NCPA - National Center for Policy Analysis

Private Companies Advising On Charter Set-Ups

February 4, 1999

For-profit firms are consulting with organizers of charter schools, helping smooth the way from initial conception to the school opening -- and beyond. There is advice on curriculum, educational philosophy and school organizational plans.

Charters are considered public schools because they receive taxpayer funding -- but they avoid the bureaucracies typical of public schools run by the education establishment.

  • This school year, about 100 public schools are being managed by for-profit companies -- up from 60 last year.
  • Most of the companies will manage a school for between 6 percent and 9 percent of the school's per-pupil spending.
  • Thirty-four states and the District of Columbia allow charter schools to operate and states such as Massachusetts, Michigan and Arizona allow for-profit companies to run them.
  • Some of the firms target urban areas, while others concentrate on helping establish schools in the suburbs.

The companies sometimes hook up with real-estate developers who see the schools as a way to attract home buyers.

Observers say parents seem to be happy with the schools and the "education management organizations -- as Wall Street has dubbed the firms -- that set them up. All of the companies report that their schools have waiting lists.

Source: Anna Bray Duff, "Profiting From Public Schools," Investor's Business Daily, February 4, 1999.


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