State law also specifies which entities within the state  can authorize the establishment of a charter school, such as state  departments of education, state boards of education, local education  agencies, institutions of higher education, and municipal governments. Some States Provided Flexibility by Allowing Charter Schools to Choose among Authorizers, and Most States Released Charter Schools from Traditional Public School Requirements

In school year 2002-03, states reported that they provided flexibility  through the authorizers they established and through releasing charter  schools from traditional public school requirements. Of the 39 charter school state agencies surveyed, 26 reported that they  allowed appeals when authorizers denied applications. States Promoted Accountability for Charter School Performance and Financial Integrity through State Actions and through Authorizers

To promote charter school performance and financial integrity, states took  various actions to oversee charter schools and provided oversight of and  assistance to authorizers. Over half of the 39 states in our survey reported having responsibility for  enforcing school improvement actions. NCLBA’s Provisions Apply to Charter Schools but Provide Some Flexibilities

Under NCLBA, charter schools are required to meet the same performance  requirements as other public schools, but the law permits certain  flexibilities where allowed by state law. Charter schools, like other public  schools, are subject to the law’s requirements for the assessment of school  performance and the implementation of actions required when schools do  not meet state performance goals. NCLBA requires that oversight  responsibility be performed in accordance with state law. In addition,  while NCLBA requires certification for all other teachers to meet the  highly qualified teacher requirement, the law exempts charter school  teachers from this requirement where state law contains such an  exemption. If charter schools receiving Title I  funds do not meet annual performance goals, they must also implement  the school improvement actions NCLBA requires. Of these 33 states, 21 reported that at least half of charter schools  in the state achieved annual state performance goals in 2002-03, while 12  states indicated that fewer than half of their charter schools achieved  annual performance goals. Education Provides Support to Charter Schools Directly and Indirectly through Several Federal Programs and Conducts Research on Charter Schools

As it does for all public schools, Education plays a role in accountability  for charter schools through the resources it provides: it administers grant  programs that provide funds to charter schools, including a program  designed specifically to encourage the development of charter schools,  and sponsors research on charter school accountability. The department must ensure that new and expanding  charter schools receive timely payment of federal grant funds for which  they are eligible. Education is in the process of developing new systems  that are expected to provide both performance and financial reports for  the department’s major grant programs, but the ability of the new systems  to provide financial data for charter schools is questionable. However, Education’s OIG reported problems with the timeliness of Title I  grant payments to charter schools. The study was framed around four questions: (1) how  states allow charter schools flexibility in design and operation, (2) how  states promote accountability for school performance and financial  integrity in their charter school systems, (3) the implications of the No  Child Left Behind Act (NCLBA) for charter schools, and (4) the role  Education plays in charter school accountability for school performance  and financial integrity.
Why GAO Did This Study

Charter schools are public schools that are granted increased autonomy by states in exchange for meeting specified academic goals. State law determines who approves the formation of a charter school, often the board of education. As public schools, charter schools are subject to the performance requirements of the No Child Left Behind Act (NCLBA) as well. In this environment, states' systems for allowing charter schools flexibility and ensuring school performance and financial integrity assume greater importance. GAO examined (1) how states allow charter schools flexibility, (2) how states promote accountability for school performance and financial integrity for charter schools, (3) the implications of NCLBA for charter schools, and (4) the role the Department of Education (Education) plays in charter school accountability. GAO surveyed the 39 states and jurisdictions with operating charter schools in 2002-03 and interviewed charter school experts and Education officials.

What GAO Found

In school year 2002-03, some states reported that they provided charter schools flexibility by allowing them to choose their authorizer. Authorizers--state education agencies, local education agencies, universities, and other nonprofit organizations--oversee the formation and operation of charter schools. Also, nearly all states provided flexibility by releasing charter schools from some traditional public school requirements, such as teacher hiring and termination practices, schedules, and collective bargaining agreements. To promote charter school performance and financial integrity, states reported that they took action to oversee charter schools and to oversee and provide assistance to authorizers. About half of the 39 states reported having primary responsibility for enforcing school improvement actions in charter schools not achieving annual school performance goals under NCLBA. Most states reported that they intervened when authorizers were not performing their responsibilities and conducted or required audits of authorizers' finances. About half of the states assisted authorizers with funding for their charter school oversight responsibilities or gave them fee collection authority. NCLBA requires charter schools to meet the same requirements as other public schools, but the law permits certain flexibilities where allowed by state law. Charter schools must be included in the statewide assessment system, and charter schools that receive NCLBA Title I funds must take school improvement actions if they do not meet state performance goals. However, NCLBA allows state law to determine the entity responsible for charter school oversight. In addition, while NCLBA requires certification for all other teachers to meet the highly qualified teacher requirement, the law exempts charter school teachers from this requirement where state law permits. As it does for all public schools, Education administers grant programs that provide funds to charter schools, monitors grant performance, and sponsors research on accountability for academic performance and financial integrity. Under NCLBA, the department and states must ensure that new and expanding charter schools receive timely payment of federal grant funds for which they are eligible and meet the act's academic achievement goals. However, in its monitoring and data collection, Education gathers little information on the timeliness of charter school grant payments or how well the schools perform. Moreover, Education's Office of the Inspector General (OIG) reported delays in states' Title I payments to charter schools. Education is in the process of developing new systems that are expected to provide both academic performance and financial reports for the department's major grant programs, but the ability of the new systems to provide financial reports for charter schools is uncertain.