There are 211 charter schools in North Carolina, according to data from the Department of Public Instruction (DPI), making up 10% of the state’s allotted Average Daily Membership (ADM).

Charter schools are public schools with more flexibility than traditional public schools. North Carolina lawmakers authorized the establishment of charter schools in 1996 to encourage the use of innovative teaching methods and “provide parents and students with expanded choices… available within the public school.”

In recent years, demand for charter schools has increased. Approximately 85% of charter schools had a waitlist in 2022, according to self-reported DPI data, totaling more than 77,000 students. That waitlist number could include duplicate students on multiple waitlists, Ashley Baquero, DPI’s director of the Office of Charter Schools, told the State Board of Education last summer.

“The size of our charter school students is equivalent to a large district,” State Board of Education Chair Eric Davis said at the time.

From 2019 to 2022, charter school enrollment in North Carolina increased 19% — the fifth highest growth rate in the nation, according to DPI’s annual report to the General Assembly.

Such growth accompanies a recent focus by North Carolina Republican lawmakers to expand school choice, through both private schools and charters. While charter schools demonstrate some of the choice already available in the public school system, traditional public schools remain the top choice for most of the state’s students.

The expansion of school choice — through charter schools — is one of several factors expected to continue impacting traditional public school funding and enrollment. Across the state, charter school enrollment ranges from less than 1% to 37% of public school enrollment in a district, according to 2021-22 DPI data on district ADM.

Here’s a look at how charter schools are created and funded, who attends charter schools, and how charter school performance compares to the performance of traditional public schools.

Charter school application process

The 2024 North Carolina Charter School Application opened on Jan. 26 and will close on April 26 at 5:00 p.m. You can find the 2024 NC Charter School application on DPI’s website.

“Applicants who are interested in opening a charter school in 2025 under the accelerated timeline, or in 2026 under the standard timeline must submit their charter applications on or before the April 26, 2024 application close date,” DPI’s Office of Charter Schools said in an email. 

Applicants must submit a $1,000 application fee with their online application by the deadline. In-person interviews will begin in September, according to the email. You can email questions about the charter application process to Melanie.Rackley@dpi.nc.gov.

In the past, charter school applications were reviewed by the Charter School Advisory Board, which recommended to the State Board of Education which ones should be approved or denied.

Following legislation passed in August, this board no longer exists. It is now the Charter School Review Board (CSRB). The law grants the review board sole authority to approve or deny charter applications, renewals, and material changes. The State Board of Education can only review appeals of decisions by the review board.

“This action will make the application process more efficient, more cost-effective, and much more streamlined for all stakeholders involved,” Rep. Tricia Cotham, R-Mecklenburg, a primary sponsor of the bill, previously said of the legislation.

The State Board of Education is still in the process of updating its policy on charter school renewals. John Blackburn, Board member and chair of the Education Innovation and Charter Schools Committee, said the committee plans to bring an amendment to the Board for a vote in April. You can read the most updated draft amendment language from last month here.

Here is how membership for the new Board will be appointed:

• The state superintendent, as secretary and nonvoting of the review board.
• Eight members appointed by the leaders of the House and the Senate (four each).
• Two members appointed by the State Board of Education who are not current members of the Board and who are charter school advocates in North Carolina.
• The lieutenant governor or the lieutenant governor’s designee.

In June, State Board of Education Chair Eric Davis published a letter raising concerns about the legislation.

The Board approved 26.26% of all charter school applications on average between 1997 to 2022, Davis said. However, the Board approved 90% of applications recommended for approval by the former advisory board.

After the law passed, CSRB Chair Bruce Friend said the board’s work would continue as before.

“The mission and work of the CSRB basically remains the same — to ensure the existence of high-quality charter schools in the State of North Carolina,” he said. “High-quality charters benefit families and raise the level of academic excellence in North Carolina.”

Charter school funding

North Carolina’s 211 charter schools receive $1 billion in state funding, DPI Chief Financial Officer Alexis Schauss said during a recent presentation to lawmakers on charter school funding.

That funding goes toward roughly 145,000 students and 9,100 teachers.

Like traditional public schools, charter schools receive funding across several buckets, Schauss said. Those include:

• State: Base allocations and restricted state funds administered through DPI.
• Local (county) current expense.
• Federal: Grants administered through DPI.
• Capital financing.
• Enterprise funds, like through the National School Lunch Program, and before and after school programs.
• Other local funds.

The largest funding bucket comes from the state, through four revenue streams: General Fund appropriations, fines and forfeitures, sales tax refunds, and lottery receipts.

“Charter schools are beneficiaries of all these funding sources, as the funds support the allotments provided to all public schools,” the presentation said.

Here’s a look at what state statute says concerning the funding of charter schools.

The base dollars per student is calculated from the district allotments and includes allotments for positions (like teachers, administrators, and instructional support) and “categorical allotments” (like non-instruction support, teacher assistants, transportation, and textbooks).

“In addition to the base dollars per student, charter schools receive funds for Exceptional Children and Multilingual Learners. These funds are calculated based on the students in membership in the charter school, who are identified in the headcount for each category,” Schauss’ presentation said. “Since 2022, charters have received funds from the State funded Salary Supplement appropriation in accordance with the legislated formula.”

Over 95% of state funding is allocated through the initial allotments and the special populations funding, Schauss said.

Legislation determines the eligibility of charter schools for other state-funded grants, such as school safety, charter school transportation, and STEM grants.

Currently, there are 30 federal grants that are administered by DPI, Schauss said. The grant’s eligibility requirements determine if charters can access the funds. Examples include:

• Title I: supplemental funds to support students in poverty.
• IDEA: supplemental funds to support exceptional children.
• ACCESS grants restricted to charter schools.

Charter schools also received federal Covid relief dollars during the pandemic, Schauss said. You can find a look at the distribution and expenditure of those funds on DPI’s website.

According to state statute, charters also must receive their share of local funds:

If a student attends a charter school, the local school administrative unit in which the child resides shall transfer to the charter school an amount equal to the per pupil share of the local current expense fund of the local school administrative unit for the fiscal year.

G.S.115C-218.105(c)

Schauss said this policy has been in place since 2009, when the Sugar Creek Charter School vs. Charlotte-Mecklenburg Board of Education “determined that charter schools are entitled to a per pupil share of funds in the local current expense fund.”

You can view the full presentation here.

Who attends charter schools?

This year, there are more than 145,000 students attending North Carolina charter schools, Schauss said.

Historically, some critics of charter schools have said that charter schools serve less diverse populations of students than traditional public schools.

North Carolina charter schools are more white than traditional public schools, a DPI report shows — 49% versus 44%.

“You can see that over the years, we’ve seen the (local education agency’s) ethnic and racial data fairly aligned to charter schools,” Baquero said last June. “The biggest difference we always see is with the Hispanic population.”

From 2019 to 2022, there was a 14.3% increase in charter school enrollment among Black students, she said, and a 23% increase among Hispanic students during the same time period. Currently, 21.1% of public school students are Hispanic, compared to 13.3% of charter school students.

Here is a look at the 2022 ethnicity and racial data.

The difference among the enrollment of students with disabilities has remained stable, Baquero said — about a two percentage point difference. Here is a look at that data.

The biggest enrollment gap is among English learner students, with traditional public schools enrolling twice the amount of English learners than charter schools.

English learner students attending charter schools had stronger growth than their traditional public school peers, according to a report by Stanford University’s Center for Research on Education Outcomes, along with low-income students.

There has been an increase in the number of economically disadvantaged students at charters in the state, Baquero said, but there is still a gap. In 2022, 37.26% of all public school students were economically disadvantaged, compared to 30.93% of all charter schools.

Several factors play into this gap, including transportation, the National School Lunch Program, federal Medicaid direct certification, and charter reporting. 

In North Carolina, state statute says that charter schools are supposed to develop a plan to ensure “that transportation is not a barrier to any student.” However, unlike traditional public schools, charters are not required to offer formal transportation and bussing services for students. Charters are also not required to provide free and reduced school lunches, though the number that do has risen in North Carolina in recent years.

“We know that transportation and child nutrition are essential components to access,” Baquero said.

Charter school performance

DPI data show that charter schools and traditional public schools perform similarly, based on school performance grades and school growth.

Fifty-three of 195 charter schools (27.2%) received a school performance grade of A or B in 2022, DPI’s annual charter school report says. In comparison, 591 of 2,595 traditional public schools (22.8%) received an A or B.

However, charter schools provide students with stronger learning outcomes in math and English compared to traditional public schools, according to the Stanford report. The report also found, among other things, that students receiving special education services had significantly weaker growth in both math and reading compared to their peers in traditional public schools.

Nearly 70% of all public schools — including charters — met or exceeded expected annual academic growth in 2022. Among only charters, nearly 63% met or exceeded growth.

Last school year, 77 of 195 charter schools (39.4%) received a D or F, compared to 1,097 of 2,595 traditional public schools (42.3%). Baquero said that charter schools have a smaller proportion of continually low-performing schools than traditional public schools due to the fact that those charter schools are often closed.

Since 1998, there have been a total of 87 charter terminations, per the annual DPI report.

Here’s a look at low-performing schools comparisons, presented at the Board’s June 2023 meeting at the Board’s request.

You can view DPI’s full 2023 presentation on charter schools here, and last year’s annual General Assembly report here.