This is a really basic but frequently misunderstood principle in the design of state charter school legislation. From a Wash. Post story about MD charter schools:
Deborah Driver, one of the organizers, said the obstacles to opening a charter school in the county are immense because the school system wields power of approval over a would-be competitor. “It’s like you make an application to McDonald’s to see if you can open up a Burger King,” Driver said.
It’s also relatively easily dealt with for instance in MN and Indy but don’t do what they did in OH, though to their credit they’re trying to deal with that. Also, an interesting natural experiment unfolding on this in Washington DC that has a quality dimension as well: Ed Sector’s Mead here and GAO here (pdf).