BILL ANALYSIS
AB 572
Page 1
ASSEMBLY THIRD READING
AB 572 (Brownley)
As Amended May 6, 2009
Majority vote
EDUCATION 8-3
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|Ayes:|Brownley, Ammiano, | | |
| |Arambula, Buchanan, | | |
| |Carter, Eng, Solorio, | | |
| |Torlakson | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Nestande, Garrick, Miller | | |
| | | | |
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SUMMARY : Requires charter schools to comply with the same conflict
of interest requirements as school districts. Specifically, this
bill declares:
1)Charter schools are subject to all of the following:
a) The Ralph M. Brown Act (Brown Act), except that a charter
school operated by an entity governed by the Bagley-Keene Open
Meeting Act is subject to the Bagley-Keene Open Meeting Act;
b) The California Public Records Act (CPRA);
c) Article 4 (commencing with Section 1090) of Chapter 1 of
Division 4 of Title 1 of the Government Code; and,
d) The Political Reform Act of 1974 (PRA).
2)A member of the governing body of a charter school shall abstain
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from voting on all matters affecting his or her own employment and
personnel matters that uniquely affect a member's relative; and,
specifies a person who is disqualified by the California
Constitution or laws of the state from holding a civil office
shall not serve on the governing body of a charter school.
EXISTING LAW pertaining to charter schools:
1)Provides no specific requirement for charter school governing
board conflict of interest policies.
2)Deems charter schools as school districts for the purposes of
receiving state education funds.
EXISTING LAW pertaining to school districts:
1)Specifies that Members of the Legislature, state, county,
district, and city officers or employees shall not be financially
interested in any contract made by them in their official
capacity, or by any body or board of which they are members.
(Government Code 1090)
2)Specifies that an employee of a school district (or local agency)
may not be sworn into office as an elected or appointed member of
that school district's (or local agency's) governing board unless
and until he or she resigns as an employee. (Education Code
35107)
3)Requires members of school district governing boards and
designated employees of the school district to file statements of
financial interest according to the PRA. (Government Code 87100
et. seq.)
4)Requires a school district or any board, commission or agency
thereof, or other local public agency to comply with the Brown
Act. (Government Code 54950 et. seq.)
5)Requires a school district or any board, commission or agency
thereof, or other local public agency to comply with the CPRA.
(Government Code 6250 et. seq.)
FISCAL EFFECT : This bill is keyed non-fiscal.
COMMENTS : This bill requires charter school governing board members
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to comply with the same conflict of interest policies by which
school district governing board members currently abide. Recent
news reports of charter school board members engaging in
inappropriate financial mismanagement have highlighted the need for
charter school conflict of interest laws to be clarified. While
charter schools are given more autonomy than public schools, their
governing boards have authority over public funds to be used for the
educational benefit of their students. Charter school governing
boards should be held to the same standards as school district
governing boards. This bill requires charter school boards to file
statements of economic interest according to the PRA; specifies that
charter school board members may not be financially interested in
any decision made by the board; requires charter schools to comply
with the CPRA; and, requires charter school boards to abide by the
Brown Act or the Bagley-Keene Open Meetings Act.
The Brown Act governs meetings conducted by local legislative
bodies, such as boards of supervisors, city councils, and school
boards. The Brown Act requires meetings of the board to be publicly
noticed 72 hours before their meetings, among other requirements.
The CPRA was enacted in 1968 and according to the Attorney General,
in enacting the CRPA, the Legislature stated that access to
information concerning the conduct of the public's business is a
fundamental and necessary right for every person in the state.
Government Code 1090 states that members of the Legislature, state,
county, district, judicial district, and city officers or employees
shall not be financially interested in any contract made by them in
their official capacity, or by any body or board of which they are
members. In a 1983 opinion the Attorney General stated, "Section
1090 of the Government Code codifies the common law prohibition and
the general policy of this state against public officials having a
personal interest in contracts they make in their official
capacities. Mindful of the ancient adage, that 'no man can serve
two masters,' the section was enacted to ensure that public
officials 'making' official contracts not be distracted by personal
financial gain from exercising absolute loyalty and undivided
allegiance to the best interest of the entity which they serve."
The Fair Political Practices Commission (FPPC) was created by the
PRA of 1974. The FPPC receives and files statements of economic
interests from many state and local officials, investigates alleged
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violations of the PRA, imposes penalties when appropriate, and
assists state and local agencies in developing and enforcing
conflict-of-interest codes. School districts are required to comply
with the PRA, and in so, school district governing board members and
designated employees must file a statement of economic interest,
annually.
Supporters of the bill, including the California School Boards
Association, the Association of California School Administrators,
the California Association of School Business Officials, the
California State PTA, the California Federation of Teachers, Orange
County Department of Education, San Francisco Unified School
District, and Antioch Unified School District, argue this measure
will strengthen efforts to end financial abuse of public funds in
charter schools, provide transparency into the operations of the
many charter schools that are providing quality educational options
for parents and students.
The California Teachers Association (CTA) supports the bill and
believes that all charter school governing boards should be free of
conflicts of interest in the operation of charter schools and that
the Ralph M. Brown Act and the CPRA should apply to the operation of
these schools. There is a role for charter schools in California's
education system. That role should be performed to at least the
same high standards of integrity, transparency and openness required
of traditional public schools.
The California Charter Schools Association (CCSA) opposes the bill
and argues, "CCSA supports applying appropriate conflict of interest
provisions to charter schools, including transparency and recusal by
board members with a financial interest in a board decision. In
fact, most charter schools are nonprofit corporations and must abide
by the Corporations Code that includes conflict of interest
provisions. We believe that AB 572's directive that charter schools
comply with Government Code Section 87100 et seq applies an
inappropriate conflict of interest scheme to charter schools."
Statute governing corporations authorizes up to 49% of people
serving on the board of any corporation to be financially interested
in the decisions made by the board. Advocates of charter schools
contend they should abide by conflict of interest provisions related
to corporations, not school district, because some charter schools
are operated by non-profit corporations. The Assembly should
consider whether it is appropriate to allow public funded charter
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schools to have board members be financially interested in the
decisions they make.
Previous legislation: AB 2115 (Mullin) of 2008, required charter
schools to adopt and comply with a conflict of interest policy that
requires its governing board members to abide by the same conflict
of interest requirements as local education agency (LEA) governing
board members. The bill was vetoed by Governor Schwarzenegger with
the following message: "Not only would this bill create state
mandated costs for charter schools to comply with its provisions,
the measure runs counter to the intent of charter schools, which
were created to be free from many of the laws governing schools
districts."
AB 1197 (Wiggins) of 2004, specified that individuals who govern
charter schools shall file statements of economic interest under the
PRA. The bill failed passage on the Senate Floor.
Analysis Prepared by : Chelsea Kelley / ED. / (916) 319-2087
FN: 0000649