TCS Daily

Good News out of New Orleans

By Kathryn Newmark - November 17, 2005 12:00 AM

In the aftermath of Hurricane Katrina, many have blamed the New Orleans government for the city's poor preparedness -- and rightly so. But let's also give credit where credit is due: the city government is making good decisions about restoring New Orleans public schools.  

Last month, the school board unanimously approved charter applications for all 13 schools on the relatively undamaged West Bank and for 7 additional schools on the East Bank. Charter schools are public schools that must comply with state laws and accountability programs but have greater autonomy than regular public schools.                            

It appears that the primary motivation for this action was money. With much of the city's tax base gone, local revenues are highly uncertain. State per-pupil funding is also uncertain, as the legislature figures out how to allot money when school districts across the state have experienced significant -- and still fluctuating -- shifts in student population. According to the most recent proposal, Orleans Parish will receive less than half of the state funding it received last year.  

Funding for charter schools looks more promising. A month after the hurricane hit, the U.S. Department of Education awarded Louisiana a $20.9 million grant to help repair and expand existing charter schools, as well as open new ones. School board vice president Lourdes Moran emphasized the financial motivation for the charter decision: "I'm not saying that I want to do this because I want to change governance. I am interested in making sure we access all the resources necessary to have a quality education." Referring to the federal grant, she said, "We don't want to miss an opportunity."  

But taking advantage of this federal grant is just one of many reasons charter schools are good for the New Orleans school system. Everyone agrees that simply re-creating the system that existed before the storm is not good enough. Corrupt, incompetent management and abominable academic performance made the school district a disaster area long before Katrina hit. Charter schools offer hope for a better future.  

Earlier this year, the state's legislative auditor declared that, thanks to promotion policies that put people in jobs they were not qualified for, there was "not one accountant working in the accounting department" of the Orleans Parish school district. And it showed: before the hurricane, the system was projected to run a $25 to $30 million deficit. The U.S. Department of Education reported that nearly $70 million in federal money for low-income students in New Orleans was either improperly accounted for or misspent. Corruption was so pervasive that the FBI and other federal and state investigators opened an office inside the school administration building. Their investigation resulted in two dozen indictments for theft, fraud, and kickbacks.  

This terrible situation forced the school board to cede substantial power to a financial turnaround company this past summer. Alvarez & Marsal, a financial restructuring firm, was given control over hiring, firing, and contracting in the central office, while the school board retained control over the budget and school-based employees.  

Katrina made the already-monumental task facing Alvarez & Marsal even more difficult and urgent. They may be able to improve the system in the long run, but certainly not with the speed that the post-Katrina reconstruction demands; in the short run, it's likely to be the same bureaucracy in charge as before. And why would anyone want that? Indeed, private foundations, such as the Gates Foundation and the Aspen Institute, are reportedly willing to fund brand-new schools for New Orleans but not if the dysfunctional leadership remains in place.  

Therein lies an immediate advantage of the switch to charter schools: charter schools sidestep the management mess because, to a large degree, they are self-governing. They handle their own budgets, manage their own personnel, and organize their own curricula, schedules, and policies. The role of the school district bureaucracy shrinks to handing out money and administering the accountability program.  

Furthermore, the site-based management at charter schools makes them more flexible, a quality that will be particularly important in the uncertain environment of post-Katrina New Orleans. It will be difficult to predict how many students will come back, when and where they will show up, what their needs will be, and what sort of schools they will prefer. A system of many independent schools will be better able to adapt to a changing, unpredictable situation than a system of centralized control.  

Another advantage of charter schools in New Orleans is that they may be able to, over time, improve the system's miserable academic performance. Recently-released 2004-05 test score data show that 170 Louisiana public schools were rated "academically unacceptable," and 68 were in Orleans Parish -- over half of the district's schools. On the Spring 2005 Graduate Exit Exam, high-schoolers in the district received "unsatisfactory" scores at a rate twice the state average; in many New Orleans high schools, over half of test-takers scored in the "unsatisfactory" range. The high-stakes tests for fourth and eighth graders had similar results.  

While these poor-performing schools have been allowed to muddle on for many years, a charter school that consistently posted such low test scores would likely be shut down. The difference in consequences faced by charter and regular public schools gives charter schools much more powerful incentives to achieve. In addition, because charter schools are free to innovate -- by trying out a new curriculum or experimenting with longer school days, for instance -- they will bring fresh ideas to the table.  

Many studies of charter schools in other states have found that charter school students perform better than their counterparts in regular public schools, even though they often are more likely to be disadvantaged or start with lower test scores.  

We may some day look to post-Katrina New Orleans as the model for improving failing urban school districts.  

The author is a researcher at the American Enterprise Institute.

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