School Choice & Charters

How a District Hopes to Save an ESSER-Funded Program

By Mark Lieberman — January 10, 2024 6 min read
Chicago charter school teacher Angela McByrd works on her laptop to teach remotely from her home in Chicago, Sept. 24, 2020.
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Since the early days of the COVID pandemic, dozens of students in Missoula, Mont., have attended a fully online program run by the school district.

To keep the program running, the district has invested several hundred thousand dollars per year from its pot of federal COVID relief aid. But those dollars will no longer be available by the time the next school year begins.

Thanks to a quirk of the state’s new laws aimed at promoting school choice, though, the program may get a second chance.

Last fall, state lawmakers approved laws that establish two mechanisms for creating the state’s first charter schools.

One is called the “community choice” model, under which anyone seeking to run a charter school can bring a proposal before a newly formed state commission.

The other law presents an unexpected opportunity for public school districts, many of which are currently pondering massive cuts as the expiration of federal pandemic aid later this year looms. The Montana law, HB 549, allows districts to apply for approval from the Montana Board of Public Education to establish district-run charter schools.

Missoula is one of more than a dozen districts in Montana currently pursuing that approach. The state education board is expected to weigh in on the proposals later this month.

If the board agrees, the Missoula district’s online learning program will become a charter school—and receive a new stream of funding from the state that will keep it viable.

Missoula’s story illustrates both the risks districts face as an unprecedented, one-time federal infusion into local school systems comes to an end, and the creativity some are employing to find alternative funding for their ESSER-funded investments.

The state funding Missoula would receive to run its virtual program as a charter school wouldn’t cover the full cost of keeping it running or expanding it significantly. But it would be sufficient, said Micah Hill, the district’s superintendent. From an operating budget of roughly $670,000, roughly $458,000 would come from “basic entitlements” all newly established charter schools will receive from the state. The rest would come from local tax dollars.

In order to qualify for basic entitlement, the charter school must enroll a minimum of 41 high school students and 21 middle school students, under state law.

“The way this is structured, it’s going to be really hard for a small school district to actually meet the requirements to get any more money,” Hill said.

Still, Montana’s unusual wrinkle in the vast nationwide constellation of charter school models has drawn criticism from charter advocates who believe districts operating charters of their own doesn’t fit the spirit of innovation that charter schools are designed to encourage.

“At the end of the day, they’re not creating new schools,” said Todd Ziebarth, senior vice president for state advocacy and support at the National Alliance for Public Charter Schools. “That’s fine that districts have these programs. To say these are charter schools, and pretend that they’re creating these new opportunities in communities, just isn’t the case.”

Charter school policy looks vastly different from one state to the next

The Montana debate represents just one of many examples nationwide of disputes over the proper approach to charter schools.

Charter schools are widely understood to be publicly funded, independently operated schools that offer students an alternative to a traditional public education.

The vast majority of states allow charter schools, but each one has its own distinct processes that determine who approves and operates them.

Charter schools have been around for more than three decades, but those processes continue to be contested and in some state of flux.

In North Carolina last fall, for example, lawmakers approved a bill to create a new Charter School Review Board, wresting authorizing power from the existing State Board of Education. In response, the state board adopted a policy maintaining its role in allocating funds to charter schools.

Charter schools’ political purchase on the left has waned in recent years. And conservative pushes for school choice have drifted toward vouchers and education savings accounts as the preferred policy model.

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Robert Hill, Head of School at Alice M. Harte Charter School, talks with students in New Orleans on Dec. 18, 2018.
Robert Hill, Head of School at Alice M. Harte Charter School, talks with students in New Orleans on Dec. 18, 2018. Charter schools have taken a backseat in school choice debates to policies expanding private school choice.
Gerald Herbert/AP

But charters have continued to spring up, and enrollment has more than doubled nationwide in recent years. It grew from 1.8 million students in fall 2010 to 3.7 million students, or 7.4 percent of the U.S. public school population, in fall 2021, the most recent year for which federal data on charter school enrollment are available.

The volume of applications from Montana districts seeking to expand or transform their existing programs into charters vastly exceeds what lawmakers predicted. The state board is considering 26 applications from more than a dozen districts.

Hill from Missoula argues that spinning district-run programs into charter schools affirms the innovative experiments districts are already undertaking to help students learn.

“When you see 27 applications for charter schools, it’s a reflection that they are already doing amazing things,” Hill said. “If we want to call them by a different name, that’s what we’re doing.”

Most states don’t offer districts an option like the one Montana districts are trying to use. Wisconsin and California have charter schools that operate within districts and with district employees. But in both cases, the district, not the state, approves the creation of the charter school.

A close analog to the emerging Montana model, according to Ziebarth, can be found in Virginia, where a bill passed in the late 1990s that permitted the establishment of district-run charter schools. Only a handful have cropped up in the intervening two-plus decades, however.

Districts sometimes gain revenue in exchange for charter support

There is precedent, however, for dangling funds before districts to create incentives for the expansion of charter schools, said Robert Cotto, a professor of education at Connecticut’s Trinity College who has extensively studied charter school operations.

During implementation of the Race to the Top initiative, the Obama administration promised to reward states that loosened policy barriers to charter schools. And grant funders like the Gates Foundation have offered funding as an incentive for districts and charters to collaborate.

But Cotto worries that framing charter schools, whether intentionally or otherwise, as opportunities for districts to gain revenue distracts from the mission of providing sufficient resources to traditional public schools.

“Why is the state of Montana providing support for new charter schools for remote learning over support for the public school district to offer a safe, in-person public school system with remote learning as a special component for particular needs?” Cotto said.

In Montana, public education advocates are aiming to overturn the 2023 law that establishes a new state commission for authorizing charter schools outside the purview of district operations. Lawsuits challenging key charter school policies are also underway in Kentucky and Wisconsin.

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Illustration of a school building with a Venn diagram superimposed

Meanwhile, public school districts are looking to any opportunity to minimize cuts in the coming months. Hill worries that students in his district who are currently enrolled in online classes will instead end up in lower-quality, privately run programs if the charter proposal doesn’t find favor with the state board.

“Without additional funding, you can’t replace it,” said Hill. “What you go back to is what existed before.”

A version of this article appeared in the January 31, 2024 edition of Education Week as How a District Hopes to Save An ESSER-Funded Program


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