Debunking the Real Estate Risk of Charter Schools
Ewing Marion Kauffman FoundationJuly 2005
Ewing Marion Kauffman FoundationJuly 2005
Ewing Marion Kauffman Foundation
July 2005
Homeownership is the American Dream, but for many charter schools finding a permanent place to lay down roots is more like a nightmare. Lenders and real estate brokers get nervous about charter schools because the market is so new, the charters relatively short-lived, and the risk of default unknown. This creates what the Kauffman Foundation, in this fine and refreshingly hardheaded report, calls a circular dilemma: The greatest cause of charter school closure is failure to secure an adequate building, yet the risk of closure is the greatest obstacle to charter schools securing an adequate building. You couldn't plan a more perverse catch-22. In fact, though many lenders take as gospel reports that 10 percent of charter schools have closed, Kauffman notes that many of those schools simply "changed organizational structure, and continued to occupy and pay on their buildings." Kauffman estimates that the real closure rate is more like 6 percent. Furthermore, while many lenders fear that buildings re-fitted to be schools are hard to resell or lease, the current rate of re-use for such properties is more than 95 percent. Finally, bigger schools, older schools (especially those started more than one year after a state's charter law was enacted), and schools run by EMOs all have close-to-negligible default rates. The arrival of this report is timely indeed, not only because it might help to put lenders at ease about this market, but also because it's great to see funders like Kauffman wading into the nitty-gritty of making charter schools work. Worth reading, and available here.
John Merrifield, Cato Institute
June 2005
In this dry but important book, John Merrifield takes a look at the current state of school reform on a global scale and envisions changes needed to advance the reform movement. Using seven examples of parental-choice programs in Chile, New Zealand, Sweden, and the United States, he contends that current school choice initiatives should be seen as "early milestones toward real and substantive reform, not destinations, or even indefinite rest stops." According to Merrifield, the small experiments that have been adopted in the U.S. are not enough to force change; advocates need to push for more. Namely, several "essential elements" are needed in order to transform the school choice movement into a "reform catalyst": the freedom for schools to specialize, non-discrimination regarding funding, low formal entry barriers, avoiding price controls, and minimal private school regulation. We would add "accountability for results" to the list, but otherwise the book is useful reading. You can download it here.
James J. Kemple, Corinne M. Herlihy, and Thomas J. Smith, MDRC
May 2005
This well-named publication reports the findings from a federally-funded study of the "Talent Development" high school reform design as it was implemented in five Philadelphia schools. This model, developed in 1994 by the Johns Hopkins-based "Center for Research on the Education of Students Placed At Risk" (CRESPAR), combines many reform elements still in vogue today: smaller learning communities; an intensive, standards-based ninth-grade program; and an upper-level curriculum that links academics to career pursuits. The results were positive, though modest, as the title implies. Ninth graders participating in the program did better in terms of attendance, credits earned, and promotion to the tenth grade, and maintained these advantages through their next several years of school. As for test score gains, slight increases were detected in eleventh grade once the program had been in place for several years. Meanwhile, graduation rates rose by 8 percent. Still, as the study points out, these schools remain in desperate straits; even with the program, only half of all ninth graders will graduate within four years. High school reformers should read it for a dose of sobering reality even as researchers squabble over its "quasi-experimental" design. You can download it here.
Jay Mathews's weekly online column "Class Struggle" looks inward this week in response to the release of a report from the Clare Booth Luce Policy Institute that analyzes the content of education news stories in the state of Virginia. (As Mathews notes, the Washington Post is not included though it is the most widely read paper in the Commonwealth.) Most of the stories covered topics favorable to the "public school industry" like school funding, staffing, and teacher pay, and less than 3 percent reported on "public education reforms and innovations such as charter schools, home schooling, vouchers, and tuition tax credits." Mathews says that "the education reporting habits the report describes are common to nearly all newspapers in this country," including a tendency for reporters to rely mostly on "government" sources like departments of education and local school boards, not think tanks or stories from the classroom. "More outside voices, reported sooner in the process," he writes, "would help." Gadfly, of course, is all in favor of this, and willing to lend a quote or two to any education reporters trying to, as Mathews suggests, "do better."
"How to make me a better education reporter," by Jay Mathews, Washington Post, July 26, 2005
"Society's Watchdogs," Clare Booth Luce Policy Institute, July 2005
Two weeks ago we noted, "Success has a thousand fathers and many will try to claim credit" for the good news about rising NAEP scores (see here). Last week we ridiculed the many organizations that "tied themselves in knots" to claim responsibility for the improvement (see here). The summer heat must be making Gadfly lightheaded, because we're back to cheer a hat trick of articles that give credit where credit is due. USA Today's editorial board described the progress of 9-year-olds on NAEP as "dramatic" - perhaps a bit overstated - but recognized the standards-and-accountability movement as the major driver of the progress so far. (It also rightfully called out the National Education Association and Harvard's Civil Rights Project for their shameful silence in the face of palpable gains in student learning.) The Economist provided a fair assessment (along with a wonderful cartoon) acknowledging President Bush's limited but important role: "Mr. Bush's act may be very new. But the ideas that lie behind it - focusing on basic subjects such as math and reading and using regular testing to hold schools accountable - have been widely tried at the state level since at least the mid-1990s. Mr. Bush deserves credit for recognizing winning ideas thrown up by America's 'laboratories of democracy' and then applying them at the federal level." Debra Saunders, writing in the San Francisco Chronicle, follows the same line of argument and credits Bush with jumping "on the right horse" as governor of Texas, and then president. Of course, before galloping off into the sunset we still have a lot of work to do, especially in the middle and high school grades, where, as all three articles explain, education progress still goes to die.
"No lessons left behind," editorial, USA Today, July 20, 2005
"Now for the good news," The Economist, July 21, 2005
"Dubya's school reforms pay off," Debra J. Saunders, San Francisco Chronicle, July 26, 2005
In the latest City Journal, Kay Hymowitz discusses Bill Cosby's parenting-power crusade among poor African-Americans and links it to the failure of government social welfare programs to close the education and economic gaps. A typical Cosby rant: "Proper education has to begin at home. . . . What we need now is parents sitting down with children, overseeing homework, sending children off to school in the morning, well fed, rested, and ready to learn." To Hymowitz, parents who do engage in these activities have signed up for what she calls "The Mission" - that is, the conscious attempt on the part of parents to develop the talents, interests, and personal character of children such that they are freed to pursue their bliss. She bluntly states the problem: "Poor black parents rear their children very differently from the way middle-class parents do, and even by the time the kids are four years old, the results are extremely hard to change." Hymowitz claims that underclass parents fail to sign up for The Mission, and while they may have the requisite parenting skills, they lack "the motivation to bring them to bear in a consistent, mindful way." Gadfly is probably unqualified to judge the cultural claims Hymowitz is making and is uncomfortable anyway with the logical conclusion of some of them (i.e., some kids are damaged goods by age four; there's nothing schools can do about it). But we would certainly agree that, while proper education must start in the home, such broad changes take time and prodigious effort. So in the meantime, the fact that these kids are showing up at school already behind does suggest that high-quality pre-school for lower-income children can be an important (if not fully effective) stopgap. (For more on that topic, see this recent Fordham publication, here). Parenting is key, but so is high-quality schooling.
"What's holding black kids back?" by Kay S. Hymowitz, City Journal, Spring 2005
Middle schools, like middle children, are just plain misunderstood. There is pretty clear evidence from the recent NAEP results that middle schools are where academic achievement in America falters and begins its accelerating decline, as the Los Angeles Times argues in a cracker-jack editorial this week. To our way of thinking, this is because middle schools (as author Cheri Pierson Yecke will argue in a forthcoming Fordham report) are usually places where academic rigor and achievement take a back seat to "personal development," social consciousness, and the inculcation of egalitarian principles. Middle schoolism is about curing the middle school student of his or her supposed dysfunction - which doesn't leave much time for learning (which the most radical proponents of middle schoolism believe is beyond the ability of early adolescents anyway). These nonsensical beliefs have become conventional wisdom. So, for example, Julia Steiny argues in the Providence Journal this week that middle schools are rife with bullying, and runs through the litany of ills to which middle schoolers are allegedly prey: cutting, purging, depression, suicide, homicide. . . . Clearly, the middle school is a veritable chamber of horrors. And in Delaware, the state department of education is blaming the abysmal results on state math tests on, yes, those darn middle schoolers, who are just more interested in "the right clothes, dating, and being seen at the mall - which doesn't leave a lot of time for algebra." Well, yes, from time immemorial, parents and teachers have known that early adolescents are surly, inconstant, and inattentive - but also can be engaged, creative, and energetic if someone gives them something to care about. We used to be able to educate these kids. Gadfly's answer to the problems of middle schools? Give them something serious to do!
"The neglected middle classes," Los Angeles Times, July 26, 2005
"The basics of school bullying," by Julia Steiny, Providence Journal, July 24, 2005
"For many kids, math is a low priority," by Cecilia Le, Delaware News Journal, July 24, 2005
Merit pay for teachers has gotten a lot of play recently (for examples, see here). Without a doubt, the principle that some teachers ought to get paid more than others has gained political currency around the country. More and more politicians - generally a risk-averse group - are coming out four-square behind merit pay, even if it means taking on the unions.
While I'm certainly glad that merit pay is gaining ground as the "right" thing to do, right doesn't always make might. The groundswell of public support could quickly seep back into the cracks depending upon how we proceed from here. Merit pay could be doomed to failure unless governors support the careful experimentation that's needed to solve some of this reform idea's great dilemmas.
Structuring merit pay well is hard to do. The systems need both to be fair and to be hefty enough actually to impact a talented teacher's decision to enter or leave the profession, i.e. to alter behavior. As we've seen in California - where the unions have formed a formidable bloc in opposition to Governor Schwarzenegger's attempt to reform teacher tenure and institute merit pay - our collective naivet?? combined with unrestrained enthusiasm plays right into the hands of groups opposed to change.
The thorny problem of how best to determine a teacher's effectiveness - the only fair basis for deciding who gets merit pay - has by no means been worked out to the degree required for wide scale adoption. Challenges include:
Though these problems appear daunting, policy makers must tackle them. Some experimentation is surely in order as well as some pilot programs coupled with rigorous evaluations. Meanwhile, we do know some things that offer useful parameters for moving forward:
The teaching profession has no choice but to remedy an outmoded pay structure that is woefully insensitive to current labor force realities. Daunting though the challenges appear, there's no question that it can be done. Will it be perfectly fair? No system is - but the system we're saddled with now is remarkably unfair to teachers and, even more importantly, runs counter to what works best for kids.
Kate Walsh is president of the National Council on Teacher Quality (www.nctq.org). This editorial is adapted from a recent edition of the Teacher Quality Bulletin.
Ewing Marion Kauffman Foundation
July 2005
Homeownership is the American Dream, but for many charter schools finding a permanent place to lay down roots is more like a nightmare. Lenders and real estate brokers get nervous about charter schools because the market is so new, the charters relatively short-lived, and the risk of default unknown. This creates what the Kauffman Foundation, in this fine and refreshingly hardheaded report, calls a circular dilemma: The greatest cause of charter school closure is failure to secure an adequate building, yet the risk of closure is the greatest obstacle to charter schools securing an adequate building. You couldn't plan a more perverse catch-22. In fact, though many lenders take as gospel reports that 10 percent of charter schools have closed, Kauffman notes that many of those schools simply "changed organizational structure, and continued to occupy and pay on their buildings." Kauffman estimates that the real closure rate is more like 6 percent. Furthermore, while many lenders fear that buildings re-fitted to be schools are hard to resell or lease, the current rate of re-use for such properties is more than 95 percent. Finally, bigger schools, older schools (especially those started more than one year after a state's charter law was enacted), and schools run by EMOs all have close-to-negligible default rates. The arrival of this report is timely indeed, not only because it might help to put lenders at ease about this market, but also because it's great to see funders like Kauffman wading into the nitty-gritty of making charter schools work. Worth reading, and available here.
James J. Kemple, Corinne M. Herlihy, and Thomas J. Smith, MDRC
May 2005
This well-named publication reports the findings from a federally-funded study of the "Talent Development" high school reform design as it was implemented in five Philadelphia schools. This model, developed in 1994 by the Johns Hopkins-based "Center for Research on the Education of Students Placed At Risk" (CRESPAR), combines many reform elements still in vogue today: smaller learning communities; an intensive, standards-based ninth-grade program; and an upper-level curriculum that links academics to career pursuits. The results were positive, though modest, as the title implies. Ninth graders participating in the program did better in terms of attendance, credits earned, and promotion to the tenth grade, and maintained these advantages through their next several years of school. As for test score gains, slight increases were detected in eleventh grade once the program had been in place for several years. Meanwhile, graduation rates rose by 8 percent. Still, as the study points out, these schools remain in desperate straits; even with the program, only half of all ninth graders will graduate within four years. High school reformers should read it for a dose of sobering reality even as researchers squabble over its "quasi-experimental" design. You can download it here.
John Merrifield, Cato Institute
June 2005
In this dry but important book, John Merrifield takes a look at the current state of school reform on a global scale and envisions changes needed to advance the reform movement. Using seven examples of parental-choice programs in Chile, New Zealand, Sweden, and the United States, he contends that current school choice initiatives should be seen as "early milestones toward real and substantive reform, not destinations, or even indefinite rest stops." According to Merrifield, the small experiments that have been adopted in the U.S. are not enough to force change; advocates need to push for more. Namely, several "essential elements" are needed in order to transform the school choice movement into a "reform catalyst": the freedom for schools to specialize, non-discrimination regarding funding, low formal entry barriers, avoiding price controls, and minimal private school regulation. We would add "accountability for results" to the list, but otherwise the book is useful reading. You can download it here.