Budget & Finance

Private Charter Managers Team Up

By Jeff Archer — February 04, 2004 5 min read
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After years of complaining about interest groups that oppose charter schools run by profit-making companies, six of the country’s largest school-management businesses have formed a special-interest group of their own.

The National Council of Education Providers will seek more public money for charter schools, along with more charter-friendly regulations, at both the state and federal levels. It also aims to counter what its members see as a negative image of charter schools promoted by critics of private management, such as teachers’ unions.

John Hage of Charter Schools USA, right, chats with Christopher Whittle of Edison Schools, center, and Jeanne Allen of the Center for Education Reform at a Capitol Hill reception last week.

John Hage of Charter Schools USA, right, chats with Christopher Whittle of Edison Schools, center, and Jeanne Allen of the Center for Education Reform at a Capitol Hill reception last week.
—Photograph by Allison Shelley/Education Week

The new group is the latest sign that the industry made up of education management organizations, or EMOs, is maturing. Often competitors for contracts to run schools, the six companies hope that by banding together, they can make a stronger case in policymaking arenas.

“There are people who don’t believe there is a role for private business in public education,” said Michael J. Connelly, the chief executive officer of Mosaica Education, a New York City-based company and a member of the new council. “And for those people, we are going to get the word out that we are not Beelzebubs. This is not a satanic plot to destroy public education.”

Based here in Washington, the council made its debut in a series of meetings last week, when representatives of its member companies rubbed elbows with federal policymakers.

Along with Mosaica, the council includes: Charter Schools USA, of Fort Lauderdale, Fla.; Chancellor Beacon Academies, of Coconut Grove, Fla.; Edison Schools Inc., of New York City; National Heritage Academies, of Grand Rapids, Mich.; and White Hat Management, based in Akron, Ohio.

“This group is to make sure we have a voice at the table,” said Jonathan Hage, the chief executive officer of Charter Schools USA.

With 14,000 employees serving 140,000 students in 24 states, the companies claim to add nearly $1 billion to the U.S. economy each year.

“There are some common goals they need to address, and each of them individually is far too small to take on the challenges,” observed Trace Urdan, a senior analyst at ThinkEquity Partners, a San Francisco-based investment company that helped convene some of the meetings that led to the council’s formation. “This gives them more credibility and probably makes it easier to have them involved.”

Level Field Sought

The council is supported by $5,000-a-month contributions from each of its member companies, making for a total budget of $360,000 a year.

Helping to coordinate the nascent group is The Allen Company, a government- affairs firm led by Jeanne Allen, the founder and president of the Center for Education Reform, a nonprofit group based in Washington that supports charter schools. (“Agitator for Choice Leaves Her Mark,” Nov. 12, 2003.)

Ms. Allen plans to continue to lead the CER while expanding The Allen Company, which was her husband’s firm until his death last year.

The management companies’ main goal is to achieve more equity in charter school funding, organizers say. In many states, such schools get less per student from government sources than traditional public schools do, and they often lack the same access to public money for construction.

Ms. Allen argues that federal funding mechanisms similarly are biased against charter schools because most federal programs disburse aid to districts. “If you have inequities with these schools,” she said, “then you have inequities with their students.”

“Part of this,” she added, “is educating Congress that as we move to a system where individual schools are controlled or managed by independent entities, there has to be some recognition in how money is distributed that these new, independent folks are different.”

Asked what federal programs the council might target, Ms. Allen pointed out that measures aimed at encouraging more universities to start charter schools could be included in the upcoming reauthorization of the Higher Education Act. Changes in federal policy, she noted, also could make it easier for charter schools to get public dollars earmarked for vocational education programs.

Another major concern of the new organization is what its members call “re-regulation"—the imposition of new state mandates on charter schools that, they say, could keep more schools from opening.

Ripe Pickings?

Nancy Keenan, the education policy director for People for the American Way, a liberal watchdog group based in Washington, expressed skepticism last week about the new council’s motives.

Noting that Republicans control both houses of Congress and the White House, she predicted that the council would find an audience sympathetic to the idea of giving private companies more access to public education money.

“The fruit is ripe, and I think they’re preparing to pick it,” said Ms. Keenan. She added that she supports charter schools, but worries about the trend toward privatizing educational services.

“What is the purpose of school?” she said. “To make money or to educate children?”

Officials of EMOs think they can do both. Like other industry organizations, the council plans not just to lobby for favorable regulations, but to share information among its members about how to improve quality, said Mr. Hage of Charter Schools USA. The council also plans to draft a code of ethics for members.

“Certainly, we want to make sure that charter schools are treated fairly and equitably,” said Mr. Hage, who is the president of the new council. “But we are also there to ensure that the industry is delivering the educational outcomes that it is in the business to do.”

Ms. Allen added that, for practical reasons, the council isn’t looking for a partisan fight over funding.

“If you look at where their schools are, many fall in heavily Democratic districts,” she said. “They are going to reach out to those folks.”

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