More charitable groups are starting charter schools
Detroit
Three years ago, when officials of the YMCA of Metropolitan Detroit were thinking of opening an
elementary school that could serve neighborhood children better than the struggling local public schools, they hoped a few dozen parents would show up at a meeting to hear about the idea.
To their surprise, more than 250 people came, and a subsequent meeting drew 500.
The turnout, says Reid Thebault, president of the Detroit YMCA, indicated not only the parents’ pent-up demand for better schools, but also their faith in the YMCA to educate their kids. “It really gave us a lot of confidence to move forward,” Mr. Thebault says.
Today, the Detroit YMCA is one of five YMCA’s across the nation that have opened schools, and another two dozen are studying the idea. Called charter schools, the institutions are nonsectarian, tuition-free, supported largely by state and local tax dollars, and exempt from many of the regulations that apply to conventional public schools. In return, they must meet performance standards to stay in operation, unlike regular public schools, which typically remain open even when they fail.
The charter-school movement, which began in the early 1990s when small groups of citizens sought to create smaller and more personal or effective schools, is spreading rapidly to the nonprofit world. At least 100 charities have added a charter school to their repertoire of programs, and the trend is expanding.
For example, the National Council of La Raza, an advocacy group for Latinos, is helping its affiliates create 100 schools by 2010. In addition, museums, Urban League chapters, Boys & Girls Clubs of America affiliates, and other charities have ventured into the charter-school arena.
Challenges Abound
Despite the growth, however, many charity leaders are discovering that getting a school off the ground can have as many challenges as rewards. Opening a school can eat up large amounts of staff members’ time and threaten to distract a nonprofit group from its primary mission. It can also subject the organization to more government oversight than it is used to.
“If you are going to start a school, make sure you really want to start and run it for the right reasons,” cautions Frank Martinelli, president of the Center for Public Skills Training, an organization in Milwaukee that provides consulting services to nonprofit groups. He has advised dozens of charities interested in starting charter schools, and helped start three schools in Milwaukee. “Nonprofits really need to think carefully about whether they can pull it off and maintain their existing programs.”
Wide-Ranging Motivations
The reasons that nonprofit organizations are starting charter schools are varied.
For the YMCA and La Raza, the primary motive is dissatisfaction with conventional public schools. With dropout rates in some urban schools as high as 50 percent, many nonprofit leaders have concluded that they can do a better job than traditional schools at educating students.
Other nonprofit groups have started charter schools to highlight innovative teaching methods. Among them is Exploris, a museum in Raleigh, N.C., that seeks to help students understand global issues through exhibits on such topics as culture, the environment, and technology. Anne Bryan, former head of elementary education at the North Carolina Department of Public Instruction, and Gordon Smith III, a vice president at Salomon Smith Barney, were planning the museum when the state passed a law in 1996 allowing the creation of charter schools.
Ms. Bryan says she envisioned the museum as a place to showcase creative, hands-on teaching methods to visiting educators. It was an easy decision, she says, to add a middle school into the design. Exploris now is one of at least eight museums around the country that have started charter schools.
Sixth-graders at the Exploris school recently studied the culture of Tibet by watching an IMAX film, viewing renowned photographer Phil Borges’s images of the Tibetan region, and then interviewing Mr. Borges along with Tibetan monks, artists, and other experts. Later, the students served as volunteer guides for the museum, and, with ideas gleaned from the photographer, created their own photo exhibit on North Carolina rivers.
Having the school on site is a way for the museum to practice what it preaches, Ms. Bryan says. If a skeptical visiting educator tells her, “Well, you can do this in a museum, but I can’t do it in my classroom back at home,” she says she can readily respond, “Come across the courtyard to our school and see it in action for yourself.”
Creative Approaches
Like Exploris, the East Bay Conservation Corps, a nonprofit group in Oakland, Calif., saw charter schools as a way to advance its creative teaching methods and, in the process, receive government financial support.
Joanna Lennon, the charity’s executive director, started East Bay in 1983 to teach academic, job, citizenship, and other skills to young people, including some at risk of dropping out of school. The students work in teams on environmental projects that the corps is hired to do by local government agencies and nonprofit groups, and their lessons are tied to their labor. For example, students might learn math, science, and writing skills by determining what type of trees or plants can best halt erosion, planting them on a hillside for the local park district, and writing a report about how the project prevents soil and silt from entering the water system of a nearby housing development.
Over the years, East Bay has won praise for helping to raise the test scores of students participating in its programs. After California authorized the creation of charter schools in 1992, Ms. Lennon began to think about starting a formal school, deciding that not only could charter status bring in new government money to pay for East Bay’s programs, but it could also help the organization hone its education model and share its findings with other schools.
Developing the school took hard work, Ms. Lennon says. She raised $650,000 from seven foundations to help pay for a detailed planning process in which dozens of educators, nonprofit leaders, theologians, and others spent three years drafting an 85-page outline of how the school would operate and what its institutional values would be.
“What we did takes a lot of time, money, and planning, and a lot of energy,” Ms. Lennon says. “That should not be underestimated.”
Looking for New Services
For the YMCA in Detroit, the decision to start a charter school was motivated not only by its discontent with the city’s education system, says Mr. Thebault, but also by the fact that -- like many other YMCA’s around the country -- it was ending its short-term–housing services for the poor, travelers, and others and looking for ways to help the city.
In 1999, it opened the YMCA Service Learning Academy next door to a YMCA branch in northwest Detroit. The academy started with an elementary school and added middle-school grades the following year. Today, the institution serves 1,084 children in kindergarten through eighth grade and, as part of its daily studies, includes community-service projects such as visiting the elderly, delivering Thanksgiving food baskets to the poor, and building a playground open to all nearby youngsters.
Mr. Thebault says he is pleased with the results: “You walk into the library, which has 40 computers, and at every one, kids are doing homework or research for a project.” He describes other signs of progress: “seeing our attendance in the 95-percent range, when most public schools would be excited about 70 percent. Having parents show up at board meetings not complaining, but asking what are some additional things they can do.”
Building a School
Still, YMCA leaders quickly learned that starting and running a school can pose challenges. It took $11-million to build the YMCA school, a bill that initially was covered by a loan from Edison Schools, a for-profit company that manages 150 public schools with 84,000 students nationwide.
The YMCA repaid Edison and bought the land where the school is located by floating $12.1-million in bonds that carried a lower interest rate than the Edison loan. With interest expenses, the bonds will cost the YMCA $31.7-million.
The YMCA is making the bond payments with money left over from the roughly $7.4-million it receives annually in state and federal appropriations to operate the school. It pays Edison $1.8-million a year to manage the school. But Edison is in financial straits: While its revenue has grown every year since it began to manage public schools in 1995, it has never made a profit. Should Edison go out of business, the YMCA would have to hire another company to manage its school or take over those duties itself.
Even with Edison in charge, the YMCA must worry about other administrative responsibilities, including one of the biggest: hiring the right person to fill the principal’s chair. The principal must not only possess traditional management and academic skills, but also be able to work with YMCA staff members, charter-school officials, the Michigan Department of Education, and Edison Schools. The YMCA just filled the post for the second time in three years.
Says Mr. Thebault, “The complexities of running a school are much greater than anything I have encountered.”
Despite the hurdles, though, Mr. Thebault says that starting the school gave him a jumping-off point for conversations with major donors. “It gave us an opening to say, ‘This is not the same old YMCA,’” he says.
That message is especially important, he says, as the YMCA of Metropolitan Detroit moves ahead with a $35-million capital campaign, its first in about 60 years.
The campaign will help pay for renovating YMCA branches and building new facilities throughout the Detroit area.
Worried About Distractions
While some charities like the YMCA have decided the time, energy, and money spent starting a charter school are worthwhile, other groups have decided that such efforts may distract them from their primary mission.
Hugh Price, president of the National Urban League, has been a vocal proponent of charter schools, but he says his organization has other priorities at the moment. The Urban League recently began a campaign to improve academic achievement among African-American youngsters that includes partnerships with black churches and community groups.
Not even an offer from the Bill & Melinda Gates Foundation to help support charter schools run by Urban League chapters could persuade Mr. Price to promote the idea, he says. “At another point in time, it might become something we want to pursue,” he says.
Roughly a half dozen local Urban Leagues already have opened charter schools on their own, though with mixed results. A school in Albany is now run by another board of trustees after the Urban League of Northeastern New York state went out of business. A school in San Diego returned to school-district control when Urban League officials clashed with the teaching staff. But in Springfield, Mass., the Urban League–run New Leadership Charter School, which works in partnership with the National Guard, has thrived, and its math and reading scores on the Iowa Test of Basic Skills, a well-known standardized test, have been increasing.
After-School Group
Like the Urban League, Boys & Girls Clubs of America has refrained from actively supporting the formation of charter schools by local affiliates, because its main mission is running after-school programs, says Evan McElroy, vice president for communications. It does not even have plans to track how many local clubs have started schools, Mr. McElroy says.
Even so, a handful of local Boys & Girls Clubs have started schools, some with considerable success.
In 1995 the Boys & Girls Club of the East Valley, in Mesa, Ariz., founded the Mesa Arts Academy, which has ranked among the top public schools in the state for improvements in student achievement in several grades and subjects. It also has received praise in the news media and from national charter-school experts for its arts programs and work with students who are learning English as a second language.
Sue Douglas, the school’s administrator, says collaboration between the Boys & Girls Club and the school benefits both groups. For example, she says, her teachers train Boys & Girls Club staff members in classroom-management techniques, while the Boys & Girls Club’s multimedia specialist is helping a teacher learn to use video technology effectively.
The academy relies largely on government money to cover its expenses. It receives about $5,191 in state- and local-tax revenue for each of its 165 students -- which amounts to about 90 percent of its $1-million annual budget. The remainder comes from a dozen other government programs, both state and federal. Ms. Douglas estimates that she spends 15 hours per week managing paperwork related to those dozen programs. Small fund-raising events bring in only about $3,000 a year -- so little that she treats private contributions as windfalls that she doesn’t include in her budget.
Effect on Fund Raising
Some charities open charter schools to obtain a stable source of government funds to pay for work they already have been doing. Such charities include 18 of the 106 affiliates of YouthBuild USA, a nonprofit group that helps young people earn high-school diplomas while learning construction skills.
On average, the 18 affiliates spend about $20,000 annually per student but receive only about $6,500 per pupil per year in state money. Nonetheless, that money is a net benefit, says Dorothy Stoneman, YouthBuild’s founder, because many YouthBuild programs are getting government funds to do essentially the same work they were doing before the schools were started. That, in turn, means having to raise less from other sources, she says.
The charter-school money also makes the flow of revenue to the 18 YouthBuild affiliates more reliable than in the past. Unlike most other YouthBuild programs, which receive much of their income from competitive, short-term state and federal grants that must be renewed annually or biannually, the charter schools can count on roughly the same amount of state money each year, as long as they meet performance expectations.
Despite the advantages, Ms. Stoneman says, the money comes with strings attached. As is true of any charter school, the YouthBuild schools must admit all children who want to attend. They cannot turn away students who, for example, have serious mental or physical disabilities that may require the school to spend extra to educate them, nor can the schools limit entry to only the most motivated students.
Ms. Stoneman says she is optimistic about the prospects of the 18 affiliates that have opened charter schools. But, she says, it remains unclear whether helping YouthBuild programs obtain charter-school status will ultimately help or hinder their ability to carry out their missions.
“We don’t know that yet,” she says. “But so far, people have figured out how to adapt to the requirements.”