1149 S. Hill St., Suite 600 Los Angeles, CA greendot.org. Business Plan February 2011

Transcription

1 1149 S. Hill St., Suite 600 Los Angeles, CA greendot.org Business Plan February 2011

2 Executive Summary Our education system is failing too many: four out of every five high school students in LAUSD attends a Dropout Factory Green Dot provides hope. Our ultimate goal is to reform LAUSD so that all 700K students can attend a great school and will graduate prepared to succeed in college and life Over the past ten years, we ve grown to serve over 8,300 students, almost half of whom attend schools that are part of Locke High School; Locke had been one of the district s most notorious Dropout Factories until Green Dot took it over in 2009 Green Dot is proving that it can achieve better student outcomes, with the same student population, lower per pupil funding than LAUSD, and a unionized workforce Green Dot has a bold vision and the opportunity to achieve it, as LAUSD faces increasing pressure and education reformers increasingly focus on turning around failing schools The next five years will be pivotal. Green Dot will lay the foundation for transforming the school system in Los Angeles by: Turning around three more failing schools and pushing the district to establish a legitimate process for outsourcing failed schools to partner operators Achieving outstanding academic results at all its schools, through effective teaching, strong principal leaders, and continuous improvement of its school model Maintaining organizational health and improving financial sustainability To support this ambitious strategy within a challenging economic environment, GDPS will need to raise $28-$40M in the next five years 2

3 Table of contents 1. Our education system is broken 2. Green Dot provides hope and concrete solutions 3. We have an ambitious vision and a focused strategy 4. We have identified critical first steps and are poised to implement the plan 3

4 Our education system is broken; the situation in LAUSD is particularly dire Half of LAUSD s high schools are considered Dropout Factories 1 % of dropout factories, Four out of every five high school students in LAUSD attend a Dropout Factory 2 % of students attending dropout factories, % 14, % 15M 194K 21% 80 50% % 60 85% % % US 50% LAUSD Nondropout factories Dropout factories % US LAUSD Nondropout factories Dropout factories 1. The term Dropout Factory refers to a high school where no more than 60% of students who start as freshmen make it to their senior year 2. Breaks down to 78% of African American students, 80% of Latino/Hispanic students, and 80% of low-income students Sources: Research by Bob Balfanz for JHU and Everyone Graduates Center, 2007; California State Department of Education data,

5 Outcomes are most unequal for low-income and minority youth in LAUSD On-time graduation rates 1 % LAUSD students completing high school on time, 2006 English Language Arts (ELA) proficiency % LAUSD students performing at grade level in ELA, 2009 Math proficiency % LAUSD students performing at grade level in Math, % 80% 50% 47% 60 57% 65% 60 62% 65% 40 34% 48% 45% 45% 48% % 28% 27% 29% % 6% 9% 11% 0 Overall African American Latino Low-income White Asian 0 Overall African American Latino Low-income White Asian 0 Overall African American Latino Low-income 5 1. Based on a sample of 12,488 LAUSD first-time 9 th graders who started in and graduated in Sources: What Factors Predict High School Graduation in the Los Angeles Unified School District, Silver et al, 2008; School Report Card, , Los Angeles Unified School District White Asian

6 LAUSD faces numerous challenges, is in flux Serves ~700K students, second largest district (behind NYC) and 85x the size of Green Dot High dropout rates and unequal outcomes Weak college-going culture (31% of seniors plan to go to 4-year college; 38% take the ACT/SAT) Faces dire financial situation Recently laid off 1,000 non-teacher staff, re-assigned 2,500 others to help close $142M deficit for school year Further cuts may force district to eliminate thousands of teachers, shorten school year, increase class sizes Has slashed $1.5B from budget since 2008 Managing major construction projects to address legacy of overcrowding and neglect Political situation in flux (e.g., Superintendent in transition, school board elections in March 2011) 6 Source: External and internal interviews; School Report Card, , LAUSD faces projected $1.1B deficit over next three years, (9/20/2010)

7 Table of contents 1. Our education system is broken 2. Green Dot provides hope and concrete solutions 3. We have an ambitious vision and a focused strategy 4. We have identified critical first steps and are poised to implement the plan 7

8 Green Dot s mission is to fix them is leading the charge to transform public education in Los Angeles and beyond so that all young adults receive the education they deserve to be prepared for college, leadership & life Our ultimate goal: All 700K students in LAUSD go to a great school 8

9 Green Dot is unique among CMOs Model: Apples to apples Strategy: Transformations to Our unique model defies common criticisms about charters: Unionized teachers/staff Student population that mirrors district and, at Locke, serves all students in attendance area We spend the same as the district Mission: District reform GD is the only CMO whose mission is to transform a district; we see all 700K students in LA as our mission We are the only CMO focused on transforming failed schools in order to transform the district Track record: Strength Character: Boldness #1 largest CMO in LA with longest track record of success #2 largest in California Top 5 in the country History of trail blazing and taking risks to achieve our mission and serve student interests 9

10 In ten years, Green Dot has grown to serve over 8,300 students Locke Transformation First Middle School * Jefferson Cluster Founding Five *Refers to projected annual enrollment (e.g., average enrollment throughout the year, not start-of-year enrollment) Source: State of the Dot update,

11 working with a diverse student population that mirrors LAUSD Student Racial Make-up % students enrolled in Special Ed, ELL, FRL 100% 18.4% 16.1% 100% % % 73.2% Green Dot LAUSD Other African-American Latino Special Ed ELL* FRL* *Preliminary estimates for school year; ELL number to finalized in February 11; FRL number to be finalized in November 10 Source: Green Dot internal data; California Department of Education Data for grades 9-12 ( data) Green Dot LAUSD

12 Green Dot outperform LAUSD and comparable schools 1 1,000 Data for Green Dot s independent charters schools School API scores ( ) % students advanced or proficient on CST ( ) LAUSD HS Average: 654 Comparable HS Average: % 29% LAUSD Average (33%) Comparable HS Average (20%) 13% Animo Ralph Bunche Animo Jackie Robinson Animo South LA Oscar de la Hoya Animo Animo Venice Animo Inglewood Animo Leadership Animo Pat Brown 12 1 Comparable schools refers to those operating in neighborhoods with a Green Dot school: Inglewood, Morningside, Venice, Westchester, Roosevelt, Garfield, Washington Prep, Jordan, Fremont, Santee, and Jefferson Source: Green Dot Key Performance Indicators 2010; LAUSD website; California Department of Education data 0 Math 5% ELA

13 More importantly, Green Dot s schools demonstrate significantly better college-ready outcomes % students passing CAHSEE ( ) 100% % 9 th graders graduating within four years and meeting UC/CSU requirements College Opportunity Ratio (COR) 2 60% 57% LAUSD Average: 73% Comparable HS 1 Average: 49% ELA Math % 11% Animo Ralph B. Animo Jackie R. Animo South LA Oscar DLH Animo Animo Venice Animo Inglewood Animo Leadership Animo Pat Brown 0 Green Dot ( ) LAUSD ( ) Comparable ( ) 1. Comparable schools refers to those operating in neighborhoods with a Green Dot school: Inglewood, Morningside, Venice, Westchester, Roosevelt, Garfield, Washington Prep, Jordan, Fremont, Santee, and Jefferson; Venice and Westchester are outliers with 71% and 63%, respectively Refers to metric developed by University of California All Campus Consortium on Research for Diversity; calculated by dividing number of graduates completing A-G curriculum required for UC/CSUs by freshman cohort four years earlier; Green Dot s % based on outcomes from Founding Five schools Source: Green Dot Key Performance Indicators 2010; LAUSD website; California Department of Education data; UC ACCORD

14 In 2008, Green Dot took on its most complex project to date: The Locke Transformation An unprecedented challenge with a very high-need student population Green Dot s first transformation Locke was one of the worst high schools in the state 20x size of all previous school launches No CMO has taken on a transformation of similar scale, difficulty ~ severely credit deficient 10th-12th graders 300 students with full range of Special Education needs juvenile justice returnees per year Youth with a range of other significant barriers, including: strong gang-affiliation, living in foster care, high level of mental health issues and an inherited culture that worked against Green Dot s success Culture not about going to class, let alone going to college Community concerns about Green Dot 14 Source: Internal data for Green Dot

15 Despite these difficulties, in two years, Locke has made strides Retention Rigor Results Start- vs. end-of-year enrollment 2,613 Start of year 2,193 End of year +785 students (+36%) 2,964 2,712 3,128 2,978 # of CST exams scored for A-G = Proxy for more rigorous coursework 1 1, % +56% 2,282 2, ,408 1,976 2,193 # of 10 th graders passing CAHSEE +53% +54% LAUSD Green Dot Green Dot ELA Math ELA Math Retention (%) % of students advanced/proficient % of all students passing CST exams are only given at the end of A-G college prep courses, so an increase in # of exams taken indicates more students taking college prep courses Source: CDE Dataquest for LAUSD; internal data for Green Dot 15

16 Green Dot has mobilized parents, achieved victories in reforming the district LAPU Launched Los Angeles Parents Union (LAPU) as a parent mobilizing arm within Green Dot Parent Revolution LAPU spun off and relaunched as Parent Revolution to empower parents to transform their children s lowperforming schools Parent Trigger Helped pass Parent Trigger, a state law that empowers parents to transform failing schools Prop 39 Advances Helped win settlement that required LAUSD to comply fully with Prop 39 and to engage in long-term facilities planning with charter schools Public School Choice Helped to develop and win passage of Public School Choice, which allows charters and others to apply to operate district schools Charter-District Compact Helped Los Angeles become one of the first cities in the country to sign on to a charterdistrict compact, which will ensure charters are included in LAUSD s reform strategy 16

17 Green Dot s formula for academic success 1 We do what it takes to prepare the highest need students* for college, leadership and life, which makes us better at serving all students We value results and have built systems and processes to enable accountability and earned autonomy 2 A firm commitment to serve all students, including the highest need 3 We are part of a $60M, 7-year grant from the Gates Foundation to raise teacher effectiveness 4 Unparalleled focus on the development and support of strong principal leaders We have made a large investment in developing a pipeline of strong administrators, through high-touch coaching, mentoring, and individualized PD *Student population mirrors that of LAUSD based on % of SpEd students, English Language Learners, and Free-and-Reduced Lunch Recipients Note: Each of these elements is detailed in the Appendix 17

18 The schools are supported by an efficient home office Metrics and dashboards to track and hold staff accountable to restults Consistent parent and student policies Targeted intervention programs to accelerate and support student achievement Instructional quality Student Outcomes Model school organization and roles New systems for school accountability Curriculum standards Operational effectiveness Supports to enable school ownership of financial goals Full service menu and service level agreement for every department Key Performance Indicators (KPIs) to measure process effectiveness Home Office Schools Involvement in 7-year $60M grant from the Gates Foundation to improve teacher effectiveness and accountability 18

19 Green Dot has a bold vision for the future By 2015 Fewer dropout factories and more high-performing schools Green Dot will transform three more failing schools and demonstrate an irrefutably successful model that spurs others to replicate its approach, amplifying Green Dot s impact New role for district: Portfolio manager that views all students as their students Green Dot will pressure and support LAUSD to implement PSC 1 as intended and become a portfolio manager with high accountability and high support for both charters and non-charters, viewing all students as their students By 2025 All of the district s dropout factories will be eliminated and all young people in LAUSD will attend a great school Next few years will be pivotal Either PSC 1 will be working as intended or not 19 1 Public School Choice is an annual process where the worst performing schools are awarded through an RFP process and Board vote to external operators or teams of teachers

20 Successful school transformations have power to transform the district, our history has prepared us to deliver Design Deliver Scale Founding Rapid growth Preparing for the challenge of Locke Locke transformation Public School Choice Parent Trigger Organizational strengthening 3 more transformations Continuing academic success Political pressure on district to make PSC work Other orgs become partner operators too Dropout factors turned around by partner operators and district until none left Entire system becoming stronger More failed schools turned over 20

21 Several external forces working in Green Dot s favor, making our vision more achievable Worsening economic crisis State budget crisis worsening, amplifying pressure and requiring district to make cuts Increasing competition Continued expansion of charters Green Dot and other school operators demonstrate better outcomes Mounting Public Outrage Activation of parents, teachers layoffs, and failing schools Not all factors are working in our favor, e.g. Will CTA s influence wax or wane? Growing political pressure Emphasis on accountability highlights LAUSD s failures Increasing political support for charters and turnarounds National attention on the country s Dropout Factories Note: More detail included in Appendix section External factors likely to affect Green Dot s progress Sources: U.S. Department of Education and California Department of Education websites; external and internal interviews; California Budget Project 21

22 The work ahead: our priorities 1 Codify school transformation model Work towards legitimate Public School Choice process Turn around ~3 more failing schools and form the turn-around system Parent engagement Community mobilization Achieve outstanding academic results at all schools 5 Teacher effectiveness 6 Teacher recruiting 7 School leader pipeline development 8 Intervention programs 9 Core curriculum Middle school feeder plan 10 Maintain organizational health, increase financial sustainability Student enrollment 11 Major gifts 12 Management/teacher relations 13 Ops Note: For more detail on Green Dot s strategic initiatives, see Appendix, p

23 Table of contents 1. Our education system is broken 2. Green Dot provides hope and concrete solutions 3. We have an ambitious vision and a focused strategy 4. We have identified critical first steps and are poised to implement the plan 23

24 Over the next five years, Green Dot aspires to add ~12 new schools, ~9 from transformations FY12 FY13 FY14 FY15 FY16 5-year total Jordan, Westside MS, Clay (4 schools) One independent MS or Clinton (1-2 schools) One MS or HS conversion (2-4 schools) One independent MS (1 school) One MS Conversion (2-3 schools) ~12 schools (~2 per year) Rationale for pace of growth Green Dot has demonstrated ability to grow at this pace effectively Faster growth may require more capacity and resources (i.e., funding, Prop 39 facilities, talent) than Green Dot can currently access Growth at two schools per year seems realistic given near-term opportunities 24 Note: For the purpose of developing financial projections, MS and HS conversations assumed to result in 3 schools

25 To fund this growth, Green Dot will need to raise at least $28-$40M over the next 5 years FY12 FY13 FY14 FY15 FY16 5-year total Projected # of new schools (Excel model) 1 Projected # of new students 2 ~2000 ~500 ~2000 ~500 ~2000 ~7000 (+84% growth from 8300 students in FY11) Additional philanthropy $7-$9.5M $6-$8.5M $5-$7.5M $5-$7.5M $5-$7.5M $28-$40M needed 3 Add l philan. need as % of total rev. 7-10% 6-8% 4-6% 4-6% 3-5% N/A Total revenue $96-98M $ M $ M $ M $ M N/A 1 # of new schools is somewhat unpredictable, but financial model has made assumptions as shown in the table; or the purpose of developing financial projections, MS and HS conversations assumed to result in 3 schools 2 - # of new students includes growth of existing schools and new students from schools opened in that year 3 Refers to additional philanthropy needed beyond expected grants from PCSPG, Broad, and Walton; $657K of Broad funding in FY15 and FY16 contingent upon extension of FY14 deadline to use all school grants Source: GDPS internal data estimates 25

26 $50M in 5 Our fundraising campaign is $50M in 5 years Growth (+11 schools) 9 from transformations Nearly doubling in student population 2x the size 100x the impact Teacher incentive fund Academic enhancements Reserve funds 26

27 We are developing a fundraising plan PRELIMINARY Philanthropy Need: $50M over 5 years Foundations Major Gifts Government Small Donors Corporations $15-20M Grants from current and new funders $7.5-10M Support from high net worth individuals $15-19M New federal and state grants $1-2M Los Angelesbased small gift campaign $2-5M Event sponsorships and small program grants 27 Target: $ M per yr Target: $ M per yr Target: $ M per yr Target: $ M per yr Target: $0.4-1M per yr 27 Note: Targets are preliminary and are likely to be updated by incoming Director of Development

28 Appendix Implementation plan -Strategic initiatives -Performance metrics Core strengths and key practices External factors likely to affect Green Dot s progress -Financial -Political -Competitive landscape Vision for a reformed LAUSD 28

29 We have identified 14 priorities to execute the strategy (1 of 3) Turn around ~3 more failing schools and form the turn-around system Purpose Codify school transformation model Work towards legitimate Public School Choice process Parent engagement Community mobilization Capture lessons from Locke Improve efficiency and effectiveness of future school transformations Work with LAUSD to create a fair and transparent process for selecting schools and school operators to partner with in turning them around Build stronger relationships with key district leaders to expedite change Find new ways to serve and engage parents Support parents by providing services through the Locke Wellness Center and Parent Engagement Program (PEP) Build constituency base that will advocate on GDPS s behalf, including for a legitimate PSC process Improve GDPS connection to parents to better serve student, family, and community needs 29 29

30 We have identified 14 priorities to execute the strategy (2 of 3) Achieve outstanding academic results at all schools Purpose Teacher effectiveness Teacher recruiting School leader pipeline development Intervention programs Core curriculum Middle school feeder pattern As part of TCRP, continue to improve systems for developing, assessing, rewarding, and retaining effective teachers to improve student outcomes Revamp teacher recruiting and selection Increase quantity of candidates who are well-prepared to lead GDPS schools Improve academic results at all schools, ensuring that all students are able to graduate college-ready Improve curriculum in priority areas (i.e., Leadership and Life aspects of the curriculum, middle schools 7th and 8th grade, alignment with Common Core) Identify high priority middle school transformation targets based on feeder pattern to GD high schools Develop plans for all high schools for strengthening academic preparation of all incoming 9 th graders 30

31 We have identified 14 priorities to execute the strategy (3 of 3) Maintain organizational health, improve financial sustainability Purpose Student enrollment Major gifts Management/union relations Ops 3.0 Spread best practices in attendance, enrollment, retention to all schools Increase financial sustainability of schools Increase unrestricted funding for Green Dot Seek support from previously untapped source (high net worth individuals) Strengthen relationship between Green Dot management and teachers/counselors and classified unions Document lessons learned to share with field Explore business case for ERP system, or other next generation technology solutions that will bring efficiency gains to Green Dot operations (including HR and Finance) 31

32 10 high-level indicators to track progress PRELIMINARY Indicator Transformations Is GD successfully taking over schools? Is the system of partner operators that GD advocates coming to fruition? # of LAUSD schools turned over to GD # of LAUSD schools turned over to any non- LAUSD, # of LAUSD schools that go through PSC to a strong internal team Are our transformations off to a good start? # of transformations with positive early indicators 1 Academic Results Are our schools becoming irrefutable success stories? % of GD schools on track to meet 800 API goal 2 % GD schools on track to meet COR goal 3 Are we achieving our fundraising goals? % towards annual goal Organization health Is the HO becoming more efficient? Are we meeting our budget? Total $ spent per student on HO % surplus/deficit at school budgets 32 Is our culture strong? % of employees and Board that respond 4 or 5 (to question about Bleeding Green ) 1. Early indicators to be finalized, but probably include retention, attendance, and CST test participation 2. All Green Dot schools must achieve 800 API within 6 years, assigned annual targets to get there 3. COR = College Opportunity Ratio, meaning number of A-G graduates divided by number of freshman four years earlier Note: Green Dot has developed an extensive set of Key Performance Indicators (KPIs) and detailed dashboards for tracking progress. Green Dot undertakes an annual target setting process. The high-level measures above are a complement to that rigorous and ongoing performance measurement process. 32

33 Three levels of dashboards track more granular metrics that affect ultimate outcomes indicators Level Enterprise School Home Office Scope Organization-wide performance Performance of individual schools Performance of Home Office 33 Primary audience (those with most power to move performance) C-level executives Management team GDPS Board of Directors Principal, AP Instr. Leadership Team Teachers and staff school-wide Home Office Management Team Home Office staff Cluster Director 33

34 Appendix Implementation plan -Strategic initiatives -Performance metrics Core strengths and key practices Vision for a reformed LAUSD External factors likely to affect Green Dot s progress -Financial -Political -Competitive landscape 34

35 Green Dot s core strengths A We do what it takes to prepare the highest need students* for college, leadership, and life, which makes us better at serving all students B We value results and have built systems and processes to enable accountability and earned autonomy A A firm commitment to serve all students, including the highest need C We are part of a $60M, 7-year grant from the Gates Foundation to raise teacher effectiveness D Unparalleled focus on the development and support of strong principal leaders D We have made a large investment in developing a pipeline of strong administrators, through high-touch coaching, mentoring, and individualized PD 35 *Student population mirrors that of LAUSD based on % of SpEd students, English Language Learners, and Free-and-Reduced Lunch Recipients

36 Detail: Key practices (1 of 2) A A firm commitment to serve all students, including the highest need Provide services and supports for special education students and low-level English Language Learners Invest in Mental Health team and Locke Wellness Center to support retention and success of troubled students Provide special intervention courses that adapt by school by year, based on specific needs of the population Provide tiered support for all students through Response to Intervention model Use Target 10 approach each grade level at each school tracks and responds to 10 students with needs that are representative of larger set of students Publicly share data within the organization (teacher and principal data, shown with comparables; student assessment results shared with all teachers) and externally (organization and school performance) Teachers undergo peer observations and maintain open door policy Give teachers, counselors, principals real-time data (Data Director software) B A culture of transparency, reflection, and performance Run Data Days, during which Principals share success and weakness data with each other Run Key Results process: Principals each take a turn with their school under microscope of peers and supervisors 36

37 Detail: Key practices (2 of 2) TCRP: Continue moving towards comprehensive overhaul of teacher performance management systems (i.e., evaluations, compensation, PD, career ladder, etc) in collaboration with teachers Offer Teacher Leadership Development Program Closely monitor quality of school-level PD by Central Ed Team Provide extensive PD for principals on continually improving instructional observation and coaching skills Continue to develop strong relationship with teachers/counselors and AMU, leading the field by example C Collaborating with our union to develop leading edge practices for highly effective teachers Unparalleled focus on strong principal leaders Offer best-in-class yearlong leadership development program to prepare Principals and APs Provide biweekly two-hour coaching sessions, focused on school strategic plan and instruction Furnish extensive feedback mechanisms (e.g., Program Reviews and Site Visits) Provide mentor principals Offer collaborative PD with peer principals D 37

38 Green Dot is a heavy user of technology to improve quality and efficiency Objective Approach Tools A Serve all students First First level level bullet bullet Second Second level level dash dash Third level arrow Third level arrow B Culture of transparency C Highly effective teachers D Strong principal leaders (Improve back office efficiencies to increase amount of time principals devote to instructional leadership) Expand current and pilot new uses of student-facing technologies to promote personalized and differentiated instruction, reduce cost of GDPS s school model, improve academic results, and promote college matriculation Through investments described below, in addition to continued collection and monitoring of Key Performance Indicators (KPIs) across all aspects of the organization Through participation in TCRP, Green Dot is developing a robust technology infrastructure and teacher evaluation and performance measurement system that will incorporate student outcome data as well as a number of other inputs APEX Advance Path Cyber High BYU Read and Connect Read 180 Data Director Tableau System 44 Edge Revolution Prep Riverdeep Orchard Custom-designed performance management dashboards Better Lesson PD Portal Additional tools to be developed by TCRP 38 38

39 Appendix Implementation plan -Strategic initiatives -Performance metrics Core strengths and key practices Vision for a reformed LAUSD External factors likely to affect Green Dot s progress -Financial -Political -Competitive landscape 39

40 Green Dot s vision of a reformed LAUSD: All 700K students attend a great school All students in LA attend a great school A system of partner and in-district operators The worst performing schools have been turned over to external operators and strong internal teams supported by district that plays a dramatically different role Role of the district is to: Plan and provide for facilities to serve LAUSD area (acts as landlord ) Assign schools to school operators through RFP process Set accountability metrics Re-assign schools if results are not met Advocate for public funding Funds go directly to schools; schools pay management, service, rent, and oversight fees to selected vendors and partners, including the district 40

41 Appendix Implementation plan -Strategic initiatives -Implementation timeline -Performance metrics Core strengths and key practices Vision for a reformed LAUSD External factors likely to affect Green Dot s progress -Financial -Political -Competitive landscape 41

42 By focusing on LAUSD, Green Dot is working in an extremely challenging fiscal climate Per-pupil funding is far below level in states with comparable urban districts Per-pupil funding of states with largest urban districts, FY09 ($K) 20 LAUSD teacher salaries are among the highest in the country Base salary for entry-level full-time teacher, FY09 ($K) DC New Jersey New York Pennsylvania Michigan Illinois California Florida 1.0 * LAUSD Green Dot Operating in a district with lower per-pupil funding and higher teacher salaries complicates Green Dot s ability to achieve financial sustainability *For purposes of comparison only; formula used to calculate NEA per pupil funding may be different from calculation used by Green Dot Source: National Education Association data (2010); Green Dot internal data; salary schedules available on each district s website 0 Chicago DC LA NYC Miami Atlanta Baltimore Philadel. Detroit Green Dot 42

43 and recent reductions in public funding have been drastic, requiring major cost reductions Green Dot reducing expenses at a faster pace than funding cuts, but gap remains Per-student expenses and public revenue $15K Per student expenses Per student public revenue FY FY FY FY11E % decline since FY08 1. FY11 projections; figures assume no growth in number of schools 2. Outlined cost reductions not necessarily made across all Green Dot schools Source: Green Dot internal data and projections 1-37% -13% Cost reductions have been severe, raising concerns they may affect student outcomes 2 Increased class sizes Reduced number of professional development days Salary freezes Furlough days Reduced busing Elimination of summer school, Saturday school, and credit recovery programs Reductions in office/support staff Reduced spending on athletics and extracurricular activities Reduced spending on computers and technology Hiring of less experienced teachers 43

44 Weak economic climate likely to persist Amidst downturn, administration is increasing federal funding for education To stimulate the economy, Obama plans to increase spending, including increasing the education budget by $4B in FY11 However, most increases are for limited-term continuations of ARRAestablished competitive grants (i.e., RTTT, i3) that experts believe will expire over the next few years However, state budget crisis continues to adversely affect California s schools California budget cuts have reduced available funding for education Per-pupil ADA funding has declined from $7.2K in FY08 to an estimated $6.6K in FY11 its lowest in nearly 15 years* forcing schools to significantly reduce costs, rely on reserves/stimulus funds Experts are pessimistic about the fiscal environment in CA and the likelihood of change in the near-term In the near-term, the economic environment might get worse. At best, it will stay steady. Charters were hit hard by budget cuts last year, but they may be hit harder this year. Expert from charter school association I don t envision any new opportunities for [public] funding for charters or turnarounds on the horizon. If anything, many of the opportunities charters have today may soon dissolve. - Expert from CA Dept of Education 44 *After adjusting for inflation Source: U.S. Department of Education website; California Department of Education website; external interviews; California Budget Project

45 Philanthropic funding for charters is evolving Foundations were pivotal in expanding the LAUSD charter movement Large grants from foundations like Gates, Broad, and Walton critical to increasing number of charters in LAUSD CMOs like Green Dot, KIPP, and Aspire have relied on philanthropy to expand their presence nationwide, including in LA Over the years, philanthropic funding for education has declined Since 2007, philanthropy for education has decreased by 11%* Funding to create new charter schools shrunk significantly: Since 2007, philanthropy from Gates -68%, Broad -57%, Walton -18% Other foundations like Hewlett and Dell have also reduced funding Leading foundations are investing limited dollars into what works and innovation With fewer assets, foundations are prioritizing CMOs with proven outcomes and promising new models worthy of further testing Green Dot is beginning to take advantage of these new priorities, participating in Gates-funded TCRP and working to develop, codify a new model for effective turnarounds 45 To adapt to the evolving philanthropic environment, Green Dot must continue to achieve outstanding outcomes across all schools and work to expand and diversify its funding base 45 *Based on all grants of $10K or more awarded by a sample of 1,490 largest foundations; represents approx. half of total giving by all U.S. foundations Source: Foundation Center; websites for The Bill & Melinda Gates Foundation, The Walton Family Foundation, and The Broad Foundation

46 Political support at the federal and state level is strong, but district opposition continues to be a challenge There is strong federal support for charter schools and turnarounds Arne Duncan and the Obama administration have voiced strong support for charter schools, seeking to aggressively expand high-quality charter schools, increase accountability, promote sharing of best practices, and educate the public about charter options The administration reform agenda call for dramatically reduc[ing] the drop-out rate by helping states and districts turn around their 5,000 lowest-performing schools in the next five years. To do this, Obama s has introduced a blueprint for reform, which encourages districts to turnaround its lowest performing schools Level of support in State House unclear However, opposition from LAUSD continues to be a challenge New California Governor Jerry Brown appointed a new State Board of Education that many believe will be less supportive of charters The district has demonstrated a lack of interest in collaborating with charter schools in its recent reform efforts, overlooking Green Dot and other charters during the Public School Choice process UTLA continues to be an obstacle, aggressively advocating against GDPS efforts to launch new schools and turnaround existing schools Green Dot has been working at the federal level to turn political support into policy change, and at the local level to overcome barriers to driving district-wide reform Source: U.S. Department of Education and California Department of Education websites; external interviews 46

47 New potential pathways to transform failing schools are opening, but major roadblocks remain Public School Choice (PSC) Overview NCLB-rule where parents of students at a Program Improvement (PI) school must be given option to transfer child to non-pi school with paid transportation; PSC motion adopted in LA in 2009 Parent Trigger CA-approved measure enables parents to transform a failing school through petition by bringing in new leadership or converting that school into a charter Opportunity Annually, LAUSD solicits RFPs from educators, CMOs, and nonprofits for right to transform all PI and all new schools Current status Green Dot applied for two HS transformations in round one ( ), lost both Green Dot re-applying for one MS transformation and one new MS in round two ( ) Opportunity to mobilize parents to convince them to petition to convert a failing school into a Green Dot charter Policy has not yet been tested; Green Dot is reluctant to go first given its role in helping to establish legislation Potential challenges In 2011, only three schools are available for transformation; Green Dot is eligible for one Highly political process; board can overturn decision May be difficult to meet criteria (i.e., approval of 50% of existing or prospective parents) Experts believe the first Parent Trigger win will prompt lawsuits, won t yield a quick win 47 Source: U.S. Department of Education and California Department of Education websites; external and internal interviews

48 The charter school field is maturing and becoming more crowded Since 2000, the number of charters in LAUSD has increased from 36 to 148, including an increase in charter schools from CMOs like Aspire and Alliance College-Ready Public Schools Federal and State Departments of Education are increasing charter school standards, promoting rigorous accountability and investing to scale those with proven academic outcomes More charters CMOs are facing increasing competition from alternative 48 providers such as teacher-led transformations, district-led turnarounds and magnet schools 48 Source: U.S. Department of Education and California Department of Education websites; external interviews

49 1149 S. Hill St., Suite 600 Los Angeles, CA greendot.org 49