NCPA - National Center for Policy Analysis

For-Profit Schools Expanding

June 2, 1997

Charter and for-profit schools are transforming the American educational landscape in fundamental ways, educational experts note.

  • Some 500 chartered schools -- public schools operated autonomously -- have been created in the last few years.
  • About 10 percent are run by private companies such as the Edison Project, Advantage Schools Inc., Sabis Educational Systems, Education Alternatives Inc. and Alternative Public Schools, according to a survey in the upcoming issue of Education Industry Report.
  • Edison, the leader in this group, is expected to announce that it will double in size next year to 25 schools in eight states.

Edison, founded in 1991, appeared to be on its last legs three years ago, but has now bounced back.

  • Edison will announce new school sites in Chula Vista, Ca.; Detroit, Mich.; Duluth, Minn.; Flint, Mich., and San Antonio, Tex.
  • It will also announce test scores showing that it has had some striking successes in improving students' educational performance.
  • By next fall the company, headed by media entrepreneur Christopher Whittle and former Yale University president Benno C. Schmidt Jr., will have grown in three years from four schools to 12 to 25 -- enrolling 13,000 students.
  • Officials say Edison is likely to add even more schools in the 1998-99 school year than it will in 1997-98.

The company has yet to lose a school district client and all but one of its eight current cities have expanded their Edison schools. Some analysts say Edison's growth and performance provide evidence that a private company can operate schools better and more cheaply than school districts do.

Student test scores support the performance claim.

  • Fifth-graders at Edison's Wichita, Kan., school moved up to the 59th national percentile in reading from the 46th.
  • They also increased scores on a standardized math test taken by all public school students in Wichita from the 35th percentile to the 64th.
  • On tests conducted by the Educational Testing Service, gains by Edison first graders and kindergartners substantially exceeded students in a control group at the two sites where matched control groups exist, Edison said.

While some financial analysts dispute Edison's claim that all its schools are operating profitably now, once corporate and start-up costs are factored out, many previously skeptical educators now say that children are better educated under Edison's plan than those who remain in conventional public schools.

Source: Peter Applebome, "For-Profit Education Venture to Expand," New York Times , Wednesday, June 2, 1997.


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