Are There For-Profit Charter Schools? Dispelling the Myth.

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Black female student learning remotely

All charter schools are public schools. Yet many people insist that nefarious “for-profit charter schools” exist and call for their defunding. This myth—and similar calls to stop the so-called privatization of public education—baffles those that understand the mechanics of charter schools.

While part of the false narrative about “for-profit charter schools” can be traced back to intentional misinformation spread by charter opponents, there is also genuine misunderstanding about how charter schools operate that adds to the confusion.

To clear up these misconceptions, here are some answers to common questions about charter schools that are worth knowing:

What is a Charter?

The “charter” in charter schools refers to a written contract allowing for the establishment of a public school, often independent of the school district. The state or jurisdiction’s legislature tasks entities known as authorizers with the responsibility of approving, overseeing, and renewing charters in order to better the public education sector.

What are Authorizers?

Authorizers are granted jurisdiction by a legislature to approve, oversee, and renew charter schools. These are typically public agencies, such as local school districts/municipalities and state departments of education. In some states, the legislature grants universities, independent charter boards, and non-profit organizations authorizing ability. In order to remain open and have their charter renewed, charter schools must demonstrate success. Authorizers must therefore hold charter schools to the same (or higher) accountability standards as district-run schools.

Why do Charter Schools Exist?

State constitutions require state governments to provide their residents free access to public school education. Charter schools achieve this mandate while functioning independently of their local school district. As such, charter schools can be hubs of educational innovation and often focus on creative school environments, customized teaching approaches, alternative curricula to meet the needs of their students and families, or all of the above.

With their flexibility, charter schools may also use a variety of different management structures. For some, the myth of “for-profit charter schools” comes from confusion about the function of these management organizations.

What is a Management Organization?

Management organizations operate at least three charter schools and serve a minimum of 300 students. Some refer to these organizations as networks. While roughly 60% of charter schools operate as single-site schools, about 40% of charter schools choose to contract with a management organization for some form of support. These organizations can offer a wide range of services to schools such as financial, legal, and pedagogical support, staff training, and sometimes even overall administration and leadership of the school.

The vast majority of these organizations are non-profits and education experts refer to them as charter management organizations (CMOs). CMOs manage roughly 30% of charter schools and campuses, and students attending CMO-managed schools appear to show stronger academic growth than those in district-run schools or independently operated charter schools.

A management organization may also be a for-profit education management organization (EMO). Like CMOs, EMOs contract with a school to provide a specific management-related service such as back-office support, curriculum, or staffing. Because many EMOs serve as vendors for specific services, some refer to these schools as vendor-operated schools. Roughly 10% of charter schools and campuses contract with EMOs for management-related services. EMOs do not typically hold or manage a school’s charter—they simply provide services that the school needs. However, one state, Arizona, allows EMOs to both manage the public charter school and hold the charter.

Where do Virtual Charter Schools Come In?

EMOs can also provide online platforms for a group of virtual charter schools. Many have noted that because these EMOs operate the online platform—which is fundamental for a virtual school—they essentially operate the virtual school in its entirety. Roughly 10% of schools that contract with EMOs are full-time virtual schools, compared to less than 3% for CMOs.

Due to concerns about oversight and uneven academic performance in some of these schools, the National Alliance joined a coalition of education organizations in calling for changes to state laws to address these issues at full-time virtual schools. The National Alliance strongly believes that transparency and accountability measures are an integral component to ensuring all children have access to a high-quality public education.

Why Not Ban Charter Schools from Hiring For-Profit Companies?

It is understandable to be concerned that EMOs may offer recommendations to a school for their personal financial gain. However, preventing abuse and financial mismanagement falls under the purview of charter authorizers. To ensure schools are acting in the best interests of the families in their communities, charter laws across the nation require a high degree of financial transparency and oversight. The National Alliance works to improve state laws that hold both charter schools and their authorizers to the highest standards of accountability.

Although some people may feel for-profit companies have no place in education, for-profit companies regularly work with public and governmental agencies—including district schools—to provide management services. Hiring or contracting with a for-profit entity does not inherently make the receiving entity for-profit as well. To categorically prevent only charter schools from engaging with such companies holds them to an unfair standard not applied to any other institutions and prevents charter schools from accessing resources that could lead to higher student achievement.

It is true that not all EMOs are high performing. It is also true that thousands of public schools with other management structures—both charter and district—also struggle with performance. This is a problem Americans cannot afford to ignore.

As a society, we need to stand up for excellent public schools regardless of management structure and oppose schools that are consistently failing students and exacerbating inequality. With so many students in underperforming schools, limiting options makes no sense.

It is time for us to move past bickering over bureaucracy and instead focus on empowering all public schools to help all students achieve.


Jamison White is the senior manager of data and research at the National Alliance for Public Charter Schools.