How Charter School Regulations Harm Minority School Operators

It’s the oldest story in public policy. Regulations keep less favored providers from entering a market, allowing in only those who have the money to comply with the regulations or friends in high places to look the other way. In the name of protecting the public, government intervention ends up empowering the powerful. Such regulations have always had particularly pernicious impacts on African Americans.

Economists like Milton Friedman and Walter Williams have long written about how government licensing boards and bureaucracies refused to find minorities qualified to practice professions from doctor to teamster, keeping African Americans out. Such government regulations, justified as protecting the public from poor service, in practice increased prices for consumers and presented huge barriers to upward mobility for minorities.

Perhaps nowhere is this truer than in that most regulated of service sectors, education. In traditional public schools, upward mobility is often determined by personal patronage rather than good teaching, as then community organizer Barack Obama lamented of the Chicago public schools in his autobiography, Dreams from my Father. As Obama and others have pointed out, the charter school movement was meant to allow newcomers like parents, teachers, and preachers to open schools in their own communities.

When charters were first conceived nearly 30 years ago, they were intended to pioneer educational practices outside traditional public school bureaucracies and also to allow education newcomers to provide out of the box options, especially in minority communities where students were historically underserved by traditional public schools. Through much of its history the charter movement did in fact serve teachers and local parents by empowering educators outside the mainstream, including small, innovative operators like the Seven Generations Charter School in Pennsylvania, which focuses on environmental stewardship, or the Arizona Agribusiness and Equine Center in Arizona, where students participate in equestrian activities as part of their course requirements. These education options have helped scores of students.

Yet the charter movement has strayed from its founding ideals. Philanthropies have spent hundreds of millions of dollars on the charter movement. Their demand for results—typically measured by test scores alone— coupled with intense scrutiny of chartering from teacher unions and their allies has resulted in copycat practices. Rather than innovate, charters emulate the practices of schools with a strong track record of achievement.

Many state governments have tacitly supported the achievement- rather than innovation-focused model of charter schooling. As we show in our just published study in Urban Education, “Charter School Regulation as a Disproportionate Barrier to Entry,” since the early 2000s policy-makers in most states have increased regulation with the worthwhile goal of assuring that only those most likely to produce test score gains receive a charter to run a school. The unfortunate result, though, is that fewer minority educators and independent community-based educators receive charters, which instead go to white operators, and to deep pocketed charter management organizations, or CMOs, typically multi-state non-profit organizations founded by Teach For America alumni. These “cool kids of education reform”—with friends in high places, the sophistication to handle regulations, and access to capital to build and expand schools—may have deeper pockets and fancy credentials, but also are less representative of and know less about the low income, mainly minority communities that most charter schools serve.

Our study indicates that the effect of regulation on controlling market entry can be dramatic. In high-regulation states like Texas, Ohio, and Indiana, White and Asian applicants are more than twice as likely to receive authorization compared to Black and Hispanic applicants. Moreover, applicants affiliated with CMOs are more than twice as likely to receive authorization compared to unaffiliated applicants. In low-regulation Arizona and North Carolina, differences in success rate vary only marginally according to applicant race or affiliation with a CMO.

The observation that stringent charter authorizing regulation disproportionately affects people of color is troubling, especially at a time when most of us critically reflect on how to ensure equitable access to the American dream. Beyond those gut feelings, it is likely that disproportionate costs imposed upon would-be charter operators of color also disproportionately harm students of color. A strong and growing body of research literature indicates that students of color (and especially charter school students of color) benefit from student- teacher and administrator race-matching, sometimes in ways undetected by test scores.

All of this invites the question: How does an authorizing body best evaluate a charter school, or proposed charter school? For one, listen. Parents have a lot to say about what their kids need from a school, and whether a school meets those needs. Their intuition is good: Research suggests that parents are adept at picking schools that suit their children when provided the option. As states like California and Pennsylvania mull strengthening their charter regulatory regimes, they’d do well to take heed to ensure that people of color are stewards and not subjects of the charter schooling movement.