Author Archives: Juliet Squire and Rebecca Gifford Goldberg

9 Considerations for Charter School Mergers in an Era of Limited Budgets

Since March, school funding experts have sought to understand how the economic turmoil coming out of the COVID-19 pandemic would affect school revenue. Most analysts agree that the impact will be significant and will be felt most by those who are the furthest from opportunity. Unfortunately, charter schools — which nationally enroll a student population that is 52 percent low-income, 25 percent Black, and 34 percent Hispanic — are particularly vulnerable to variations in state funding. 

Charter schools struggling with financial sustainability may consider whether the school’s mission might be better served by merging with another charter school. However, while charter school mergers can work, they are far from a simple solution and must be approached carefully.

As our colleagues Lina Bankert and Lauren Schwartze have previously written, a “merger” can take many shapes but, fundamentally, it involves joining together two or more organizations as one entity — through a formal legal agreement — in pursuit of a common goal. In the current financial climate, financial sustainability may be what prompts schools to explore a merger, but any merger conversation should start by defining all of the reasons why it could be a strategic move for each partner in the merger.

These nine considerations will help school leaders determine whether a merger might make sense for their school:

While a merger can support better financial efficiency in the long-term, financial efficiency is neither immediate nor guaranteed. If school leaders are pursuing a merger first and foremost because they believe it promises immediate financial benefits, they should stop and reconsider. A successful merger between two or more charter schools requires a short-term infusion of funding to support the merger process. To conduct due diligence, support internal decision making, plan implementation, and ensure a smooth transition period, school leaders will need financial resources for necessary staff time and legal expertise. Any long-term financial efficiencies will only occur after an initial up-front investment that can sometimes total hundreds of thousands of dollars.  

While a merger can increase financial strength by achieving a larger or more stable revenue base (via combined student enrollment) and by enabling some economies of scale, in practice the additional revenue is often used to support a high-quality school model, via investments to support rigorous and consistent instruction for the merged institution. As a result, a merger should not be thought of as a strategy for “saving money” per se, but instead as a way to combine resources to provide a high-quality education to more students, with the stronger financial footing that comes with that.   

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The Looming Financial Crisis? Resources for the Education Sector

Efforts to lift economy could tip off a financial crisis.” School districts brace for cuts.” Will the Banks Collapse?

With headlines like these making the rounds, there’s no way to avoid questions about how the COVID-19 pandemic has and will impact the economy — and in turn, America’s schools. The uncertainty is very real, and the consequences could be as well, but how can education leaders make sense of often contradictory and evolving prognostications? And if the impact won’t be catastrophic, what is the more complicated outlook?

At Bellwether Education, we’ve worked with schools, CMOs, districts, states, and nonprofits to understand this moment, and have begun to build an understanding — unpredictable as this moment is — of where our sector is headed fiscally, how organizations and policymakers should respond, and the key variables to keep an eye on. We understand how school funding works, from the federal budget process to state legislatures to local levies, and we’ve coached hundreds of clients on planning for and through financial uncertainty. 

In this new series, The Looming Financial Crisis?, we bring our policy chops together with our practical experience with districts, schools, and networks forward to share perspectives on how a financial crisis might play out and where impacts will be felt. Some questions we’ll explore:

  • Where does school revenue come from, what do we know about how the economic downturn might affect lower income communities? 
  • How can districts and schools carry out short-term and long-term planning amidst uncertainty, while prioritizing students furthest from opportunity?
  • What are the potential impacts on private school operations, especially those private schools dedicated to serving high-need students?
  • Will an economic downturn lead to increased interest in charter school mergers, and how should school leaders approach these potential partnerships and their impact on students and school communities? 

We’re here to cut through the noise so the education sector can navigate the uncertain future as effectively and efficiently as possible. Follow along as we roll out insights targeting school districts, state education agencies, individual schools, charter networks, and more.

5 Recommendations to Make “Learning Pods” More Equitable

Born out of desperation, families across the country are looking outside the school system for safe educational options for their children this fall, often partnering with other families to privately finance small-group learning. These “learning pods,” also referred to as “pandemic pods,” have fomented concerns about equity, since only a fraction of Americans can afford to pay a teacher out-of-pocket. 

But “learning pods” need not be inequitable. With the right blend of volunteerism, leadership, and innovation, learning pods can be a tool for increasing equity while traditional school campuses remain closed to students.

Here’s how:

Ask community spaces to donate meeting facilities

The requirements of social distancing demand more space if all students are to get a full education. Meanwhile, there are churches, temples, community centers, office buildings, and storefronts across the country currently sitting empty, as large gatherings are discouraged, adults work from home, and retailers close up shop. Many of those entities would probably be willing to donate their space to small learning communities at no cost, or in exchange for financial relief on their rent or mortgage payments. 

Expand the pool of potential teachers to enable lower student-teacher ratios

Student-to-teacher ratios are lower today than they were 30 or 40 years ago, but still higher than the number of students we might want to share a learning pod in order to minimize public health risks. According to the National Center for Education Statistics, the average number of students per teacher in 2017 was 16. Including the total number of instructional staff brings that ratio down significantly to 11.7. Add in teachers who have retired or left the profession, substitute teachers, students studying to become teachers, Americorps volunteers, and others and there may just be enough to create learning pods of 10 students or fewer. This could create the conditions for personalized instruction on a scale that’s often been dreamed of but never fully realized.

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Business Leaders Must Continue to Engage in Education Advocacy

The business and education sectors are feeling the effects of the coronavirus pandemic acutely. Among small businesses, 75% have applied for emergency relief from the federal government and nearly three in ten have reduced staff. About half report having less than one month cash on hand. At the same time, tens of thousands of schools are closed and uneven transitions to distance education suggest significant adverse effects on student learning.

That’s why, even as the business community struggles to keep its head above water, business leaders must continue to invest time and energy into supporting the best possible paths forward for students — our nation’s future employees, professionals, and entrepreneurs.

A strong education system is key to economic growth, something that will be a priority after this crisis. In addition to the vast research linking a population’s education to economic prosperity, it’s impossible to miss how the unemployment rate for high-school graduates is currently at least twice that for those who hold at least a bachelor’s degree. As policymakers think about economic recovery in the years ahead, they will benefit from the business community’s vantage point on the skills and knowledge students need to be successful.

cover of May 2020 bellwether report

National business groups like the U.S. Chamber of Commerce include education as a policy priority; other business organizations, like America Succeeds, focus exclusively on education issues. In recent years, these and other business efforts have lent their voice to the drive toward providing strong options for students after high school, including apprenticeships and industry certifications alongside four-year college degrees. But business associations have a long track record of engaging in essential education issues; they were an important part of the coalition advancing higher standards and accountability in the 1990s, which helped shine a light on vast inequities in the education system and created urgency for reform.

Today, with the learning trajectories of students in turmoil, the business community again has a stake in charting the path forward. Business advocacy organizations can help create space for innovative thinking and drive policy proposals for resources and programs tailored to the needs of their state. And they can impart skills, for instance convening school leaders who benefit from management training. In Washington State, Partnership for Learning and the Washington Roundtable have provided leadership training to high school principals.

The business community can also support the continuation of learning for high school students through apprenticeships and other work-based learning experiences, since the school year has been disrupted and postsecondary opportunities have been clouded by economic uncertainty. Colorado Succeeds, an affiliate of America Succeeds, helped establish a state policy that provides school districts and charter schools up to $1,000 per student who completes a qualified industry credential program, work-based learning experience, or relevant coursework.

Of course the business community shouldn’t be the sole voice in education, especially since the purpose of schooling is not just about ensuring future economic prosperity. We also rely on schools to shape upstanding community members and informed citizens. But the business community absolutely has interests aligned to the success of today’s students — its perspectives are legitimate and often valuable.

Educators and policymakers should ensure it has a seat at the table.

Democratic Candidates are Missing a Chance to Lead on Charter Schools

When asked about charter schools at last week’s Democratic debate in South Carolina, former New York City Mayor Michael Bloomberg hedged, saying he was “not sure they’re appropriate every place.” Other primary candidates dodged the question altogether, pivoting quickly to talking points on teacher pay, school funding, and quality child care. Why are Democratic candidates so reticent to engage on the question of charter schooling? Charter schools are a contentious issue within the Democratic Party to be sure, but by avoiding the issue, candidates are missing an opportunity to demonstrate the kind of leadership the Democratic Party needs. 

Looking at polling data, it’s clear that candidates who stake out positions flatly in favor of or against charter schools are bound to alienate a core Democratic constituency. Democratic candidates don’t want to upset teachers or their unions, which are powerful Democratic interest groups that often oppose charter schools. Polling among teachers supports candidates’ concerns: EdChoice’s 2019 Schooling in America Survey poll found that a majority (55%) of public school teachers support charter schools; however, their margin of support was lower than any other subgroup detailed in the poll results. The 2019 Education Next Poll found that 42% of teachers supported charter schools overall, but only 28% of union-member public school teachers, compared to 50% of non-union public school teachers. And in “Voices from the Classroom 2020,” Educators for Excellence found only 35% support for charter schools among public school teachers. In turn, multiple candidates have endorsed policies that would seriously restrict the growth of the charter sector, including eliminating the federal Charter School Program, banning for-profit charter schools, and supporting proposals to make school districts the only entities that can authorize charter schools.

No candidate has gone so far as to oppose charter schools altogether, however, likely because charter school support is particularly strong within African American and Hispanic/Latinx communities, which are disproportionately served by poorly performing schools, often in segregated neighborhoods, making school choice a powerful issue. Both the EdChoice and Education Next polls found majority support for charter schools among these groups. In fact, just days before the South Carolina primary, where black voters make up the majority of Democratic primary voters, both Senator Elizabeth Warren and former Vice President Joe Biden met with the Powerful Parent Network, a group that supports school choice and garnered attention last November for confronting Warren at a campaign event in Atlanta.

How Democrats navigate the issue also depends on constituencies in various states. Today, Super Tuesday, candidates must court votes from states where public opinion on charter schools varies widely. Across the thirteen states with primaries taking place tonight, we found relevant 2019-20 polling data on charter schools in four of them. Support ranges from just 44% in Tennessee to as high as 76% in North Carolina.

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