BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 1172
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          ASSEMBLY THIRD READING
          AB 1172 (Mendoza) 
          As Amended  January 26, 2012
          Majority vote 

           EDUCATION           7-4                                         
           
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          |Ayes:|Brownley, Ammiano,        |     |                          |
          |     |Buchanan, Butler, Carter, |     |                          |
          |     |Eng, Williams             |     |                          |
          |     |                          |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |Nays:|Norby, Beth Gaines,       |     |                          |
          |     |Halderman, Wagner         |     |                          |
          |     |                          |     |                          |
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           SUMMARY  :  Makes changes to the charter school approval process.  
          Specifically,  this bill  :  

          1)Specifies that a chartering authority may deny a charter 
            petition if it makes a written factual finding that the 
            charter school would have a negative fiscal impact on the 
            school district. 

          2)Specifies that a negative fiscal impact on a school district 
            may only be established, and is deemed to be established, if 
            any of the following conditions are met:

             a)   The school district has received a negative financial 
               certification;

             b)   The school district has received an emergency 
               apportionment or loan and is operating under the oversight 
               of a state administrator or trustee; or,

             c)   The school district, due to the declining enrollment of 
               pupils, is in the process of closing a school that a 
               charter school petition has identified as the proposed site 
               for its charter school and has received a qualified 
               financial certification or would receive a qualified 
               financial certification if the charter school is approved.

           EXISTING LAW  :  Current law establishes the Charter Schools Act 
          of 1992 which authorizes a school district, a county board of 








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          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, 
          increased learning opportunities for all students, with special 
          emphasis on expanded learning experiences for students who are 
          identified as academically low achieving, holding charter 
          schools accountable for meeting measurable student outcomes, and 
          providing the schools with a method to change from rule-based to 
          performance-based accountability systems.

           FISCAL EFFECT  :  This bill is keyed non-fiscal by the Legislative 
          Counsel.

           COMMENTS  :  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 local education agencies (LEAs) or the SBE.  A 
          charter school is generally exempt from most laws governing 
          school districts, except where specifically noted in the law.  
          Specific goals and operating procedures for the charter school 
          are detailed in an agreement (or "charter") between the 
          sponsoring board and charter organizers.

          The Charter Schools Act of 1992 originally authorized an LEA or 
          the SBE to approve a petition for a charter school.  Subsequent 
          legislation, AB 544 (Lempert), Chapter 34, Statutes of 1998, 
          requires the LEA or SBE to approve a petition for a charter 
          unless it makes one or more of the following findings:

          1)The charter school presents an unsound educational program.

          2)The petitioners are demonstrably unlikely to successfully 
            implement the program set forth in the petition.

          3)The petition does not contain the required number of 
            signatures.

          4)The petition does not satisfactorily address requirements 
            regarding admissions policies and employment practices.

          5)The petition does not contain reasonably comprehensive 
            descriptions of the school's educational program, measurable 








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            pupil outcomes, governance structure and other operational 
            requirements.

          This change shifted the burden of proof in the petition process 
          from the petitioners to the LEA or SBE.  Districts are required 
          to support their decision to deny a charter petition with 
          written, factual findings, and the decision to deny may be 
          appealed to the county board of education.  This bill adds the 
          finding that the proposed school would have a negative fiscal 
          impact on the district to the list of reasons for which a 
          petition may be denied.  
           
           Arguments in support:  Proponents argue that this bill is needed 
          to allow districts to deny a charter petition if creating the 
          school would have a negative impact on the district's ability to 
          maintain programs and services for its remaining, non-charter 
          students.  They argue that "funding of charter schools should 
          not negatively impact the educational program of the school 
          district in which the charter school is located" and that the 
          "bill is necessary to ensure the fiscal solvency of school 
          districts."

          Arguments in opposition:  Opponents say the bill is too broadly 
          written and that most districts would be able to claim a 
          negative financial impact under its provisions.  In addition, 
          the financial impact on the school district, regardless of how 
          it would be measured, should not be a factor in the charter 
          school approval process.  They argue that this undermines the 
          original intent of the charter school law by taking away 
          "parental and student choice whenever a school district decides 
          that a charter would have a negative fiscal impact on the 
          district."  
           
           Previous legislation:  AB 2954 (Liu) of 2006, would have added 
          negative fiscal impact to the reasons that a school district may 
          cite as the basis for refusing to initially approve a charter 
          school, but prohibited this as a basis to deny renewal of a 
          charter.  Further, the bill authorized a school district to 
          require that a charter school describe how it will provide free 
          and reduced price meals to eligible pupils as a condition for 
          initial charter approval.  The bill was vetoed by the Governor 
          with the following veto message:

               While I understand the plight of school districts faced 
               with fiscal challenges of declining enrollment and other 








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               management issues, I cannot condone allowing them to deny 
               parents and students their rights to petition for the 
               establishment of a charter school. In essence, this bill 
               would grant school districts the authority to punish 
               charter petitioners because of problems caused by their own 
               fiscal management issues or their unwillingness to make 
               tough decisions, or both.

               In addition, allowing school districts to require, as a 
               condition of approval, that the petition describe how the 
               charter school will provide free and reduced-priced meals 
               to eligible pupils would simply provide districts with 
               another pretext on which to deny a charter.  Charter 
               schools are generally exempt from most laws and regulations 
               governing school districts and they should continue to be 
               exempt from this one.

               In sum, this bill runs counter to the intent of charter 
               schools, which is to provide parents and students with 
               other options within the public school system and to 
               stimulate competition that improves the quality not only of 
               charter schools, but of non-charter schools as well.
           
           
           Analysis Prepared by  :    Rick Pratt / ED. / (916) 319-2087


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