CMO (Charter Management Organization) and EMO (Education Management Organization) Replication and Expansion: What Is the Potential for Growth?

• In Event: The Walmartization of Charter Schools: A Road to Failure or the Salvation of Public Education

Abstract

Roughly 30 percent of public charter schools nationwide in 2009-10 were managed by nonprofit charter management organizations (CMO) or for-profit education management organizations (EMO), up from 21 percent in 2007-08 (NAPCS, 2011). As of 2009-10, over 500,000 students attended public charter schools operated by an EMO or CMO (34.6 percent of students enrolled in charter schools).

CMOs and EMOs play an important part in the scalability of the charter school movement by enabling the replication of models that work, creating economies of scale, encouraging collaboration between similar schools, and building support structures for schools (Lake et al, 2010). Two bills in the 112th Congress pursue additional funding for the replication and expansion of quality charter schools: the All Students Achieving through Reform (All STAR) Act and the Empowering Parents Through Quality Charter Schools Act. Additionally, the US Department of Education has promoted replication of high quality models through Race to the Top, Investing in Innovation (i3) Fund, and the recently announced Replication and Expansion for High-Quality Charter Schools grant competition through the Charter Schools Program.

In effect, these federal efforts to support replication and expansion are in response to stories of success, but relatively limited growth in the CMO and EMO sectors (Hassel et al, 2011). In 2009-10, CMO and EMO affiliated charter schools accounted for only 15 percent of the new schools opened that year (70 out of 441). From 2007 to 2009, new CMO and EMO charter schools each added roughly 10,000 new seats, compared with over 55,000 seats added on average by new independent charter schools. CMO and EMO charter schools have experienced higher growth rates in terms of expanding the number of students enrolled in existing schools (in 2009-10, CMOs expanded existing school enrollment by 30 percent, EMOs expanded by 10 percent, and independent charter schools expanded by 5 percent). However, as charter schools age and meet their grade configuration goals, it is foreseeable that growth by expansion could slow down. As policymakers and the public demand quality education options, it is increasingly important to monitor the growth of CMO and EMO schools as scalable models.

This paper uses four years of growth data on public charter schools to examine growth patterns and model different projection estimates for CMO and EMO charter schools, as well as independent charter schools. The growth projection models account for the average size of new schools, closure data, state legislative caps on charter growth, expansion of existing schools, grade configuration limitations, authorizer willingness to approve schools operated by management organizations, and growth potential by different CMO and EMO providers (e.g., providers with existing plans for replication and providers willing to undertake low performing turnarounds). This paper contributes to both research and policy discussions regarding the potential for growth of different types of charter schools.

Author

• Anna Nicotera, National Alliance for Public Charter Schools