnerships, receive on average 30% less per pupil than their traditional school peers whose management has no accountability or incentive to improve student outcomes.

For example, National Heritage Academies (NHA) has invested over $475 million in the communities it serves, creating good jobs, and providing new opportunities for students. For each new school, NHA makes a multi-million-dollar upfront investment to cover construction and construction-related costs – the school itself does not pay anything, as the school’s facility is financed privately and with no taxpayer money. In building any new public charter school, NHA typically leverages millions of dollars in private capital to create a new or renovated facility, all at no cost to local taxpayers.

Lawmakers should seize the opportunity to open the doors to public-private partnerships for Tennessee’s charter school sector. Doing so is not only a best practice but an important step to ensure quality growth among charters. Education management organizations serving charter schools bring expertise, capital, quality service and tremendous job creation to the communities they serve.