Parents from Peninsula Preparatory Academy rallied against the city's closure decision outside Department of Education headquarters in January.

Last month, as parents from Peninsula Preparatory Academy vocally protested the city’s decision to close their charter school, Principal Ericka Wala quietly pursued an alternative.

Wala discovered that a charter school in Harlem that had faced closure last year was saved when a different operator was allowed to take over its charter and management. Harlem Day lost virtually all of its teachers and got a new name and curriculum when Democracy Prep took over in 2011, but the students were allowed to stay.

For Wala, the last point was the biggest draw: Peninsula Prep’s students are set to be sent back to neighborhood schools that mostly post lower test scores.

“I was like, this is something we should explore,” Wala said, even though it meant she’d almost certainly lose her job in the process. Both Wala and the school’s board, led by Chair Betty Leon, told Recy Dunn of the Department of Education’s Charter Office that they would resign if that’s what it took to keep the school open.

“We were willing to do whatever that would allow the school to continue to exist, in whatever capacity, so that there would be less disruption to the children,” Wala said.

Wala reached out to Seth Andrew, the founder and head of the Democracy Prep charter network, and asked him to consider taking over Peninsula Prep. Wala set up a time for Andrew to visit the school, but when he floated the idea to top city and state education officials they rejected it, according to a source who was briefed on the proposal.

The reason, according to the source, was that state officials felt Andrew, already running a successful chain of his own charter schools, didn’t have the organizational capacity to undertake a charter school turnaround for a second straight year.

State education officials declined to comment on the saga; a city Department of Education spokesman said a formal proposal was never presented by Wala or the board.

Andrew declined to comment on whether he would have pursued a Peninsula Prep takeover. But he did say that the school’s fate laid bare a distressing reality: that no mechanism exists to let low-performing charter schools be overhauled rather than closed outright.

“The reason that this is a necessary tool in the portfolio for all authorizers is that in the case of a school like Harlem Day being closed, most of the kids would have gone to equally bad or worse schools,” he said.

In some ways, the tool is absent by design.

“It’s not what charter schools are supposed to be about,” said Eric Nadelstern, a former deputy chancellor who oversaw school closures at the Department of Education. “If they can’t perform, then they were supposed to close.”

Still, the idea that some schools might be better off restructured than closed has gained traction in recent years and was even enshrined in a federal program that hands out funding to low-performing schools that undergo prescribed overhaul strategies. The city has itself proposed to “turn around” 33 low-performing district schools in accordance with one of those strategies. Under turnaround, the schools would get a new name, have their leadership and staffs purged, and see changes to their programs. But their students would stay put.

That’s a model that should be considered for under-performing charter schools, too, Andrew believes. He is calling the process “restructured renewal,” because the takeover operators would get a new charter allowing them to run the school, and he is positioning his network to be the sector leader in the effort.

It’s a risky endeavor that few other charter operators appear ready to take on. The operators, who are judged by their schools’ test scores, have little incentive to seek out students who have already had subpar educational experiences. Plus, the application for Harlem Prep’s new charter was 1,500 pages long — a steep procedural task for people who are already running schools of their own.

“This is brand-new, cutting-edge stuff, so right now there are a few brave souls willing to do this, but I’m hoping in time they’ll be more operators willing to take on the challenge of turnaround,” Andrew said.

To build his network’s capacity, Andrew has hired an administrator to supervise Democracy Prep’s turnaround portfolio. That administrator — Sean Gallagher, the founder of a New Orleans charter school — started earlier this month. For now, his portfolio contains Harlem Prep alone, but part of Gallagher’s job will be to assess how many schools Democracy Prep could eventually absorb as restructured renewal projects.

State and city officials don’t seem to share Andrew’s enthusiasm for restructured renewal just yet. The city, which authorized Peninsula Prep, and the State Education Department, a third authorizer that since 2010 has handled city-authorized schools’ renewals, have never worked to offer a new charter for an existing school to a different operator.

And even SUNY’s Charter Schools Institute, which solicited bids for charter operators to take over Harlem Day, said it would be premature to formalize a process for restructured renewal: The Harlem Prep experiment has been underway for only one semester.

Cynthia Proctor, a spokeswoman for SUNY’s charter office, said the institute would carefully monitor Harlem Prep’s development and has even hired a researcher to study turnaround strategies locally and nationally.

“When we first thought about doing this, we thought this is a really tough thing to do, so we wanted to be careful,” Proctor said.

Despite the authorizers’ hesitancy, it’s clear that Peninsula Prep represents only the tip of an approaching iceberg.

While Peninsula Prep’s test scores did not meet the Department of Education charter renewal standards, it was not even close to being one of the worst-performing charter schools in the city. The school outperformed 46 schools in average proficiency on the 2011 English language arts exam and 29 schools on the 2011 math exam.

That means that when many of those schools come up for their renewals in the next couple of years, they are likely to face the same scrutiny as Peninsula Prep.

On a recent Friday afternoon, Crescent City Schools CEO Kate Mehok visited Harlem Prep to compare her own charter school turnaround efforts in New Orleans to Andrew’s. Mehok’s organization took over Harriet Tubman, a K-8 charter school, in July after it lost its charter because of poor performance.

Andrew and Mehok agreed that some charter schools deserved to be closed. They also said certain conditions need to exist  for a charter school turnaround to succeed. In Harlem Day’s case, Andrew said, it was essential that the school was in good financial health and was also housed in a private facility that meant an operator wouldn’t have to deal with the city’s cutthroat space-sharing policies.

Most importantly, Andrew said, the school’s population would have been dispersed into schools that were doing worse than Harlem Day.

One thing Andrew, Mehok, and almost everyone else agree on is that turnaround efforts are an unproven and risky undertaking.

But Andrew said that he is already seeing results at Harlem Prep that suggest the model can work at other schools. Attendance rates are up significantly and results from internal assessments are showing significant progress. During Mehok’s visit, Andrew and the rest of the school was in the auditorium for a weekly town hall event. Andrew and the staff danced on stage to live music while teachers handed out awards to students who showed exceptional academic achievement. Meanwhile, more than 100 elementary school students clapped and sang along.

At this point, any changes to state policy would almost certainly come too late to provide relief for Peninsula Prep’s families. The nail in the coffin came earlier this month, when Wala learned that an offer to renew the lease at its private school facility had been pulled off the table. Days later, Wala said Marc Sternberg, the Department of Education official in charge of school closures, told her in a conference call that the school was out of options.

Not all parents are convinced that Wala and the school board did everything they could have done to push forward a restructured renewal plan.

“The principal and the board were willing to step down, but they were never really aggressive about it,” said Josmar Trujillo, a parent board member and co-president of the parent association at Peninsula Prep. Trujillo was on that final conference call with city education officials and said Wala and Leon spent most of their time advocating for a one-year charter extension with the same operators.

“Theirs was a more conservative approach, whereas the parents wanted the more aggressive plan,” Trujillo added.

“What was proposed was an extension or a reversal or any another option, such as restructuring other than closure,” Wala said of the call.

That Wala was willing to step aside but also reluctant to plunge unreservedly into restructured renewal hints at another barrier that stands in the way of potential charter school turnarounds. It is unique for school leaders to be willing to acknowledge their role in a school’s failure and cede control to another operator, as happened at Harlem Day, said James Merriman, CEO of the city’s Charter School Center.

“It’s clear you have to have a special set of circumstances for it to work,” Merriman said “So I think it’s very important that the basic default of charters is that if they don’t perform, they are shut down.”