By DORMAN E. CORDELL

Texas has one of the most liberal charter school laws in the country and an increasing numb of parents find charter schools attractive.

Charter schools are public schools that operate with a great deal of autonomy. Many are founded by parents, teachers and social service organizations. They receive about the same per pupil expenditure for maintenance and operations as other public schools receive, but they receive no capital funding.

This means they get about $4,000 per pupil each year, compared to about $5,000 per pupil for traditional public schools. Charter schools in Texas serve 4,200 pupils in grades K-12. For the coming year lawmakers allowed 100 additional regular state charter schools plus an unlimited number specifically for at-risk pupils. In addition, school districts can authorize an unlimited number of local charter schools.

Texas exempts charter schools from many regulations other public schools face. Anyone can start a charter school, even a private school can become a charter school and several have. Although charter school teachers don't have to be certified, a recent evaluation found they are more likely to hold advanced degrees than traditional public school teachers statewide. And more than half of charter school teachers came from private schools, businesses and universities.

One of the first local charter schools was started by Thaddeus Lott, an innovative pubic school principal in a violent, drug-infested area of Houston. All the students at Wesley Elementary qualified as "disadvantaged," 99 percent were minorities and their test scores were mediocre. But by 1996, 100 percent of Wesley's third graders were passing the state's reading exam. In 1995 local residents petitioned the Houston school board to allow Lott to manage Wesley and three neighboring schools as charter schools. Their efforts were rewarded -- even in the worst of the four, 4th graders passing the state reading exam jumped from 37 percent three years ago to 100 percent last year.

Contrary to critics of choice, charter schools do not take the best students from traditional schools. Seven of the 19 state charter schools in operation are specifically for students who have dropped out of other schools.

Some 68 percent of students attend-ing open enrollment charter schools are classified at-risk compared to 39 percent in traditional public schools. And 76 percent are minorities compared to 53 percent in regular public schools. The racial makeup of Texas charter schools is 45 percent Hispanic, 29 percent black, 24 percent white and two percent other.

Texas business, concerned about the quality of the state's workforce, has spearheaded reform. Business leaders established the Charter School Resources Center of Texas to aid expansion of charter schools. A new foundation will provide loans to qualified charter school who need startup funds.

These reforms have met resistance. To ease the shock of accountability (and perhaps mollify teacher opposition), special education students and students who took Spanish-language versions of the tests --about 10 percent of students statewide -- have not been counted in grading school performance. They are a substantial portion of students in some schools. Thus, a lot of poorly performing schools have been given a temporary reprieve. Beginning next year, however, special education and Spanish-speaking students' scores will be counted.

In addition, Gov. George W. Bush has proposed ending social promotions.

Overall, increasingly tough standards applied to more students and more schools -- couple with more freedom of choice for parents -- is proving to be a formula for success.

Dorman Cordell is a Senior Scholar at the National Center for Policy Analysis.