Charter schools are the most publicized, most controversial expression of school choice. What are charters? What's been their history? What makes them controversial? The charter school idea, in echo of the 19th century of the academy structure first appeared in the 1980s. At that time, charters were conceived to be experimental programs operated and controlled by teachers in urban public schools. They were think tanks, hothouses, demonstration sites where innovative teachers experimented on a small scale. With progressive education curriculum and learning activities that were targeted to children of poverty, color, and immigrants. Avant-garde teachers designed these programs in consultation with parents and local community organizations. Practices that worked were to be disseminated to the other classrooms in the building and other schools. This idea which had the endorsement of Albert Schenker of the American Federation of Teachers, and was promoted by middle of the road Progressives, was subsequently transformed in the next decade into something quite different than what many publicly minded charter pioneers had in mind. Today, charter schools are publicly funded, though privately operated, public schools of choice. According to the US Department of Education, quote, a public charter school is a publicly funded school, that is typically governed by a group or organization under a legislative contract or charter with the state or jurisdiction. The charter exempts the school from selected state or local rules and regulations, in return for funding and autonomy, the charter school must meet the accountability standards articulated in its charter. A school's charter is reviewed periodically, typically every three to five years by the group or jurisdiction that granted its charter and can be revoked if guidelines on curriculum and management are not followed, or if the standards are not met. >> Minnesota passed the first charter school law in 1990. By school year 2010-11, 41 states and the District of Columbia had charter legislation on their books. By that year, some 5,300 charter schools were in operation. Enrolling about 5% of the nation's total number of public school children. Charter school laws vary from state to state. Here's how charter school laws work in Pennsylvania. Pennsylvania passed its charter school law in 1997. The Chartering Authority in our state is the local school board. In Philadelphia, Charter founders receive their authorization from the Philadelphia School Reform Commission, an entity formed after a state take over of the district supplanting the city school board. Pennsylvania charter schools are public, nonprofit, nonsectarian institutions. They may be established by teachers, parents, institutions of higher education, or museums, subject to approval by the local board. Charters have some control over whom they admit, though they may not discriminate. For example, a Charter may have a thematic focus such as, social justice, environmental science, or foreign languages. A Charter has the right to establish reasonable criteria for admission that are consistent with the Charter's mission. A Charter that has more eligible applicants than seats must hold a lottery. >> The law requires that at least 75% of a charter school's teachers must hold a Pennsylvania Teaching Certificate. In other words, up to 25% of a charter's teachers need not hold a teaching certificate. Charter teachers have the right to bargain collectively, but they may not belong to the school district's bargaining unit. In Philadelphia, the Philadelphia Federation of Teachers is the bargaining unit, and the PFT is not friendly to charters. Charters are subject to renewal by their local school boards every five years. If a charter renewal is denied for any reason, usually it's financial insolvency, mismanagement or inadequate yearly performance, the charter supporters have the right to petition the State Charter Appeals Board for reinstatement. If the appeal is denied, the petitioners may ask for review by the commonwealth court. >> Nationwide, as a rule, charter schools are associated with highly stressed urban school districts. As a general concern, critics of charter schools charge that charter's undermine city schools by draining precious funds from school districts and creaming the most talented motivated students from district schools. Some take the argument further, pointing an angry finger at corporate and philanthropic America. The social psychologist, Michelle Fine, and her colleagues argue that corporate America has co-opted the original charter idea, and corrupted the contemporaneous charter movement. The question is, what motivates them, if not profit? Diane Ravitch casts her explanation as what we call, a more world to conquer hypothesis. She labels the fabulously wealthy corporate leaders in education reform the billionaire boys club. The premier members are the Bill and Melinda Gates Foundation, the Eli and Edythe Brode Foundation and the Walton Family Foundation. Bill Gates, of course, made his fortune in Microsoft. Brode in real estate markets and Sam Walton in big-box merchandising. The billionaire boys club's motivation is ideological. It's not profit based. They have all the money they need. What works for corporate America, they assume, will work for education. This is social efficiency ideology in a new rind skin from the 21st century. Business know how will fix America. >> In the hands of Gates, Brode, the Walton family, and hedge fund managers turned education reformers, this is imperialism for ideas. The billionaire boys club wants to deconstruct public education and reassemble it through parents exercise of school choice. The big donors envision a national marketplace of competing schools. Their quality adjudicated on the basis of their test scores. With school leaders trained in the data driven mindsets and management practices of corporate America. Teachers evaluated on the basis of student scores. They are unfriendly to the present generation of teachers and their unions, whom they view as a drain on the society. They fund alternative teacher and administrator education programs. They fund charter schools. Big business will lead the way. Nonprofit charter school network have taken root in the nation's cities. For example, the Knowledge Is Power Program, or KIPP, in 20 cities and the District of Columbia. Master Chartery schools in Philadelphia. Harlem Success Academies in New York City. Schools in charter networks typically spend most of their time and effort to improve the standardized test scores of children of poverty and color. Their No Excuses programs are highly scripted and leave little room for student voices or creative expression. The ones we've just cited are generally regarded as effective schools. Though objective evidence is scanty. There is also considerable instability in the charter sector, with high student and teacher turnover plaguing many schools. Suffice it to say the overall quality of any charter school depends on the quality of its founders and leaders, its teachers and its resources, not to mention the motivation of its students and their families. In our next episode, we look at the role of charter schools in what are called portfolio management models of urban school reform. [SOUND]