First Charter School Failed, but Two More Have High Hopes

Gateway Charter School in Ponca knew it was in financial trouble the first day of school in September 2000.

The first open-enrollment charter school in Arkansas needed 40 students to break even, but it only had 13, said Steve Brewer, director of the Ozarks Unlimited Resource Cooperative in Harrison, which oversaw the school.

The school never recovered from its early student shortages and voluntarily surrendered its charter on Aug. 24, leaving $400,000 in debt.

Although Gateway shut its doors after only one year of teaching students, the two open-enrollment charter schools starting this year say they are in a better position to succeed.

Both Benton County School of the Arts in Rogers and Academics Plus Charter School in Maumelle said they have overcome the biggest hurdle in forming an open-enrollment charter school — the startup costs — and should be financially secure for years.

In 1999, the state Legislature eased a 1995 law that allowed the two main types of charter schools, conversions and open enrollment, to come on the scene.

Conversion schools can be run by public school districts only for students in their districts, said Randall Greenway, charter school liaison for the Arkansas Department of Education. The schools are granted exemptions from standard Department of Education regulations to experiment with new educational programs.

“If the [public] school isn’t doing a great job, parents and students aren’t going to chose to attend that school,” Greenway said.

The conversion schools are more likely to succeed because their districts have the facilities and transportation system already in place, he said.

“They also have the ability to issue bonds and to increase the revenue that’s generated through local millage,” Greenway said.

The open-enrollment schools, however, have to start from scratch and produce new facilities, food service and equipment, he said.

“That first couple of years is really where the challenge lies,” he said.

The open-enrollment charter schools are run by nonprofit organizations and are open to all students in the state.

Gateway’s Woes

A recent special report by the Division of Legislative Audit showed Gateway spent $972,376 during its two years in existence, although students didn’t start attending until fall 2000. During that period, its revenue was $570,792, leaving a $401,584 deficit.

In its 2000-2001 school year, it spent $676,089, but brought in only $513,999, for a deficit of $162,092, Greenway said.

Brewer said the Ozarks Unlimited Resource Cooperative, which sponsored the charter and is made up of 21 school districts, will have to divide the debt.

“Their budget was not realistic to begin with,” Greenway said.

School of the Arts

Benton County School of the Arts has also succeeded in raising the necessary startup money.

It has received grants and donations that totaled $400,000, said the school’s principal and superintendent, Bill Osborne.

“We’re financially stable now,” he said. “The only thing that really hurt us and always hurts charter schools … [is] there’s no funding allocated for startup in buildings.”

Benton County School of the Arts is leasing a clinic from St. Mary’s Mercy Hospital System for $6,500 a month. At the end of the three-year lease it has the option to buy the building, he said.

“We have put into effect a very strong financial budget, even without any of the grants or funds from philanthropic organizations,” Osborne said.

Osborne, who has run his own consulting company for nine years, will manage the school and its $1.8 million budget like a business, he said.

He said he’s not worried about a shortage of students.

It took two weeks for classes to fill up, and now there are at least 150 students on the waiting list, Osborne said.

The school offers its 300 students, kindergarten through seventh grade, classes in all of the major fine arts, including dance, theater, music and studio art. The plan is to add a grade a year through the 12th grade and to add 100 students a year.

“When the test scores come out, that will be the proof in the pudding,” he said.