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LISC
Ánimo Pat Brown Charter High School, in Los Angeles, California, is committed to fostering a community of empowered learners and socially conscious and concerned citizens.
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Why Charter Schools?
Elise Balboni, Project Director, Local Initiatives Support Corporation (LISC), and Ann Margaret Galiatsos, Management and Program Analyst, U.S. Department of Education
Overview
Charter schools operate under a charter, or contract, with state-approved authorizing entities, such as local school districts, state departments of education, universities, other nonprofit groups, or specialized chartering boards. Like other public schools, charter schools do not charge tuition and are nonsectarian. In addition, charter schools may not practice selective enrollment.
The charter school movement is a response to the deteriorating performance of the public school system, most notably in urban areas, and to a persistent achievement gap between minority or low-income students and their peers. Minnesota passed the nation’s first charter school law in 1991. Since then, the number of schools and the number of students attending charter schools have grown significantly. Today, approximately 5,000 charter schools educate more than 1.6 million students in 40 states and the District of Columbia. Charter schools represent 5 percent of all public schools nationally and serve 3 percent of all public school students.
Figure 1: Charter School Growth

Source: National Alliance for Public Charter Schools
Quality charter schools provide public education alternatives to low-income students and families that do not have the option of private education or moving to a neighborhood with a quality district public school. Studies have shown that they can help boost educational achievement and the future earnings potential of their students. Beyond these benefits, successful charter schools also serve as community anchors and forces for revitalization. They help maintain and strengthen a community’s population, redevelop deteriorating properties, provide a safe place to offer health and other community services, and ultimately act as a beacon, attracting further housing and business development.
Location
Charter schools tend to be located in low-income communities and low-performing school districts where the need for quality educational options is greatest. The New Orleans and Washington, D.C., school districts had the most charter schools in the United States in 2009-2010, and Los Angeles and Detroit had the most students enrolled. As illustrated in figure 2, in the 2008–2009 school year, more than half of all charter schools were located in urban areas, compared with 25 percent of all non-charter public schools.
Figure 2: Charter School Location
(2008-2009 School Year)

Source: National Alliance for Public Charter Schools
Because they tend to be located in urban areas, charter schools serve a relatively higher percentage of minority and low-income students. Nationally, roughly 43 percent of charter school students are eligible for the federal free or reduced-price lunch program, compared with 40 percent in non-charter schools. In the 2009-2010 school year, charter schools nationally had a student body that was 56 percent black and Hispanic, compared with 38 percent in non-charter schools.
Charter School Academic Achievement
Charter schools disproportionately serve minority and low-income students in large, underperforming urban school districts. How have they performed academically? Do they outperform traditional district public schools? The debate over these achievement questions has been fierce at times over the past two decades, frequently involving complex research methodology questions that can be difficult for the layperson, the press, and the general public to parse.
There is no single definitive study that answers the question of how charter schools are performing compared with traditional public schools at the national, state, or even district level. There have been nearly 300 studies examining charter school performance, many with contradictory findings. In its December 2010 report, "Measuring Charter Performance: A Review of Public Charter School Achievement Studies,"
the National Alliance for Public Charter Schools reviewed 203 studies that compared charter school achievement with that of traditional public schools and examined a significant segment of the charter sector. While the results of these studies were mixed, analysis of 33 high-quality studies that used longitudinally linked student-level data ("panel studies") from 2001 and later shows that charter schools produce more instances of larger achievement gains in both math and reading when compared with traditional public schools (see table 1).
Table 1: Charter School Gains Compared With Those of Traditional Public Schools
(Based on Panel Studies Using Post-2001 Data)
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Reading gains
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Math gains
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| Level |
Larger |
Similar |
Mixed |
Smaller |
Larger |
Similar |
Mixed |
Smaller |
| Elementary |
5 |
2 |
2 |
6 |
5 |
4 |
2 |
5 |
| Middle |
9 |
6 |
1 |
4 |
10 |
6 |
2 |
3 |
| High |
9 |
2 |
0 |
4 |
7 |
4 |
1 |
4 |
| Overall |
12 |
9 |
0 |
9 |
15 |
5 |
0 |
10 |
| Total |
35 |
19 |
3 |
23 |
37 |
19 |
5 |
22 |
Source: "Measuring Charter Performance: A Review of Public Charter School Achievement Studies" (National Alliance for Public Charter Schools)
Note: Number of research findings totals more than 33 because most studies reported more than one finding (e.g., reading and math, elementary and middle, etc.). Overall means that the studies examined performance data using combined grade levels.
Thirty-three studies also compared the achievement of students who stayed at a charter school for an extended period of time with that of traditional public school students. Of these studies, 21 found that charter school students showed larger gains the longer they were enrolled in charters, 11 found similar or mixed results, and one showed smaller gains for charters.
In addition to illustrating the need for more high-quality studies on charter performance, these studies underscore the fact that there is no "uniform"
or "average"
charter school. When underwriting charter schools, it is important to analyze academic performance from both a mission and a financial perspective. Certain jurisdictions with strong charter environments, such as Massachusetts and New York City, have produced extremely strong charter schools. Some stand-alone charter schools and nonprofit charter management organizations seem to have found the right formula of culture, teaching, and curriculum that allows their students to make great gains in achievement and outperform not only district but also statewide performance benchmarks. An integral part of charter accountability is that poor or underperforming charters should be closed and high-performing charters should be replicated, both within the charter sector and by sharing best practices with traditional district schools.
Outlook
The $4.35 billion competitive federal Race to the Top grant fund, launched by the federal government in 2009, has given far greater visibility to charter schools as part of broader education reform efforts and has prompted the removal or loosening of state caps on charter growth. The year 2010 also featured the charter documentary film, with Waiting for Superman and The Lottery, among others, calling for reform with a sense of urgency not normally associated with large system change. Securing adequate and affordable facilities remains a central challenge for charter schools, however, hindering the growth of some of the nation’s highest-performing schools and limiting the scale of the movement as a whole.
Elise Balboni can be reached at (917) 698-9960 or elisebalboni@gmail.com; Ann Margaret Galiatsos can be reached at (202) 205-9765 or ann.galiatsos@ed.gov.
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Fostering Public Policy Initiatives
Long-term sustainability of alternative education reform models requires consistent funding streams and increased access to public facility financing. The Educational Facilities Financing Center (EFFC) at the Local Initiatives Support Corporation (LISC) is helping to create and enhance state and federal financing mechanisms and documenting best practices in facility financing. As part of the documenting process, EFFC published "The Finance Gap: Charter Schools and Their Facilities"
in 2004 and its "Landscape"
series in 2005, 2007, and 2010.
The "2010 Charter School Facility Finance Landscape"
is an updated mapping survey of private nonprofit and public financing programs for charter school facilities across the nation. It includes descriptions of private philanthropies and nonprofit organizations active in the sector and, for the first time, information on charter school access to the tax-exempt bond market. Performance data are provided for both loans and tax-exempt bond issues. Public initiatives are also detailed, including federal programs supportive of charter school facilities and state policies in all 40 jurisdictions with a charter law.
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| The Public School Achievement Gap
In November 2010, the U.S. Department of Education released "The Nation’s Report Card: Grade 12 Reading and Mathematics 2009."
The report includes results of the National Assessment of Educational Progress (NAEP), an achievement measure for various subjects that has been conducted periodically since 1969. The 2009 "Nation’s Report Card"
took nationally representative samples of 12th-graders from 1,670 schools across the nation. While the report showed that performance has improved in both reading and math since the last assessment in 2005, it also showed that racial and ethnic gaps persist.
In reading, the 2009 "Nation’s Report Card"
showed a 27-point gap between white and black students and a 22-point gap between white and Hispanic students. These gaps were similar in magnitude to those of all assessments going back to 1992. Similarly, in math, the report showed a 30-point gap between white and black students and a 23-point gap between white and Hispanic students; the gaps were almost identical to those in 2005, the only comparable assessment year. These gaps translate roughly into average performance at or near proficiency for white students and at or near basic for black and Hispanic students.
An October 2010 study by the Council of the Great City Schools, a national organization representing the needs of urban public schools, examined the achievement gap specifically for black male students. The study analyzed NAEP proficiency levels nationally for black males and found that on the 2009 fourth-grade reading assessment, only 12 percent of black male students performed at or above proficient levels nationally, compared with 38 percent of white males. In eighth grade, only 9 percent of black males across the country performed at or above the proficient level in reading, compared with 33 percent of white males. Math results were similarly uneven in both grades.
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OCC's Community Affairs Department
(202) 874-5556
E-mail CommunityAffairs@occ.treas.gov
to receive a print copy of this Community Developments Investments or another publication.
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