BILL ANALYSIS Ó
AB 787
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GOVERNOR'S VETO
AB
787 (Roger Hernández)
As Enrolled September 11, 2015
2/3 vote
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|ASSEMBLY: |46-28 |(June 4, 2015) |SENATE: |22-15 |(September 8, |
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|ASSEMBLY: |45-29 |(September 9, | | | |
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Original Committee Reference: ED.
SUMMARY: Prohibits a charter school from operating as, or being
operated by, a for-profit corporation.
AB 787
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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
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
AB 787
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services to students in order to increase corporate profits?
GOVERNOR'S VETO MESSAGE:
Under this bill, beginning January 1, 2017, a charter school
could not "operate as" or be "operated by" a for-profit
corporation.
I don't believe the case has been made to eliminate for-profit
charter schools in California. Moreover, the somewhat ambiguous
terms used in this bill could be interpreted to restrict the
ability of non-profit charter schools to continue using
for-profit vendors.
For these reasons, I am unable to sign AB 787.
Analysis Prepared by:Chelsea Kelley / ED. / (916) 319-2087 FN:
0002484