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Municipal Charter School Report 2009 Prepared by: Management Intern Ben Nibarger And Chief Executive Officer Tom Brymer This report was prepared at the request of the Westlake Academy Board of Trustees to provide general information on municipally owned and operated charter schools. This report was commissioned in order to make better informed decisions regarding municipally operated charter schools’ best practices, and their optimal organizational and governance structures. In the process of this review a number of municipally owned and operated charter schools have been evaluated and recommendations for the Westlake Academy have been put forth. Town of Westlake 3 Village Circle, Westlake, TX 76262 Phone: 817-490-5733 Fax: 817-430-1812 ii Photos by Jaymi Ford iii Westlake Academy Vision/Mission Westlake Academy is a nurturing, community owned International Baccalaureate Charter School whose mission is to achieve academic excellence and to develop life-long learners who become well- balanced, responsible citizens. iv Preface Charter schools are public schools that are operated under a contract called a charter. This contract is issued by the authorizing agent(s) in each state. Because charter schools are operating outside the rules regulating traditional public education institutions, they are allowed to create new and innovative forums for delivering their curriculum and ultimately student success. Charter school legislation was instituted with the vision of creating choice in the education market place, and charter school applicants must outline in their charter school application to the authorizing agency, why they will be successful as well as how their school will be different from the local Independent School District (ISD) in which they reside. The agencies that authorize charter schools are determined by a state’s legislature. In Texas, the Texas Education Agency (TEA) acts as the authorizing body. In Florida, the local ISDs are the authorizing body. Each state has either strong charter school legislation which promotes charter schools by offering the most latitude in the way they are authorized and operated, or weak charter school legislation which limits the number of schools, students served, and provide little relief from the current regulations placed on traditional public schools. Most charter schools exist in states with strong charter school laws, which do not set caps on the number of charter schools allowed in the state, and allow for multiple charter authorizers (Brown, 2006). Over the last decade, charter schools have continued to gain acceptance as stakeholder’s satisfaction with existing public education choices continues to decline. Although charter schools continue to become tools of change, their success, as measured through standardized testing, has seen mixed results. A recent study conducted by the Center for Research on Education Outcomes (CREDO) indicates that while 17% of charter schools exceed traditional public schools in academic gains, 46% were equal in gains and 37% showed gains that were worse than traditional public schools (CREDO, 2009). There are mixed results as another study, conducted in 2005, that indicates in areas where charter schools are operating, the standardized testing results increase in the traditional public school compared to traditional public schools that are not in competition with charter schools (Gronberg & Jansen, 2005). In 2003, the Town of Westlake petitioned the Texas Education Agency (TEA) to establish a municipally operated charter school, Westlake Academy, after the local independent school districts refused to locate a campus within Westlake. The TEA issued the charter and Westlake Academy became the only municipally operated charter school in the State of Texas, and one of approximately a dozen in the United States. Westlake Academy received its ten year charter renewal in 2006. The majority of municipally operated charter schools are located in Florida. Municipalities that operate a charter school are reacting to the demands of their residents. There are many reasons that led to these various Florida municipalities’ decision to take control of education: school overcrowding, low educational standards, local school options, as well as the absence of other educational options (Brown, 2006). v Purpose/Goals of the Study This report was commissioned by the Board of Trustees to examine as thoroughly as possible, all of the aspects of municipally owned charter schools. To that end, this report will examine the following: 1. Review past and current Westlake Academy structures 2. Examine charter schools generally and examine municipally owned and operated charter schools specifically 3. Identify options for Westlake Academy’s organizational structure 4. Discuss options for Westlake Academy’s governance structure 5. Provide recommendations vi Contents Preface ......................................................................................................................................................... iv Purpose/Goals of the Study .......................................................................................................................... v 1. Situation Review: Westlake Academy’s Performance .......................................................................... 1 1.1. IB Curriculum................................................................................................................................. 2 2. Data Collection and Study Methodology .............................................................................................. 3 3. Literature Review .................................................................................................................................. 3 3.1. Definitions ..................................................................................................................................... 3 3.2. Economic Development ................................................................................................................ 5 3.3. Financing ....................................................................................................................................... 6 3.4. Governance ................................................................................................................................... 7 3.5. Administrative Structure ............................................................................................................... 7 3.6. Community Involvement/Partnerships......................................................................................... 7 3.7. Funding Differences ...................................................................................................................... 8 3.7.1. Revenues ............................................................................................................................... 8 3.7.2. Expenditures ......................................................................................................................... 8 3.8. Accountability Standards ............................................................................................................ 10 3.9. Growth ........................................................................................................................................ 10 3.10. Achievement ........................................................................................................................... 10 4. Municipally Operated Charter Schools Reviewed .............................................................................. 11 4.1. Aventura, Florida......................................................................................................................... 12 4.2. Cape Coral, Florida ...................................................................................................................... 13 4.3. Coral Springs, Florida .................................................................................................................. 14 4.4. Kissimmee, Florida ...................................................................................................................... 15 4.5. Oakland, Florida .......................................................................................................................... 16 4.6. Pembroke Pines, Florida ............................................................................................................. 17 4.7. Palm Bay, Florida ......................................................................................................................... 18 6. History of Westlake Academy Organizational Structure .................................................................... 19 7. Organizational Structure Options for Westlake Academy .................................................................. 20 7.1. Organizational Structure Parameters and Criteria ..................................................................... 20 7.2. Integration with Existing Organizational Structure(s). ................................................................ 21 7.3. “Height or flatness” of the organizational structure .................................................................. 23 7.3.1. Empowerment .................................................................................................................... 23 7.3.2. Speed of decision making desired ...................................................................................... 23 7.3.3. Team work .......................................................................................................................... 24 7.3.4. “Silos and Turf” ................................................................................................................... 24 7.3.5. Cost ..................................................................................................................................... 24 7.3.6. Communication ................................................................................................................... 25 7.3.7. Compliance with regulatory and/or legal requirements .................................................... 25 7.3.8. Existing organizational culture and the organizational culture desired ............................. 25 7.3.9. IB learners strive to be: ....................................................................................................... 25 vii 7.3.10. Talents/Skill Sets of current management/leadership and development .......................... 26 7.3.11. Whether the daily operation of the school has been outsourced to an EMO.................... 26 7.3.12. Span of control .................................................................................................................... 26 7.3.13. Organizational conflict ........................................................................................................ 27 7.3.14. Lack of clarity as to lines of authority ................................................................................. 27 7.3.15. Role confusion ..................................................................................................................... 27 7.3.16. Accountability ..................................................................................................................... 28 7.3.17. “Touch” and lack of linkages resulting in “parallel organizations” ..................................... 28 8. High Performance Organizational Structure Parameters & Criteria ................................................... 29 9. Governance Structure for Westlake Academy ................................................................................... 35 10. Recommendations .......................................................................................................................... 37 10.1. Organizational Structure ......................................................................................................... 37 10.2. Governance Structure ............................................................................................................. 37 11. Executive Summary ......................................................................................................................... 39 Works Cited ............................................................................................................................................... 433 Tables Table 1 - Chartered School Rankings 2007 - 2008 ........................................................................................ 1 Table 2 - All Texas Public School Rankings 2007 - 2008 ................................................................................ 2 Table 3 - Comparison of Considered Issues (Brown, 2006) .......................................................................... 5 Table 4 - Revenue per Pupil in Texas 1997-98 (Nelson, Muir, & Drown, 2003) ........................................... 8 Table 5 - Expenditures per Pupil in Texas 1997-98 (Nelson, Muir, & Drown, 2003) .................................... 9 Table 6 – Evaluation Matrix of the Five Options ......................................................................................... 32 Figures Figure 1 - Four Measures of School Performance (Carpenter, 2008) ........................................................... 1 Figure 2 - States with charter school legislation ........................................................................................... 4 Figure 3 - Aventura, Florida Org Chart ........................................................................................................ 12 Figure 4 – Cape Coral, Florida Org Chart ..................................................................................................... 13 Figure 5 – Coral Springs, Florida Org Chart ................................................................................................. 14 Figure 6 – Kissimmee, Florida Org Chart ..................................................................................................... 15 Figure 7 – Coral Springs, Florida Org Chart ................................................................................................. 16 Figure 8 – Pembroke Pines, Florida Org Chart ............................................................................................ 17 Figure 9 – Palm Bay, Florida Org Chart ....................................................................................................... 18 Figure 10 - The organizational structure for the Academy from May 2008 to June 2009 ......................... 22 Figure 11 - Since June 2009, Westlake Academy’s organizational structure has been .............................. 22 Figure 12 - Focusing on Team Basics (Katzenback & Smith, 1993) ............................................................. 24 Figure 13 – Option 1 .................................................................................................................................... 29 Figure 14 – Option 2 .................................................................................................................................... 30 Figure 15 – Option 3 .................................................................................................................................... 30 viii Figure 16 – Option 4 .................................................................................................................................... 31 Figure 17 – Option 5 .................................................................................................................................... 32 1 1. Situation Review: Westlake Academy’s Performance The Texas Assessment of Knowledge and Skills (TAKS) measures the statewide curriculum of specific subjects at specific grade levels. In comparison to the previous state assessment, the Texas Assessment of Academic Skills (TAAS) the TAKS includes a broader assessment of the Texas Essential Knowledge and Skills (TEKS), which is the statewide curriculum. The TAKS is a more rigorous assessment and questions are asked in a more authentic manner to measure student knowledge of the TEKS. Performance measurement is important in order to be able to determine whether or not schools are meeting their primary mission of educating children. Texas administers the (TAKS) annually to measure the student’s and school’s performance level. The data collected by the Texas Education Agency (TEA) allows for analysis of school performance over time. Dr. Brian Carpenter writes about four methods to determine a school’s performance: absolute performance, relative performance, mission specific outcomes and individual gains (2007). The combination of these four performance measures gives an accurate measurement of the school’s present performance. The data available through the PEIMS database, maintained by the TEA, allows for the analysis of absolute performance, the percent of children who met the standards, and for relative performance, the rank order of all public schools in the State of Texas. Different types of measures are presented to examine the Academy’s past and desired future student academic performance. Over time it is anticipated these measures will grow in their usefulness as we continue to identify results we wish to achieve. Table 1 demonstrates that Westlake Academy is ranked 13th out of 208 charter schools placing it in the top six percent (6%) of Texas chartered schools. Table 1 - Chartered School Rankings 2007 - 2008 Rank School Names TAKS Overall Reading Writing Math Science Social Studies 1 HARMONY SCHOOL OF EXCELLENCE 96%98%0%98%97%0% 2 HARMONY SCHOOL OF INNOVATION 95%97%98%97%98%0% 2 RISE ACADEMY 95%0%0%98%90%0% 2 SEASHORE LEARNING CTR CHARTER 95%0%0%95%0%0% 4 HARMONY SCIENCE ACAD (SAN ANTONIO)93%99%96%94%93%0% 4 ARLINGTON CLASSICS ACADEMY 93%98%96%97%90%0% 4 HARMONY SCIENCE ACAD (FORT WORTH)93%98%0%95%96%97% 4 HARMONY SCIENCE ACADEMY (AUSTIN)93%98%95%97%93%0% 4 ALIEF MONTESSORI COMMUNITY SCHOOL 93%93%0%0%0%0% 5 RICHLAND COLLEGIATE HS OF MATH SCIENCE ENGINEERING 92%99%0%96%95%0% 5 UNIVERSITY OF TEXAS ELEMENTARY CHARTER SCHOOL 92%99%97%97%85%0% 5 SCHOOL OF SCIENCE AND TECHNOLOGY 92%98%99%96%92%99% 6 WESTLAKE ACADEMY CHARTER SCHOOL 91%99%93%93%96%98% 6 YES PREPARATORY PUBLIC SCHOOLS 91%96%97%95%93%99% Figure 1 - Four Measures of School Performance (Carpenter, 2008) Mission-Specific Outcomes Absolute Performance In d i v i d u a l G a i n s Re l a t i v e P e r f o r m a n c e School’s Present Performance 2 The 2008 accountability ratings are based on the TAKS administered in the spring of 2008 to third through eleventh grade students. Westlake Academy student performance in terms of absolute performance, vis a vis the TAKS test, ties the Academy with seven other schools for eighth place and places the Academy at 36 out of 1,229 public schools or the top three percent (3%). TAKS results for 2007-2008 are as follows: Table 2 - All Texas Public School Rankings 2007 - 2008 Rank Schools TAKS Overall Reading Writing Math Science Social Studies 1 Highland Park 9899999998 . 1 Walcott 98 ..98 .. 3 Red Lick 96 .999897 . 3 Patton Springs 96 ..9896 . 3 Harmony Sch of Excellence 9698 .9897 . 3 Falls City 969998989698 4 Harmony Sch of Innovation 9597989798 . 4 Guthrie CSD 95 ..9694 . 4 Rise Academy 95 ..9890 . 4 Seashore Lrn Ctr Charter 95 ..95 .. 4 Carroll 9599 .989599 4 Eanes 959999989599 5 Coppell 949999979499 5 Friendswood 949999969599 5 Gunter 949998969399 5 Prairie Valley 94 .939592 . 5 London 9499 .9790 . 5 Wildorado 94 ..94 .. 6 Harmony Sci Acad (San Anton 9399969493 . 6 Sunnyvale 939998989097 6 Morgan Mill 9394 .96 .. 6 Dodd City 9399 .969398 6 Alief Montessori Community 9393 .... 6 Arlington Classics Academy 9398969790 . 6 Harmony Sci Acad (Ft Worth)9398 .959697 6 Wylie 939997969398 6 Harmony Sci Acad (Austin)9398959793 . 7 Sch of Science and Technolo 929899969299 7 Silverton 9298 .9492 . 7 Lovejoy 929999969099 7 Richland Collegiate HS Math 9299 .9695 . 7 Crawford 929999959199 7 U T Elementary Charter 9299979785 . 7 Lake Travis 929899959398 7 Newcastle 9298 .9595 . 8 Randolph Field 919899959297 8 Malta 91 .899786 . 8 Allen 919898959199 8 YES Preparatory Public 919697959399 8 Sundown 919799969198 8 Westlake Academy Charter 919993939698 8 Wall 919898958997 1.1. IB Curriculum In addition to quantitative performance the IB Curriculum evaluates member schools with a number of qualitative measures. Westlake Academy is the only charter school in the Texas offering all three IB programmes – Primary Years, Middle Years, and Diploma Programmes. The Westlake Academy finished its Primary Years Programme Evaluation and received many positive accommodations from the IB North America evaluation committee with no matters to be addressed. 3 2. Data Collection and Study Methodology Westlake Academy just received the final parents’ survey report from the ETC Institute which provides primary data regarding the school’s perceived performance and satisfaction levels. Additionally, secondary data was collected for comparison purposes. Secondary data is data that has been collected and compiled by a source other than this organization. The secondary data comes from multiple sources in order to more fully address the goals of the study. Quantitative data regarding the absolute and relative performance levels for statewide comparison of school and district testing was collected from the Public Education Information Management System (PEIMS) on the TEA website. In addition, data was collected from the International Baccalaureate (IB) program for qualitative comparison. 3. Literature Review With a growing sense of failure in the American public school system, many parents and students are looking at alternative forms of education and increasingly, the option of choice is charter schools. Charter schools are public schools that are granted authority to operate through a charter. The authorizing body varies from state to state as allowed by each state’s legislature. Charter schools were created to increase choice in public education, improve student learning and encourage innovative learning methods. The charter contract negotiations allow for innovations in the education process by removing regulations that prevent creativity and innovation in education (Brown, 2006). Following are examples of reduced regulations in charter schools: • Instructional time • Length of school day • Length of year • Teacher certification requirements • Hiring policies • Teacher compensation 3.1. Definitions Charter schools are public schools that are operated under a contract called a charter. Strong state charter school legislation promotes charter schools by offering the most latitude in the way they are authorized and operated. Most charter schools exist in states with strong charter school laws, which do not set caps on the number of charter schools allowed in the state and allow for multiple charter authorizers (Brown, 2006). Weak charter school legislation does not provide the same latitude for charter schools, maintaining many of the existing regulations. Of the forty (40) states with charter school legislation, about one half sets limitations on who can operate charter schools. Only two states, Texas and Florida, specifically mention government entities as potential operators (Brown, 2006). Each of these states has created authorizing bodies for granting charter schools. In Texas, the TEA grants the charter and is responsible for monitoring the charter schools progress, testing and compliance. Other states, like Florida, have given the Independent School District (ISD) charter granting authority. Since 1991, forty (40) states, the District of Columbia and Puerto Rico have all signed into law legislation authorizing charter schools. 4 Figure 2 - States with charter school legislation Education management organizations (EMOs) are for-profit companies hired by the Board of Trustees of a charter school to manage operational functions of the school. The EMO is managed through a contract which designates the scope of services and provides baselines for performance measurement. EMOs have been compared to health management organizations (HMOs) that revolutionized the health industry in the 1970s (Brown, 2006). The only scholarly research currently available on the subject of municipally operated charter schools was published in the Journal of Education and Urban Society in 2006, by Pamela. In this research, Pamela explores the relationship between municipalities and operating a charter school. Pamela’s research is grouped into six major headings: economic development, financing, governance, administrative structure, community involvement and partnerships. Table 3 visually displays the results of this research. 5 Table 3 - Comparison of Considered Issues (Brown, 2006) Area/City Aventura, Florida Cape Coral, Florida Coral Springs, Florida Kissimmee, Florida North Lauderdale, Florida Oakland, Florida Pembroke Pines, Florida Westlake, Texas Economic Development School overcrowding XXXX XX Rapid growth XXXX XX Need for a neighborhood school XXXXXX Revitalization XXX Attract new development X X Financing City owned and/or bought land XX X XXX City purchased building XXXX XXX Bond XX X XX Land swap Buildings leased back to private sector X X Sales tax and/or other revenue X X Governance City commission as governing body X XXX XX City manager as superintendant X XXXXXX Not-for-profit board X Hybrid board X X Community advisory board XXXXXX Administrative structure Education Management Organization (EMO)X XX XX City performs administrative function XXX X X Principal reports to city X XXXX Principal reports to EMO XXX Community involvement prior Neighborhood meetings XX XXXX Public input at commission XXXXXXXX Other Partnerships Shared facilities XX XXXXX School involved in city events X X XX Parent involvement XXXXXXXX Community learning activities XXX XX Community activities XXX XX Business partnerships XXX XX 3.2. Economic Development Charter schools are playing an important role in urban renewal and development by helping to fulfill the educational needs of neighborhoods where traditional public schools are failing the population (Halsband, 2003). The literature discusses that community based organizations (CBOs) are starting charter schools and view them as a way to expand local services, targeting their population, and as the schools improve, fewer young, middle-income parents are leaving the area (Halsband, 2003). Charter schools have been accused of creating schools that isolate upper-income students and economically challenged students, but as the number of charter schools increase, numerous examples of increased diversity in student population has become apparent (Halsband, 2003). Charter schools, 6 when compared to traditional ISDs, are more racially and economically diverse. Charter schools provide choices to parents allowing them to choose where their children will attend based upon quality of education versus boundaries which may tie them to a failing school system (Halsband, 2003). A study completed by Hanushek (2002) argues that both quality of education and quantity are essential in increasing human capital and maintaining national competitiveness. The quality of public education in the United States has been decreasing, but the quantity has been increasing. Meanwhile, other countries are closing the gap and this model will not maintain the United States’ lead in human capital development (Weiss, 2004). In addition to improving national competitiveness, quality education in public schools makes state and local government more economically competitive (Weiss, 2004). “Lisa Barrow and Cecilia Elena Rouse find that real estate values increase by $20 for every additional dollar in state education funding (Weiss, 2004).” In addition, William T. Bogart and Brian A. Cromwell found that home buyers are willing to pay higher taxes for better schools because of the positive relationship in school performance and the value of real estate (Weiss, 2004). Quality education is considered a major factor in quality of life, ranked fourth in a survey conducted by 1997 by Segedy. The three factors that were ranked higher, ranked in order of importance, were the cost of living, higher education, and nature-oriented outdoor options (Weiss, 2004). The relationship between public schools and property values may be seen in both low and high income ranges, urban and suburban, including families with children and without (Weiss, 2004). The National Bureau of Economic Research gauged the impact of performance at a so-called “A” scoring schools versus a “B” scoring school (Weiss, 2004). It was concluded that for median sized homes, an “A” school increases property values by more than seven percent over a “B” school (Weiss, 2004). The literature overwhelmingly concludes that increased education spending, ultimately resulting in improved school quality, increases the value of property. 3.3. Financing A recent study by the Center for Education Reform found that of 194 charter school closures nationwide, nine percent (9%) were due to facility issues, and of the 84 charter schools which never opened after receiving a charter, 27 percent (27%) were due to facility issues (Halsband, 2003). In Brown’s 2006 study, all nine (9) municipally operated charter schools financed the construction or purchase of facilities. The municipality’s ability to fund the initial capital costs resolves a major problem facing most charter schools today of start-up costs. The ability to issue debt for the initial capital costs associated with starting a school provides a symbiotic relationship between municipalities and charter schools (Brown, 2006). The majority of the municipalities that own charter schools lease the newly purchased/built facilities to the charter schools for an amount that covers the cost of the debt service as well as a combination of public-private partnerships to deliver the highest quality and most cost efficient program possible (Brown, 2006). Pembroke Pines, Florida is an example of a city government where many traditional city services are operated via contract. All personnel and services are operated through a management 7 company with the city manager acting as the CEO of the city. Municipally operated charter schools appear to be an excellent example of public-private partnerships (Brown, 2006). 3.4. Governance In Brown’s 2006 study, all the municipalities that own a charter school operate in a council-manager form of government. In addition, the elected bodies in six of the nine municipalities act as the board of trustees and set policy and control the budget. In seven of the nine municipalities, the city/town manager serves as the superintendant of the school and is responsible for the administrative functions of the school. The emerging model appears to be one in which the municipality establishes a Department of Education with a department head, which in many scenarios is the school principal, who reports directly to the city manager. All the administrative functions of the school are handled by the corresponding departments in the city; personnel, finance and budget are provided to the school by the city departments, for which the school reimburses the city. In some cases, an EMO is involved ranging from total administrative control to limited control of curriculum and teachers (Brown, 2006). In this model, education becomes incorporated into the array of services offered by the city/town. Some of these cities utilize outsourcing as a method of service delivery in order to be responsive to the community needs while keeping costs under control. Five of the nine charter schools reviewed chose to contract out school services to EMOs (Brown, 2006). 3.5. Administrative Structure One common theme throughout seven of the nine charter schools is that the city manager acts as the CEO/Superintendant for the school. The administrative structures used by the municipalities operating charter schools vary in their direct involvement of the day to day operations. Five of the nine schools reviewed in Brown’s 2006 study utilize the expertise of EMOs to help with the administrative duties of running the charter school. In every municipality reviewed, their administrative staff is considered a shared resource with the school; departments like HR, finance, facilities, and parks and recreation play a dual role in working for both the school and the city (a more in depth review of the schools is available in the Municipally Operated Charter Schools Reviewed section.) 3.6. Community Involvement/Partnerships In every municipality, the community supported the establishment of the charter school to resolve unmet needs; be it overcrowding in existing schools, poor scholastic results, or a local school choice (which is discussed in greater detail in the Municipally Operated Charter Schools Reviewed section.) Every municipality either provided land, funding or facilities in order to establish the charter school. This also involved sharing resources in order to provide the maximum benefit to the community. Many of the municipalities utilize recreational facilities for the charter schools extracurricular activities and the school facilities are shared as additional community space that may be used for civic and private functions. There is a sense of synergy between the municipalities and the charter schools allowing for 8 amenities that would not be available for either party without the combined resources of the charter schools and the municipalities (Brown, 2006). 3.7. Funding Differences The differences between funding for charter schools and traditional public schools are generally associated with local property taxes, daily attendance, transportation, food service, and the education of high-cost special needs children, as well as other adjustments incorporated into the student weighting system for funding (Nelson, Muir, & Drown, 2003). Charter schools are less likely to provide transportation, breakfast and lunch programs, but have the same ratio of special needs students to non- special needs students as in traditional public schools (Nelson, Muir, & Drown, 2003). 3.7.1. Revenues The average charter school receives more than eighty-six percent (86%) of their funding from the state. The balance is comprised of a combination of federal funds (9.3%) and grants or donations (4.6%). Charter schools do not have the ability to impose local taxes, nor do they receive facilities funding from the state. In addition, charter schools do not receive small school adjustments given to similarly sized public schools, which put them at a financial disadvantage (Nelson, Muir, & Drown, 2003). As a result of the differing funding sources Texas charter schools receive approximately $785 less per student than traditional public schools (Nelson, Muir, & Drown, 2003). Table 4 - Revenue per Pupil in Texas 1997-98 (Nelson, Muir, & Drown, 2003) Average Min Max Average Min Max Local tax -$ -$ 7$ 3,133$ 1,736$ 4,533$ 0.0%53.0% Other local & intermediate 232 - 764 321 235 518 4.5%5.4% State 4,414 3,437 7,463 1,883 639 3,993 86.2%31.9% Federal Title I 127 - 623 206 70 350 2.5%3.5% School lunch (240)85 - 555 175 - 323 1.7%3.0% Federal start-up 180 - 1,328 - - - 3.5%0.0% Special education - - - 41 15 71 0.0%0.7% Other federal 83 - - 146 - - 1.6%2.5% Total federal 475 - 2,506 568 85 744 9.3%9.6% Total revenue 5,121$ 4,043$ 7,958$ 5,908$ 5,504$ 7,002$ 100.0%100.0% Percent of Total Charter Schools Host Districts Charter Schools Host Districts Note: N=16. Minimums and maximums do not add up to totals. Data provided by Texas Education Agency. Excludes Building Alternatives, One-Stop and North Hills (including host school districts). 3.7.2. Expenditures On average, Texas charter schools spend about $650 per pupil less than traditional public schools (Nelson, Muir, & Drown, 2003). Charter schools spent an average of 49.6% of expenditures on instruction compared to 52.7% for traditional public schools. This deficit in funding generally results in 9 decreased funding for instructional resources and media, curriculum development, staff development and instructional leadership (Nelson, Muir, & Drown, 2003). The data argues that charter schools’ inability to create economies of scale on general administrative costs, which average 17.4% of expenditures compared to 8.3% in traditional public schools, decreases the amount of available funds to be spent on educational services (Nelson, Muir, & Drown, 2003). In addition, the lack of facility funding, resulting in rental and lease costs for charter schools average 10.9% of charter school spending. Plant operations, maintenance and utilities consume another 7.5% for a total of 18.4% compared to a traditional public school that spends 6.5% on debt service and 9.9% for operations and maintenance for a total of 16.4 percent (Nelson, Muir, & Drown, 2003). Table 5 - Expenditures per Pupil in Texas 1997-98 (Nelson, Muir, & Drown, 2003) Average MinMax Average MinMax Total operating expenditures Instruction 2,560$ 1,018$ 4,203$ 3,069$ 2,697$ 3,539$ 49.6%52.7% Instructional media 24 - 120 80 65 110 0.5%1.4% Curriculum/staff development 70 - 278 107 20 237 1.4%1.8% Instructional leadership 62 - 707 90 52 148 1.2% School leadership 467 - 2,457 328 248 364 9.0%5.6% Guidance/counseling 272 - 1,321 185 155 220 5.3%3.2% Social work services 22 - 194 19 6 31 0.4%0.3% Health services 31 - 190 52 27 76 0.6%0.9% Transportation 61 - 478 134 17 195 1.2%2.3% Food 106 - 541 307 244 382 2.1%5.3% Co-curricular 45 - 252 71 36 181 0.9%1.2% General administration 434 2 1,181 157 141 212 8.4%2.7% Maintenance and operation 388 87 1,467 575 490 609 7.5%9.9% Charter school lease costs 564 - 2,541 - - - 10.9%0.0% Security/monitoring 24 - 166 40 11 78 0.5%0.7% Data processing services 47 - 327 56 31 85 0.9%1.0% Intergovernmental charge - - - 6 - 49 0.0%0.1% Total operating 5,136 3,651 8,331 5,278 4,903 6,026 99.4%90.7% Community services 22 - 216 38 3 102 0.4% Debt Services 7 - 47 380 168 700 0.1%6.5% General fund capital outlay1 - - - 123 82 189 0.0%2.1% Total expenditures 5,165$ 3,851$ 8,331$ 5,819$ 5,218$ 6,808$ 100.0%100.0% Percent of Total Charter Schools Host Districts Charter Schools Host Districts Note: N=16. Minimums and maximums do not add up to totals. Data provided by Texas Education Agency. Excludes Building Alternatives, One-Stop and North Hills (including host school districts). 1 Excludes an average of $470 per pupil financed by bond proceeds and other non-revenue sources. 10 3.8. Accountability Standards Many provisions of Federal laws such as the No Child Left Behind (NCLB) and Individuals with Disabilities in Education Act (IDEA) apply to charter schools. In addition, charter schools are held accountable for student performance just like traditional public schools. Charter schools are also held accountable to parents, students, authorizers, the state, lenders, and donors (Terry & Alexander, 2008). In many ways charter schools are held to a higher standard; a charter school, in Texas, may be shut down for two consecutive years of unacceptable performance, while a traditional public school is allowed five years of unacceptable performance (Terry & Alexander, 2008). 3.9. Growth Nationally more than 1.25 million students, in the 07-08 school years, were enrolled in charter schools and enrollment continues to increase. In Texas, enrollment has grown from 2,498 students in the 96-97 school years to 113,760 students in the 07-08 school years. Approximately two percent (2%) of all Texas school-age children attend a charter school (Terry & Alexander, 2008). Texas is now ranked fifth nationally in the total number of charter schools and fourth in the total number of charter school students, behind California, Florida, and Michigan (Charter School Policy Institute, 2007). There are approximately 16,000 students on charter school waiting lists in Texas. The ability of charter schools to meet the growing demand is limited by the resources available (Gronberg & Jansen, 2005). 3.10. Achievement A study recently conducted by the Center for Research on Education Outcomes (CREDO) “reveals that a decent fraction of charter schools, 17%, provide superior education opportunities for their students. Nearly half of the charter schools nationwide have results that are no different from the local public school options and over a third, 37%, deliver learning results that are significantly worse than their student would have realized had they remained in traditional public schools (Center for Research on Education Outcomes , 2009).” Although the study conducted by CREDO shows that the majority of students at charter schools are not performing better than students at traditional public schools, Dr. Gronberg and Dr. Jansen conclude in their 2005 assessment of charter schools that academic gains for elementary and middle school students who remain in the charter school for several years, are significantly higher than their matched counterparts in traditional school. In addition, students at traditional public schools facing charter competition generally achieved significantly higher gains in reading and math than schools that did not face competition from charter schools – without any increase in traditional public school funding (Gronberg & Jansen, 2005). 11 4. Municipally Operated Charter Schools Reviewed There are about a dozen municipally operated charter schools located within nine municipalities in the United States, all of which have been in operation for less than 10 years (Brown, 2006). This creates a unique situation where historical data is very limited making it difficult to model best practices and benchmarking. Data has been collected from the municipalities who currently operate a charter school. The literature reviewed shows that the majority of municipally operated charter schools were started due to the rate of growth in the school district, overcrowding in schools, and because they lacked a community school. Charter schools are also viewed as a tool for retaining existing citizens who might move elsewhere due to the problems mentioned above, as well as attracting new residents who would not locate in their city without the benefit derived from the charter school. 12 4.1. Aventura, Florida Aventura and the entire surrounding region experienced rapid growth in their population resulting in overcrowding of the existing school facilities. Due to the local ISD’s failure to quickly respond to the demands presented by massive new student populations, Aventura resolved to open a municipally owned and operated charter school. Aventura’s charter school opened in August 2003 and houses 900 students in grades K-8. It is operated by the city in conjunction with an EMO, Charter Schools USA. The city issued debt to purchase land and build the school facility. The land purchased was used also to build a community center which may be used by the school and community members in order to maximize the use of both facilities. The school facilities are used for community learning activities in the off-peak hours. The charter school operates on an $8,410,970 annual budget (FY 2008-2009). This includes all state funding at a rate of $6,316 per student. Florida uses the A+ Plan which grades schools on a scale of A thru F based upon the performance and progress of students on the FCAT. Aventura’s charter schools have achieved ratings of A for the last three (3) school years. The charter school operates under a special fund. The budget is prepared and submitted to the Board of Directors (consisting of the elected Commissioners and Mayor) and adopted separately in May of each year. The administrative functions are contracted out to Charter Schools USA for $341,040 annually. The charter school has been able to meet all financial obligations including annual transfers into the Debt Service Fund to cover the cost of the city issued bonds. Figure 3 - Aventura, Florida Org Chart Aventura, Fl City Council City Manager / Superintendant Principal School Operations Charter Schools USA / Administrative Services School Advisory Board 13 4.2. Cape Coral, Florida Cape Coral, Florida opened the first of several charter schools in August, 1999. They are following the example of Pembroke Pines and creating a 171 acre academic campus where there may be multiple schools, a four-year college, athletic fields, wetlands and other ancillary facilities. They currently operate two elementary schools, one middle school and one high school with a total capacity of close to 1,700 students. The operating budget in FY 2008 was $11.8 million or approximately $6,900 per student in state funding. The charter schools operate under the Cape Coral Charter School Authority whose board consists of one council member, the city manager and five appointments that are made by the City Council from the parents within the municipal boundaries. The Board works closely with the Lee Independent School District, one of the authorizing bodies in Florida. This separate governing body prepares and adopts the school budget which is operated as an enterprise fund in the city budget. The charter schools are run through a contract with Charter Schools USA and governed by the Cape Coral Charter School Authority. The community partners with the school in community activities, learning activities, and the Cape Coral Chamber of Commerce has a mentoring program with the charter high school. Florida uses the A+ Plan which grades schools on a scale of A thru F based upon the performance and progress of students on the FCAT. Cape Coral charter schools have achieved ratings of C, B, and C respectively for the last three school years. Figure 4 – Cape Coral, Florida Org Chart City Council Charter School Authority Charter School USA / EMO Principal Principal Principal Principal Cape Coral, Fl 14 4.3. Coral Springs, Florida Coral Springs and the entire surrounding region experienced rapid growth in their population resulting in overcrowding of the existing school facilities. With the local ISD’s failure to quickly respond to the demands presented by massive new student populations, Coral Springs opened a municipally owned and operated charter school. Coral Springs charter school opened in August 1999 and houses 1,634 students in grades 6-12. It is operated by the city in conjunction with an EMO, Charter Schools USA. Coral Springs desire to have a neighborhood school was also aimed at revitalizing the community in addition to relieving overcrowded schools. Florida uses the A+ Plan which grades schools on a scale of A thru F based upon the performance and progress of students on the FCAT. Coral Springs charter school has achieved an A rating for the last six years. The total operating contract with Charter Schools USA was $10,069,178 for the FY 08/09 school year. The state funding totaled $11,489,178 or $7,031 per student. The City Council acts as the school’s Board of Trustees and the City Manager as its Superintendant. Coral Springs purchased the facilities for the charter school without having to issue debt. The charter school leases the facility from the city and pays $8.4507 per square foot. Figure 5 – Coral Springs, Florida Org Chart Coral Springs, Fl City Council City Manager / Superintendant Charter School USA / EMO Principal 15 4.4. Kissimmee, Florida Kissimmee viewed the construction and operation of a charter school as a solution to multiple issues: school overcrowding, rapid population growth, creating a neighborhood school, revitalizing the area, and attracting new development. Kissimmee issued debt to build an elementary charter school as well as a middle school. The charter schools opened in 2001. They currently have 772 students enrolled in grades Pre-K thru 8. The City Council acts as the governing body, but depends upon a nine-member advisory board appointed by the City Council for three-year terms. The charter school operates as a special revenue fund and contracts out for services. The Osceola Foundation for Education oversees Imagine Schools, an EMO, on a daily management issues. The total state funding for Kissimmee charter schools in FY 2008/09 was $5,650,000 or $7,318 per student. Florida uses the A+ Plan which grades schools on a scale of A thru F based upon the performance and progress of students on the FCAT. Kissimmee charter school has had a mixed performance record achieving three A’s, two B’s, and two C’s since the schools inception. Figure 6 – Kissimmee, Florida Org Chart City Council Osceola Foundation for Education Imagine Schools / EMO Principal Kissimmee Charter School Advisory Board Kissimmee, FL City Manager / Superintendant 16 4.5. Oakland, Florida Oakland started their charter school to resolve the issue of students who were not able to be bussed, having to cross a state highway to reach the existing school campuses. In addition, the local schools were overcrowded and the area was experiencing rapid growth. In response they opened an elementary school, the Oakland Avenue Charter School. The school was opened in August, 2003 and currently has 514 students enrolled in the program. The City Council acts as the governing body of the school. The Board contracted out the education and administrative services to an EMO, but a merger of the contracted EMO resulted in poor service delivery. The city reclaimed the administrative responsibilities and the EMO focused on curriculum and teaching. A decline in the states FCAT test resulted in the contract being terminated and the city now fully operates and administers the school. The state funding is $3,202,985 or $6,231 per student. Florida uses the A+ Plan which grades schools on a scale of A thru F based upon the performance and progress of students on the FCAT. Oakland Charter School has achieved an A ranking for the last four years, the same time frame that the city reclaimed full control of the operations of the school. Figure 7 – Coral Springs, Florida Org Chart Oakland, FL City Council City Manager / Superintendant Principal 17 4.6. Pembroke Pines, Florida Pembroke Pines’ population influx of young families created a strain on the local schools. In August 1998, the city began its charter school system, known as the Academic Village Campus, to alleviate the classroom shortage. It has grown to be the largest charter school system in the nation with four elementary schools, two middle schools and one high school, currently serving over 5,600 students. The city’s partnership with two local community colleges offering two-year AA degrees, as well as a Florida International State University facility which is planning an expansion of course offerings at the Village. The total state funding for the school system in FY 08/09 was $40,112,760 serving 5,426 students at $7,392 per student. The Pembroke Pines charter schools have all maintained rankings of A on the FCAT for the last three years. There have been slight variations in the scores from previous years, but the majority of scores have been A’s for the last decade. The governing body consists of the City Commission and the Mayor with the City Manager acting as the school Superintendent. The charter school leases the facilities from the city and makes an approximate $6.4 million transfer to the debt service fund to cover the cost of the $64 million debt issued for the charter school construction. Figure 8 – Pembroke Pines, Florida Org Chart City Commission Parent Advisory Board Principal Principal Principal Principal Principal City Manager Pembroke Pines, FL 18 4.7. Palm Bay, Florida Palm Bay’s population growth has been in the double digits for most of the last decade, placing a huge strain on the local schools. In response to a growing overcrowding issue at local schools, Palm Bay issued debt to build a K thru 7 charter school system which opened in August 2006. Palm Bay just received approval to add a charter high school which began operations in the 09/10 school year. They currently have 646 students enrolled in grades K thru 8 and 17 students enrolled in grade 9. The City Council acts as the governing body and partnered with Charter Schools USA to access Federal start-up funds and manages the day to day operations of the school. Due to slowing growth in housing, the charter school has failed to meet enrollment goals which have placed a strain on the ability for the school to meet its debt obligations. Palm Bay and Charter Schools USA have separated and Palm Bay now uses Academica to manage the charter school operations. Palm Bay has recently contracted with other local charter schools to work as feeder schools for their charter school system. The Council acts as the governing body for the high school, but appoints a five member charter school authority to govern the elementary and middle schools. The total state funding for Palm Bay charter schools in FY 2008/09 was $5,907,790, based upon reaching the 768 students in the budget assumptions, or $7,692 per student. Florida uses the A+ Plan which grades schools on a scale of A thru F based upon the performance and progress of students on the FCAT. Palm Bay charter school has achieved two C’s and a B since the school’s inception. Figure 9 – Palm Bay, Florida Org Chart Palm Bay, FL City Council Academica / EMO Principal Grades 9 thru 12 Palm Bay Charter School Authority Academica / EMO Principal Grades K thru 8 19 6. History of Westlake Academy Organizational Structure Over the course of its existence, Westlake Academy’s organizational structure reflects the needs that occur as an organization grows (in this case with the addition of new grades and attendant enrollment increases). The Academy’s organizational structure over time also reflects the same dynamics that occur in many organizations. These organizational dynamics often include centralization versus decentralization of the organization (i.e. this can be of specific functions, or it can be decentralization/centralization of the entire organization from its creating entity). It can also involve the organizational dynamic that can occur with the splitting of a reporting structure. Whether this reporting structure split is a “dotted line” or direct reporting relationship, it creates clarity issues and questions including: • who is accountable to whom? • who is responsible for various types of decisions and what are the decisions they are empowered to make? • once the reporting structure is split, who will be evaluating that employee’s performance? • who establishes the affected employees’ performance standards and holds the employee accountable for meeting those standards? • does the remainder of the organization, including internal support services, understand this reporting relationship as it relates to decision making authority and how/whom they are to interact with on a daily basis? • how does this reporting structure affect not only the management of the organization, but its governance? • what is to be communicated in the way of information, how should it be communicated, and who makes the decision as to this communication chain? This communication can be internal to the organization as well as between the governing body and the organization(s). The charter granted and approved by the TEA to the Town of Westlake in 2003 sets out the management structure and reporting relationships for the Academy. This TEA approved structure established the Town Manager as Chief Executive Officer/Superintendent for the Academy with a principal reporting to him/her. Once operational, this principal position for the Academy was called the Head of School, a term more widely used in private schools and/or schools which utilize exclusively the IB curriculum as Westlake Academy does. Additionally, a Head of Primary position was added in 2007. Finally, prior to adding grade 11 in the 2008-09 school year, a Head of Secondary position was also added. In 2007, the Town Manager/CEO resigned in their capacity of CEO/Superintendent, but remained with the Town in their capacity as Town Manager. The Head of School then began reporting directly to the Board of Trustees’ President. This bifurcation of the organization created many pressures on the organization in terms of the organizational dynamics described above. In 2008, when hiring a new Town Manager and Head of School, the Board of Trustees (Board) determined that they wished to restore the original reporting structure that is set out in the Academy’s initial charter. The Board did continue, as it did with the founding Head of School, to select and approve the hiring of the Head of School. Since spring 2009, when the Head of School left the Town’s employment, the Town Manager/CEO has been utilizing a reporting structure whereby the Heads of Section (Primary and 20 Secondary Principals) are reporting directly to him. The Heads of Section are involved in the daily operations of the Academy, including academics supervision, professional development, curriculum development and implementation, as well as parent relations. The Town Manager/CEO is responsible directly to the Board and is held accountable for the finances and management of the Academy, working with the Board in facilitating its policy making role and effectiveness, evaluating the Heads of Sections, as well as achieving the Board’s identified desired outcomes for the Academy in terms of student achievement. 7. Organizational Structure Options for Westlake Academy 7.1. Organizational Structure Parameters and Criteria Much has been written about organizational structure, both for private sector and public sector organizations. Likewise, much has been written regarding governance structure. Here the focus on both organizational structure and governance structure will be as it relates to public sector and specifically, municipal charter schools. Organizational structure has many impacts on organizational performance. According to NDMA (N. Dean Meyer and Associates Inc.), many common problems trace their root cause back to organizational structure, for example: political in-fighting, poor teamwork, lack of customer focus, weak strategic alignment, slow pace of innovation, a bureaucratic rather than entrepreneurial culture, pressure for decentralization and outsourcing, and poor morale (www.ndma.com). While NDMA focuses on private sector organizations in making these observations, these same problems frequently surface in public sector organizations as a result of their organization’s structure. The parameters and criteria used to establish an organizational structure for a municipally owned charter school can, and perhaps should, vary from locality to locality based on local needs. However, it could be fairly argued that the basic parameter would be; how does the organizational structure for Westlake Academy allow the school to function most effectively on a day-to-day basis, as well as into the future, in terms of impacting the achievement of Board identified desired educational outcomes for Westlake Academy? With that end in mind, further parameters and criteria can be established to guide the evaluation of organizational structure options for the Academy. These can include (and are not presented in any priority order): • Integration with and linkage to existing organizational structure(s) • “Height or flatness” of the organizational structure, including: o Empowerment o Speed of decision making desired o Team work o “Silos and turf” o Cost o Communication • Compliance with regulatory and/or legal requirements • Existing organizational culture and the organizational culture desired 21 • Talents/Skill sets of current management/leadership as well as those desired for future development • Whether the daily operation of the school has been outsourced to an EMO • Span of control • Organizational conflict o Lack of clarity as to lines of authority, roles, accountability o “Touch” and lack of linkages resulting in “parallel organizations” A discussion of various dimensions and aspects of these parameters and criteria for Westlake Academy’s organizational structure follows. 7.2. Integration with Existing Organizational Structure(s). With Westlake Academy being a municipally owned and operated charter full spectrum IB school, integration of the Academy’s organizational structure to existing organizational structure (in this case the Town of Westlake), is critical for effective Academy operation. As stated earlier in this report, of the municipal charter schools examined, all operate under the council-manager form of government, as does Westlake. According to the International City Managers’ Association (ICMA), the council-manager form of government has continued to grow. Today there are 3,003 ICMA-recognized local governments operating under the council-manager form of government in the United States (www.icma.org). In the council-manager form of government, the city (town) manager is hired, removed and is responsible to the city/town council for the overall daily management of municipal services and financial management of the municipality. The city/town manager is also held responsible for assisting the council in its policy making role by facilitating strategic planning, the development and evaluation of policy options, as well as making recommendations to the governing body regarding these options. In the vast majority of city/town governments that utilize the council-manager form of government, with the exception of the municipal judge, municipal attorney, and city/town secretary (clerk) positions, the city/town manager is responsible for all department head (director) appointments. This was a key impetus for the origin of the council-manager form of government which came out of a reform movement early in the twentieth century that strove to couple principles of efficient and effective management with representative democracy. The city/town manager is intended to be a trained professional who is accountable to the council which is comprised of elected officials who are local civic volunteers (i.e. not full time municipal employees) who focus on governance of the municipality. The city/town manager serves strictly at the pleasure of the council and can be removed at any time by the council. However, with that prerogative of the council to remove the city/town manager at any time, it helps “depoliticize” the remainder of the organization. This in turn allows department directors and their employees to be selected by the city/town manager based on their qualifications, merit, and their ability to manage the delivery of efficient and effective services that are equitable for all citizens, rather than on the basis of political influence, political patronage, and favoritism. In Westlake, the Town Council also serves as the Board of Trustees for the Academy. 22 The Town of Westlake owns the 23 acre Academy campus and its 63,000 sq. ft. of buildings, as well as being legally responsible for the now $33.8 million debt (principal and interest) generated by the bonds issued to build this campus. These further spotlights the need to strongly examine integration of the Academy’s organizational structure with the existing municipal structure based on the council-manager form of government. This becomes an even more important consideration when taking into account the present arrangement whereby services that support the academic operations of the Academy (facility maintenance, accounting, budgetary, and financial management, human resource, information technology, and general administration) are provided by the Town of Westlake. These services are all managed by directors appointed by and responsible to the Town Manager as they also provide these services to the Town government. The department heads of these services now interact with Academy staff on an almost daily basis. Figure 11 - Since June 2009, Westlake Academy’s organizational structure has been: Figure 10 - The organizational structure for the Academy from May 2008 to June 2009: Head of Primary Head of Secondary Town Council / Board of Trustees Town Manager / Superintendant Administrative Coordinator Head of Secondary Head of Primary Head of School Town Manager / Superintendant Administrative Coordinator Town Council / Board of Trustees 23 Earlier in this report it is shown that the prevalent model for municipally owned charter schools is to create integration with the municipal government by having the principal or EMO of the school report to the city/town manager. In this case, the city/town manager serves in a general management/administrative role with the municipal charter school (with some or all support services out-sourced). In one municipal charter school where an EMO is used to operate the school, the city manager sits on a board that governs the school. In either case, the city manager plays a prominent role in oversight of the school’s operations. Separation of the principal of the school from the city manager, in terms of hiring, firing, and/or reporting relationship, divides this structure. This occurred, as mentioned earlier in 2007, when the Westlake’s Town Manager/CEO resigned in their capacity of CEO/Superintendent, but remained with the Town in their capacity as Town Manager. The Head of School then began reporting directly to Board of Trustees’ President. This division of the organization created pressures on the organization in terms organizational dynamics and governance. Having experienced this situation before, it further illustrates the need to strongly consider and understand the impacts of integration as well as separation of the Academy’s organizational structure from that of the municipal government. 7.3. “Height or flatness” of the organizational structure Trends for the “tallness versus flatness” of an organizational structure have been the subject of much management literature and attention. Forces that cause this discussion in an organization can vary, but often revolve around the issue of removing as many layers between management and front line employees as possible so that management and employees have more interaction and feedback. The desired result of this increased interaction and feedback is the improvement of both management’s and employee’s work performance understanding, communication and decision making. As shown in the organizational charts above for Westlake Academy (and as discussed in the section of this report describing the evolution and history of Westlake Academy’s organizational structure), over time (prior to June 2009) the Academy’s structure has been fairly tall for an organization of its size (400 plus students, 50 plus employees). Exploring impacts of a flat versus tall organizational structure should also consider: 7.3.1. Empowerment It is capable for tall organizations to empower their employees. However, strong arguments can be made that with flat organizations placing both employees and management closer to the “customer” (in this case, the student and parents), as well as to the point where decisions need to be made, they more naturally lend themselves to empowering employee decision making. 7.3.2. Speed of decision making desired While fast decision making is not always appropriate in terms of its benefits to an organization, generally speaking most organizations value timely decision making. Flat organizational structures, it can be asserted, should lend themselves to faster decision making due to a reduction in the layers of the organization in which a decision must be filtered before it is finalized. Certainly public organizations like a school or municipality have certain legal processes as well as board, citizen and parent input processes 24 to go through prior to a final decision being made. Yet, even in that public governmental environment, timely decision making is generally agreed to be a reasonable outcome for an organization to aspire. 7.3.3. Team work In today’s organizations, team work is generally accepted as an important way of gaining employee participation in an effort to harness their ideas, creativity, input, and energy all pointed towards improving organizational performance. Teams outperform individuals acting alone or in larger organizational groupings, especially when performance requires multiple skills, judgments, and experiences (Katzenback and Smith 1993, pg. 9). There are many reasons that teams in an organization should not be used as well as many reasons when teams performs better in some situations than others. Likewise, organizational structure can enhance or impede the effectiveness of team work. If for no other reason than it has fewer vertical levels, a flat organizational structure lends itself to the use of teams. And, if the vertical divisions within the organization are held to as few as possible, the use of teams will be seen as important (and perhaps a necessity) for achieving a high level of organizational performance as daily employee interaction between these divisions will be critical to the organization’s success. 7.3.4. “Silos and Turf” “Silos are nothing more than the barriers that exist between departments within an organization, causing people who are supposed to be on the same team to work against one another (Lencioni, 2006, p. 175).” Divisions within an organizational that create obstacles for performance, work processes, collaboration, creativity, and improvement known as “silos and turf” can occur in any type of organizational structure and they can incur informally (i.e. not being related to the organizational structure, simply created by employees and management in their individual capacities). However, a tall organization with more layers of management and other formal organizational divisions lends itself to formal “silos and turf” that can impact organizational performance. 7.3.5. Cost Both in the private and public sectors, the cost of maintaining an organizational structure can become a factor in determining what that structure should be. Often this is a result of impacts from an economic down turn which reduces available financial resources forcing prioritization of the spending of scarce dollars. At times cost becomes a factor in terms of addressing real or perceived market competitiveness and customer service issues. Or, evaluation of cost considerations for a particular organizational structure or structures may result from a combination of these and other factors. Regardless, this cost Figure 12 - Focusing on Team Basics (Katzenback & Smith, 1993) 25 consideration often focuses on the cost of maintaining various levels of upper and mid-level management. In Westlake Academy’s case, the annual cost of maintaining the management structure that existed from April 2008 to June 2009 was $500,245. Since June 2009 that annualized cost has been $409,500. 7.3.6. Communication Most, if not all, organizations value communication, both horizontally and vertically. Few organizations assess themselves as doing as well with communication as they would like. Height of organization (i.e. the number of tiers in an organizational structure), while not the only factor, can definitely be a significant factor that impacts effective communication among all employees, the governing body, students, parents, as well as the greater Westlake Academy community. 7.3.7. Compliance with regulatory and/or legal requirements All organizations have various legal and regulatory requirements they must meet. As discussed above, those take the form of State and Federal educational legal and administrative requirements administered by the Academy’s authorizing agency, the TEA. The Town’s charter for the Academy represents a contract with the State and as such, the language in that charter outlining the Academy’s organizational structure (unless amended by the governing body and approved by TEA) must be complied with. The structure outlined in the Town’s State approved charter for the Academy outlines that a structure will include the Town Manager as the CEO of the Academy with a principal involved in overseeing daily operations of the school. 7.3.8. Existing organizational culture and the organizational culture desired In looking at organizational structure, it is imperative to examine the organization culture in place, as well as the culture that is desired for development both in individual employees and in the organization’s work force as a whole. Many definitions of organizational culture exist, but they all revolve around the norms, values, and beliefs of an organization’s employees that impact not only individuals’ work place performance, but how the organization functions holistically. While there may not have been a formal description done on Westlake Academy’s organizational structure, observation of the Academy over time would indicate that it revolves around the IB curriculum and the IB learner profile that is striven for by parents, faculty, and students. The IB Learner Profile helps teachers and students to establish goals, plan units of inquiry, and assess performance. This learner profile is: 7.3.9. IB learners strive to be: • Inquirers • Knowledgeable • Thinkers • Communicators • Principled • Open-minded • Caring • Risk-takers • Balanced • Reflective 26 In conjunction with this learner profile, another important piece of describing the Academy’s culture is the desired emphasis on participation in decision making, including the Academy’s employees. When examining the type of organizational structure desired for the Academy, the question should be asked, is this structure congruent with the organization’s culture as described in the IB learner profile and will this structure enhance or impede the fostering of that culture? 7.3.10. Talents/Skill Sets of current management/leadership and development This is an important consideration when selecting an organizational structure. Given the organizational structure desired, what type of talent does the organization have the employees in key management/leadership positions in that structure? Do they have with their correct set of skills and abilities so their job performance can be optimized to the highest level possible to positively impact the organization’s performance? If not, what skill sets and abilities for those key management positions need to be developed, and should a different structure be utilized until their skill sets and abilities are more fully developed? And, if those skill sets and abilities already exist in those employees, how can they be further developed? These same sets of questions should be also asked for the organization’s work force as a whole when examining types of organizational structure. 7.3.11. Whether the daily operation of the school has been outsourced to an EMO As shown in the section of this report reviewing other municipal charter schools, some schools hire EMO’s to operate their school. While outsourcing, given the unique circumstances in each situation, may be an attractive option for school operation, it has a significant impact on organizational dynamics. Unless the municipality very specifically defines in its contract with the EMO the type of organizational structure it wishes the EMO to use, outsourcing to an EMO effectively removes the municipality’s control and oversight of what organizational structure should be used to manage the school, and cedes that decision to the EMO. This is done so that the EMO, being given the prerogative to choose the organizational structure they deem most appropriate, can be held fully accountable by the governing body to achieve the educational results that the municipality’s governing body has identified (hopefully in their contract with the EMO). The net effect is one in which the governing body must have a clear idea of the decision they are making when utilizing an EMO and that they will no longer be involved in issues that organizational structure create as this is now strictly the EMO’s realm. Perhaps one way of summarizing this discussion of EMO’s and organizational structure as it relates to Westlake Academy is that, organizational structure will be an important topic for discussions with the EMO. However, it will involve very different dynamics and levels of influence in terms of being able to directly shape organizational structure (as is done now) as opposed to retaining an EMO, identifying results, and letting the EMO determine the best organizational structure for attaining those results. 7.3.12. Span of control This can be defined as the number of employees reporting to one supervisor/manager. Many views are written about the optimal span of control. Many variables influence this decision on span of control for management as it relates to creating an organization’s structure. These variables range from the specific service or product the organization is charged with creating, whether the employees all work in the same facility or multiple, separated facilities, to how much interaction on a daily basis is necessary between a manager and his/her direct reports in order to achieve acceptable organizational 27 performance. There are various opinions as to the maximum number of employees that can be supervised and managed through their span of control. Whatever that number is, there is a point in any organization that beyond a certain number of employees, it is not possible to have a span of control that allows that manager sufficient interaction to give employees the level of feedback and input they need to stay focused on the organization’s mission and desired results. In turn, the type of structure becomes important as it can directly impact a manager’s span of control within that organization. 7.3.13. Organizational conflict While many reasons for organizational conflict can occur, including personality clashes and egos unwilling to bend (George Cuff 2009), organizational conflict can occur due to organizational structure that creates multiple opportunities for conflict. Absence of key ingredients in an organizational culture can also lead to organizational conflict. Organizational structure can generate conflict due to lack of clarity as to lines of authority, role confusion, accountability, as well as “touch” and lack of linkages resulting in “parallel organizations”. As organizational structure options are analyzed, it is important to attempt a forecast of that structure’s impact on creating or mitigating these potential sources of conflict which we will examine here: 7.3.14. Lack of clarity as to lines of authority As is sometimes asked in some organizations, “When is someone going to make a decision around here so we can get something done?” This question may be asked in a context that involves individuals in decision making roles which have personal characteristics that manifest themselves with indecisiveness, particularly on key decisions. However, often organizations structure themselves so that is unclear who makes what types of decisions. Or, if those decisions are shared decisions, who ultimately has the authority to “break the tie” and actually make the final decision? This lack of clarity as to boundaries of authority can be further exacerbated by “dotted line” relationships. This is where a position supposedly has been given the authority to make a certain type of decision. However, because of another position of equal (or it can be lesser) authority’s informal relationship to the supervisor of the person formally charged with that authority, no decision is made or it is delayed. Perhaps worse, the decision that is ultimately made is not one the individual would have made if he/she had clear decision making authority based on what they thought was best for the organization. Instead, they made what they thought was a “safe” decision based on fears of being second guessed by the organization. Clearly organizational structures that do not define lines of authority lend themselves easily to flawed decisions that can impact the entire organization. In some cases, it is easy to confuse clear lines of authority with prohibition of interaction between employees assigned to various levels in an organization. Lines of authority do not need to prohibit this interaction. In fact, depending on the organization’s culture and desire to embrace work place teams, this interaction is vital and is promoted, even when lines of authority are clearly defined. It simply means it is clear to all in the organization who is empowered to make what types of decisions on a daily basis. 7.3.15. Role confusion In the same way that organizational structure can create lack of clarity as to decision making authority; an organization’s structure can create role confusion. By its very name, it can be easily seen as to what role confusion is - positions in an organization that have unclearly defined roles. This may have occurred 28 because the organization defined a position’s or positions’ roles incorrectly, unclearly, or defined them in a duplicative manner (i.e. multiple positions performing exactly or similar tasks or duties). Often role confusion occurs because there has not been a discussion at the highest levels of the organization as to what the roles of specific positions should be. As a result, what frequently occurs is that it is left to the individual holding a position to self-define their role. When this happens, the role may or may not be defined in a manner that is congruent with other roles in the organization or may not be a role that the organizational actually needs in terms of its strategic direction as well as other parameters. One attribute of an effective organizational structure is one that does not create role confusion within the organization, which in turn helps avoid unnecessary organizational conflict. 7.3.16. Accountability Effective organizations strive to link results to performance, which means requiring accountability of individual employees for their contribution to the achievement of the organization’s goals, objectives, and desired outcomes. Organizational structures that facilitate clarity as to who is accountable for what outcomes, as well as the standard to which positions in the structure will be held in performing their job duties and tasks, have an attribute that lends the organization to being categorized as high performance. 7.3.17. “Touch” and lack of linkages resulting in “parallel organizations” Having an organizational structure that has “no touch” at key decision points is a central cause of organizational conflict. “Touch” can be defined as the central place in an organization where management and/or governance decisions should occur. Local government consultant George Cuff maintains that when this “touch” does not occur, parallel organizations begin to emerge causing conflict. From one perspective, one can argue that parallel organizations come into being when many of the facets of good organizational structure discussed above are not implemented. Chief among these would lack of integration of a newly created organization with the existing organization involved in the creation. This results in independent reporting relationships to a governing body that is often holding each reporting party (i.e. a member of management) to a different standard. This generates competing interests, role confusion, lack of clarity of accountability, as well as poor decision making. With all these forces at work, the organization’s ability to manage and govern itself through current challenges, conflicts, as well as to position itself optimally for the future becomes impaired. Simply put, the organization cannot be aligned internally or externally to achieve both governance and management identified desired outcomes because it is no longer one organization, it is now two. When considering these paradigms and criteria for evaluating types of organizational structure, one can begin to see many of the hallmarks of what organizations strive for, being a “category of one”, or what is commonly referred to today as the high performance organization. 29 8. High Performance Organizational Structure Parameters & Criteria With these paradigms/criteria in mind for organizational structure, how might they be applied to organizational structure options for Westlake Academy? A plethora of organizational structure options, as well as hybrids of those options, can be created and examined. For that reason, we will concentrate on applying these criteria to five (5) options for organizational structure for Westlake Academy. These options are not presented in any priority order. Option 1 : Structure Used from May 08 to June 09: CEO and Head of School with HOS Dotted Line Relationship to Board Description . Here the management structure of the Academy would involve five (5) management employees: the CEO, Head of School (Principal), Head of Primary, Head of Secondary, and Administrative Coordinator. It has three (3) tiers of management. The Board has a “dotted line” relationship with the Head of School as it has appointing and removal authority for this position, although it reports to the Board through the CEO. Figure 13 – Option 1 Town Manager, CEO / Superintendant Head of Secondary Head of Primary Administrative Coordinator Town Council / Board of Trustees Head of School 30 Option 2: Structure Used from June 09 to Present: CEO Reporting to Board With Heads of Section (Principals) and Administrative Coordinator Reporting to CEO Description. Here the CEO reports to the Board. The management structure of the Academy would involve four (4) management employees: the CEO, Head of Primary (Principal), Head of Secondary (Principal), and the Administrative Coordinator. It has two (2) tiers of management and has no dotted line reporting relationship between the Board and any members of management reporting directly to the CEO. Option 3: CEO Reporting to Board with Director of Education/Head of Secondary Reporting to the CEO, and Head of Primary and Administrative Coordinator Reporting to Director of Education/Head of Secondary Figure 15 – Option 3 Figure 14 – Option 2 Town Manager, CEO / Superintendant Head of Secondary Head of Primary Administrative Coordinator Town Council / Board of Trustees Town Manager, CEO / Superintendant Town Council / Board of Trustees Director of Education / Head of Secondary Head of Primary Administrative Coordinator 31 Description. Here the management structure of the Academy would involve four (4) management employees: the CEO, Head of Primary (Principal), Head of Secondary (Principal), and the Administrative Coordinator. It has three (3) tiers of management and has no dotted line reporting relationship between the Board and any members of management reporting directly to the CEO. Option 4: CEO Reporting to Board, Head of School/Director of Education Reporting to the Board, Head of Section Positions and Administrative Coordinator Positions Reporting to the Head of School/DOE Description. Here the management structure of the Academy would involve five (5) management employees: the CEO, Head of School/Director of Education, Head of Secondary (Principal), Head of Primary (Principal), and Administrative Coordinator. It has two (2) tiers of management. The Board has a direct relationship with the Head of School as it is the appointing and removal authority for this position. The CEO has no direct or indirect authority over the Head of School position. The CEO also reports directly to the Board due to his/her oversight of the support services provided by the Town to the Academy. Figure 16 – Option 4 Town Council / Board of Trustees Head of School Town Manager, CEO / Superintendant Head of Secondary Head of Primary Administrative Coordinator 32 Option 5: CEO is Removed from the Structure, Board, Head of School/Director of Education Reporting to the Board, Head of Section Positions and Administrative Coordinator Positions Reporting to the Head of School/DOE Description. Here the management structure of the Academy would involve four (4) management employees: the Head of Primary/Director of Education, Head of Secondary (Principal), and Administrative Coordinator. It has two (2) tiers of management. The Board has a direct relationship with the Head of School as it has appointing and removal authority for this position. The CEO is removed from this structure, thus having no direct or indirect authority over the Head of School position and no involvement in school operations or management. Taking these five options, will now apply an evaluative matrix consisting of the criteria described above: Table 6 – Evaluation Matrix of the Five Options Op t i o n In t e g r a t i o n wi t h Ex i s t i n g O r g He i g h t / F l a t Em p o w e r m e n t De c . Ma k i n g Sp e e d Te a m w o r k Si l o s / U n i t C o s t Co m m u n i c a t i o n Le g a l / Co m p l i a n c e Cu l t u r e De v . Ta l e n t / S k i l l S e t EM O Sp a n o f C o n t r o l Or g C o n f l i c t "To u c h " 1 No Tall ---Yes H -X -X n/a X Yes No 2 Yes Flat X X X No L X X X X n/a X No Yes 3 Yes Tall ---Yes H -X -X n/a X No Yes 4 No Flat X -X Yes H ---X n/a X Yes No 5 No Flat X X X Yes L --X X n/a X Yes No Figure 17 – Option 5 Head of School / Director of Education Head of Secondary Head of Primary Administrative Coordinator Town Council / Board of Trustees 33 This matrix displays which organizational structure option meets the most criteria as it relates to impacts of the ability of the structure to move the organization towards high performance. It should be noted that all five (5) structural options meet two evaluative criteria. First, with all structural options analyzed it was determined that the talent sets and skill levels are now in place with existing management personnel necessary for implementation of any of these options. However depending on the structure chosen, which the person or body is responsible for making sure that these talent sets are developed will need to be clearly delineated in order to achieve success. Second, all options studied provide an acceptable span of control. A description as to how this rating system was applied to each organizational structure option is as follows: Option 1: Structure Used from May 08 to June 09: CEO and Head of School with HOS Dotted Line Relationship to Board Evaluative Matrix Application to this Structure: This option does not integrate as well as it could with the existing Town organization. This is because in this structure, the Head of School (a director level position) is hired and removed by the Board of Trustees, as opposed to the CEO. In the Town’s council- manager form of government, the Town Manager is responsible and accountable to the elected governing body while all department directors are hired and removed solely by the Town Manager. This includes the municipal departments that provide internal support services to the Academy. The organization structure is tall due to it having three (3) tiers of management. This many levels of management does not facilitate employee empowerment, timely decision making, or teamwork compared to a flatter structure. A structure of this height is more likely to create “silos and turf”, thus negatively impacting organizational culture development. It costs more than structures with fewer levels of management. Further, this many levels of management can impede communication compared to a flatter structure. This structure would comply with legal requirements from TEA. While its span of control is acceptable, it can easily create organizational conflict due to lack of role clarity between the CEO and Head of School, authority boundary questions between these two positions, and as a consequence, foster confusion as to who is accountable for what results. This structure lacks “touch” at key management and governance decision making points effectively creating two parallel organizations. Option 2: Structure Used from June 09 to Present: CEO Reporting to Board with Heads of Section (Principals) and Administrative Coordinator Reporting to CEO Evaluative Matrix Application to this Structure: Integration of this structure with the municipality is achieved with both Heads of Section (Principals) and the Administrative Coordinator reporting directly to the CEO, who as Town Manager also has the municipal support departments reporting to him/her. The management structure is flattened to have two (2) tiers. This in turn has a positive impact on all the other structural evaluative criteria ranging from employee empowerment and teamwork, to cost and communication. This structure meets TEA parameters. It can reduce organizational conflict by having only one position hired and removed by the governing body (CEO), thereby eliminating lack of clarity as to the CEO’s role, decision making authority, as well as designating one point of accountability to the governing body for the results it wishes to achieve for the Academy. This also eliminates the creation of a parallel organization by having this one point of accountability to the governing body and ensures that the academic and municipal structures will “touch” at key decision making points. 34 Option 3: CEO Reporting to Board With Director of Education/Head of Secondary Reporting to the CEO, and Head of Primary and Administrative Coordinator Reporting to Director of Education/Head of Secondary Evaluative Matrix Application to this Structure: This structure does integrate with the municipal structure with the Head of Secondary/Director of Education reporting solely to the CEO (who also has the municipal departments providing support to the Academy reporting to him/her). However, this structure utilizes three (3) tiers of management making it a tall structure. In addition to having higher cost, a structure of this height does not positively impact the other evaluative criteria such as speed of decision making, empowerment, team work, and communication. Organizational development can be diminished with this additional layer of management by not allowing the CEO to serve as the school’s linkage to the Town so that these efforts integrate with the Human Resources Department’s organizational development efforts. An additional layer of management, while not necessarily creating new “silos and turf”, makes it easier for development of new ones, and more difficult to eliminate existing ones in efforts to create organizational integration with the municipal structure. With the Head of Secondary/Director of Education reporting to the CEO, this structure has points of “touch” with the municipal structure and governing body at key decision points. It does have an impact on reducing potential organizational conflict, but it may not eliminate role confusion, lack of clarity of decision making authority or points of accountability between the Head of Secondary/DOE and the CEO. Option 4: CEO Reporting to Board, Head of School/Director of Education Reporting to the Board, Head of Section Positions and Administrative Coordinator Positions Reporting to the Head of School/DOE Evaluative Matrix Application to this Structure: This structure’s ability to integrate with the municipal structure is impaired by placement of the CEO in a dual reporting role to the governing body with the Head of School/DOE. This structure, while being flattened, does not reduce cost due to the continued involvement of the CEO over support services provided by the Town as well as the CEO’s role in the Academy’s budgetary and financial management. While arguable, team work and employee empowerment were attributes given to this structure. Other criteria such as “silos and turf”, communication, and organizational development were not attributed to this structure due to its bifurcated nature. With the Head of School able to spend funds to operate the school without any connection and accountability to the CEO who is being held accountable for results in this financial arena, the negative impacts of competing and conflicting interests between the two positions becomes easily identifiable. Due to the absence of linkages and points of touch with this structure to the municipal structure, it does create parallel organizations greatly enhancing organizational conflict due to lack of clarity as to roles, accountability for results, and decision making. This structure does not meet the criteria for legal parameters of the Town’s initial charter with TEA. Option 5: CEO is removed from the Structure, Board, Head of School/Director of Education reporting to the Board, Head of Section Positions and Administrative Coordinator Positions reporting to the Head of School/DOE 35 Evaluative Matrix Application to this Structure: Similar to Option 4, this option flattens the structure, but does it by completely eliminating the CEO from the structure. While it is assumed that the Town is still providing support services to the Academy under this structure, it would not have to do so since the CEO is not part of the organizational structure. With no involvement by the CEO, costs would be lowered. This structure does not meet the criteria for legal parameters established by the Town’s initial charter with TEA. Criteria involving empowerment, decision making, and team work were determined to be able to exist under this criteria, but would only within the confines of the Academy’s structure. This is because this structure does not integrate, and in fact separates, from the municipal structure, both in terms of all operations and governance. There is no “touch” between the two, thus creating parallel organizations. Governance of the Academy becomes a challenge since the governing body, while governing both the Academy and the Town, has effectively separated the two and must treat them as mutually exclusive, despite the financial linkages with the Town and the Town being the charter grantee. 9. Governance Structure for Westlake Academy From the review of existing municipal charter schools in this report, some conclusions can be made that affect Westlake Academy’s governance structure. These conclusions can be made in the context of community discussions that have previously occurred in Westlake regarding the present governance arrangement (i.e. elected officials that serve both as members of the Town Council and members of the Board of Trustees for the Academy). These prior community discussions focused on whether or not the Board of Trustees should be a body entirely separate from the Town Council. First, all charter schools owned by a municipality use the council-manager form of government. There is some variation as to how these municipalities owning charter schools connect their school to the municipal government, as well as some variation on they how they connect all of these facets into one municipal organization from a governance standpoint. However, the overall pattern becomes clear: municipalities owning a charter school place the city government’s chief administrative officer (the city/town manager) in a general managerial oversight role in their school’s administrative structure. The school’s principal or EMO reports to the city/town manager in the same manner as all other department directors in the municipality. For the governing body, the city/town manager position becomes the single point of accountability (which differs from the single point of contact) to the board. The city manager/town manager/CEO/superintendent is whom the board oversees and holds responsible for implementation of the board adopted policies, as well as achievement of the desired educational outcomes those policies are intended to achieve. A key point is this; whether this single reporting relationship is accomplished through one governing body or two, the importance of adherence to the reporting principle of having only one position responsible to the governing body for the school’s management/administration remains the same. However, when the same governing body appoints two positions responsible to the board that have independent points of accountability (they are “first among equals”), and the positions are responsible for managing overlapping areas of the same organization, governance dysfunction occurs. Whether there is one board, two boards with identical membership, or two boards comprised of different 36 membership, the net effect of such a move is to create two organizations. This can be done formally or in a de facto fashion, but in either case, it produces dysfunctional governance. This governance dysfunction is caused by many of the same forces already mentioned that affect organizational structure. By now having two distinct, parallel organizations, they now only “touch” at the governing body level, if they touch there at all. This becomes a fatal flaw from a governance standpoint. Although theoretically the governing body can serve as this point of “touch”, the extent of their point of interconnection with the entire organization is not broad or deep enough to overcome problems that involve lack of role clarity, impaired decision making and role confusion. Furthermore, many of these problems occur deep within the organization, so the governing body may not be aware of them nor does it have a good means to address them because they are management problems stemming from a flawed management structure that has its roots in a flawed governance structure. This becomes the hard realization. That is, a board that must deal with a flawed organizational structure will find that it does not support their ability to govern effectively. Similarly, a flawed governance structure will only exacerbate and highlight the shortcomings of their flawed organizational structure. One impacts the other. Since there is a working and prevalent model (with some minor variations) that provides for integration of all aspects of a municipal charter school with a municipality that uses the council-manager form of government like Westlake, and because Westlake Academy has previously used that model successfully, it is appropriate to ask a different question. That question is not whether the current governance structure is adequate, but rather; how it is put into action and whether modifications could be made to it to make it more effective? Governance, more widely known as policy governance (Carver), has as its central focus providing the organization leadership through policy making that identifies both desired results and executive limitations on the means used to achieve those results (ends). Governing bodies frequently utilize advisory boards to assist them in their policy making role. Specifically, school’s governing bodies have access to many affiliate organizations such as parent-teacher organizations, campus leadership councils, athletic booster clubs, foundations, and other groups. If tapped, these affiliate groups can serve as valuable input conduits to the board that enhances their governance. While these groups often exist, frequently their level of effectiveness as it relates to enhancing the board’s governance role can be improved. However, the governing body must take the initiative for that to happen. Westlake Academy has all of these affiliates in place and they are now meeting with the Board of Trustees as separate groups. One approach to improve governance is for all the affiliates’ officers to all meet together with the staff leadership team and the Board at least annually. The campus leadership team also needs to be examined and evaluated to see if it can enhance the Board’s governance by meeting with the Board, as opposed to the current practice of meeting solely with the Head of Secondary and/or CEO. Westlake Academy, being a municipally owned charter school, is unique in that its board is elected, but only by residents of Westlake. Parents that reside in the Academy’s boundaries beyond Westlake do not vote on the Board’s membership. It is likely that this was known and understood by these parents when they enrolled their child in the Academy’s annual enrollment lottery. Also, it is important to keep in 37 mind that most charter schools self-select their boards, so for parents of Westlake Academy students residing in the areas outside of Westlake, their situation is the same as if their child was enrolled at a typical (i.e. non-municipal) charter school. Nonetheless, open access, equity, transparency, and involvement of all stake holders, regardless of residency, are critical to the successful governance of any public school. In its governance role, the Board of Trustees can apply the multiple tools it already has available through its affiliates, as well as parents’ direct access to the Board itself, to involve all parents in their child’s education at Westlake Academy. This will affect continuous improvement in the Academy’s governance process using the present governance structure chartered by the State. Particularly for Academy parents residing outside of Westlake, these become the optimal vehicles by which to provide constructive input into the Academy’s governance. 10. Recommendations In light of the information presented, reviewed, and applied in this report concerning municipal charter schools, two primary recommendations emerge for Westlake Academy: 10.1. Organizational Structure With the application of the analysis of the organizational structure of other municipally owned charter schools, as well as the application of evaluative criteria to organizational structure options, Option 2 provides the most positive attributes for contributing to Westlake Academy’s organizational performance as well as its governance. This is because it provides for the highest level of integration with the creating organization for the Academy, the Town of Westlake. This option, if selected, could be periodically reviewed and evaluated by the Board. Option 3 could be viable because it does provide interconnection to the municipal and education components of the organization (touch), but does not have as many positive attributes as Option 2. Remaining Options 1, 4, and 5 all have significant negative qualities, particularly as they relate to the evaluative criteria of “touch,” organizational conflict, and/or compliance with the Town’s initial charter for the Academy. 10.2. Governance Structure Review of other existing municipal charter schools shows a pattern in that many are governed by the municipal government’s governing body. A few variations exist where a school authority board or advisory board has been created to govern the school. However, in those instances, these appointments are made by the city council and in some case; the city manager serves as a member of that authority or advisory board. Creation of a new governance structure with multiple new boards does not improve governance or make it more effective, but can complicate it for the reasons explained in this report. Effective governance can best be attained using the existing governance structure for Westlake Academy as set out in its initial charter. However, in order for this governance structure to be provide governance at the highest performing level, three (3) things should occur: 38 The governing body (Board of Trustees) must be supported by an organizational structure that has a single point of “touch” and accountability to the Board and a high degree of integration to the entire (municipal and educational) organization. The issue of parent access and input to the Board related to election of the Board only by residents of Westlake should be addressed. This should be done via modifications and improvements to the processes and means by which Board interfaces and interacts on an on-going basis with the multiple Academy affiliate organizations that already exist. Finally, the Campus Leadership Team, which could be adapted into an advisory board for the Board of Trustees, instead of solely for school staff. Continued pursuit of governance improvement through consideration and adoption of policies that establish the Board’s policy governance role for Westlake Academy. 39 11. Executive Summary 1. Westlake Academy is unique. It is the only municipally owned charter school in Texas and one of only twelve municipally owned charter schools nationally. Of all municipally owned l charter schools in this country, Westlake Academy is the only one that features the IB curriculum for all grades, K-12. 2. The Academy’s academic performance, as measured by absolute quantative measures from the TEA, has been rated exemplary for three (3) of seven (7) years of its existence with two of those exemplary ratings being in the last two (2) consecutive school years. 3. A literature review of charter schools generally shows that: a) forty (40) states have passed authorizing legislation for charter schools and that legislation varies in its strength from state to state. b) charter schools play an important role in urban renewal and neighborhood revitalization. c) studies have shown that increased education spending, that ultimately results in school quality improvement, increases the value of property. d) charter school funding regulations create facility issues for charter schools that can affect their closing. e) charter schools operate with funding differences from traditional public schools. While the average charter schools received more than 86% of its funding from the state, the balance is from Federal funds, grants, and donations. Charter schools cannot impose a local tax. Nor do they receive facility funding from the state. Because of this, Texas charter schools receive about $785 less per student than ISD’s. f) on average Texas charter schools spend approximately $650 per student less than ISD’s. Charter schools spend an average of 49.6% of expenditures on instruction compared to 52.7% for traditional public schools, generally resulting from less funding for instructional resources, media, curriculum development, staff development, and instructional leadership. g) data argues that charter schools’ inability to create economies of scale for their administrative cost decreases available funding for educational services. General administrative costs for charter schools average 17.4 % of expenditures compared to 8.3% for traditional public schools. h) Rental/lease costs for facilities costs charter schools an average of 10.9% of charter school spending i) Charter schools, while being formed with the idea of being under less bureaucratic regulation than ISD’s, are in fact held to many of the same provisions of Federal and State laws as traditional public schools. Yet, charter schools are held to a higher standard related to closure. A charter school may be closed for two (2) consecutive years of unacceptable performance, 40 while ISD’s are allowed five (5) years of unacceptable performance before being under threat of closure. j) Charter schools have experienced continued growth in enrollment going from 2,498 students enrolled in Texas charter schools in 1996-97 to 113,760 students in 2007-2008. Texas now ranks fifth nationally in the total number of charter schools and fourth in total number of charter school students. k) CREDO study results show that, while a majority of charter schools are not performing better than students at traditional public schools, that academic gains for elementary and middle school students who remain in the charter school for several years are significantly higher than their matched counter parts in traditional schools. 4. A review of other municipally owned and operated charter schools indicates: a) other municipalities that own a charter schools are located in Florida. They lease newly purchased/built facilities to the charter school for an amount that covers debt issuance costs for facility acquisition and/or construction. b) With the municipality owning the school land and facilities, many of these municipalities develop community partnerships that allow the charter school to use city recreational facilities for charter school extra-curricular activities and the charter school’s facilities are shared community space that may be used for civic and private functions. c) municipalities that own a charter school all utilize the council-manager form of government. d) Some municipally owned charter schools are operated directly by the municipality, while some outsource all or a portion (education services and/or support services) of the operation to an EMO. e) in these municipalities, the emerging organizational structure model appears to be one where the school’s principal or EMO reports to the city/town manager who in turn reports to the governing body. f) the governance model for municipalities that own a charter school, while having some minor variation, comports to the council-manager form of government for the school and municipal operations. g) in municipalities that own charter schools, support existed for the school’s establishment in order to meet unmet needs such as overcrowding, school choice, or poor scholastic results. h) for the Florida municipal charter schools studied, annual per student expenditures run in the $6,000 to $7,000 range, including the lease payment to the municipality to cover debt issued to acquire or build school facilities 41 5. Westlake Academy’s initial charter establishes the Town Manager in a CEO/ Superintendent type role with the Principal (latter called Head of School) reporting to the CEO, and the Board of Trustees hiring the Head of School. In 2007 the Head of School began reporting to the Board of Trustees’ President. A number of deleterious organizational impacts both in terms of management and governance then occurred. In 2008 this structure was changed back to the initial reporting structure in place at the school’s founding. Since June 2009, the Academy has been operating with the CEO in a direct oversight role with the Heads of Section and Administrative Coordinator. 6. Five (5) organizational structure options for Westlake Academy were examined utilizing the following evaluative criteria: • Integration with and Linkage to Existing Organizational Structure(s) • “Height or flatness” of the organizational structure, including: o Empowerment o Speed of decision making desired o Team work o “Silos and turf” o Cost o Communication • Compliance with regulatory and/or legal requirements • Existing organizational culture and the organizational culture desired • Talents/Skill Sets of current management/leadership as well as those desired for future development • Whether the daily operation of the school has been outsourced to an EMO • Span of control • Organizational conflict o Lack of clarity as to lines of authority, roles, accountability o “Touch” and lack of linkages resulting in “parallel organizations” 7. Organizational Structure. With the application of the analysis of the organizational structure of other municipally owned charter schools, as well as the application of evaluative criteria to organizational structure options, Option 2 provides the most positive attributes for contributing to Westlake Academy’s organizational performance as well as its governance. 8. Governance Structure. Effective governance can best be attained using the existing governance structure for Westlake Academy as set out in its initial charter. However, in order for this governance structure to be provide governance at the highest performing level, three (3) things should occur: a) The governing body (Board of Trustees) must be supported by an organizational structure that has a single point of “touch” and accountability to the Board and a high degree of integration to the entire (municipal and educational) organization. 42 b) The issue of parent access and input to the Board related to election of the Board only by residents of Westlake should be addressed. This should be done via modifications and improvements to the processes and means by which Board interfaces and interacts on an on-going basis with the multiple Academy affiliate organizations that already exist. 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