Education management organization

In 1991, Minnesota enacted legislation that enabled charter schools. Other states followed. The state or its delegate issues a charter to a school. In most states, the charter-holder has the privileges and responsibilities of a school board, but not the taxing authority. Many states have adopted laws that require that the holder of the school charter be a non-profit organization. As a result, the most common form of a charter management organization is a 501(c)(3) non-profit organization. The charter holder may contract all aspects of school operation to an education management organization. The EMO accepts the full amount of state subsidy per student. If it can operate at a lower cost, the difference is profit for the EMO. The school may advertise that it is a non-profit, which it is, even if there is a for-profit entity operating in the background. ==For-profit EMOs==

Wisconsin, California, Michigan, Massachusetts, and Arizona allow for-profit corporations to manage charter schools. Examples include: • Stride, Inc. • Academica • Pansophic Learning • Connections Academy ==Vendor operated school==

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). ==Distinction from charter management organization==

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. ==References==