BILL NUMBER: AB 440 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Brownley
FEBRUARY 14, 2011
An act to amend Sections 14502.1, 47604, 47605, 47605.6, and 47607
of, and to add Section 47630.6 to, the Education Code, relating to
charter schools.
LEGISLATIVE COUNSEL'S DIGEST
AB 440, as introduced, Brownley. Charter schools.
(1) Existing law requires the Controller, in consultation with the
Department of Finance and the State Department of Education, to
develop a plan to review and report on financial and compliance
audits. Existing law requires the Controller to propose the content
of an audit guide and authorizes a supplement to the audit guide to
be suggested in the audit year to address issues resulting from new
legislation in that year that changes the conditions of
apportionment. Existing law requires the Controller to submit the
proposed content of the audit guide and any supplement to the
Education Audits Appeal Panel for review and possible amendment and
requires the Education Audits Appeal Panel to adopt the audit guide
and any supplement pursuant to the rulemaking procedures of the
Administrative Procedure Act.
This bill would require the Controller to propose, and the
Education Audits Appeal Panel to adopt, a charter school supplement
to the audit guide in order to provide guidance to auditors regarding
which sections of the school district and county office of education
audit guide apply to charter schools and to create specific guidance
related to the unique nature of charter schools. The bill also would
make conforming changes.
(2) The Charter Schools Act of 1992 (Charter Schools Act) allows a
charter school to elect to operate as, or be operated by, a
nonprofit public benefit corporation, as specified.
This bill would impose a state-mandated local program by requiring
a charter school operating as, or operated by, a for-profit
corporation to notify the Superintendent of Public Instruction of
that fact in writing annually.
(3) The Charter Schools Act specifies the procedures for the
submission, review, and approval or denial of a petition to establish
a standard or countywide charter school. The act allows the
governing board of a school district to deny a charter petition only
if the board makes written factual findings that support certain
facts regarding the petition. The act requires a county board of
education to deny a petition to establish a countywide charter school
if the board makes any of several specified factual findings.
This bill, in addition, would allow a governing board of a school
district to deny a petition and would require a county board of
education to deny a petition for a countywide charter, if it makes a
written factual finding that the petitioner has operated another
charter school for at least 3 consecutive years and one of several
specified events has occurred.
(4) The Charter Schools Act limits the duration of charters to a
period not to exceed 5 years and authorizes the chartering authority
to grant one or more subsequent renewals for an additional period of
5 years. The act prescribes the requirements a charter school must
comply with in order to have its charter renewed, including a
requirement that a charter school that has been in operation for 4
years satisfy at least one of several specified criteria regarding
academic performance.
This bill would authorize a charter renewal to be for a period of
1 to 5 years. The bill would require a chartering authority to
consider, as one factor in determining whether to grant a renewal,
the degree to which a charter school serves pupil populations that
are similar to local school district pupil populations, especially
with regard to high-need pupils, as specified. The bill would delete
one of the criteria for the requirement regarding charter schools in
operation for 4 years. The bill would prohibit a chartering authority
from granting a renewal of a charter school for longer than a 3-year
period if that charter school is in program improvement or has
entered into year 5 of program improvement, has not exited program
improvement, and did not meet Adequate Yearly Progress in the year
prior to the renewal year.
(5) The Charter Schools Act requires a charter petition to include
a reasonably comprehensive description of the manner in which
annual, independent financial audits will be conducted. The act
requires a charter school to transmit a copy of its annual,
independent financial audit report for the preceding fiscal year to
its chartering entity, the Controller, the county superintendent of
schools of the county in which the charter school is sited, except as
specified, and the State Department of Education by December 15 of
each year.
This bill would require the Controller, by December 31 of each
fiscal year, to publish a directory of certified public accountants
and public accountants, licensed by the California Board of
Accountancy, deemed by the Controller to be qualified to conduct
audits of charter schools. The bill would require each audit of a
charter school to be conducted by a certified public accountant or
public accountant selected by the charter school from the directory.
The bill would specify that it is unlawful for a public accounting
firm to provide audit services to a charter school if the lead audit
partner, or coordinating audit partner, having primary responsibility
for the audit, or the audit partner responsible for reviewing the
audit, has performed audit services for that charter school in each
of the 6 previous fiscal years, except as provided.
(6) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. It is the intent of the Legislature in enacting this
act to do all of the following:
(a) Ensure successful conditions for high-performing and
high-quality charter schools and encourage high levels of academic
performance and sound fiscal management practices among charter
schools.
(b) Implement accountability standards for charter schools that
will ensure that all charter schools are of high quality.
(c) Ensure successful conditions for high-performing charter
schools by setting academic achievement targets as a condition of
charter renewal, accountability standards to identify charter schools
that are not high quality, and evaluation standards to determine
whether entities operating multiple charter schools are establishing
and operating high-quality charter schools.
(d) Establish fiscal management standards for charter schools that
are as rigorous as those for other schools and school districts, in
order to ensure the most efficient and effective use of public funds
for the education of children in California.
(e) Ensure successful conditions for high-performing charter
schools by setting standards for the auditing of, and financial
reporting by, charter schools so as to provide for the transparent
use of public funds.
(f) Require a charter school authorizer to consider during a
charter school renewal whether a charter school has intentionally
targeted high-achieving pupils to attend the charter school and
whether the charter school's population generally reflects a similar
proportion of low-achieving pupils as the local school district pupil
population, especially high-need pupils, including, but not limited
to, pupils with disabilities, pupils living in poverty, and English
learners.
SEC. 2. Section 14502.1 of the Education Code is amended to read:
14502.1. (a) The Controller, in consultation with the Department
of Finance and the State Department of Education, shall develop a
plan to review and report on financial and compliance audits. The
plan shall commence with the 2003-04 fiscal year for audits of school
districts, other local education agencies, and the offices of county
superintendents of schools. The Controller, in consultation with the
Department of Finance, the State Department of Education, and
representatives of the California School Boards Association, the
California Association of School Business Officials, the California
County Superintendents Educational Service Association, the
California Teachers Association, the California Society of Certified
Public Accountants, shall recommend the statements and other
information to be included in the audit reports filed with the state,
and shall propose the content of an audit guide to carry out the
purposes of this chapter. A supplement to the audit guide may be
suggested in the audit year, following the above process, to address
issues resulting from new legislation in that year that changes the
conditions of apportionment. The proposed content of the audit guide
and any supplement to the audit guide shall be submitted by the
Controller to the Education Audits Appeal Panel for review and
possible amendment.
(b) The audit guide and any supplement shall be adopted by the
Education Audits Appeal Panel pursuant to the rulemaking procedures
of the Administrative Procedure Act as set forth in Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title 2 of
the Government Code. It is the intent of the Legislature that, for
the 2003-04 fiscal year, the audit guide be adopted by July 1 of the
fiscal year to be audited. A supplemental audit guide may be adopted
to address legislative changes to the conditions of apportionment. It
is the intent of the Legislature that supplements be adopted before
March 1 of the audit year. Commencing with the 2004-05 fiscal year,
and each fiscal year thereafter, the audit guide shall be adopted by
July 1 of the fiscal year to be audited. A supplemental audit guide
may be adopted to address legislative changes to the conditions of
apportionment. The supplements shall be adopted before March 1 of the
audit year. To meet these goals and to ensure the accuracy of the
audit guide, the process for adopting emergency regulations set forth
in Section 11346.1 of the Government Code may be followed to adopt
the guide and supplemental audit guide. It is the intent of the
Legislature that once the audit guide has been adopted for a fiscal
year, as well as any supplement for that year, thereafter only
suggested changes to the audit guide and any additional supplements
need be adopted pursuant to the rulemaking procedures of the
Administrative Procedure Act. The audit guide and any supplement
shall be issued in booklet form and may be made available by any
means deemed appropriate. The Controller and consultants in the
development of the suggested audit guide and any supplement shall
work cooperatively on a timeline that will allow the education audits
appeal panel to meet the July 1 and March 1 issuance dates.
Consistent with current practices for development of the audit guide
before the 2003-04 fiscal year, the Controller shall provide for the
adoption of procedures and timetables for the development of the
suggested audit guide, any supplement, and the format for additions,
deletions, and revisions.
(c) For the audit of school districts or county offices of
education electing to take formal action pursuant to Sections 22714,
22714.5 (as it read prior to January 1, 2005) ,
44929, and 44929.1 (as it read prior to January 1, 2005)
, the audit guide content proposed by the Controller shall include,
but not be limited to, the following:
(1) The number and type of positions vacated.
(2) The age and service credit of the retirees receiving the
additional service credit provided by Sections
22714,22714.5, 22714, 22714.5 (as it read prior to
January 1, 2005) , 44929, and 44929.1 (as it
read prior to January 1, 2005) .
(3) A comparison of the salary and benefits of each retiree
receiving the additional service credit with the salary and benefits
of the replacement employee, if any.
(4) The resulting retirement cost, including interest, if any, and
postretirement health care benefits costs, incurred by the employer.
(d) The Controller shall annually prepare a cost analysis, based
on the information included in the audit reports for the prior fiscal
year, to determine the net savings or costs resulting from formal
actions taken by school districts and county offices of education
pursuant to Sections 22714, 22714.5 (as it read prior to January
1, 2005) , 44929, and 44929.1 (as it read prior to January
1, 2005) , and shall report the results of the cost analysis
to the Governor and the Legislature by April 1 of each year.
(e) All costs incurred by the Controller to implement subdivision
(c) shall be absorbed by the Controller.
(f) This section shall become operative July 1, 2003 and shall
apply to the preparation of the audit guide for school district
audits commencing with the 2003-04 fiscal year.
(f) Pursuant to subdivisions (a) and (b), the Controller shall
propose, and the Education Audits Appeal Panel shall adopt, a charter
school supplement to the audit guide to provide guidance on the
sections of the school district and county office audit guide that
apply to charter schools and to provide specific guidance on the
unique nature of charter schools. In developing the charter school
supplement, the Controller shall consult with representatives of the
following organizations:
(1) Organizations specified in subdivision (a).
(2) The California Charter Schools Association.
(3) Other charter school organizations, as appropriate.
SEC. 3. Section 47604 of the Education Code is amended to read:
47604. (a) Charter schools may elect to operate as, or be
operated by, a nonprofit public benefit corporation, formed and
organized pursuant to the Nonprofit Public Benefit Corporation Law
(Part 2 (commencing with Section 5110) of Division 2 of Title 1) of
the Corporations Code).
(b) The governing board of a school district that grants a charter
for the establishment of a charter school formed and organized
pursuant to this section shall be entitled to a single representative
on the board of directors of the nonprofit public benefit
corporation.
(c) An authority that grants a charter to a charter school to be
operated by, or as, a nonprofit public benefit corporation is not
liable for the debts or obligations of the charter school, or for
claims arising from the performance of acts, errors, or omissions by
the charter school, if the authority has complied with all oversight
responsibilities required by law, including, but not limited to,
those required by Section 47604.32 and subdivision (m) of Section
47605.
(d) A charter school operated as, or operated by, a for-profit
corporation shall notify the Superintendent of that fact in writing
annually.
SEC. 4. Section 47605 of the Education Code is amended to read:
47605. (a) (1) Except as set forth in paragraph (2), a petition
for the establishment of a charter school within a school district
may be circulated by one or more persons seeking to establish the
charter school. A petition for the establishment of a charter school
shall identify a single charter school that will operate within the
geographic boundaries of that school district. A charter school may
propose to operate at multiple sites within the school district, as
long as each location is identified in the charter school petition.
The petition may be submitted to the governing board of the school
district for review after either of the following conditions are met:
(A) The petition has been is signed
by a number of parents or legal guardians of pupils that is
equivalent to at least one-half of the number of pupils that the
charter school estimates will enroll in the school for its first year
of operation.
(B) The petition has been is signed
by a number of teachers that is equivalent to at least one-half of
the number of teachers that the charter school estimates will be
employed at the school during its first year of operation.
(2) A petition that proposes to convert an existing public school
to a charter school that would not be eligible for a loan pursuant to
subdivision (b) of Section 41365 may be circulated by one or more
persons seeking to establish the charter school. The petition may be
submitted to the governing board of the school district for review
after the petition has been is signed
by not less than 50 percent of the permanent status teachers
currently employed at the public school to be converted.
(3) A petition shall include a prominent statement that a
signature on the petition means that the parent or legal guardian is
meaningfully interested in having his or her child or ward attend the
charter school, or in the case of a teacher's signature, means that
the teacher is meaningfully interested in teaching at the charter
school. The proposed charter shall be attached to the petition.
(4) After receiving approval of its petition, a charter school
that proposes to establish operations at one or more additional sites
shall request a material revision to its charter and shall notify
the authority that granted its charter of those additional locations.
The authority that granted its charter shall consider whether to
approve those additional locations at an open, public meeting.
If the additional locations are approved, they shall be
The approval of additional locations of a charter
school constitutes a material revision to the charter
school's o f its charter.
(5) A charter school that is unable to locate within the
jurisdiction of the chartering school district may establish one site
outside the boundaries of the school district, but within the county
in which that school district is located, if the school district
within the jurisdiction of which the charter school proposes to
operate is notified in advance of the charter petition approval, the
county superintendent of schools and the Superintendent are notified
of the location of the charter school before it commences operations,
and either of the following circumstances exist:
(A) The school has attempted to locate a single site or facility
to house the entire program, but a site or facility is unavailable in
the area in which the school chooses to locate.
(B) The site is needed for temporary use during a construction or
expansion project.
(6) Commencing January 1, 2003, a petition to establish a charter
school may not be approved to serve pupils in a grade level that is
not served by the school district of the governing board considering
the petition, unless the petition proposes to serve pupils in all of
the grade levels served by that school district.
(b) No later than 30 days after receiving a petition, in
accordance with subdivision (a), the governing board of the school
district shall hold a public hearing on the provisions of the
charter, at which time the governing board of the school district
shall consider the level of support for the petition by teachers
employed by the district, other employees of the district, and
parents. Following review of the petition and the public hearing, the
governing board of the school district shall either grant or deny
the charter within 60 days of receipt of the petition ,
provided, however, that the date . The 60-day period
may be extended by an additional 30 days if both
parties the governing board and the proponents of the
petition agree to the extension. In reviewing petitions for the
establishment of charter schools pursuant to this section, the
chartering authority shall be guided by the intent of the Legislature
that charter schools are and should become an integral part of the
California educational system and that establishment of charter
schools should be encouraged. The governing board of the school
district shall grant a charter for the operation of a school under
this part if it is satisfied that granting the charter is consistent
with sound educational practice. The governing board of the school
district shall not deny a petition for the establishment of a charter
school unless it makes written factual findings, specific to the
particular petition, setting forth specific facts to support one or
more of the following findings:
(1) The charter school presents an unsound educational program for
the pupils to be enrolled in the charter school.
(2) The petitioners are demonstrably unlikely to successfully
implement the program set forth in the petition.
(3) The petition does not contain the number of signatures
required by subdivision (a).
(4) The petition does not contain an affirmation of each of the
conditions described in subdivision (d).
(5) The petition does not contain reasonably comprehensive
descriptions of all of the following:
(A) (i) A description of the educational program of the school,
designed, among other things, to identify those whom the school is
attempting to educate, what it means to be an "educated person" in
the 21st century, and how learning best occurs. The goals identified
in that program shall include the objective of enabling pupils to
become self-motivated, competent, and lifelong learners.
(ii) If the proposed school will serve high school pupils, a
description of the manner in which the charter school will inform
parents about the transferability of courses to other public high
schools and the eligibility of courses to meet college entrance
requirements. Courses offered by the charter school that are
accredited by the Western Association of Schools and Colleges may be
considered transferable and courses approved by the University of
California or the California State University as creditable under the
"A" to "G" admissions criteria may be considered to meet college
entrance requirements.
(B) The measurable pupil outcomes identified for use by the
charter school. "Pupil outcomes," for purposes of this part, means
the extent to which all pupils of the school demonstrate that they
have attained the skills, knowledge, and attitudes specified as goals
in the school's educational program.
(C) The method by which pupil progress in meeting those pupil
outcomes is to be measured.
(D) The governance structure of the school, including, but not
limited to, the process to be followed by the school to ensure
parental involvement.
(E) The qualifications to be met by individuals to be employed by
the school.
(F) The procedures that the school will follow to ensure the
health and safety of pupils and staff. These procedures shall include
the requirement that each employee of the school furnish the school
with a criminal record summary as described in Section 44237.
(G) The means by which the school will achieve a racial and ethnic
balance among its pupils that is reflective of the general
population residing within the territorial jurisdiction of the school
district to which the charter petition is submitted.
(H) Admission requirements, if applicable.
(I) The manner in which annual, independent financial audits shall
be conducted, which shall employ generally accepted
accounting principles government auditing standards
, and the manner in which audit exceptions and deficiencies
shall be resolved to the satisfaction of the chartering authority
, consistent with the supplement to the audit guide adopted
pursuant to subdivision (f) of Section 14502.1 .
(J) The procedures by which pupils can be suspended or expelled.
(K) The manner by which staff members of the charter schools will
be covered by the State Teachers' Retirement System, the Public
Employees' Retirement System, or federal social security.
(L) The public school attendance alternatives for pupils residing
within the school district who choose not to attend charter schools.
(M) A description of the rights of any employee of the school
district upon leaving the employment of the school district to work
in a charter school, and of any rights of return to the school
district after employment at a charter school.
(N) The procedures to be followed by the charter school and the
entity granting the charter to resolve disputes relating to
provisions of the charter.
(O) A declaration whether or not the charter school shall be
deemed the exclusive public school employer of the employees of the
charter school for the purposes of Chapter 10.7 (commencing with
Section 3540) of Division 4 of Title 1 of the Government Code.
(P) A description of the procedures to be used if the charter
school closes. The procedures shall ensure a final audit of the
school to determine the disposition of all assets and liabilities of
the charter school, including plans for disposing of any net assets
and for the maintenance and transfer of pupil records.
(6) The petitioner has operated another charter school for at
least three consecutive years and any of the following have occurred:
(A) The charter school demonstrated academic achievement
equivalent to a persistently lowest-achieving school as set forth in
Section 53200.
(B) The charter school completed its first renewal cycle and was
not renewed by the authorizing entity, the county board of education,
or the state board.
(C) The charter school had its charter revoked, and the charter
was not restored by the county board of education or the state board.
(c) (1) Charter schools shall meet all statewide standards and
conduct the pupil assessments required pursuant to Sections 60605 and
60851 and any other statewide standards authorized in statute or
pupil assessments applicable to pupils in noncharter public schools.
(2) Charter schools shall , on a regular basis,
consult , on a regular basis, with their parents, legal
guardians, and teachers regarding the school's educational programs.
(d) (1) In addition to any other requirement imposed under this
part, a charter school shall be nonsectarian in its programs,
admission policies, employment practices, and all other operations,
shall not charge tuition, and shall not discriminate against any
pupil on the basis of the characteristics listed in Section 220.
Except as provided in paragraph (2), admission to a charter school
shall not be determined according to the place of residence of the
pupil, or of his or her parent or legal guardian, within this state,
except that an existing public school converting partially or
entirely to a charter school under this part shall adopt and maintain
a policy giving admission preference to pupils who reside within the
former attendance area of that public school.
(2) (A) A charter school shall admit all pupils who wish to attend
the school.
(B) However, if If the number of
pupils who wish to attend the charter school exceeds the school's
capacity, attendance, except for existing pupils of the charter
school, shall be determined by a public random drawing. Preference
shall be extended to pupils currently attending the charter school
and pupils who reside in the district except as provided for in
Section 47614.5. Other preferences may be permitted by the chartering
authority on an individual school basis and only if consistent with
the law.
(C) In the event of a drawing, the chartering authority shall make
reasonable efforts to accommodate the growth of the charter school
and in no event shall take any action to impede the charter school
from expanding enrollment to meet pupil demand.
(3) If a pupil is expelled or leaves the charter school without
graduating or completing the school year for any reason, the charter
school shall notify the superintendent of the school district of the
pupil's last known address within 30 days, and shall
, upon request, shall provide that school
district with a copy of the cumulative record of the pupil, including
a transcript of grades or report card, and health information. This
paragraph applies only to pupils subject to compulsory full-time
education pursuant to Section 48200.
(e) The governing board of a school district shall not require any
employee of the school district to be employed in a charter school.
(f) The governing board of a school district shall not require any
pupil enrolled in the school district to attend a charter school.
(g) The governing board of a school district shall require that
the petitioner or petitioners provide information regarding the
proposed operation and potential effects of the school, including,
but not limited to, the facilities to be utilized by the school, the
manner in which administrative services of the school are to be
provided, and potential civil liability effects, if any, upon the
school and upon the school district. The description of the
facilities to be used by the charter school shall specify where the
school intends to locate. The petitioner or petitioners shall also be
required to provide financial statements that include a proposed
first-year operational budget, including startup costs, and cashflow
and financial projections for the first three years of operation.
(h) In reviewing petitions for the establishment of charter
schools within the school district, the governing board of the school
district shall give preference to petitions that demonstrate the
capability to provide comprehensive learning experiences to pupils
identified by the petitioner or petitioners as academically low
achieving pursuant to the standards established by the department
under Section 54032 as it read prior to July 19, 2006.
(i) Upon the approval of the petition by the governing board of
the school district, the petitioner or petitioners shall provide
written notice of that approval, including a copy of the petition, to
the applicable county superintendent of schools, the department, and
the state board.
(j) (1) If the governing board of a school district denies a
petition, the petitioner may elect to submit the petition for the
establishment of a charter school to the county board of education.
The county board of education shall review the petition pursuant to
subdivision (b). If the petitioner elects to submit a petition for
establishment of a charter school to the county board of education
and the county board of education denies the petition, the petitioner
may file a petition for establishment of a charter school with the
state board, and the state board may approve the petition, in
accordance with subdivision (b). A charter school that receives
approval of its petition from a county board of education or from the
state board on appeal shall be subject to the same requirements
concerning geographic location to which it would otherwise be subject
if it received approval from the entity to which it originally
submitted its petition. A charter petition that is submitted to
either a county board of education or to the state board shall meet
all otherwise applicable petition requirements, including the
identification of the proposed site or sites where the charter school
will operate.
(2) In assuming its role as a chartering agency, the state board
shall develop criteria to be used for the review and approval of
charter school petitions presented to the state board. The criteria
shall address all elements required for charter approval, as
identified in subdivision (b) and shall define "reasonably
comprehensive" as used in paragraph (5) of subdivision (b) in a way
that is consistent with the intent of this part. Upon satisfactory
completion of the criteria, the state board shall adopt the criteria
on or before June 30, 2001.
(3) A charter school for which a charter is granted by either the
county board of education or the state board based on an appeal
pursuant to this subdivision shall qualify fully as a charter school
for all funding and other purposes of this part.
(4) If either the county board of education or the state board
fails to act on a petition within 120 days of receipt, the decision
of the governing board of the school district to deny a petition
shall, thereafter, be subject to judicial review.
(5) The state board shall adopt regulations implementing this
subdivision.
(6) Upon the approval of the petition by the county board of
education, the petitioner or petitioners shall provide written notice
of that approval, including a copy of the petition , to
the department and
the state board.
(k) (1) The state board may , by mutual
agreement, may designate its supervisorial and oversight
responsibilities for a charter school approved by the state
board it approves to any local educational
agency in the county in which the charter school is located or to the
governing board of the school district that first denied the
petition.
(2) The designated local educational agency shall have all
monitoring and supervising authority of a chartering agency,
including, but not limited to, powers and duties set forth in Section
47607, except the power of revocation, which shall remain with the
state board.
(3) A charter school that has been granted its charter through an
appeal to the state board and elects to seek renewal of its charter
shall, prior to expiration of the charter, submit its petition for
renewal to the governing board of the school district that initially
denied the charter. If the governing board of the school district
denies the school's petition for renewal, the school may petition the
state board for renewal of its charter.
( l ) Teachers in charter schools shall hold a
Commission on Teacher Credentialing certificate, permit, or other
document equivalent to that which a teacher in other public schools
would be required to hold. These documents shall be maintained on
file at the charter school and are subject to periodic inspection by
the chartering authority. It is the intent of the Legislature that
charter schools be given flexibility with regard to noncore,
noncollege preparatory courses.
(m) A charter school shall transmit a copy of its annual,
independent financial audit report for the preceding fiscal year, as
described in subparagraph (I) of paragraph (5) of subdivision (b), to
its chartering entity, the Controller, the county superintendent of
schools of the county in which the charter school is sited, unless
the county board of education of the county in which the charter
school is sited is the chartering entity, and the department by
December 15 of each year. This subdivision does not apply if the
audit of the charter school is encompassed in the audit of the
chartering entity pursuant to Section 41020.
SEC. 5. Section 47605.6 of the Education Code is amended to read:
47605.6. (a) (1) In addition to the authority provided by Section
47605.5, a county board of education may also approve a petition for
the operation of a charter school that operates at one or more sites
within the geographic boundaries of the county and that provides
instructional services that are not generally provided by a county
office of education. A county board of education may only approve a
countywide charter if it finds, in addition to the other requirements
of this section, that the educational services to be provided by the
charter school will offer services to a pupil population that will
benefit from those services and that cannot be served as well by a
charter school that operates in only one school district in the
county. A petition for the establishment of a countywide charter
school pursuant to this subdivision may be circulated throughout the
county by any one or more persons seeking to establish the charter
school. The petition may be submitted to the county board of
education for review after either of the following conditions are
met:
(A) The petition has been is signed
by a number of parents or guardians of pupils residing within the
county that is equivalent to at least one-half of the number of
pupils that the charter school estimates will enroll in the school
for its first year of operation and each of the school districts
where the charter school petitioner proposes to operate a facility
has received at least 30 days notice of the petitioner's intent to
operate a school pursuant to this section.
(B) The petition has been is signed
by a number of teachers that is equivalent to at least one-half of
the number of teachers that the charter school estimates will be
employed at the school during its first year of operation and each of
the school districts where the charter school petitioner proposes to
operate a facility has received at least 30 days notice of the
petitioner's intent to operate a school pursuant to this section.
(2) An existing public school may not be converted to a charter
school in accordance with this section.
(3) After receiving approval of its petition, a charter school
that proposes to establish operations at additional sites within the
geographic boundaries of the county board of education shall notify
the school districts where those sites will be located. The charter
school also shall also request a
material revision of its charter by the county board of education
that approved its charter , and the county board shall
consider whether to approve those additional locations at an open,
public meeting, held no sooner than 30 days following notification of
the school districts where the sites will be located. If approved,
the location of the approved sites shall be a material revision of
the school's approved charter.
(4) A petition shall include a prominent statement indicating that
a signature on the petition means that the parent or guardian is
meaningfully interested in having his or her child or ward attend the
charter school, or in the case of a teacher's signature, means that
the teacher is meaningfully interested in teaching at the charter
school. The proposed charter shall be attached to the petition.
(b) No later than 60 days after receiving a petition, in
accordance with subdivision (a), the county board of education shall
hold a public hearing on the provisions of the charter, at which time
the county board of education shall consider the level of support
for the petition by teachers, parents or guardians, and the school
districts where the charter school petitioner proposes to place
school facilities. Following review of the petition and the public
hearing, the county board of education shall either grant or deny the
charter within 90 days of receipt of the petition. However, this
date may be extended by an additional 30 days if both parties agree
to the extension. A county board of education may impose any
additional requirements beyond those required by this section that it
considers necessary for the sound operation of a countywide charter
school. A county board of education may grant a charter for the
operation of a school under this part only if the board is satisfied
that granting the charter is consistent with sound educational
practice and that the charter school has reasonable justification for
why it could not be established by petition to a school district
pursuant to Section 47605. The county board of education shall deny a
petition for the establishment of a charter school if the board
finds , one or more of the following:
(1) The charter school presents an unsound educational program for
the pupils to be enrolled in the charter school.
(2) The petitioners are demonstrably unlikely to successfully
implement the program set forth in the petition.
(3) The petition does not contain the number of signatures
required by subdivision (a).
(4) The petition does not contain an affirmation of each of the
conditions described in subdivision (d).
(5) The petition does not contain reasonably comprehensive
descriptions of all of the following:
(A) (i) A description of the educational program of the school,
designed, among other things, to identify those pupils whom the
school is attempting to educate, what it means to be an "educated
person" in the 21st century, and how learning best occurs. The goals
identified in that program shall include the objective of enabling
pupils to become self-motivated, competent, and lifelong learners.
(ii) If the proposed charter school will enroll high school
pupils, a description of the manner in which the manner in which the
charter school will inform parents regarding the transferability of
courses to other public high schools. Courses offered by the charter
school that are accredited by the Western Association of Schools and
Colleges may be considered to be transferable to other public high
schools.
(iii) If the proposed charter school will enroll high school
pupils, information as to the manner in which the charter school will
inform parents as to whether each individual course offered by the
charter school meets college entrance requirements. Courses approved
by the University of California or the California State University as
satisfying their prerequisites for admission may be considered as
meeting college entrance requirements for purposes of this clause.
(B) The measurable pupil outcomes identified for use by the
charter school. "Pupil outcomes," for purposes of this part, means
the extent to which all pupils of the school demonstrate that they
have attained the skills, knowledge, and attitudes specified as goals
in the school's educational program.
(C) The method by which pupil progress in meeting those pupil
outcomes is to be measured.
(D) The location of each charter school facility that the
petitioner proposes to operate.
(E) The governance structure of the school, including, but not
limited to, the process to be followed by the school to ensure
parental involvement.
(F) The qualifications to be met by individuals to be employed by
the school.
(G) The procedures that the school will follow to ensure the
health and safety of pupils and staff. These procedures shall include
the requirement that each employee of the school furnish the school
with a criminal record summary as described in Section 44237.
(H) The means by which the school will achieve a racial and ethnic
balance among its pupils that is reflective of the general
population residing within the territorial jurisdiction of the school
district to which the charter petition is submitted.
(I) The manner in which annual, independent, financial , and
compliance audits shall be conducted, in accordance with
audit guide regulations established by the State Board
of Education adopted by the Education Audits Appeal
Panel , and the manner in which audit exceptions and
deficiencies shall be resolved.
(J) The procedures by which pupils can be suspended or expelled.
(K) The manner by which staff members of the charter schools will
be covered by the State Teachers' Retirement System, the Public
Employees' Retirement System, or federal social security.
(L) The procedures to be followed by the charter school and the
county board of education to resolve disputes relating to provisions
of the charter.
(M) A declaration whether or not the charter school shall be
deemed the exclusive public school employer of the employees of the
charter school for the purposes of the Educational Employment
Relations Act (Chapter 10.7 (commencing with Section 3540) of
Division 4 of Title 1 of the Government Code).
(N) Admission requirements, of the charter school, if applicable.
(O) The public school attendance alternatives for pupils residing
within the county who choose not to attend the charter school.
(P) A description of the rights of an employee of the county
office of education, upon leaving the employment of the county office
of education, to be employed by the charter school, and a
description of any rights of return to the county office of education
that an employee may have upon leaving the employ of the charter
school.
(Q) A description of the procedures to be used if the charter
school closes. The procedures shall ensure a final audit of the
school to determine the disposition of all assets and liabilities of
the charter school, including plans for disposing of any net assets
and for the maintenance and transfer of public records.
(6) The petitioner has operated another charter school for at
least three consecutive years and any of the following have occurred:
(A) The charter school demonstrated academic achievement
equivalent to a persistently lowest-achieving school as set forth in
Section 53200.
(B) The charter school completed its first renewal cycle and was
not renewed by the authorizing entity, the county board of education,
or the state board.
(C) The charter school had its charter revoked, and the charter
was not restored by the county board of education or the state board.
(6)
(7) Any other basis that the county board
of education finds justifies the denial of the petition.
(c) A county board of education that approves a petition for the
operation of a countywide charter may, as a condition of charter
approval, enter into an agreement with a third party, at the expense
of the charter school, to oversee, monitor, and report to the county
board of education on the operations of the charter school. The
county board of education may prescribe the aspects of the charter
school's operations to be monitored by the third party and may
prescribe appropriate requirements regarding the reporting of
information concerning the operations of the charter school to the
county board of education.
(d) (1) Charter schools shall meet all statewide standards and
conduct the pupil assessments required pursuant to Section 60605 and
any other statewide standards authorized in statute or pupil
assessments applicable to pupils in noncharter public schools.
(2) Charter schools shall consult, on a regular basis
consult , with their parents and
teachers regarding the school's educational programs.
(e) (1) In addition to any other requirement imposed under this
part, a charter school shall be nonsectarian in its programs,
admission policies, employment practices, and all other operations,
shall not charge tuition, and shall not discriminate against any
pupil on the basis of ethnicity, national origin, gender, or
disability. Except as provided in paragraph (2), admission to a
charter school shall not be determined according to the place of
residence of the pupil, or of his or her parent or guardian, within
this state.
(2) (A) A charter school shall admit all pupils who wish to attend
the school.
(B) However, if If the number of
pupils who wish to attend the charter school exceeds the school's
capacity, attendance, except for existing pupils of the charter
school, shall be determined by a public random drawing. Preference
shall be extended to pupils currently attending the charter school
and pupils who reside in the county except as provided for in Section
47614.5. Other preferences may be permitted by the chartering
authority on an individual school basis and only if consistent with
the law.
(C) In the event of a drawing, the county board of education shall
make reasonable efforts to accommodate the growth of the charter
school and, in no event, shall take any action to impede the charter
school from expanding enrollment to meet pupil demand.
(f) No county board of education shall require any employee of the
county or a school district to be employed in a charter school.
(g) No county board of education shall require any pupil enrolled
in a county program to attend a charter school.
(h) The county board of education shall require that the
petitioner or petitioners provide information regarding the proposed
operation and potential effects of the school, including, but not
limited to, the facilities to be utilized by the school, the manner
in which administrative services of the school are to be provided,
and potential civil liability effects, if any, upon the school, any
school district where the charter school may operate , and
upon the county board of education. The petitioner or petitioners
shall also be required to provide financial statements that include a
proposed first-year operational budget, including startup costs, and
cashflow and financial projections for the first three years of
operation.
(i) In reviewing petitions for the establishment of charter
schools within the county, the county board of education shall give
preference to petitions that demonstrate the capability to provide
comprehensive learning experiences to pupils identified by the
petitioner or petitioners as academically low-achieving pursuant to
the standards established by the State Department of
Education department under Section 54032.
(j) Upon the approval of the petition by the county board of
education, the petitioner or petitioners shall provide written notice
of that approval, including a copy of the petition, to the school
districts within the county, the Superintendent of Public
Instruction , and to the
State Board of Education state board .
(k) If a county board of education denies a petition, the
petitioner may not elect to submit the petition for the establishment
of the charter school to the State Board of Education
state board .
( l ) Teachers in charter schools shall be required to
hold a Commission on Teacher Credentialing certificate, permit, or
other document equivalent to that which a teacher in other public
schools would be required to hold. These documents shall be
maintained on file at the charter school and shall be subject to
periodic inspection by the chartering authority.
(m) A charter school shall transmit a copy of its annual,
independent, financial audit report for the preceding fiscal year, as
described in subparagraph (I) of paragraph (5) of subdivision (b),
to the County Office of Education county
office of education , State the
Controller , and the State Department of
Education department by December 15 of each
year. This subdivision shall not apply if the audit of the charter
school is encompassed in the audit of the chartering entity pursuant
to Section 41020.
SEC. 6. Section 47607 of the Education Code is amended to read:
47607. (a) (1) A charter may be granted pursuant to Sections
47605, 47605.5, and 47606 for a period not to exceed five years. A
charter granted by a school district governing board, a county board
of education , or the state board, may be granted one or
more subsequent renewals by that entity. Each renewal shall be for a
period of one to five years. A material revision of the
provisions of a charter petition may be made only with the approval
of the authority that granted the charter. The authority that granted
the charter may inspect or observe any part of the charter school at
any time.
(2) Renewals and material revisions of charters are governed by
the standards and criteria in Section 47605, and shall include, but
not be limited to, a reasonably comprehensive description of any new
requirement of charter schools enacted into law after the charter was
originally granted or last renewed.
(3) The chartering authority that authorizes a charter school
shall consider, as one factor in determining whether to grant a
renewal, the degree to which a charter school serves pupil
populations that are similar to the local school district pupil
populations or similar to pupil populations in the school's local
community, or similar to the pupil populations identified in the
charter petition as the target pupil populations to be served,
especially with regard to high-need pupils, including, but not
limited to, pupils with disabilities, pupils living in poverty, and
English learners.
(b) Commencing on January 1, 2005, or after a
A charter school that has been in operation for
four years , whichever date occurs later, a charter school
shall meet at least one of the following criteria prior to
receiving a charter renewal pursuant to paragraph (1) of subdivision
(a):
(1) Attained its Academic Performance Index (API) growth
target schoolwide and subgroup growth targets in
the prior year or in two of the last three years, or in the
aggregate for the prior three years.
(2) Ranked in deciles 4 to 10, inclusive, on the API in the prior
year or in two of the last three years.
(3) Ranked in deciles 4 to 10, inclusive, on the API for a
demographically comparable school in the prior year or in two of the
last three years.
(4) (A) The entity that granted the charter determines that the
academic performance of the charter school is at least equal to the
academic performance of the public schools that the charter school
pupils would otherwise have been required to attend, as well as the
academic performance of the schools in the school district in which
the charter school is located, taking into account the composition of
the pupil population that is served at the charter school.
(B) The determination made pursuant to this paragraph shall be
based upon all of the following:
(i) Documented and clear and convincing data.
(ii) Pupil achievement data from assessments, including, but not
limited to, the Standardized Testing and Reporting Program
established by Article 4 (commencing with Section 60640) for
demographically similar pupil populations in the comparison schools.
(iii) Information submitted by the charter school.
(C) A chartering authority shall submit to the Superintendent
copies of supporting documentation and a written summary of the basis
for any determination made pursuant to this paragraph. The
Superintendent shall review the materials and make recommendations to
the chartering authority based on that review. The review may be the
basis for a recommendation made pursuant to Section 47604.5.
(D) A charter renewal may not be granted to a charter school prior
to 30 days after that charter school submits materials pursuant to
this paragraph.
(5)
(4) Has qualified for an alternative
accountability system pursuant to subdivision (h) of Section 52052.
(5) Has met or exceeded the API of the local school district.
(c) Notwithstanding subdivision (a), for purposes of achieving
high-performing charter schools, a chartering authority shall not do
either of the following:
(1) Grant a renewal of a charter school for a period longer than
three years if that charter school is in program improvement,
pursuant to the federal No Child Left Behind Act of 2001 (20 U.S.C.
Sec. 6301 et seq.).
(2) Grant a renewal of a charter school that has entered into year
five of program improvement, pursuant to the federal No Child Left
Behind Act of 2001 (20 U.S.C. Sec. 6301 et seq.), has not exited
program improvement, and did not meet Adequate Yearly Progress in the
year prior to the renewal year.
(3) This subdivision does not apply to charter schools that
qualify for the alternative accountability system developed pursuant
to subdivision (h) of Section 52052.
(c)
(d) A charter may be revoked by the
authority that granted the charter under this chapter if the
authority finds, through a showing of substantial evidence, that the
charter school did any of the following:
(1) Committed a material violation of any of the conditions,
standards, or procedures set forth in the charter.
(2) Failed to meet or pursue any of the pupil outcomes identified
in the charter.
(3) Failed to meet generally accepted accounting principles, or
engaged in fiscal mismanagement.
(4) Violated any provision of law.
(d)
(e) Prior to revocation, the authority that
granted the charter shall notify the charter public school of any
violation of this section and give the school a reasonable
opportunity to remedy the violation, unless the authority determines,
in writing, that the violation constitutes a severe and imminent
threat to the health or safety of the pupils.
(e)
(f) Prior to revoking a charter for failure
to remedy a violation pursuant to subdivision (d)
(e) , and after expiration of the school's reasonable
opportunity to remedy without successfully remedying the violation,
the chartering authority shall provide a written notice of intent to
revoke and notice of facts in support of revocation to the charter
school. No later than 30 days after providing the notice of intent to
revoke a charter, the chartering authority shall hold a public
hearing, in the normal course of business, on the issue of whether
evidence exists to revoke the charter. No later than 30 days after
the public hearing, the chartering authority shall issue a final
decision to revoke or decline to revoke the charter, unless the
chartering authority and the charter school agree to extend the
issuance of the decision by an additional 30 days. The chartering
authority shall not revoke a charter, unless it makes written factual
findings supported by substantial evidence, specific to the charter
school, that support its findings.
(f)
(g) (1) If a school district is the
chartering authority and it revokes a charter pursuant to this
section, the charter school may appeal the revocation to the county
board of education within 30 days following the final decision of the
chartering authority.
(2) The county board may reverse the revocation decision if the
county board determines that the findings made by the chartering
authority under subdivision (e) (f) are
not supported by substantial evidence. The school district may
appeal the reversal to the state board.
(3) If the county board does not issue a decision on the appeal
within 90 days of receipt, or the county board upholds the
revocation, the charter school may appeal the revocation to the state
board.
(4) The state board may reverse the revocation decision if the
state board determines that the findings made by the chartering
authority under subdivision (e) (f) are
not supported by substantial evidence. The state board may uphold
the revocation decision of the school district if the state board
determines that the findings made by the chartering authority under
subdivision (e) (f) are supported by
substantial evidence.
(g)
(h) (1) If a county office of education is
the chartering authority and the county board revokes a charter
pursuant to this section, the charter school may appeal the
revocation to the state board within 30 days following the decision
of the chartering authority.
(2) The state board may reverse the revocation
decision if the state board determines that the findings made by the
chartering authority under subdivision (e)
(f) are not supported by substantial evidence.
(h)
(i) If the revocation decision of the
chartering authority is reversed on appeal, the agency that granted
the charter shall continue to be regarded as the chartering
authority.
(i)
(j) During the pendency of an appeal filed
under this section, a charter school, whose revocation proceedings
are based on paragraph (1) or (2) of subdivision (c)
(d) , shall continue to qualify as a charter
school for funding and for all other purposes of this part, and may
continue to hold all existing grants, resources, and facilities, in
order to ensure that the education of pupils enrolled in the school
is not disrupted.
(j)
(k) Immediately following the decision of a
county board to reverse a decision of a school district to revoke a
charter, the following shall apply:
(1) The charter school shall qualify as a charter school for
funding and for all other purposes of this part.
(2) The charter school may continue to hold all existing grants,
resources, and facilities.
(3) Any funding, grants, resources, and facilities that had been
withheld from the charter school, or that the charter school had
otherwise been deprived of use, as a result of the revocation of the
charter shall be immediately reinstated or returned.
(k)
( l ) A final decision
of a revocation or appeal of a revocation pursuant to subdivision
(c) (d) shall be reported to the
chartering authority, the county board, and the department.
SEC. 7. Section 47630.6 is added to the Education Code, to read:
47630.6. (a) By December 31 of each fiscal year, the Controller
shall publish a directory of certified public accountants and public
accountants, licensed by the California Board of Accountancy, deemed
by the Controller to be qualified to conduct audits of charter
schools. Each audit of a charter school conducted pursuant to this
part shall be conducted by a certified public accountant or public
accountant selected by the charter school from the directory
established pursuant to this subdivision.
(b) Except as provided in subdivision (d) of Section 41320.1, it
is unlawful for a public accounting firm to provide audit services to
a charter school if the lead audit partner, or coordinating audit
partner, having primary responsibility for the audit, or the audit
partner responsible for reviewing the audit, has performed audit
services for that charter school in each of the six previous fiscal
years
(c) It is the intent of the Legislature that, notwithstanding
subdivision (b), the rotation within public accounting firms conforms
to provisions of the federal Sarbanes-Oxley Act of 2002 (Public Law
107-204; 15 U.S.C. Sec. 7201 et seq.).
SEC. 8. If the Commission on State Mandates determines that this
act contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code.