The Bill and Melinda Gates Foundation have generously supported Fordham’s charter school sponsorship efforts in Ohio. In doing so, the Gates Foundation requested that we share some of our experiences and the knowledge gained monitoring nine charter schools. Below is the first installment in a series of articles examining lessons learned about quality sponsorship.


The March 2, 2007 Columbus Dispatch headline read, “Sponsor to run charter schools.” It sent shivers down my spine. Sponsors (a.k.a. authorizers), of which the Thomas B. Fordham Foundation is one, are the organizations that “license” charter schools to operate and ultimately hold them responsible for their results. Charter schools are, by intention and design, supposed to be free of many regulations and rules that burden traditional public schools. In return for these essential freedoms, however, charters are to be held accountable for their academic, fiscal and operational results. That’s the sponsor’s most solemn responsibility. Indeed, for the charter-school theory to work in practice, sponsors must hold “their” schools accountable for results.

Sponsors are not “operators,” however. Leading and managing a charter school, selecting its teachers and curriculum, dealing with its students and parents, managing its finances, making it succeed academically--these are the most solemn responsibilities of the non-profit governing boards that get “licensed” by sponsors. Sometimes those organizations “outsource” school operations to other groups, non-profit or for-profit, but they remain responsible for the school’s success. Responsible to the parents and communities, of course, but officially responsible to their sponsor.

It follows that one of the great dilemmas faced by conscientious sponsors is the tension between “tough” and “love,” between the work of a policeman and that of a social worker. To what extent does the sponsor settle for monitoring the charter school’s success, and to what extent does it try to provide help to school operators to boost the chances of success? This is a bigger dilemma than most people realize. Sponsors in Ohio, in addition to being responsible on behalf of the state for ensuring that “their” charter schools comply with myriad laws and regulations, are also required by state law to provide those schools with “technical assistance.” Ohio law does not define technical assistance or say how much or what types of it to provide, yet sponsors are held accountable by the state for delivering it.

We at Fordham, in our role as a sponsor, have sought to deal with this uncertainty by clarifying in our contracts and in our communications with the state, with schools, and with other interested parties what we do as a sponsor and what we do not do as it relates to school operations. In applying to the Ohio Department of Education for approval as a sponsor, we wrote that, in our view, “charter school sponsors are not expected to be a ‘mini-school district,’ but rather a technical resource, referral service and clearinghouse that matches schools’ needs with resources that can meet them.” We continued, “It is important to note that Fordham does not believe it is appropriate for a sponsor to also be the vendor of additional fee-based services, so we are keeping the role of sponsor separate from that of supplemental service provider.”

Here’s our reasoning: It’s undesirable for a sponsor to provide (much less sell!) academic, financial, and organizational services to schools, and then hold them accountable for their performance, which has presumably been driven in part by those services. That’s an inherent conflict of interest. Furthermore, a school might find itself unable to complain about the quality of the technical assistance provided by the sponsor for fear that such complaints might jeopardize the school’s standing with the sponsor.

In our contracts with the nine schools we sponsor, we include a section that reads: “The Sponsor will not require the Governing Authority and/or Community School to purchase, contract to purchase or use any supplemental services (treasury services, financial management services, etc.) offered by the Sponsor or any affiliate of the sponsor.” We seek to make clear to one and all that sponsors are responsible for overseeing charter schools; reporting on their academic, operational and fiscal performance; and ultimately deciding if they have earned the right to stay open. It’s not right for the sponsor to play “social worker” for a troubled school if it must, at day’s end, be the policeman who blows the whistle on that school. 

Fordham’s view of sponsorship is supported by the National Association of Charter School Authorizers (NACSA), which declares that “authorizers (sponsors) are entities charged by law to approve new schools; oversee ongoing performance; and evaluate the performance of public charter schools to make renewal decisions. These three main tasks of an authorizer together provide a powerful tool for improving student outcomes” (see here). Nowhere does NACSA encourage sponsors also to sell supplemental services to schools, much less to “take over” ailing schools.

Yet some Ohio charter sponsors do sell supplemental services to their schools. These range from financial management to special education to professional development for teachers. For example, the sponsor embroiled in the recent Harte-Crossroads charter controversy (see here) apparently has an attachment in its school contracts requiring its sponsored schools also to purchase financial management services from the sponsor in return for 20 percent of the schools’ gross revenues. This sort of provision blurs the boundary between sponsor and school operator, while creating the potential for serious conflicts of interest. If the school goes bankrupt, who is liable? The school’s operator? The sponsor who was paid to manage its finances? If the sponsor sells shoddy services, can the school really complain or pick a different vendor?

Quality sponsors should stay free of such conflicts of interest, and focus squarely on ensuring whether charters are delivering results or not. Yet three real pressures encourage the blurring of sponsorship and school operations.

  1. The uncertainty in state law with regard to providing sponsored schools with “technical assistance.” If a school struggles academically should the sponsor, under the guise of technical assistance, go in and force a new curriculum upon the school or force the school to fire all of its teachers and hire new ones? Or is it enough to point out the problems, and offer access to alternatives while making clear that, if the school doesn’t turn itself around, it faces probation or closure?
  2. Sponsors’ own economics combined with the desire of some charter schools, small ones especially, to “pool” their needs and create economies of scale. There is an economic logic to an organization developing expertise in school finance, special education, and so forth--then selling such services to multiple schools. In theory, this should result in improved services at reduced costs, which should benefit schools. This pressure is greatest when sponsors are county education service centers or traditional school districts, which already employ experienced staff in these areas. 
  3. Intervening before a school implodes. If a charter school is stumbling, its sponsor will be tempted to take on particular aspects of its day-to-day operations so as to prevent melt-down, possibly stranding hundreds of children with no decent education alternative. What better way to ensure the financial integrity of a school than to put yourself in charge of its budget and financial operations? If a school falls into academic or leadership crisis, sponsors will be tempted to march in and take over. Yet even the best of intentions doesn’t always make something right.

Ohio could strengthen its charter-school program by doing two things. First, the legislature should specify what “technical assistance” is and is not. Second, sponsors should be prohibited from selling supplemental services to the schools they sponsor. Organizations that currently sponsor schools, while also selling them supplemental services, should decide whether they want to be vendors or overseers. Wearing both hats creates more problems than it solves, and forcing organizations to do one or the other could also create new partnerships between sponsors and competent third party service providers. This separation of responsibilities would ultimately make for stronger, not weaker, schools.

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