BILL ANALYSIS Ó
AB 440
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ASSEMBLY THIRD READING
AB 440 (Brownley)
As Introduced February 14, 2011
Majority vote
EDUCATION 6-3 APPROPRIATIONS 11-5
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|Ayes:|Brownley, Ammiano, |Ayes:|Fuentes, Blumenfield, |
| |Butler, Carter, Eng, | |Bradford, Charles |
| |Williams | |Calderon, Davis, Gatto, |
| | | |Hall, Hill, Lara, |
| | | |Mitchell, Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Norby, Halderman, Wagner |Nays:|Harkey, Donnelly, |
| | | |Nielsen, Norby, Wagner |
| | | | |
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SUMMARY : Establishes academic and fiscal accountability
standards related to charter schools. Specifically, this bill :
1)Requires the State Controller (Controller) to propose and the
Education Audits Appeal Panel to adopt a charter school
supplement to the audit guide in consultation with the
California Charter Schools Association; requires charter
schools to complete annual audits consistent with the audit
guide; requires the Controller to annually publish a directory
of public accountants that are qualified to conduct audits of
charter schools; and, requires the regular rotation of public
accounting firms used to complete these audits consistent with
the federal Sarbanes-Oxley Act of 2002.
2)Requires a charter school operated as or by a for-profit
corporation to notify the Superintendent of Public Instruction
(SPI) of that fact in writing annually.
3)Allows a charter school authorizer to consider during the
authorization of a new charter school, whether the charter
school petitioner has operated another charter school and any
of the following have occurred: the charter has demonstrated
academic achievement equivalent to a persistently
lowest-achieving school; the charter school has not been
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renewed; or, the school has had its charter revoked, as
specified.
4)Requires a chartering authority to consider, as one factor in
determining whether to grant a renewal, the degree to which a
charter school serves student populations that are similar to
local district student populations, the school's local
community, or the population identified in the charter
petition, especially related to high-need students, including,
but not limited to, students with disabilities, students
living in poverty and English learners.
5)Changes the charter school renewal process to include the
following academic achievement requirements: a requirement
that charter schools achieve academic growth targets for each
student subgroup prior to renewal; a requirement that charter
schools in program improvement (PI) not be renewed for more
than three years; and, a requirement that charter schools in
PI year five not be renewed if the school has not exited PI
and did not meet adequate yearly progress (AYP) in the year
prior to renewal.
6)Allows a charter school authorizer to renew a charter school
for between one and five years.
7)Deletes the authorization for a chartering authority to renew
a charter petition if the academic performance is equal to the
academic performance of the public schools that the charter
school students would otherwise have been required to attend.
8)Makes legislative findings and declarations regarding the
importance of establishing academic performance targets and
sound fiscal management practices in charter schools.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Annual General Fund/Proposition 98 (GF/98) state-reimbursable
mandated costs of $100,000 to local education agencies (LEAs)
to review and verify specified petition and renewal
information required under this bill. To the extent that the
information required for submission is more readily available
to an LEA than current law requirements, this cost may be
offset.
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2)One-time GF administrative costs, likely less than $80,000, to
the State Controller to complete the development of a
supplemental audit guide for charter schools, as specified.
COMMENTS : The bill ensures successful conditions for high
performing charter schools by specifying how charter authorizers
shall monitor and hold charter schools accountable, especially
with regard to student achievement.
Charter schools serving high need students: This bill requires
charter authorizers to consider, as one aspect of a charter
renewal petition, the extent to which the school serves similar
student populations as the local district, the school's local
community, or the population identified in the charter petition,
especially students with disabilities, students living in
poverty and English learners. This requirement is consistent
with the original legislative intent to establish charter
schools to, among other things, increase learning opportunities
for all students, with special emphasis on expanded learning
experiences for students who are identified as academically low
achieving. The 2009 EdSource report on charter schools found
that charter high schools enroll 13% fewer students who are
either English learners or redesignated as fluent English
proficient (RFEP) students compared to noncharter schools;
charter middle schools enroll English learner and RFEP students
at a 7% lower rate than noncharter schools; and, charter
elementary schools enroll 11% fewer English learner and RFEP
students compared with noncharter schools. Similarly, the
EdSource report found that charter schools serve lower
proportions of students with disabilities compared to noncharter
schools at all grade levels. The study also found that charter
schools serve fewer students that participate in the Free and
Reduced-Price Meal Program in both elementary and middle school
compared to noncharter schools, but slightly more students in
high school compared to noncharter schools.
Academic accountability: In creating charter schools, the
Legislature declared that the intent of charter schools was to
provide opportunities for teachers, parents, students and
community members to establish and maintain schools that operate
independently from the existing school district structure, as a
method to, among other things:
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1)Improve student learning.
2)Increase learning opportunities for all students, with special
emphasis on expanded learning experiences for students who are
identified as academically low achieving.
3)Hold the schools established under this part accountable for
meeting measurable student outcomes, and provide the schools
with a method to change from rule-based to performance-based
accountability systems.
4)Provide vigorous competition within the public school system
to stimulate continual improvements in all public schools.
With legislative intent in mind, AB 440 (Brownley) establishes
academic accountability standards that will ensure that charter
schools are providing opportunities for improved student
learning. If charter schools are not demonstrating improved
student learning, AB 440 will establish a system to close those
low-performing charter schools. This bill will prohibit renewal
of a charter if the school is in federal PI year five and
prohibit renewal of a charter for more than three years if the
school is in federal PI. This bill will allow a charter
authorizer to consider track record, if any, a charter school
petitioner has made at other charter schools they operate as
part of the authorization process of new charter schools. The
bill will further delete the authorization for charter schools
to be renewed if the academic performance is equal to the
academic performance of the public schools that the charter
school students would otherwise have been required to attend.
These conditions for renewal will ensure that high quality
charter schools will continue to thrive and low achieving
charter schools will close.
Fiscal accountability: This bill requires charter schools to
complete annual independent audits using a charter school
supplement to the audit guide and requires the same high quality
auditors to complete charter school audits that complete school
district audits. Existing law requires charter schools to have
annual audits, but does not provide a charter school supplement
to the audit guide and does not require charter schools to hire
qualified auditors approved by the State Controller.
For-profit corporations: This bill would require a charter
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school operated as or by a for-profit corporation to notify the
SPI of that fact in writing annually. This will bring further
transparency to charter schools operated as for-profit
corporations. Further, by making parents of students at these
charter schools aware of the school's for-profit status, this
will ensure that state taxpayer dollars spent in charter schools
to educate public school children are accurately accounted for
and utilized to support student instruction.
Renewal timeline: This bill allows a charter authorizer to
grant a charter renewal for between one and five years.
Existing law requires that charter renewals be granted for five
years. By giving authorizers more flexibility to grant renewals
for between one and five years, authorizers will be able to more
closely monitor charter schools that are struggling. For
example, if a charter authorizer has reservations about renewing
a charter school for fiscal mismanagement, the authorizer would
have the flexibility to renew the charter school for a shorter
period of time enabling the authorizer to examine the schools
fiscal stability earlier than the current five year renewal
model. According to the Los Angeles County Office of Education,
permitting initial charter renewals for less than five years
would increase the likelihood of renewals by original
authorizers and appeal bodies. Requiring a five year renewal
may not be prudent when there is question as to the soundness of
a charter school's fiscal, educational, or management/governance
status. A shorter renewal length allows the charter to continue
while the authorizer monitors. This is particularly pertinent
when the term of the original charter was less than five years.
Previous legislation: AB 1950 (Brownley) from 2010, which was
held by the author in the Senate Education Committee, would have
established academic and fiscal accountability standards related
to charter schools and was substantially similar to this AB 440
(Brownley).
Analysis Prepared by : Chelsea Kelley / ED. / (916) 319-2087
FN: 0000878
AB 440
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