BILL ANALYSIS Ó AB 401 Page 1 Date of Hearing: April 13, 2011 ASSEMBLY COMMITTEE ON EDUCATION Julia Brownley, Chair AB 401 (Ammiano) - As Introduced: February 14, 2011 SUBJECT : Charter schools. SUMMARY : Establishes a state-wide cap of 1450 on the number of charter schools that can operate until December 31, 2022; establishes a 10% cap on the number of charter schools in any individual school district, and, prohibits charter school personnel with hiring authority from employing relatives. Specifically, this bill : 1)Specifies in the 2012-13 school year, and each successive school year after until December 31, 2022, the maximum total number of charter schools authorized to operate in the state to be 1450. 2)Specifies that no more than 10% of the schools in a school district may be charter schools; specifies that after that limit is reached, the governing board of the school district shall not approve additional charter petitions; and, specifies that if the number of charter schools in a school district exceeds this limit on July 1, 2012, those charter schools may continue to operate but the governing board of the school district shall not approve any other charter petitions. 3)Prohibits charter school personnel, that work for a charter school operated by a private entity, to advocate for, appoint, employ, promote, or advance any individual who is a relative to a position in the charter school or for a contract with the charter school over which that person exercises jurisdiction or control; and, specifies that the approval of budgets does not constitute jurisdiction or control. 4)Requires a petition for a charter school to include full disclosure of the identity of all individuals who are employed, plan to be employed by the charter school, or have a contract with the charter school, who are related to the charter school owner, president, chairperson of the governing body, superintendent, governing body member, principal, assistant principal, or any other person employed by the charter school who has equivalent decision-making authority. AB 401 Page 2 5)Defines charter school personnel as a charter school owner, president, chairperson of the governing body, superintendent, governing body member, principal, assistance principal or any other person employed by the charter school who has equivalent decision-making authority to appoint, employ, promote or advance individuals. 6)Defines relative as a parent, child, sibling, uncle, aunt, first cousin, nephew, niece, spouse, father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-law, sister-in-law, stepparent, stepsibling, stepchild, half brother or half sister. FISCAL EFFECT : This bill is keyed non-fiscal. EXISTING LAW : 1)Establishes the Charter Schools Act of 1992 which authorizes a school district, a county board of education or the state board of education (SBE) to approve or deny a petition for a charter school to operate independently from the existing school district structure as a method of accomplishing, among other things, improved student learning. 2)Establishes a process for the submission of a petition for the establishment of a charter school. Authorizes a petition, identifying a single charter school to operate within the geographical boundaries of the school district, to be submitted to the school district. Authorizes, if the governing board of a school district denies a petition for the establishment of a charter school, the petitioner to elect to submit the petition to the county board of education. Authorizes, if the county board of education denies the charter, the petitioner to submit the petition to the SBE. Authorizes a school that serves a countywide service to submit the charter petition directly to the county office of education. Authorizes a school that serves a statewide purpose to go directly to the SBE. 3)Authorizes commencing in the 1998-99 school year, 250 charter schools; and, in the 1999-2000 school year, and in each successive school year thereafter, authorizes an additional 100 charter schools to operate. AB 401 Page 3 COMMENTS : According to the California Department of Education (CDE), the 2009-10 count of operating charter schools is 815 with student enrollment of more than 323,000 in the state. This includes three statewide benefit charters and 20 SBE-approved charters. Some charter schools are new, while others are conversions from existing public schools. Charter schools are part of the state's public education system and are funded by public dollars. A charter school is usually created or organized by a group of teachers, parents and community leaders, a community-based organization, or an education management organization. Charter schools are authorized by school district boards, county boards of education or the state board of education. A charter school is generally exempt from most laws governing school districts, except where specifically noted in the law. This bill will establish a state-wide cap of 1450 on the number of charter schools that can operate and establish a 10% cap on the number of charter schools in a single school district. This bill also establishes anti-nepotism hiring standards for charter schools operated by private entities. According to the author, current law only provides an increasing cap on the number of charter schools and little or no accountability. Many reports including the Stanford Center for Research on Education Outcomes (CREDO) report demonstrate that charter schools are not the panacea for closing the achievement gap; however, they are provided wide sweeping power and no true accountability. While the current cap is much higher than the actual number of charter schools in the state, the growth in the number charters is accelerating. One of the many concerns with current law is the lack of employment guidelines for these publicly funded schools. In other states, like that of Florida, there are guidelines for charter schools on hiring, promoting, and assigning relatives. This bill attempts to address nepotistic hiring practices within these schools. Charter School Cap . This bill will establish a state-wide cap of 1450 charter schools. The 2010-11 state-wide cap on charter schools is 1450 and there are 911 existing charter schools that have been authorized. Since this cap is well above the current number of charter schools state-wide, the California Federation of Teachers (CFT) argues that it will not inhibit the growth of charter schools for many years. The committee should consider AB 401 Page 4 whether a statewide cap of 1450 will inhibit charter school growth. Typically, bills that contain a sunset date also contain a report. The committee should consider whether it would be appropriate to include a report to the Legislature on the state-wide cap in the year prior to the sunset date. (Source: California Department of Education) In the last 10 years, on average, there were 86 charter schools approved each year. If this same rate of approval continues in the future, one could estimate that the cap of 1450 established by this bill would be reached during the 2016-17 school year. Because the sunset date for this bill is in 2022, the cap of 1450 will likely be reached before the sunset date. The committee should consider whether it is appropriate to limit the number of charter schools state-wide. The bill also adds a 10% cap on the number of charter schools operating in an individual school district. Currently, several school districts already have more charter schools than would be authorized with the 10% cap. While the bill grandfathers in existing charter schools above the cap, this bill would prohibit any more charter schools from being approved by these school districts. CFT, the sponsor of the bill, argues that the 10% district-wide cap does not impact the ability of county offices of education or the SBE to approve charter schools in districts that are currently above the 10% cap. The committee should consider whether prohibiting the growth of charter schools (approved by the district governing board) in districts such as Los Angeles Unified and San Diego Unified, among others, is appropriate. Hiring Practices . This bill establishes anti-nepotism employment standards for charter schools operated by private entities. The provisions in this bill model existing charter school law in Florida regarding employment prohibitions and disclosure. Florida's charter law requires an initial petition for a charter school to include full disclosure of any relatives that have been hired by the decision makers at the school, and it prohibits decision makers at operational charter schools from hiring relatives. Arguments in Support : According to CFT, there are groups, foundations, and charter management organizations that are using AB 401 Page 5 charter schools as a way to privatize public schools, accessing tax payer money for the use and access of a few. For many, charter schools have become a place to be the exception to the rules: rules of accountability, public transparency, workers' rights and most importantly students' rights. They should not be exempted from public employment practices. They should be financially responsible and transparent. Until charter schools actually follow the rules of student access, academic financial accountability, and employment laws, they should not be allowed to grow to numbers that rob the resources of our neighborhood schools. Arguments in Opposition : According to the California Charter Schools Association, AB 401 would reinstate a firm cap (1450) on charter schools through 2022. This is an old issue that has been resolved by the Legislature with the incremental cap language currently in statute. While the charter school movement is growing in California, there is universal agreement that it is not growing as fast as the current limits allow. Moreover, imposing a hard cap is a step backward, creating unnecessary artificial and arbitrary limits on charter schools after years of nurturing their responsible growth and embracing them as an important resource in our public education system. Committee Amendments : Staff recommends the bill be amended in the following ways: 1)Add a reporting requirement to the Legislature the year prior to the sunset date. 2)Change the sunset date to December 31, 2016. 3)Delete the 10% district-wide cap on charter schools. Previous legislation : AB 1982 (Ammiano) from 2010, which failed passage in the Senate Education Committee, was similar to this bill and established until December 31, 2016, a state-wide cap of 1450 on the number of charter schools that can operate and prohibits charter schools personnel with hiring authority from employing relatives. AB 8 X5 (Brownley) from 2009, which was held in the Senate Education Committee at the request of the author, proposed comprehensive changes to the Education Code consistent with the federal Race to the Top (RTTT) program; and, deleted the statewide charter school cap; proposed enhanced charter school fiscal and academic accountability standards. AB 401 Page 6 AB 3 X5 (Torlakson) from 2009 deleted the statewide charter school cap and proposed changes to the measurable student outcomes, renewal and revocation procedures for charter schools. This bill was introduced but was not referred to a committee. REGISTERED SUPPORT / OPPOSITION : Support California Federation of Teachers (Sponsor) California Labor Federation California School Employees Association California Teachers Association United Teachers Los Angeles Opposition California Charter Schools Association K-12, Inc. Los Angeles Unified School District School for Integrated Academics and Technologies (SIATech) Analysis Prepared by : Chelsea Kelley / ED. / (916) 319-2087