Private Education Management Organizations Running Public Schools Expand

NEPC report finds 44% of charter school students in 2011-12 attended schools operated by EMOs


A new National Education Policy Center report published today shows that across the nation, schools managed by for-profit firms such as K12 Inc, National Heritage Academies and Charter Schools USA, as well as nonprofit education management organizations (EMOs) such as KIPP, continue to increase the number of students they enroll, despite a scarcity of evidence showing positive results.

Students across 35 states and the District of Columbia now attend schools managed by these non-government entities. Oklahoma and Tennessee have added schools run by EMOs since the last edition of this report.

The report, Profiles of For-Profit and Nonprofit Education Management Organizations: Fourteenth Edition – 2011-2012, was released by the National Education Policy Center (NEPC), housed at the University of Colorado Boulder.

“There is growth in number of schools and students served in both for-profit and nonprofit sectors, although growth among schools operated by nonprofit EMOs continues to outpace the for-profit sector. Growth has slowed for for-profits in brick-and-mortar school settings. The real growth in the for-profit sector is with companies that operate virtual schools,” said the report’s lead author, Dr. Gary Miron, a professor of evaluation, measurement, and research at Western Michigan University. “The growth of virtual schools, which is fueled by millions in advertising dollars, is astounding because of the sketchy academic results reported by the schools that operate online.”

The report is the NEPC’s latest edition in its series of profiles of EMOs, companies contracted to manage charter schools and other public schools. The EMO sector emerged in the 1990s as part of an effort to use market forces and private entities to reform public education.

For-Profit Operators

Since the 1995-1996 school year, the number of for-profit EMOs has increased from 5 to 97, and the number of schools they operate has increased from 6 to 840. Enrollment has grown from approximately 1,000 students in 1995-1996 to 462,926 in 2011-2012.

While the actual number of for-profit companies has grown very little over the past few years, many of the large- and medium-sized EMOs are expanding into new service areas, such as supplemental education services and virtual schooling.

Imagine Schools was the largest for-profit EMO in 2011-2012 in terms of the number of schools it manages. The company managed 89 schools during the 2011-2012 school year, but it has lost a number of contracts since then. The next largest for-profit operators in 2011-2012, in terms of numbers of schools, are Academica (76) and National Heritage Academies (68).

However, in terms of enrolled students, the largest EMO is K12 Inc., which operates virtual schools. Because of the large enrollments in its schools, the total enrollment of K12 Inc.’s schools exceeded that of any other for-profit—or nonprofit—EMO, with 57 schools enrolling 87,091 students.

Nonprofit Operators

Nonprofit operators have shown more robust growth in brick-and-mortar school settings than for-profit operators, both in terms of new nonprofit EMOs and new managed schools. A total of 201 nonprofit EMOs were identified and profiled in this year’s report, including 31 large nonprofit EMOs, 68 medium-sized, and 102 small nonprofit EMOs.

The overall number of students in nonprofit EMO-managed schools has increased dramatically, from 237,591 in the 2009-2010 school year to 445,052 during the 2011-2012 school year. KIPP, the Knowledge is Power Program, a national charter school network, remained the largest nonprofit EMO, with 98 schools and just over 35,045 students in 2011-2012.

Virtual Schools

The number of virtual schools operated by EMOs increased from 60 in 2009-2010 to 91 in 2011-2012. This represents 10.8 percent of all schools managed by for-profit operators.

As noted, the largest for-profit operator is K-12 Inc. which operates full-time virtual schools. Some of the largest for-profit EMOs are beginning to lose contracts with brick-and-mortar schools and are shifting their attention to virtual education. “Most virtual schools are charters, are full-time, and are statewide in their scope,” said Charisse Gulosino of the University of Memphis, the report’s coauthor. “As it stands, research, policy and practice have not kept pace with virtual schooling’s growth — reflecting the need for deliberation about its impact and implications for public K-12 education.”