Indianapolis Mayor Greg Ballard will force the Fountain Square Academy, a charter middle and high school, to close at the end of the next school year, but plans to work with the school’s board of directors to launch a new school in the same neighborhood.

The decision, announced Friday morning at a press conference, marks the first time Ballard has chosen to shut down a charter school. It is also the first time a charter school in Indiana will be shut down primarily for academic reasons.

Ballard also gave a shorter-than-normal renewal to one other school, KIPP Indianapolis, 1740 E. 30th St., which in recent years also has had poor academic performance.

“One school, the Fountain Square Academy, has not lived up to the performance standards for multiple years,” Ballard said. “Charters that do not meet the criteria should not be permitted to operate.”

Ballard also suspended a decision on one other school, Fall Creek Academy, to allow city officials to review student scores from the state-standardized ISTEP test taken earlier this month. If those scores continue a recent growth trend, Ballard said he would “be happy” to renew the school’s charter.

The decision on Fall Creek may not come until summer or fall, but the school will be allowed to operate for the 2011-2012 school year.

Many had speculated Ballard would close Fall Creek Academy because he gave it only a two-year renewal in 2009—the first time a school was given less than a full, seven-year renewal.

But Ballard and his charter schools chief, Karega Rausch, said they were impressed with the growth in ISTEP pass rates and graduation rates at the K-12 school.

It’s been five years since a mayor-sponsored charter school has been forced to shut down. In 2005, Mayor Bart Peterson decided to close Flanner House Higher Learning Center, citing poor academic performance, too few teachers, inflated enrollment figures and generally poor management.

Fall Creek Academy and Fountain Square Academy are both managed by Indianapolis-based GEO Foundation.

GEO President Kevin Teasley pointed out that ISTEP pass rates at both his firm’s schools have been improving for the past three years, whereas the performance at KIPP has been trending downward.

In 2007, just 20 percent of the middle schoolers at Fountain Square passed both the reading and math parts of ISTEP. By 2010, the percentage passing was 39 percent.

At KIPP, meanwhile, 44 percent of its students passed both parts of ISTEP in 2007, but that number trended down to 36 percent last year.

When asked what made the difference in treatment of Fountain Square and KIPP, Ballard and Rausch said they looked at all years of each school’s existence, noting that KIPP had performed well in its early years—in contrast to Fountain Square’s early struggles.

“KIPP started out very, very strongly. It’s a national organization,” Ballard said. He added, “For Fountain Square, really, there's a continuing pattern that we didn’t see changing.”

Rausch also highlighted that KIPP on its own initiative has mounted a massive turnaround effort, which has included getting significant in-kind contributions from Indianapolis-based ITT Technical Institutes, a chain of for-profit colleges.

“The same case cannot be made for Fountain Square,” Raush said.

Ballard blamed Fountain Square’s troubles not on its board of directors but on the GEO Foundation. He said GEO would not be the operator of the Fountain Square Academy for the 2011-’12 school year, but that a decision has not been made on its replacement.

Ballard said his office would work with the existing Fountain Square Academy board to launch a new school in the neighborhood for the 2012-13 school year. Rausch, however, said anyone—including GEO—could apply to operate the school.

Ballard praised Fall Creek Academy, the other GEO school, for its strong recent gains in performance.

Teasley took a positive slant on the news, saying the mayor’s decision really just gives the Fountain Square board a year to reorganize the school.

GEO is working with the board on that transition, which could even include applying for authorization under Ball State University, the other entity currently authorizing charter schools.

“I’m obviously disappointed in how this has been handled, but at the same time, I’m optimistic about the future of the school, in that the mayor has agreed to receive a new charter application,” Teasley said. “The board will do everything it can to make sure the school does continue. It may have a different name, and it may have a different authorizer, but there will be a school there in fall of 2012.”

He also pointed to testing of Fountain Square students the school has conducted this year, which predict the school will record a huge jump in pass rates for 2011—to more than 60 percent passing both the math and reading portions of ISTEP.

Ballard gave full, seven-year renewals to three schools: Charles A. Tindley Accelerated School, the Indianapolis Metropolitan High School and the Southeast Neighborhood School of Excellence.

Scott Bess, superintendent of Indianapolis Metropolitan, said he was extremely happy with getting OK’d for another seven years. Late last year, the school launched a massive overhaul to its operations to try to improve academic performance. IBJ has been chronicling the changes at the school.

“In some ways, that’s kind of a confirmation that we’re doing the right things,” he said. “That all this work and even the upheaval that we’re going through is worth it.”