Balancing Acts: What Charter Schools Teach Us about Government-Nonprofit Contracting

Abstract

When a government agency and a nonprofit organization enter into a contract to provide a public service, each party must perform a delicate balancing act. The nonprofit organization must weigh the benefits of engagement with the public sector against the perils of entanglement. The government agency must afford the nonprofit organization enough autonomy to benefit from its flexibility and creativity, all the while holding the private organization accountable for furthering public purposes. This article develops a typology of technical, organizational, and contextual factors that may affect each party's ability to strike its balance and then uses this typology to analyze the experiences of governments and quasi-nonprofit charter schools in three states: Colorado, Massachusetts, and Michigan.

Charter Authorizing, Applications, and the Needs of Historically Marginalized Students: A Cross State Analysis

“…Much of the relevant research on charter authorizers and their perceived roles is more than 20 years old. Hassel (1997) and (Bulkley, 1999) both concluded that authorizers took different approaches to their roles. Bulkley (1999) analysis found that some authorizers focused on rule compliance while others emphasized outcomes, and also identified a lack of clear norms around authorizing, especially across states and legal/political environments.…”

“…Agents can have goals that are independent of and in tension with the goals of a principal (e.g., Holmstrom & Milgrom, 1991;Loeb & McEwan, 2006;Rees, 1985;Stiglitz, 1987). Hassel (1997), writing early in the charter school movement, described the relationship between authorizers and charter schools as a double "balancing act" in which the charter school must negotiate the benefits from "engagement" (such as additional support) with their authorizer, while avoiding "entanglement" that may limit their autonomy. Consistent with principalagent theory, Hassel (1997) found that this balancing act became easier when authorizers and charter operators had alignment in their organizational goals.…”

“…Hassel (1997), writing early in the charter school movement, described the relationship between authorizers and charter schools as a double “balancing act” in which the charter school must negotiate the benefits from “engagement” (such as additional support) with their authorizer, while avoiding “entanglement” that may limit their autonomy. Consistent with principal-agent theory, Hassel (1997) found that this balancing act became easier when authorizers and charter operators had alignment in their organizational goals. Principal-agent theory also serves as theoretical grounding for the portfolio management model put forth by Lake and Hill (2009).…”

Teen Living Programs for Young Mothers Receiving Welfare: An Analysis of Implementation and Issues in Service Delivery

“…Programs were divided as to whether more standardization is needed; some viewing this to be a program improvement, others suggesting that it deteriorates agencies' strengths in providing the best service. This tension is common in contracting relationships between government agencies and nonprofits; balance is needed between maintaining standardization in service delivery and allowing agencies the independence to provide services consistent with their strengths (Hassel, 1997). As the programs continue to operate, and an increased number of young families are served, it may be possible to identify particular program elements related to positive outcome.…”

Proximity Services in Belgium: An Analysis of Public and Nonprofit Relations

“…One major issue of partnership between the government and NPOs concerns the achievement of a balance between government control and nonpro¢t autonomy (Hassel 1997). This is especially the case when public authorities are a major source of ¢nancing as in the Belgian context.…”