Charter schools represent a distinct approach within the public education system. These tuition-free schools of choice operate with public funding yet are governed independently. The charter school concept originated over 25 years ago in Minnesota, born from a desire to reduce bureaucratic obstacles in traditional public schools and empower educators to foster innovation. Since then, charter schools have evolved into a significant national movement, encompassing 44 states and the District of Columbia. Current figures from the federal government indicate approximately 7,000 charter schools serving 3 million students.
The foundational principle of charter schools lies in a unique agreement: in exchange for greater autonomy from many state laws and regulations that govern conventional public schools, charter schools commit to a legally binding contract, or “charter.” This charter outlines the school’s mission, academic objectives, financial protocols, and accountability standards. Oversight of this charter agreement is provided by an “authorizer”—an entity empowered to approve and, crucially, close charter schools that fail to uphold their contractual obligations. Depending on state legislation, authorizers can be state agencies, universities, or local school districts.
This framework is often described by charter school proponents as the “charter bargain”: increased freedom paired with heightened accountability. The specific regulations from which charters are exempt, and the intricacies of their funding mechanisms, are determined by individual state laws, leading to variations across the country.
Unlike traditional public schools that assign students based on residential zones, charter schools operate on a choice-based enrollment system. Families actively choose to enroll their children in these schools. When a charter school experiences more applications than available spots, student selection typically occurs through a random lottery, ensuring equitable access.
Although charter schools currently educate a relatively small segment of the nation’s public school population—around 6 percent—their presence is considerably more pronounced in certain urban areas. In 19 major cities, the market share of charter schools has surged to over 30 percent, according to data from the National Alliance for Public Charter Schools, indicating a significant influence in these educational landscapes.
As a pioneering form of competition to the established public schooling model—and a direct contender for limited educational resources—charter schools remain a subject of considerable debate and controversy within the education sector and broader public discourse.
Who Takes Charge of Charter Schools? Understanding Operational and Oversight Structures
On a daily operational basis, charter schools are managed by a school leader, often a principal, and are governed by an appointed board, a structure analogous to that of a local non-profit organization. A key distinction from traditional public schools is that charter schools are not directly supervised by an elected school board. However, it’s important to note nuances to this, which we will elaborate on shortly.
At a broader, systemic level, charter schools are subject to the oversight of an authorizer. These entities are legally empowered at the state level to authorize the creation of new charter schools and to mandate the closure of underperforming ones. The National Association of Charter School Authorizers identifies six primary categories of authorizers: independent chartering boards, state education agencies, institutions of higher education, non-educational governmental bodies such as mayor’s offices, non-profit organizations, and local education agencies, including school districts.
While the majority of charter schools operate as single-campus entities, there is a growing trend towards charter schools being managed by larger management organizations, sometimes referred to as networks. These organizations function in a manner similar to traditional school districts, overseeing multiple charter schools under a unified administrative structure.
Are Charter Schools Considered Non-Profit Entities? Examining Profit Status in the Charter Sector
Many of the most recognized and successful charter school networks, such as KIPP and Success Academy, are operated by non-profit Charter Management Organizations (CMOs). However, some states also permit for-profit entities, typically known as Education Management Organizations (EMOs), to manage charter schools.
This distinction introduces complexity into the profit status of charter schools. While the schools themselves are structured as non-profit entities, they may contract with a for-profit company to handle various aspects of school management. These management services can encompass teacher recruitment, provision of school facilities, curriculum development, and the establishment of school policies. Therefore, the non-profit status applies to the school’s operation, but for-profit entities can be involved in their management and service provision.
How Are Charter Schools Financed? Delving into Funding Sources
Generally, charter schools receive funding from state and local sources based on their student enrollment numbers. Similar to traditional district schools, they are also eligible for federal funding to support special education services. Additionally, the federal government provides grants specifically aimed at charter school expansion initiatives. However, it’s important to note that most states do not allocate specific funds for charter school facilities, which can present a financial challenge.
Beyond public funding streams, charter schools, like district and private schools, have the option to engage in private fundraising through donations. Philanthropic contributions have played a significant role in the growth of charter schools, particularly in urban areas serving students from low-income backgrounds. The “no-excuses,” college-preparatory charter school model has particularly benefited from this philanthropic support. Prominent individuals, including heirs of Sam Walton (Walmart founder), Don and Doris Fischer (Gap founders), Bill and Melinda Gates, Eli and Edythe Broad, Reed Hastings (Netflix founder), Michael Bloomberg (former NYC mayor), and former U.S. Secretary of Education Betsy DeVos, have made substantial investments in the charter school movement both at the state and national levels, highlighting the significant private financial backing behind charter school expansion.
Charter Schools: Public or Private Institutions? Navigating the Definitional Divide
The classification of charter schools as either public or private is a point of ongoing debate, with perspectives largely depending on the criteria used to define a public school. Key defining features often considered include governance by an elected school board, public funding sources, and open admissions policies that mandate enrollment for all students. By these metrics, charter schools, assuming legal compliance, may not fully align with the first criterion if they were not authorized by a school district or elected state board. However, they generally meet the latter two criteria of public funding and open enrollment.
Adding complexity, not all traditional school districts are governed by elected boards. Moreover, a growing number of states are channeling tax dollars towards private schools through mechanisms like vouchers, tax credits, and education savings accounts. Despite receiving public funds and increased regulation, these private schools are not reclassified as public. Magnet schools, which are traditional district schools, further complicate the landscape with special admissions policies that allow for selective student enrollment.
Ultimately, the placement of charter schools on the public-private spectrum is contingent on state law and individual interpretation. Nevertheless, charter schools are generally legally recognized under state laws as public schools, and their students are required to participate in the same standardized assessments as students in traditional district schools, reinforcing their integration within the public education framework.
Weighing the Pros and Cons of Charter Schools: Autonomy, Innovation, and Controversy
Charter schools, with their operational autonomy, are often championed as vehicles for fostering innovation in school and classroom practices and for expanding public school choices for parents. Proponents of school choice argue that increased educational options create a competitive environment that drives improvement across all schools as they strive to attract and retain students. The appeal of innovative school models is another significant draw for parents and students. Charter schools frequently adopt alternative curricular approaches, specialize in particular fields like arts or technology, or focus on serving specific student populations, such as special education or at-risk students. The rise of virtual or cyber charter schools has further challenged traditional notions of schools as physical brick-and-mortar institutions.
However, while the independence of charter schools can be a key advantage, it also presents potential challenges, ranging from financial mismanagement to instances of nepotism. Furthermore, authorizers may sometimes be hesitant to close a charter school, even when faced with persistent financial and academic difficulties, due to pushback from parents and community stakeholders.
High-profile charter school scandals have prompted some charter school advocates to call for increased regulation and a more managed market approach to school choice. Despite this, many charter advocates remain steadfast in their support for a more purely free-market approach to charter school operation and expansion.
Common criticisms leveled against charter schools include concerns that they divert essential resources from underfunded school districts, enroll fewer students with disabilities proportionally, engage in selective student enrollment practices (“cherry-picking”), rely on punitive disciplinary measures, and exhibit greater racial segregation compared to traditional public schools. These criticisms underscore the ongoing debate about the equitable impact and operation of charter schools within the broader public education system.
Charter School Effectiveness: Examining the Research Landscape
The question of whether charter schools or traditional public schools are more effective in student education remains a complex and unresolved issue. This is partly due to the inherent challenges in designing research studies that can fairly compare student outcomes across district and charter schools, as well as the significant variability in quality among states, school models, and individual schools themselves.
Research from Stanford University’s Center for Research on Educational Outcomes (CREDO), though subject to some critique, provides valuable insights into this area. A national CREDO study conducted in 2009 indicated that charter school students initially lagged behind their traditional public school counterparts in math and reading achievement gains. However, a subsequent CREDO study in 2013 found a shift, with charter schools nationally slightly outperforming district schools in reading, and achieving comparable performance in math.
Focusing specifically on urban charter schools nationwide in 2015, CREDO found that these schools significantly surpassed their district school peers in both math and reading. Conversely, another 2015 CREDO analysis revealed that full-time virtual charter schools, where students primarily learn online at home, demonstrated significantly less academic progress compared to students in traditional brick-and-mortar schools, highlighting the diversity of outcomes within the charter sector.
A 2017 CREDO study further nuanced the findings, indicating that students in charter schools managed by for-profit companies showed markedly poorer academic performance compared to students in charters run by non-profit organizations, suggesting a potential influence of management structure on school effectiveness.
Several highly cited meta-analyses of charter school research corroborate the mixed findings observed in the CREDO studies. A 2014 meta-analysis on charter schools by economists from the University of California, San Diego, concluded that charter schools are “producing higher academic gains in math” relative to traditional district schools.
A 2018 review of recent charter school research, incorporating multiple CREDO studies, identified a mixed spectrum of outcomes overall and specifically for English-language learner students. However, researchers from Clemson University and the University of Alabama at Birmingham discovered that students with disabilities, in general, showed better academic progress in charter schools compared to district schools, although students in both sectors still lagged behind their non-disabled peers.
It is important to recognize that academic performance is not the sole indicator of a school’s effectiveness. A growing body of research is examining the long-term outcomes for charter school graduates beyond high school. Two studies released in 2016 investigating the earnings of charter graduates compared to their district-educated counterparts yielded contrasting results.
Researchers from Georgia State University, Vanderbilt University, and Mathematica Policy Research studying charter school students in Florida found that charter graduates did indeed earn significantly higher salaries than their non-charter peers. In contrast, an examination of charter school students in Texas by researchers from Harvard University and Princeton University reached the opposite conclusion, indicating lower future earnings for charter school graduates. These divergent findings underscore the complexity and context-dependent nature of evaluating charter school effectiveness and long-term impact.
Education Issues, Explained
For deeper insights into critical K-12 education topics, explore these research-backed explainers from Education Week.
Browse our explainers
