Pass

The ASD once said it could save these two Memphis schools. Why is its own operator now walking away?

PHOTO: Brandon Dill/The Commercial Appeal
Tim Ware, who leads the state-run Achievement Schools in Memphis, talks with Whitney Achievement Elementary School Principal Debra Broughton during a 2015 meeting.

After a charter operator abruptly announced plans to pull out of running two Memphis schools in Tennessee’s Achievement School District, leaders of the state-run turnaround initiative faced a wrenching decision.

Should they run the schools directly, using their own management group, Achievement Schools? After all, Achievement Schools already is running five similar schools nearby, and the ASD was designed to improve schools in crisis.

Or should they join other ASD charter operators in declining to rescue Klondike Preparatory Elementary and Humes Preparatory Middle schools?

After crunching the numbers, they went with the second option. A different operator has applied to step in at Humes at the end of this school year, but Klondike will become the first school in the ASD to close.

The impending closure raises questions about why the state entity that promised to catapult struggling schools to excellence is instead letting at least one die. The answers lie largely in a persistent complaint among nonprofit charter operators running ASD schools in Memphis: There simply aren’t enough students to go around.

“We did our due diligence in looking at the finances and honestly we could not make it work,” ASD Superintendent Malika Anderson told Klondike parents last week. “We couldn’t provide a breadth of services here with the number of students available.”

Klondike has 135 students, even though it can enroll up to 750. At Humes, just 315 students attend class in a building designed for 900. A combination of strict rules that limit student recruitment and a dwindling school-age population have left the schools struggling to attract students — damaging not only their mission, but also their chief source of funding.

To operate both schools, Achievement Schools Executive Director Tim Ware said balancing the budget would require slashing teacher training, after-school instruction, and programs to help poor students.

“When you strip education down to those bare bones, there’s real questions about the value of that education,” Ware said. “It costs extra money to take a school that’s challenged to create the necessary supports to turn it around.”

Officials in Shelby County Schools, the local district that previously ran the schools, already had drawn the same conclusion. The district has been pouring millions of federal and philanthropic dollars into 21 struggling schools through a turnaround initiative known as the Innovation Zone, allowing them to add extra services for students and training for teachers.

The local district also has about 22,000 more seats than students, and it recently kicked off a process to bring those two numbers in line by closing and consolidating schools.

The dynamic is not unique to Memphis, according to Ethan Gray, whose nonprofit, Education Cities, helps cities plan for the future. He said charter operators like KIPP, which is pulling out of another ASD school this spring, are learning that success in some cities might not easily be replicated in others.

“There are a number of cities that are facing declining enrollment issues where the economics of opening and running schools is really, really hard,” Gray said.

“The reality for a lot of [charter operators] that are being recruited by cities is that the conditions have to be favorable for them to set up shop and run schools that are effective economically and academically,” he added.

In Memphis, where the ASD operates 31 schools, it doesn’t appear that those conditions are in place. That raises another question about the state entity: Shouldn’t it have seen these demographic challenges coming?

Some local officials say yes — and that Tennessee shouldn’t have made the bold school-improvement promises it did without solutions.

“This goes back to the heart of the original problem. Dwindling enrollment, small schools,” said David Reaves, a former school board member who now sits on the Shelby County Board of Commissioners and has long been critical of the ASD. “The state thought the best thing was to bring in a charter operator to grow the school. But the reality is the school population isn’t there.”

The Fine Print

Why charter operators exiting Tennessee’s turnaround district can walk away

PHOTO: Laura Faith Kebede
Each of the state-run Achievement School District charter operators have an agreement that allows them to close for any reason.

When two charter school operators announced plans to leave Tennessee’s turnaround district this spring, many people were surprised that they could break their 10-year agreements.

“How could any charter management company come into a community and up and decide we’re not going to play anymore?” asked Quincey Morris, a lifelong resident of North Memphis, home to two schools that abruptly lost their charter operator.

But in Memphis and across the nation, there’s nothing to stop charter operators from leaving, even when they promise to be there for a long time.

Contracts signed by both Gestalt Community Schools and KIPP contain no penalties for exiting the Achievement School District before agreements run out, according to documents obtained by Chalkbeat.

And by design, that’s not unusual in the charter sector. For better or worse, operators are given that autonomy, according to Dirk Tillotson, a lawyer and founder of a charter incubation organization in California.

“There hasn’t been much attention paid to closures in the law,” Tillotson said of charter laws nationwide. “The laws are more forward-looking than backward-looking when things might blow up.”

That lack of clarity has suddenly started to matter a lot in Memphis, where charter schools are struggling to attract enough students to stay viable. Both KIPP and Gestalt blame their impending pullouts on under-enrollment — a challenge faced by more than half of the 31 Memphis schools operated by the ASD.

But having enough students wasn’t the focus when the ASD began taking over low-performing schools in 2012 and recruiting charter operators to turn them around. The assumption was that charter schools would have too many students and not enough seats, especially if those schools were under new management.

And their contracts reflected that line of thinking. The paperwork detailed how enrollment lotteries should be conducted if space remained after locally zoned students had registered. There was no guidance on what should happen if a school didn’t meet its enrollment goals — only that it would face a review if operating at less than 95 percent of projected enrollment under its budget.

As for the prospect of closure, the agreements don’t specify acceptable reasons for a charter operator to terminate its contract. Should that happen, the contracts say merely that the ASD has the authority to step in and conduct the school’s business and affairs.

PHOTO: Caroline Bauman
Yetta Lewis, co-founder and CEO of Gestalt Community Schools, answers questions from parents and teachers during an October assembly at Humes Preparatory Academy Middle School.

The gaps in ASD’s charter agreements show how the state-run district was helpless to prevent Gestalt and KIPP from announcing last fall that they would back out of their contracts at the end of this school year. They also highlight the gaps in understanding by all parties of how the decreasing student population in Memphis would affect the ASD’s work. It’s expensive to turn around schools or open a new one in an area losing school-age students as impoverished families vacate; running them requires enough students and funding to provide necessary supports.

Katie Jones, a Memphis charter school principal and a former charter evaluator for the ASD, said none of this should have come as a surprise, though. She said the ASD should have been clear about expectations.

“There should be stipulations that say reasons why you can not pull out of a school… and under enrollment is one of them,” Jones wrote on Facebook.

But including early-exit penalties can have unintended consequences, said William Haft, a vice president with the National Association of Charter School Authorizers, which has worked with both the ASD and Shelby County Schools to improve charter oversight.

“If they’re walking away, if they’re withdrawing from this commitment, then they’ve probably got a good reason to doing it,” Haft said. “Do you then want to try and force them (to stay open)? … I would want to be careful about setting up that situation.”

Bobby S. White, the ASD’s chief of external affairs, said adding penalties for closures could deter charter operators from taking on an already risky and challenging task to turn around schools in the state’s bottom 5 percent. It also would discourage operators from making a good-faith effort to stay open, as Gestalt did at first by running a deficit, he said.

“It would be insensitive for us to ignore what they’ve been dealing with to the detriment of their finances,” White said, adding the ASD plans to scrutinize enrollment projections more closely. “We have to be sensitive to the realities that shaped operators not being able to sustain the work.”

Still, there’s more at stake with turnaround districts like the ASD, said Morris, a Klondike alumna who is now executive director of the Klondike Smokey City Community Development Corp.

Most charter schools are new starts, but the bulk of the ASD’s charters are in existing schools that have struggled for years. In wresting control of them from their local district, the ASD and its operators promised to bring innovation and breathe new life into those schools and neighborhoods.

“They made promises that they didn’t keep,” Morris said, “and they disrupted our educational pattern.”

Achievement School District

The enrollment problems that plagued ASD schools in turmoil? They’re not unique.

PHOTO: Laura Faith Kebede
Kirby Middle School's band performs during the Memphis charter school's opening ceremony last fall. Kirby, which is operated by Green Dot Public Schools, is one of 17 schools in Tennessee's Achievement School District with enrollment under 70 percent.

When leaders of Gestalt announced they were backing out of running two Memphis schools in Tennessee’s turnaround district, they pinned the decision on low enrollment — and some charter operators were quick to paint the problem as unique.

Then KIPP told the same story a month later when it announced plans to exit University Middle, another Memphis school in the state’s Achievement School District.

“Due in large part to its remote location in Southwest Memphis, KIPP Memphis University Middle has been under enrolled since it opened in the summer of 2014,” KIPP leaders said in a statement last December.

But the two charter operators hardly faced unusual enrollment pressure. A Chalkbeat analysis found half of the ASD’s 33 schools have faced deep enrollment challenges.

Seventeen schools — 15 in Memphis and two in Nashville — enroll fewer than 70 percent of the students they were designed to serve. Fifteen of the ASD’s 25 takeovers also have fewer students today than when they were controlled by the local district.

The findings suggest that overhauling struggling schools by giving them new management, the ASD’s high-stakes turnaround strategy, does little to counteract local demographic pressure. Across much of Memphis, home to the bulk of the ASD’s work, the school-age population has been falling for years.

“The cloud over the work in Memphis is there are too many buildings for the number of students,” said Bobby S. White, the ASD’s chief of external affairs. He noted that Shelby County Schools faces similar challenges.

But that realization was still in the future in 2011, when the ASD was laying the groundwork to take over its first low-performing schools and assigning them to charter operators who promised to boost test scores dramatically.

At the time, the assumption was that improving a school would draw more neighborhood families to enroll. But that has happened in only about 40 percent of the ASD’s schools in Memphis. Most have seen their enrollment decline.

At Westside Achievement Middle School, for example, the number of students dropped from 535 to 339 after its takeover in 2012 as part of the ASD’s first portfolio of schools.

The trend was the same at Wooddale Middle, which has gone from 714 to 473 students in the two years that the school has been under management by Green Dot Public Schools.

The outlook was better at Memphis Scholars’ Florida-Kansas Elementary School, which has had a slight increase in enrollment since 2014, the last year of local governance by Shelby County Schools. Even so, the elementary school is operating at just 40 percent capacity.

PHOTO: Caroline Bauman
ASD Superintendent Malika Anderson listens to parents’ concerns in January at Gestalt’s Klondike Elementary, which will close this spring due to low enrollment.

ASD officials say they are paying closer attention to the school-age population in Memphis. They now plan to scrutinize enrollment projections when charter operators submit their budgets, with an eye toward census data and neighborhood housing trends. They also have a clear message for operators: “Don’t bank on a huge enrollment growth to sustain your model,” White said.

Charter operators are generally accustomed to recruiting students from across school zones. But in Tennessee, the challenges posed by demographic shifts have been exacerbated by strict enrollment rules for the ASD’s schools and turf battles with the local district.

State law limits to 25 percent the number of students who can come from outside their neighborhood to an ASD school. Until 2015, the schools weren’t allowed to admit any out-of-neighborhood students, while schools run by Shelby County Schools can accept students from anywhere in the district if they have extra space.

Allison Leslie, superintendent for Aspire Public Schools in Memphis, said her schools could attract more students if the state allowed them to.

“That is limiting for us, something I would like to see change,” she said about enrollment restrictions under state law. “Students and families in Memphis should be able to select whatever school they want to attend in Memphis. Currently it is really confusing for families based on the enrollment restrictions that exist for ASD schools specifically.”

ASD schools aren’t the only ones fighting for students. In the last five years, Shelby County Schools has closed 20 under-enrolled schools, and the district plans to shutter more in the near future. Low enrollment is spottier in Nashville, where the city’s population is booming.

Shelby County Schools hasn’t taken the ASD’s expansion in Memphis lying down. In recent years, the local district has aggressively recruited and rezoned to stem the tide of students and funding moving to the state-run district. In the most high-profile case, an entire school was reconfigured to retain students bound for the ASD. Charter operators, including Gestalt, also have complained that the local district withheld student information, hampering their efforts to sign kids up.

“I think what ASD operators have faced is being the new kids on the block in their mission to serve those neighborhood schools,” White said. “They have essentially had to build out from scratch in terms of communication with students and building community partnerships that assist in family and student outreach.”

Enrollment challenges in Memphis shouldn’t have been a surprise to charter operators, according to Dirk Tillotson, founder of Great School Choices, which supports community-based charter school development.

“That is something that is fairly predictable,” said Tillotson, who is based in Oakland, Calif., another urban school district with declining enrollment. “You’ve got to be financially sustainable in this work. If you don’t get that basic step down, you won’t be able to serve your kids.”

Below are two tables detailing enrollment at the ASD’s 33 schools. The first compares each school’s 2016-17 enrollment to its “programmatic capacity,” or the number of students that academic programs were designed to serve.

The second table compares enrollment this year to enrollment before their ASD takeover. Schools that were not takeovers but started from scratch are noted as “new starts.”

ASD enrollment and capacity

SCHOOL ENROLLMENT CAPACITY
Klondike Preparatory Academy 196 30.7%
Memphis Scholars Raleigh-Egypt 205 32.2%
Wooddale Middle 473 39.7%
Neely’s Bend College Prep 255 39.9%
Memphis Scholars Florida-Kansas Elementary 271 39.9%
Humes Preparatory Academy 315 41.2%
KIPP Memphis University Middle 147 43.2%
Brick Church College Prep 338 48.3%
Promise Academy-Spring Hill 281 50.9%
Martin Luther King Jr. College Preparatory High 625 52.5%
Libertas School at Brookmeade** 220 53.9%
Fairley High 565 55.4%
Hillcrest High 483 55.5%
Kirby Middle 407 58.2%
Pathways in Education-Memphis in Whitehaven 183 59.8%
Corning Achievement Elementary 224 59.9%
Westside Achievement Middle 339 66.5%
Freedom Prepatory Academy Charter Elementary 567 72.5%
Whitney Achievement Elementary 376 73.7%
Frayser Achievement Elementary 296 75.7%
Pathways in Education-Memphis in Frayser 234 84.4%
Memphis Scholars Caldwell-Guthrie Elementary 447 92.6%
Cornerstone Prep Lester campus* 756 94.6%
Georgian Hills Achievement Elementary 324 95.3%
KIPP Memphis Academy Elementary 448 95.8%
GRAD Academy Memphis 536 100.9%
Aspire Coleman Elementary 548 111.2%
Aspire Hanley campus* 820 113.4%
KIPP Memphis Preparatory Elementary/Middle* 611 115.9%
Cornerstone Prep-Denver 616 151%

Change in ASD enrollment since takeover

SCHOOL ENROLLMENT CHANGE
Memphis Scholars Raleigh-Egypt 205 -59.5%
Neely’s Bend College Prep 255 -53%
Westside Achievement Middle 339 -36.6%
Wooddale Middle 473 -33.8%
Promise Academy-Spring Hill 281 -33.6%
Libertas School at Brookmeade** 220 -30.4%
Frayser Achievement Elementary 296 -30.2%
Corning Achievement Elementary 224 -27.5%
Kirby Middle 407 -26.7%
Fairley High 565 -18.8%
Klondike Preparatory Academy 196 -15.9%
Memphis Scholars Caldwell-Guthrie Elementary 447 -13.4%
Brick Church College Prep 338 -10.8%
Whitney Achievement Elementary 376 -8.7%
Hillcrest High 483 -8.2%
Memphis Scholars Florida-Kansas Elementary 271 1.9%
Cornerstone Prep-Denver 616 3.4%
Humes Preparatory Academy 315 7.9%
Aspire Coleman Elementary 548 10.3%
Martin Luther King Jr. College Preparatory High 625 13.6%
Georgian Hills Achievement Elementary 324 17.4%
Cornerstone Prep Lester campus* 756 21.5%
Aspire Hanley campus* 820 32.7%
Freedom Prepatory Academy Charter Elementary 567 59.7%
KIPP Memphis Academy Elementary 448 78.5%
KIPP Memphis University Middle 147 new start
Pathways in Education-Memphis in Whitehaven 183 new start
Pathways in Education-Memphis in Frayser 234 new start
KIPP Memphis Preparatory Elementary/Middle* 611 new start
GRAD Academy Memphis 536 new start

*Three campuses within the ASD house two schools. For purposes of these tables, their enrollment figures are combined.

** Libertas is still phasing in grades at the elementary school. Currently, the school serves preK-2nd grade.