A charter management organization (CMO) is an educational organization that operates charter schools in the United States. Charter schools are public schools that operate independently of the local government school district.
A CMO contracts with a charter school to provide a specific service or set of services. They may not hold the charter except for in AZ.[ clarification needed] [1] By convention, a CMO manages at least three schools and serves at least 300 students. Additionally, they must be a separate business entity from the school. [2]
Economist Milton Friedman in 1955 proposed that education could be improved by a universal school voucher program. A free market in primary and secondary education would allow consumers (parents) to choose among alternatives, stimulating competition and improvement. In 1974, Ray Budde, a professor at the University of Massachusetts Amherst, floated the idea of a charter school. [3] In 1991, Minnesota enacted legislation that enabled charter schools. Other states followed.
Some commercial charter management organizations operate large networks of schools. [4]
EdisonLearning was founded in 1992.
Many states have adopted laws that require that the holder of the school charter be a non-profit organization. In these instances, a charter school must form a 501(c)(3) non-profit organization. Typically this new business entity forms a school board to oversee the operations of the new public charter school. However, they may then choose to contract with a CMO to provide management related services.
Examples include:
Wisconsin, California, Florida, Michigan, and Arizona allow for-profit corporations to manage charter schools. [5]
Examples include:
In some cases a school's charter is held by a non-profit that chooses to contract all of the school's operations to a third party, often a for-profit CMO. This arrangement is defined as a vendor-operated school, (VOS). [2]
CMOs in some usages are distinct from EMOs ( education management organizations). One authority on schools, Stanford University's Center for Research on Education Outcomes makes no distinction between terms. In its recent reports it describes CMO -- non-profit and CMO -- for-profit. [2]: 2
The National Alliance for Public Charter Schools makes a clear distinction. CMOs are non-profit; EMOs are for-profit. [6]
All agreed that Packard, by having years of charter school management experience and by having a larger network, would be able to reduce costs and save money.