BILL ANALYSIS
AB 572
Page 1
ASSEMBLY THIRD READING
AB 572 (Brownley)
As Amended May 14, 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 that 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 from voting on all matters affecting his or her own
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employment and personnel matters that uniquely affect a
member's relative; 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; and, specifies this measure does not prohibit
an employee of a charter school from serving as a member of
the governing body of that charter school.
EXISTING LAW pertaining to charter schools:
1)Provides no specific requirement for charter school 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.
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COMMENTS : This bill requires charter school governing board
members 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."
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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 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 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
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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 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: 0000729