BILL ANALYSIS Ó
AB 913
Page 1
Date of Hearing: May 24, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 913 (Chau) - As Amended: April 29, 2013
Policy Committee: Local Government
Vote: 6-3
Education 5-0
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill requires charter schools, beginning July 1, 2014, to
comply with the state's open meeting, conflict of interest, and
disclosure laws in the same manner as non-charter public
schools. Specifically, this bill:
1)Requires a charter school to be subject to the following:
a) The Ralph M. Brown Act (RBA). Further provides if a
charter school is operated by an entity that is subject to
the Bagley-Keen Open Meeting Act (Bagley-Keen) then it too
is subject to Bagley-Keen regardless of the authorizing
entity.
b) The California Public Records Act (CPRA).
c) Conflict of Interest statute (Government Code 1090).
d) The Political Reform Act of 1974.
2)Requires a member of a charter school governing body to
abstain from voting on, or influencing or attempting to
influence another member of the governing body regarding all
matters uniquely affecting his or her own employment, as
specified.
3)Specifies a person who provides a loan to a charter school due
to a fiscal emergency is not disqualified from serving as a
member of the governing body, or from being an employee of the
school, as specified.
4)Specifies a person who leases real property to be occupied by
a charter school, or who signs a guarantor agreement relative
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to the lease of the property occupied by the school, is not
disqualified from serving as a member of the governing body,
or from being an employee of the school, as specified.
FISCAL EFFECT
GF/98 cost pressure, likely less than $100,000, to charter
schools to comply with the requirements of this bill. There
were 1,062 charter schools in 2012-13. Charter schools
participating in the K-12 Mandate Block Grant (93% of the 1,062)
receive reimbursement for the RBA/Bagley Keen mandate. If the
CPRA is added to the block grant, participating charter schools
will receive reimbursement for this activity as well.
SUMMARY CONTINUED
5)Prohibits a person who is disqualified by the state
constitution or laws of the state from holding a civil office
from serving on the governing body of a charter school.
6)Clarifies a charter school governing body that engages in
activities that are not related to the operation of the school
is not subject to the RBA, Bagley-Keen or CPRA, as specified.
7)Prohibits a statement of economic interest that is filed by a
designated person of a charter school after the required
deadline from being the sole basis for revocation of a
charter.
COMMENTS
1)Background . A charter school is a public school that may
provide instruction in any of grades K-12. It is usually
created or organized by a group of teachers, parents and
community leaders or a community-based organization. A charter
school may be authorized by an existing local public school
board, county board of education (COE), or the State Board of
Education (SBE). Existing law requires a potential charter
school to submit a petition to a governing board or SBE for
approval to establish the school. According to the State
Department of Education (SDE), there were 1,062 charter
schools (including three statewide benefit charters and 33
approved by SBE) with an enrollment of 456,000 pupils in
2012-13.
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2)Purpose . The author argues this bill is necessary in order to
conform with proposed federal law related to pensions.
Specifically, the author states: "The US Internal Revenue
Service (IRS) is evaluating the status of charter schools,
among other entities, and the eligibility of affected
employees for governmental pension plans. Under the IRS
proposed regulations, all individuals who benefit from a state
retirement system would have to be employed by a governmental
entity, such as the state, an elected school board or the
federal government and no private interests are involved.
Though [state] law considers charters to be independently run
public schools, their governing boards are not 'publicly
nominated and elected' nor are they subject to open meeting
laws or the requirements to maintain public records that apply
only to governmental entities. [This fact] excludes them from
the IRS' definition of a governmental entity and would seem to
make their employees ineligible to participate in the state
pension plan.
"The proposed rules would affect more than 88 percent of the
state's charter school workforce that opted into California
State Teachers Retirement System (CalSTRS), according to a
report by Podgursky & Olberg from the Thomas B Fordham
Institute. CalSTRS has been monitoring the development of the
IRS proposal because it may be required to prohibit the
participation of charter schools in its benefit program to
avoid losing its governmental plan status under Internal
Revenue Code?"
This bill requires charter schools, beginning July 1, 2014, to
comply with the state's open meeting, conflict of interest,
and disclosure laws in the same manner as non-charter public
schools.
3)The K-12 Education Mandate Block Grant and charter schools .
The 2012 Budget Act allocated $166.6 million for this block
grant. Essentially, a school district, charter school, or COE
may choose to receive a per-pupil allocation to conduct
existing K-12 mandated activities. If the district, charter
school, or COE chooses to receive this allocation it forfeits
its ability to claim mandate reimbursement via the existing
state process. School districts received approximately $28
per pupil; charter schools approximately $14 per pupil; and
COEs approximately $29 per pupil. The advantage of this block
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grant is school districts and COEs will receive annual funding
now versus waiting to receive payment under the existing
claims process, which the state has deferred paying for a
number of years. For charter schools, they receive funding
for existing mandated activities in which they are not
eligible for reimbursement by the Commission on State
Mandates. Likewise, they receive funding for mandated
activities that may only apply to districts and COEs and not
to them. The block grant includes funding for the Ralph M.
Brown Act and therefore, charter schools are reimbursed for
this activity.
According to the Legislative Analyst Office (LAO), 634 school
districts (approximately 67% of all districts), 35 COEs
(approximately 60% of all COEs), and 877 charter schools
(approximately 93% of charter schools) participated in the
block grant.
4)The governor's 2013 budget proposal repeals the requirement
that school districts and COEs (local education agencies
(LEAs) comply with the Ralph Brown Act (RBA) and the
California Public Records Act (CPRA) by . The governor's
proposal largely conforms to actions taken on the
non-education side of the budget. The governor argues the
state should not continue reimbursing LEAs for costs
associated with meeting these requirements. The following
chart details the mandates, whether or not they are included
in the K-12 mandate block grant, and how they are treated by
non-education local governments.
-----------------------------------------------------------------
| Mandate | Included in K-12 |Suspended for Local |
| | Block Grant | Govt. |
-----------------------------------------------------------------
|-----------------------+---------+----------+---------+---------|
| | 2012 |Governor's| 2012 |Governor'|
| | Budget | 2013 | Budget | s 2013 |
| | Act | Proposal | Act |Proposal |
|-----------------------+---------+----------+---------+---------|
|RBA - Requires local | | | | |
|governing boards to | | | | |
|post meeting agendas | Noa | No | No | Yes |
|and perform other | | | | |
|activities related to | | | | |
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|board meetings. | | | | |
| | | | | |
|-----------------------+---------+----------+---------+---------|
|CPRA - Requires the | | | | |
|disclosure of agency | Yes | No | Yes | Yes |
|records to the public | | | | |
|upon request. Also | | | | |
|requires agencies to | | | | |
|assist the public with | | | | |
|their requests. | | | | |
----------------------------------------------------------------
aExcluded because it has not yet finished the mandate
determination process.
To the extent applicable, the state generally applies the
same mandate reimbursement policy across local government
agencies. With reference to the RBA, Proposition 30:
Temporary Taxes to Fund Education, passed by voters in
November 2012, eliminated the state's obligation to pay for
this mandate, but did not eliminate the requirement for
LEAs to perform the activities. This has different
implications for LEAs compared to other local governments
because the state is not required to suspend a LEA mandate
in order to avoid paying back prior-year reimbursement
claims, as it is required to do for local governments.
The Legislative Analyst Office (LAO) recommends conforming
to the actions taken for local governments for the CPRA.
For the RBA mandate, the LAO recommends rejecting the
governor's proposal to suspend it, but adopting the
proposal to remove it from the K-12 Mandate Block Grant,
given the changes made by Proposition 30, which eliminated
the state's reimbursement obligation.
The Assembly Budget Subcommittee on Education took action
to reject the governor's proposal to suspend the CPRA and
the RBA by a vote of 3-2.
5)Previous legislation . AB 360 (Brownley), similar to this
measure, died on the Assembly Floor Inactive File in August
2012.
Analysis Prepared by : Kimberly Rodriguez / APPR. / (916)
319-2081
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