HB245 By Representative Collins RFD Education Policy Rd 1 16-FEB-17

SYNOPSIS: Under existing law, the Alabama School Choice and Student Opportunity Act establishes the Alabama Public Charter School Commission and provides the process for establishing and maintaining public charter schools in the state.

This bill would provide that the 10 members of the Alabama Public Charter School Commission currently appointed by the State Board of Education from nominees recommended by the Governor, Lieutenant Governor, President Pro Tempore of the Senate, and Speaker of the House of Representatives be appointed by the Governor, the Lieutenant Governor, the President Pro Tempore of the Senate, and the Speaker of the House of Representatives and would authorize the commission to employ necessary staff.

Under existing law, a public charter school may be authorized only by a local school board or the Alabama Public Charter School Commission.

This bill would require the State Department of Education to annually publish a list of registered local authorizers and would allow an applicant to apply directly to the commission if a particular school system is not listed.

This bill would provide further for deadlines on the statewide timeline for local authorizer applications.

This bill would permit authorizers to encourage proposals that include a specific academic approach or theme.

This bill would increase the length of time during which an authorizer and the governing board of an approved public charter school are required to execute a charter contract from 60 to 120 days.

This bill would also revise provisions relating to operational funding of public charter schools and would require the forwarding of certain state funds by the department to the public charter school on a monthly basis in lieu of a quarterly basis.

A BILL TO BE ENTITLED AN ACT

Relating to the Alabama School Choice and Student Opportunity Act; to amend Sections 16-6F-6, 16-6F-7, and 16-6F-10, Code of Alabama 1975, to provide for the appointment of 10 members of the Alabama Public Charter School Commission, currently appointed by the State Board of Education from nominees recommended by the Governor, Lieutenant Governor, President Pro Tempore of the Senate, and Speaker of the House of Representatives, by those officials; to authorize the commission to employ necessary staff; to require the State Department of Education to annually publish a list of registered local authorizers of public charter schools and allow an applicant to apply directly to the commission if a particular school system is not listed; to provide further for deadlines on the statewide timeline for local authorizer applications; to permit authorizers to encourage proposals including specific academic approaches or themes; to increase the length of time during which an authorizer and the governing board of an approved public charter school are required to execute a charter contract from 60 to 120 days; to revise certain operational funding of public charter schools' provisions; and to require the forwarding of certain state funds by the department to public charter schools on a monthly basis in lieu of a quarterly basis.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Sections 16-6F-6, 16-6F-7, and 16-6F-10 of the Code of Alabama 1975, are amended to read as follows:

§16-6F-6.

"(a) Eligible authorizing entities.

"(1) A public charter school shall not be established in this state unless its establishment is authorized by this section. No governmental entity or other entity, other than an entity expressly granted chartering authority as set forth in this section, may assume any authorizing function or duty in any form. The following entities shall be authorizers of public charter schools:

"a. A local school board, for chartering of schools within the boundaries of the school system under its jurisdiction, pursuant to state law.

"b. The Alabama Public Charter School Commission, pursuant to this section.

"(2) A local school board that registers as an authorizer may approve or deny an application to form a public charter school within the boundaries of the local school system overseen by the local school board.

"(3) All authorizing entities shall prioritize those applications that are focused on serving at-risk students.

"(4) A decision made by a local school board shall be subject to appeal to the commission. The commission may hear an application for the formation of a public charter school by an applicant only if one of the following factors is met:

"a. An application to form a public charter school is denied by the local school board overseeing that system and the applicant chooses to appeal the decision of the local school board to the commission.

"b. The applicant wishes to open a start-up public charter school in a public school system that has chosen not to register as an authorizer.

"(b) Public charter school cap.

"(1) Authorizers may not approve more than 10 start-up public charter schools in a fiscal year.

"(2) Upon receiving notice of approval of the tenth start-up public charter school to be approved in a fiscal year, the department shall provide notice to all authorizers that the cap has been reached and no new start-up public charter schools may be approved in that fiscal year.

"(3) The cap expires on April 1 immediately following the conclusion of the fiscal year beginning October 1, 2020.

"(4) At the conclusion of the fiscal year beginning October 1, 2020, the department shall submit a report to the Legislature outlining the performance of both start-up and conversion public charter schools. This report shall include, at a minimum, academic performance of all public charter schools in the state, a detailed update on the authorizing process, and recommendations for adjustments to public charter school governance and oversight.

"(5) There is no limit on the number of conversion public charter schools that may be approved.

"(c) The Alabama Public Charter School Commission.

"(1) The commission is established as an independent state entity.

"(2) The mission of the commission is to authorize high quality public charter schools, in accordance with the powers expressly conferred on the commission in this chapter.

"(3) The commission shall be composed of a total of 11 members.

"a. The initial membership of the commission shall be appointed as follows:

"1. The State Board of Education shall appoint 10 members, made up of four appointees recommended by the Governor, one appointee recommended by the Lieutenant Governor, two appointees recommended by the President Pro Tempore of the Senate, and three appointees recommended by the Speaker of the House of Representatives. The Governor, the Lieutenant Governor, the President Pro Tempore of the Senate, and the Speaker of the House of Representatives shall each recommend a list of no fewer than two nominees for each initial appointment to the commission. One recommended initial appointee of the President Pro Tempore of the Senate and one recommended initial appointee of the Speaker of the House of Representatives shall be an appointee recommended by members of the Senate minority party and members of the House minority party, respectively. No initial commission member can be appointed unless he or she has been recommended by the Governor, Lieutenant Governor, President Pro Tempore of the Senate, or the Speaker of the House of Representatives.

"2. Commencing on the effective date of the act adding this subparagraph, as the terms of members expire, the nominating authority for the respective member of the commission shall be the appointing authority for his or her successor on the commission so that the Governor shall appoint four members to the commission, the Lieutenant Governor shall appoint one member to the commission, the President Pro Tempore of the Senate shall appoint two members to the commission, and the Speaker of the House of Representatives shall appoint three members to the commission.

"(4) The eleventh member of the commission shall be a rotating position based on the local school system where the application was denied. This member appointed to the rotating position shall be appointed by the local school system where the applicant is seeking to open a public charter school. The local school system shall appoint a member to the rotating position through board action specifically to consider that application.

"(5) The appointing authorities of the commission members shall strive to select individuals that collectively possess strong experience and expertise in public and nonprofit governance, strategic planning, management and finance, public school leadership, assessment, curriculum and instruction, and public education law. Each member of the commission shall have demonstrated understanding of and commitment to charter schooling as a tool for strengthening public education and shall sign an agreement to hear the appeal and review documents in a fair and impartial manner.

"(6) Membership of the commission shall be inclusive and reflect the racial, gender, geographic, urban/rural, and economic diversity of the state. The appointing authority shall consider the eight State Board of Education districts in determining the geographical diversity of the commission.

"(7) The initial appointments to the commission shall be made no later than June 1, 2015. Two recommended appointees of the Governor, one recommended appointee of the Lieutenant Governor, one recommended appointee of the Speaker of the House of Representatives, and one recommended appointee of the President Pro Tempore of the Senate shall serve an initial term of one year and two recommended appointees of the Governor, two recommended appointees of the Speaker of the House of Representatives, and one recommended appointee of the President Pro Tempore of the Senate shall serve an initial term of two years. Thereafter, all appointees shall serve two-year terms of office. All appointments shall be eligible for reappointment as determined by the appointing authority, not to exceed a total of six years of service, unless the member was initially appointed to serve a one-year term of office. If the initial term of office of an appointee was one year, he or she may serve a total of five years of service on the commission.

"(8) A member of the commission may be removed for failure to perform the duties of the appointment. Whenever a vacancy on the commission exists, the appointing authority, within 60 days after the vacancy occurs, shall appoint a member for the remaining portion of the term in the same manner as the original appointment was made. A member of the commission shall abstain from any vote that involves a local school system of which he or she is an employee or which he or she oversees as a member of a local school board. The requirement to abstain does not apply to the rotating position on the commission.

"(9) Six members of the commission constitute a quorum, and a quorum shall be necessary to transact business. Actions of the commission shall be by a majority vote of the commission. The commission, in all respects, shall comply with the Alabama Open Meetings Act and state record laws. Notwithstanding the preceding sentence, members of the commission may participate in a meeting of the commission by means of telephone conference, video conference, or similar communications equipment by means of which all persons participating in the meeting may hear each other at the same time. Participation by such means shall constitute presence in person at a meeting for all purposes, including the establishment of a quorum. Telephone or video conference or similar communications equipment shall also allow members of the public the opportunity to simultaneously listen to or observe meetings of the commission.

"(10) If the commission overrules the decision of a local school board and chooses to authorize the establishment of a public charter school in that local school system, the commission shall serve as the authorizer for that public charter school, pursuant to this chapter.

"(11) The commission may do any of the following:

"a. Utilize professional and administrative staff of the department as recommended by the State Superintendent of Education.

"b. Adopt rules for the operation and organization of the commission.

"c. Review, at least once per year, department rules and regulations concerning public charter schools and, if needed, recommend to the State Superintendent of Education any rule or regulation changes deemed necessary.

"d. Convene stakeholder groups and engage experts.

"e. Seek and receive state, federal, and private funds for operational expenses.

"f. A commission member may not receive compensation, but shall be reimbursed by the department for travel and per diem expenses at the same rates and in the same manner as state employees.

"g. The commission shall submit an annual report to the department pursuant to subsection (g).

"h. Employ staff to coordinate commission business.

"(12) In order to overrule the decision of a local school board and authorize a public charter school, the commission, in its own consideration of the application, shall do all of the following:

"a. Find evidence of a thorough and high-quality public charter school application from the applicant based on the authorizing standards in subdivision (8) of subsection (a) of Section 16-6F-7.

"b. Hold an open community hearing opportunity for public comment within the local school system where the application was denied.

"c. Find that the local board's denial of an original charter application was not supported by the application and exhibits or that the identified educational needs of the local school board were considered or applied so as to restrict a diversity of high quality educational choices.

"d. Take into consideration 1. other existing charter school applications, 2. the quality of school options existing in the affected community, 3. the existence of other charter schools, and 4. any other factors considered relevant to ensure the establishment of high-quality charter schools in accordance with the intent of this chapter.

"e. Find evidence that the local school board erred in its application of nationally recognized authorizing standards.

"(d) A local school board may register with the department for chartering authority within the boundaries of the school system overseen by the local school board. The department shall publicize to all local school boards the opportunity to register with the state for chartering authority within the school system they oversee. By June 1 of each year, the department shall provide information about the opportunity, including a registration deadline, to all local school boards. By September 1 of each year, the department shall publish a list of registered local authorizers for that calendar year. If a school system is not listed by the September 1 deadline, an applicant may apply directly to the commission to open a school within the borders of the school system during the application cycle for that year. To register as a charter authorizer in its school system, each interested local school board shall submit the following information in a format to be established by the department:

"(1) Written notification of intent to serve as a charter authorizer in accordance with this chapter.

"(2) An explanation of the local school board's capacity and commitment to execute the duties of quality charter authorizing, as defined by nationally recognized authorizing standards.

"(3) An explanation of the local school board's strategic vision for chartering.

"(4) An explanation of how the local school board plans to solicit public charter school applicants, in accordance with this chapter.

"(5) A description or outline of the performance framework the local school board will use to guide the establishment of a charter contract and for ongoing oversight and evaluation of public charter schools, consistent with the requirements of this chapter.

"(6) A draft of the local school board's renewal, revocation, and nonrenewal processes, consistent with subsection (c) of Section 16-6F-8.

"(7) A statement of assurance that the local school board commits to serving as a charter authorizer and shall fully participate in any authorizer training provided or required by the state.

"(e) If a local school board chooses not to register as an authorizer, all applications seeking to open a start-up public charter school within that local school board's boundaries shall be denied. Applicants wishing to open a public charter school physically located in that local school system may apply directly to the commission.

"(f) An authorizer may do all of the following:

"(1) Solicit, invite, receive, and evaluate applications from organizers of proposed public charter schools.

"(2) Approve applications that meet identified educational needs.

"(3) Deny applications that do not meet identified educational needs.

"(4) Create a framework to guide the development of charter contracts.

"(5) Negotiate and execute charter contracts with each approved public charter school.

"(6) Monitor the academic, fiscal, and organizational performance and compliance of public charter schools.

"(7) Determine whether each charter contract merits renewal or revocation.

"(g) An authorizer shall submit to the State Board of Education a publicly accessible annual report within 60 days after the end of each school fiscal year summarizing all of the following:

"(1) The authorizer's strategic vision for chartering and progress toward achieving that vision.

"(2) The academic and financial performance of all operating public charter schools overseen by the authorizer, according to the performance measures and expectations specified in the charter contracts.

"(3) The status of the public charter school portfolio of the authorizer, identifying all public charter schools within that portfolio as one of the following:

"a. Approved, but not yet open.

"b. Open and operating.

"c. Terminated.

"d. Closed, including year closed and reason for closing.

"e. Never opened.

"(4) The oversight and services, if any, provided by the authorizer to the public charter schools under the purview of the authorizer.

"(5) The authorizing functions provided by the authorizer to the public charter schools under its jurisdiction, including the operating costs and expenses of the authorizer detailed in annual audited financial statements that conform to generally accepted accounting principles.

"(6) All use of taxpayer dollars including expenditures, contracts, and revenues.

"(h) To cover costs for overseeing and authorizing public charter schools in accordance with this chapter, a local school board serving as an authorizer may do all of the following:

"(1) Expend its own resources, seek grant funds, and establish partnerships to support its public charter school authorizing activities.

"(2) Charge a portion of annual per student state allocations received by each public charter school it authorizes based on the following schedule:

"a. If the local school board has oversight over one to three, inclusive, public charter schools: Three percent of annual per student state allocations.

"b. If the local school board has oversight over four to five, inclusive, public charter schools: Two percent of annual per student state allocations.

"c. If the local school board has oversight over six to 10, inclusive, public charter schools: One percent of annual per student state allocations.

"d. These funds shall be used to cover the costs for a local school board to provide authorizing services to its public charter schools.

"(i) An employee, agent, or representative of an authorizer may not simultaneously serve as an employee, agent, representative, vendor, or contractor of a public charter school of that authorizer.

"(j) With the exception of charges for oversight services as required in subsection (h), a public charter school may not be required to purchase services from its authorizer as a condition of charter approval or of a charter contract, nor may any such condition be implied.

"(k) A public charter school authorized by a local school system may choose to purchase services, such as transportation-related or lunchroom-related services, from its authorizer. In such event, the public charter school and authorizer shall execute an annual service contract, separate from the charter contract, stating the mutual agreement of the parties concerning any service fees to be charged to the public charter school. A public charter school authorized by the commission may not purchase services from the commission, but consistent with this section, may purchase services from the local school system where the public charter school is located.

"(l) The department shall oversee the performance and effectiveness of all authorizers established under this chapter. Persistently unsatisfactory performance of the portfolio of the public charter schools of an authorizer, a pattern of well-founded complaints about the authorizer or its public charter schools, or other objective circumstances may trigger a special review by the department. In reviewing and evaluating the performance of an authorizer, the department shall apply nationally recognized standards for quality in charter authorizing. If, at any time, the department finds that an authorizer is not in compliance with an existing charter contract or the requirements of all authorizers under this chapter, the department shall notify the authorizer in writing of any identified problem, and the authorizer shall have reasonable opportunity to respond and remedy the problem.

"(m) If a local school board acting as an authorizer persists in violating a material provision of a charter contract or fails to remedy any other authorizing problem after due notice from the department, the department shall notify the local school board, within 60 days, that it intends to revoke the chartering authority of the local school board unless the local school board demonstrates a timely and satisfactory remedy for the violation or deficiencies.

"(n) If the commission violates a material provision of a charter contract or fails to remedy any other authorizing problems after due notice from the department, the department shall notify the commission, within 60 days, that it intends to notify the Governor, the Speaker of the House of Representatives, and the President Pro Tempore of the Senate of the actions of the commission unless the commission demonstrates a timely and satisfactory remedy for the violation of the deficiencies. Along with this notification, the department shall publicly request in writing that the Governor, the Speaker of the House of Representatives, and the President Pro Tempore appointees comply with the requests of the department or face a revocation of their appointment to the commission.

"(o) In the event of revocation of the chartering authority of an authorizer, the department shall manage the timely and orderly transfer of each charter contract held by that authorizer to another authorizer in the state, with the mutual agreement of each affected public charter school and proposed new authorizer. The new authorizer shall assume the existing charter contract for the remainder of the charter term.

"(p) Authorizer power, duties, and liabilities. Authorizers are responsible for executing, in accordance with this chapter, the following essential powers and duties:

"(1) Soliciting and evaluating charter applications based on nationally recognized standards.

"(2) Approving quality charter applications that meet identified educational needs and promote a diversity of high-quality educational choices.

"(3) Declining to approve weak or inadequate charter applications.

"(4) Negotiating and executing charter contracts with each approved public charter school.

"(5) Monitoring, in accordance with charter contract terms, the performance and legal compliance of public charter schools.

"(6) Determining whether each charter contract merits renewal, nonrenewal, or revocation.

"(q) An authorizer that grants a charter to a 501(c)(3) tax-exempt organization for the purpose of opening and operating a public charter school is not liable for the debts or obligations of the public charter school, or for claims arising from the performance of acts, errors, or omissions by the charter school, if the authorizer has complied with all oversight responsibilities required by law, including, but not limited to, those required by this chapter.

"(r) Principles and standards for charter authorizing.

"(1) All authorizers shall be required to develop and maintain chartering policies and practices consistent with nationally recognized principles and standards for quality charter authorizing in all major areas of authorizing responsibility including: Organizational capacity and infrastructure; soliciting and evaluating charter applications; performance contracting; ongoing public charter school oversight and evaluation; and charter renewal decision-making. The State Board of Education shall promulgate reasonable rules and regulations to effectuate this section by June 17, 2015.

"(2) Authorizers shall carry out all of their duties under this chapter in a manner consistent with such nationally recognized principles and standards and with the spirit and intent of this chapter. Evidence of material or persistent failure to do so shall constitute grounds for losing charter authorizing powers.

§16-6F-7.

"(a) Request for proposals.

"(1) To solicit, encourage, and guide the development of quality public charter school applications, every local school board, in its role as public charter school authorizer, shall issue and broadly publicize a request for proposals for public charter school applications by July 17, 2015, and by November 1 in each subsequent year. The content and dissemination of the request for proposals shall be consistent with the purposes and requirements of this act.

"(2) Public charter school applicants may submit a proposal for a particular public charter school to no more than one local school board at a time.

"(3) The department shall annually establish and disseminate a statewide timeline for charter approval or denial decisions, which shall apply to all local authorizers in the state. The timeline shall include deadlines that require applications to be approved or denied 12 months prior to the proposed opening of a school.

"(4) Each local school board's request for proposals shall present the board's strategic vision for chartering, including a clear statement of any preferences the board wishes to grant to applications that help at-risk students.

"(5) The request for proposals shall include or otherwise direct applicants to the performance framework that the authorizer has developed for public charter school oversight and evaluation in accordance with this chapter.

"(6) The request for proposals shall include the criteria that will guide the authorizer's decision to approve or deny a charter application.

"(7) The request for proposals shall state clear, appropriately detailed questions as well as guidelines concerning the format and content essential for applicants to demonstrate the capacities necessary to establish and operate a successful public charter school.

"(8) The request for proposals shall require charter applications to provide or describe thoroughly all of the following essential elements of the proposed school plan:

"a. An executive summary.

"b. The mission and vision of the proposed public charter school, including identification of the targeted student population and the community the school hopes to serve.

"c. The location or geographic area proposed for the school.

"d. The grades to be served each year for the full term of the charter contract.

"e. Minimum, planned, and maximum enrollment per grade per year for the term of the charter contract.

"f. Evidence of need and community support for the proposed public charter school.

"g. A brief biography regarding the expertise and background on the proposed founding governing members and the proposed school leadership and management team.

"h. The school's proposed calendar and sample daily schedule.

"i. A description of the academic program.

"j. A description of the school's instructional design, including the type of learning environment, such as classroom-based or independent study, class size and structure, curriculum overview, and teaching methods.

"k. The school's plan for using internal and external assessments to measure and report student progress.

"l. The school's plan for identifying and successfully serving students with disabilities, students who are English language learners, students who are academically behind, and gifted students, including, but not limited to, compliance with applicable laws and regulations.

"m. A description of cocurricular or extracurricular programs and how they will be funded and delivered.

"n. Plans and timelines for student recruitment and enrollment, including random selection procedures in the event that interest exceeds capacity.

"o. The school's student discipline policies, including those for special education students.

"p. An organization chart that clearly presents the school's organizational structure, including lines of authority and reporting between the governing board, staff, any related bodies, such as advisory bodies or parent and teacher councils, and any external organizations that will play a role in managing the school.

"q. A clear description of the roles and responsibilities for the governing board, the school's leadership and management team, and any other entities shown in the organization chart.

"r. A staffing chart for the school's first year, and a staffing plan for the term of the charter.

"s. Plans for recruiting and developing school leadership and staff.

"t. The school's leadership and teacher employment policies, including performance evaluation plans.

"u. Proposed governing bylaws.

"v. Explanations of any partnerships or contractual relationships central to the school's operations or mission.

"w. The school's plans for providing transportation, food service, and all other significant operational or ancillary services.

"x. Opportunities and expectations for parental involvement.

"y. A detailed school start-up plan, identifying tasks, timelines, and responsible individuals.

"z. Description of the school's financial plan and policies, including financial controls and audit requirements. This plan shall include a disclosure of all donations of private funding, if any, including, but not limited to, gifts received from foreign governments, foreign legal entities, and, when reasonably known, domestic entities affiliated with either foreign governments or foreign legal entities.

"aa. A description of the insurance coverage the school will obtain.

"bb. Start-up and five-year budgets with clearly stated assumptions.

"cc. Evidence of anticipated fundraising contributions, if claimed in the application.

"dd. A sound facilities plan, including backup or contingency plans, if appropriate.

"ee. In the case of an applicant who has submitted an application for 501(c)(3) tax-exempt status, but has not yet been approved for 501(c)(3) tax-exempt status, the applicant shall submit a copy of the application for 501(c)(3) tax-exempt status.

"ff. Authorizers may encourage, but may not require, proposals that include a specific academic approach or theme to address the diverse educational needs of communities in the state. A request for proposals shall include a clear statement of any preference the authorizer wishes to grant to particular types of applications. Notwithstanding the statement of an authorizer of any priority or preference, an authorizer shall consider each application received based on the merits of that particular application.

"ff.gg. Any other item that the authorizer deems appropriate to assess the applicant's ability to successfully open and operate a public charter school.

"(9) Conversion public charter schools. A local school board may convert a non-charter public school to a public charter school.

"a. Any local school board's decision to convert a school is not appealable to the commission.

"1. After identifying the non-charter public school it has decided to convert to a public charter school, a local school board shall release a request for proposals, allowing education service providers the opportunity to submit applications to manage the specific school as a public charter school under the terms of this chapter.

"2. The conversion must occur at the beginning of an academic school year and shall be subject to compliance with this chapter.

"3. At the time of conversion to a public charter school, any teacher or administrator in the newly converted public charter school shall have the opportunity to interview for a position in the public charter school. The public charter school is under no obligation to hire any teacher or administrator.

"4. At the time of conversion to a public charter school, any teacher or administrator in the public charter school may be allowed to transfer into vacant positions for which they are both certified and qualified in other schools in the school system prior to the hiring of new personnel for those vacant positions.

"5. If personnel reductions are contemplated as the result of a conversion to a charter model, that shall be clearly stated in the application. An approved conversion shall constitute decreased student enrollment or a shortage of revenues, or both, for the purposes of the local school board implementing a reduction in force pursuant to Section 16-1-33.

"b. After an education service provider has been identified to manage the non-charter public school, the local school board shall negotiate a performance contract with the selected education service provider as set forth in subdivision (1) of subsection (e).

"(10) In the case of a proposed public charter school that intends to contract with an education service provider for substantial education services, management services, or both types of services, the request for proposals shall additionally require the applicants to do all of the following:

"a. Provide evidence of the education service provider's success in serving student populations similar to the targeted population, including demonstrated academic achievement as well as successful management of nonacademic school functions, if applicable.

"b. Provide a term sheet setting forth the proposed duration of the service contract; roles and responsibilities of the governing board; the school staff; and the education service provider; scope of services and resources to be provided by the education service provider; performance evaluation measures and timelines; compensation structure, including clear identification of all fees to be paid to the education service provider; methods of contract oversight and enforcement; investment disclosure; and conditions for renewal and termination of the contract.

"c. Disclose and explain any existing or potential conflicts of interest between the school governing board and proposed education service provider or any affiliated business entities.

"(11) In the case of a public charter school proposal from an applicant that currently operates one or more schools inside or outside of Alabama, the request for proposals shall additionally require the applicant to provide evidence of past performance and current ability to manage for growth.

"(b) Application decision-making process.

"(1) In evaluating and reviewing charter applications, authorizers shall employ procedures, practices, and criteria consistent with nationally recognized principles and standards for quality charter authorizing. The application review process shall include thorough evaluation of each written charter application, an in-person interview with the applicant group, and an opportunity in a public forum for local residents to learn about and provide input on each application.

"(2) In deciding whether to approve charter applications, authorizers shall do all of the following:

"a. Grant charters only to applicants that have demonstrated competence in each element of the authorizer's published approval criteria and are likely to open and operate a successful public charter school.

"b. Base decisions on documented evidence collected through the application review process.

"c. Follow charter-granting policies and practices that are transparent, based on merit, and avoid conflicts of interest or any appearance thereof.

"d. In the case of the commission, require significant and objective evidence of interest for the public charter school from the community the public charter school wishes to serve.

"(3) An authorizer shall not approve a public charter school application that includes any of the following:

"a. Admissions requirements for entry, including, but not limited to academic proficiency, particular skills or competencies, or financial means.

"b. Any parochial or religious theme.

"(4) No later than 60 days after the filing of the charter application, the authorizer shall decide to approve or deny the charter application; however, an application submitted by a public historically black college or university (HBCU), in partnership with a national nonprofit public HBCU support organization, for a charter school to be operated on or near the campus of the HBCU may be considered for expedited approval by the authorizer. The authorizer shall adopt by resolution all charter approval or denial decisions in an open meeting. If no action is taken on the application within 60 days, the application shall be considered denied and the applicant may appeal the decision to the commission.

"(5) An approval decision may include, if appropriate, reasonable conditions that the charter applicant must meet before a charter contract may be executed pursuant to this section.

"(6) For any charter denial, the authorizer shall clearly state, for public record, its reasons for denial. A denied applicant may subsequently reapply to that board the following year or appeal the denial to the commission.

"(7) Within 30 seven days of taking action to approve or deny a charter application, the authorizer shall report to the department the action it has taken. The authorizer shall provide a copy of the report to the charter applicant at the same time that the report is submitted to the department. The report shall include a copy of the authorizer's resolution setting forth the action taken and reasons for the decision and assurances as to compliance with all of the procedural requirements and application elements set forth in this section.

"(c)(1) The applicant for a public charter school, the local school board for the district in which a public charter school is proposed to be located, and the authorizer shall carefully review the potential impact of an application for a public charter school on the efforts of the local school system to comply with court orders and statutory obligations for creating and maintaining a unitary system of desegregated public schools.

"(2) The authorizer shall attempt to measure the likely impact of a proposed public charter school on the efforts of local school systems to achieve and maintain a unitary system.

"(3) The authorizer shall not approve any public charter school under this chapter that hampers, delays, or in any manner negatively affects the desegregation efforts of a local school system.

"(d) Initial charter term. An initial charter shall be granted for a term of five operating years. The charter term shall commence on the public charter school's first day of operation. An approved public charter school may delay its opening for one school year in order to plan and prepare for the school's opening. If the school requires an opening delay of more than one year, the school shall request an extension from its authorizer. The authorizer may grant or deny the extension depending on the particular school's circumstances.

"(e) Charter contracts.

"(1) Within 60 120 days of approval of a charter application, the authorizer and the governing board of the approved public charter school shall execute a charter contract that clearly sets forth the academic and operational performance expectations and measures by which the public charter school will be judged and the administrative relationship between the authorizer and the public charter school, including each party's rights and duties. The charter contract shall also include a statement of the amount of funding and a payment schedule detailing when those funds will be provided to the charter school. The performance expectations and measures set forth in the charter contract shall include, but need not be limited to, applicable federal and state accountability requirements. The performance provisions may be refined or amended by mutual agreement after the public charter school is operating and has collected baseline achievement data for its enrolled students. A governing board shall have received 501(c)(3) tax exempt status before beginning charter contract negotiations.

"(2) The charter contract shall be signed by the president of the authorizer's board and the president of the public charter school's governing body. Within 10 days of executing a charter contract, the authorizer shall submit to the department written notification of the executed charter contract and any attachments.

"(3) No public charter school may commence operations without a charter contract executed in accordance with this chapter and approved in an open meeting of the authorizer's governing board.

"(f) Preopening requirements or conditions. Authorizers may establish reasonable preopening requirements or conditions to monitor the start-up progress of newly approved public charter schools and ensure that they are prepared to open smoothly on the date agreed, and to ensure that each school meets all building, health, safety, insurance, and other legal requirements for school opening.

§16-6F-10.

"(a) Enrollment. Students enrolled in and attending public charter schools shall be included in all enrollment and attendance counts of students of the local school system in which the students reside. The public charter school shall report all such data to the local school systems of residence in a timely manner. Each local school system shall report such enrollment, attendance, and other counts of students to the department in the manner required by the department.

"(b) Operational funding.

"(1) The following provisions govern operational funding:

"a. In their initial year, and in subsequent years to accommodate growth as articulated in their application, funding for public charter schools shall be provided from the Education Trust Fund in the Foundation Program appropriation for current units. Subsequent year funding for public charter schools shall be based on the Foundation Program allocation and other public school Education Trust Fund appropriations.

"b. For each of its students, a public charter school shall receive the same amount of state funds, including funds earmarked for the Foundation Program transportation, school nurses, technology coordinators, and other line items that may be included in the appropriation for the Foundation Program Fund, that, for the then-current fiscal year, would have otherwise been allocated on behalf of each public charter school student to the local school system where the student resides. This amount shall reflect the status of each student according to grade level, economic disadvantage, limited English proficiency, and special education needs.

"c. For each of its students, a public charter school shall receive the same amount of local tax revenue, that, for the then-current fiscal year, would have otherwise been allocated on behalf of each public charter school student to the local non-charter public school of each student's residence, excluding those funds already earmarked through a vote of the local school board for debt service, capital expenditures, or transportation for the state-required 10 mill match. As necessary, the department shall promulgate processes and procedures to determine the specific local revenue allocations according to the Foundation Program for each public charter school.

"d. The state funds described in paragraph a. shall be forwarded on a quarterly monthly basis to the public charter school by the department. The local funds described in paragraph b. shall be forwarded on a quarterly monthly basis to the public charter school by the local educational agency of the student's residence, notwithstanding the oversight fee reductions pursuant to Section 16-6F-6. Additionally, any local revenues restricted, earmarked, or committed by statutory provision, constitutional provision, or board covenant pledged or imposed by formal action of the local board of education or other authorizing body of government, shall be excluded by the local educational agency of the student's residence when determining the amount of funds to be forwarded by the agency to the public charter school.

"e. The maximum annual local tax allocation forwarded to a start-up public charter school from a local school system shall, for each student, not exceed the per student portion of the state required 10 mill ad valorem match.

"f.e. The maximum annual local tax allocation forwarded to a conversion public charter school from a local school system shall, for each student, equal the amount that would have been received by the local education agency of the student's residence for each student who now attends a conversion public charter school, minus any amounts otherwise excluded pursuant to this section.

"g.f. If necessary, the department shall adopt rules governing how to calculate and distribute these per-student allocations, as well as any rules governing cost-sharing for students participating in specialized gifted, talented, vocational, technical, or career education programs.

"(2) Categorical funding. The department shall direct the proportionate share of moneys generated under federal and state categorical aid programs to public charter schools serving students eligible for such aid. The state shall ensure that public charter schools with rapidly expanding enrollments are treated equitably in the calculation and disbursement of all federal and state categorical aid program dollars. Each public charter school that serves students who may be eligible to receive services provided through such programs shall comply with all reporting requirements to receive the aid.

"(3) Special education funding.

"a. The state shall pay directly to a public charter school any federal or state aid attributable to a student with a disability attending the school.

"b. At either party's request, a public charter school and its authorizer may negotiate and include in the charter contract alternate arrangements for the provision of and payment for special education services.

"(4) Generally accepted accounting principles; independent audit.

"a. A public charter school shall adhere to generally accepted accounting principles.

"b. A public charter school shall annually engage an independent certified public accountant to do an independent audit of the school's finances. A public charter school shall file a copy of each audit report and accompanying management letter to its authorizer by June 1. This audit shall include the same requirements as those required of local school system pursuant to Section 16-13A-7.

"(5) Transportation funding.

"a. The department shall disburse state transportation funding to a public charter school on the same basis and in the same manner as it is paid to public school systems.

"b. A public charter school may enter into a contract with a school system or private provider to provide transportation to the school's students.

"c. Public charter schools that do not provide transportation services shall not be allocated any federal, state, or local funds otherwise earmarked for transportation-related expenses."

Section 2. This act shall become effective immediately following its passage and approval by the Governor, or its otherwise becoming law.

Education

Charter Schools

Public Charter School Commission

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Governor

Lieutenant Governor

Speaker of the House of Representatives

President Pro Tempore of Senate

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Code Amended