It's easy to say that lousy schools (whether charter or district) should be shut down, but in practice there's a lot of gray area – and this case of the likely decision to close down Albany's New Covenant charter school certainly underscores this.  Here's an excerpt from the NYT article today on it:

But as New York State moves to shut down an 11-year-old charter school in Albany, whose test scores it acknowledges beat the city's public schools last year, it is apparent that holding schools themselves accountable is not always so easy, or bloodless, as numbers on a page.

The principal, teachers and families of the New Covenant school have mounted a furious defense, citing rising achievement as well as their fears for the loss of a safe harbor from chaotic homes and streets, where teachers deliver homework to parents who are in jail to keep them involved, and the dean of students chases gang members from a nearby park.

"We're that turnaround school America has been waiting to see," said Jamil Hood, the dean, who grew up in the Arbor Hill neighborhood where the school is located.

Nonetheless, a trustees' committee of the State University of New York, which grants the school's charter, voted last month to close it. The committee endorsed the findings of state evaluators who said that despite academic gains, New Covenant fell short of a key benchmark in English, suffered from high student and teacher turnover and was not fiscally sound. The full 17-member SUNY board will decide the school's fate on Tuesday.

A commitment to shut or radically shake up failing schools is central to President Obama's vision of education reform and explains in part the bear hug his administration has given charters, which are publicly funded but privately run. But the dispute in Albany exposes a delicate issue in the data-driven world of education policy: If a school improves, but not enough to meet high standards, should its value as a safe and nurturing community also be weighed?

"Everyone who ever closed a school knows it's not easy," said James Merriman, who closed five when he was executive director of the Charter Schools Institute, the regulatory agency that evaluates SUNY-authorized charters. Since 1999, SUNY, one of two statewide authorizers, has granted charters to 82 schools and closed seven. "If we are serious about not just incrementally, but substantially, improving achievement in the inner city, we need to stick to standards," said Mr. Merriman, who is now chief of the New York City Charter School Center.

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Despite Gains, Charter School Is Told to Close

By TRIP GABRIEL

Published: March 18, 2010

www.nytimes.com/2010/03/19/education/19covenant.html