Closing time: Authorizers, policymakers strive to address charter school shutdowns
Public charter school authorizers and legislators are working to create policy on charter school closure costs, but some fear regulations could cause smaller schools to never open due to financial constraints.
Indiana is considering a charter reform bill that initially would have required every charter school to have $100,000 in an escrow account upon opening. Legislators later removed the escrow account requirement from the bill.
James Betley, executive director of the Indiana Charter School Board, says having escrow accounts with set amounts and a closure process too prescriptive would eliminate the chance for smaller public charters to open.
“It would make it almost impossible for what we often call the mom-and-pop charters, the homegrown schools to open,” said Betley, adding that some of the best charter schools in his state and elsewhere are smaller and, therefore, don’t have the financial backing from charter school management organizations or education management organizations. “The only schools that would be able to open would be the ones opened by CMOs and EMOs.”
In Florida, legislators are considering a requirement that charter schools post a performance bond each school year equal to a half of the school’s projected operating funds to be used if the charter school defaults on any financial obligations after it closes.
William Haft, vice president of authorizer development at the National Association of Charter School Authorizers, told Watchdog.org the handling of the cost of charter schools closing is different by state, but it’s a concern for authorizers nationwide.
“The way it works in terms of handling the costs is, it has not always worked,” said Haft. “There hasn’t been a plan at the policy level and that’s something authorizers have been struggling with.”
Haft says there are usually three types of charter schools that close: schools that are open for a few years and don’t make it financially; schools that should probably never have been approved in the first place and close within the first year; and schools that close for reasons not related to finances. The first two groups are the ones that create the most headaches for authorizers, policymakers and taxpayers.
“Schools that are closing within the first year — it’s got less to do with the costs and Closing time: Authorizers, policymakers strive to address charter school shutdowns - Watchdog.org:
