ATLANTA -- The red ink on many charter schools' report cards aren't from poor academic grades but from money challenges, though recent legislation is easing some of those difficulties just as dozens of groups seek to start new ones.
A university study highlighting the financial woes of the start-ups stirred a hornets' nest when news reports of it spread. Charter-school supporters complained the reports provided ammunition to opponents.
"Charter schools aren't having money problems because of mismanagement. They're having money problems because of lack of funding," fumed Tony Roberts, chief executive of the Georgia Charter Schools Association.
He vented during a meeting of the Georgia Board of Education's Charter Schools Committee. He found a sympathetic audience. The committee voted to expedite funding for two start-ups and to issue $400,000 grants of federal money to each of four others wanting to get started.
The study, by Georgia State University professor Cynthia S. Searcy, found that 40 percent of the start-ups operated in the red during the 2006-07 school year, the most recent in which complete data was available to her. Two closed in that period, one of them for purely financial reasons.
The Georgia Department of Audits found the same ratio in its March analysis. Half of the eight charter schools that have failed since 1993 when charters were allowed attributed their closure to financial reasons.
"Given the budget crisis all schools are facing, we need to have more conversations on how to help charter schools reduce costs or enhance revenues if we expect to use them as vehicles for educational innovation," Ms. Searcy said. The auditors reached the same conclusion.
Charter schools are public schools given considerable latitude when it comes to the state's rules about things such as hours of instruction, students per classroom and even curriculum. The schools are governed instead by a custom contract of charter.
If the students don't meet performance standards spelled out in the contract, they can be closed.
Many existing schools switch to charter status. Some because teachers want to try new strategies for instruction. Some because they are already failing and they are looking for some salvation.
The conversion charter schools haven't drawn much criticism. Start-ups have. They're launched by parents or community leaders eager to try something different or dissatisfied with traditional schools.
One of the most controversial start-ups is Lake Oconee Academy, conceived by the residents of the posh, gated community of Reynolds Plantation. Opponents have described it as a taxpayer-funded private school. Even the U.S. Department of Education was reluctant to let it open until state officials made clear that Georgia law requires all charter schools to accept any student, just like any other public school.
Brian Burdette, of Greensboro, near Lake Oconee, is a member of the state school board and its charter committee, and he's a defender of start-up charter schools.
"The perception is that charter schools take the elites, the cream of the crop, and that's not true," he said Wednesday.
Besides, start-up charter schools have enjoyed greater success on the measures of adequate yearly progress (AYP) as set out by the federal No Child Left Behind Act.
"Interestingly, if you break out charter schools by type, start-up schools had the highest rate of AYP, at over 81 percent. The conversions had the lowest rate, around 70 percent," said Andrew Broy, the state Education Department staffer over charter schools. "One of the reasons this is because we have had, in the past year or two, several public schools that are traditional public schools struggling (decide to) convert to charter status in order to do school-improvement work, and they haven't yet made AYP."
These details are likely to be tossed around again soon since groups seeking to charter 34 start-ups are thrusting their applications at a newly created state commission. Of that group, 21 had been rejected by their local school districts -- often over funding concerns.
There's one critical detail to be considered in addition to the audit and the university study, says Kelly McCutchen, the vice president of the Georgia Public Policy Foundation that lobbies for charter schools.
"I think the important thing to keep in mind is the data in this report is two years old and reflects a time when charter schools were not funded very equitably, and many things have changed since then," he said.
Mr. McCutchen isn't just an advocate, he also is chairman of the board of start-up charter Tech High, which was created by the foundation. The school ran into headaches with its building and aging boiler, a situation many start-ups face because local school boards have forced them to find their own facilities.
Mr. McCutchen estimates most of start-ups' money problems stem from their facilities. A new law requires districts to provide space for start-ups, if it's available.
"I get a little frustrated when people say that charters are pulling money away from public schools," he said. "They are a public school."
Walter Jones is the bureau chief for the Morris News Service and has been covering state politics since 1998.