BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 787


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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          787 (Roger Hernández)


          As Amended  August 18, 2015


          Majority vote


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          |ASSEMBLY:  |46-28 |(June 4, 2015) |SENATE: |22-15 |(September 8,    |
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          Original Committee Reference:  ED.


          SUMMARY:  Prohibits a charter school from operating as, or being  
          operated by, a for-profit corporation.   


          The Senate amendments specify that the provisions of the bill  
          shall take effect on January 1, 2017.


          EXISTING LAW authorizes charter schools to elect to operate as,  
          or be operated by, a nonprofit public benefit corporation,  
          formed and organized pursuant to the Nonprofit Public Benefit  
          Corporation Law.  Specifies the governing board of a school  
          district that grants a charter for the establishment of a  
          charter school shall be entitled to a single representative on  
          the board of directors of the nonprofit public benefit  
          corporation.  Specifies 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  








                                                                     AB 787


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          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. (Education Code Section 47604)


          FISCAL EFFECT:  Unknown.  This bill has been keyed non-fiscal by  
          the Legislative Counsel. 


          COMMENTS:  This bill prohibits charter schools from being  
          operated by a for-profit corporation.  According to the  
          California Charter School Association, there are currently six  
          for-profit charter schools operating in California.   


          Current law authorizes charter schools to operate as a  
          non-profit corporation, but the Education Code is silent  
          regarding whether charter schools are permitted to operate as a  
          for-profit corporations.  Due to the permissive nature of the  
          Education Code, it appears that charter schools are operating as  
          for-profit corporations.  Is it appropriate for state tax payer  
          dollars to be appropriated directly to for-profit corporations  
          to operate public schools?  If a public school is run as a  
          for-profit corporation, is there a perverse incentive to limit  
          services to students in order to increase corporate profits?


          Analysis Prepared by:Chelsea Kelley / ED. / (916) 319-2087        
            FN:  0002097