BILL ANALYSIS
AB 1950
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Date of Hearing: April 21, 2010
ASSEMBLY COMMITTEE ON EDUCATION
Julia Brownley, Chair
AB 1950 (Brownley) - As Amended: April 5, 2010
SUBJECT : Charter school accountability.
SUMMARY : Establishes academic and fiscal accountability
standards related to charter schools. Specifically, this bill :
1)Requires the Controller to propose and the Education Audits
Appeal Panel to adopt a charter school supplement to the audit
guide in consultation with the California Charter Schools
Association; requires charter schools to complete annual
audits consistent with the audit guide; requires the
Controller to annually publish a directory of public
accountants that are qualified to conduct audits of charter
schools; and, requires the regular rotation of public
accounting firms used to complete these audits consistent with
the federal Sarbanes-Oxley Act of 2002.
2)Prohibits a charter school from being operated as or by a
for-profit corporation.
3)Allows a charter school authorizer to consider during the
authorization of a new charter school, whether the charter
school petitioner has operated another charter school and any
of the following have occurred: the charter has demonstrated
academic achievement equivalent to a persistently
lowest-achieving school; the charter school has not been
renewed; or, the school has had its charter revoked, as
specified.
4)Requires a chartering authority to consider, as one factor in
determining whether to grant a renewal, the degree to which a
charter school serves student populations that are similar to
local district student populations, especially related to
high-need students, including, but not limited to, students
with disabilities, students living in poverty and English
learners.
5)Changes the charter school renewal process to include the
following academic achievement requirements: a requirement
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that charter schools achieve academic growth targets for each
student subgroup prior to renewal; a requirement that charter
schools in program improvement (PI) not be renewed for more
than three years; a requirement that charter schools in PI
year five not be renewed if the school has not exited PI and
did not meet adequate yearly progress (AYP) in the year prior
to renewal.
6)Allows a charter school authorizer to renew a charter school
for between one and five years.
7)Deletes the authorization for a chartering authority to renew
a charter petition if the academic performance is equal to the
academic performance of the public schools that the charter
school students would otherwise have been required to attend.
8)Makes Legislative findings and declarations regarding the
importance of establishing academic performance targets and
sound fiscal management practices in charter schools.
EXISTING LAW :
1)Establishes the Charter Schools Act of 1992 which authorizes a
school district, a county board of education or the state
board of education (SBE) to approve or deny a petition for a
charter school to operate independently from the existing
school district structure as a method of accomplishing, among
other things, improved student learning, increased learning
opportunities for all students, with special emphasis on
expanded learning experiences for students who are identified
as academically low achieving, holding charter schools
accountable for meeting measurable student outcomes, and
providing the schools with a method to change from rule-based
to performance-based accountability systems.
2)Establishes a process for the submission of a petition for the
establishment of a charter school. Authorizes a petition,
identifying a single charter school to operate within the
geographical boundaries of the school district, to be
submitted to the school district. Authorizes, if the
governing board of a school district denies a petition for the
establishment of a charter school, the petitioner to elect to
submit the petition to the county board of education.
Authorizes, if the county board of education denies the
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charter, the petitioner to submit the petition to the SBE.
Authorizes a school that serves a countywide service to submit
the charter petition directly to the county office of
education. Authorizes a school that serves a statewide
purpose to go directly to the SBE.
3)Authorizes a charter school to be granted for not more than
five years, and to be granted one or more renewals for five
years. Requires the renewals and material revisions of the
charter to be based upon the same standards as the original
charter petition.
4)Requires a charter school to transmit a copy of its annual,
independent financial audit report for the preceding fiscal
year, to its chartering entity, the Controller, the county
superintendent of schools of the county in which the charter
school is sited, unless the county board of education of the
county in which the charter school is sited is the chartering
entity, and the department by December 15 of each year.
5)Requires, commencing on January 1, 2005, or after a charter
school has been in operation for four years, whichever date
occurs later, a charter school shall meet at least one of the
following criteria prior to receiving a charter renewal:
a) Attained its Academic Performance Index (API) growth
target in the prior year or in two of the last three years,
or in the aggregate for the prior three years.
b) Ranked in deciles 4 to 10, inclusive, on the API in the
prior year or in two of the last three years.
c) Ranked in deciles 4 to 10, inclusive, on the API for a
demographically comparable school in the prior year or in
two of the last three years.
d) The entity that granted the charter determines that the
academic performance of the charter school is at least
equal to the academic performance of the public schools
that the charter school pupils would otherwise have been
required to attend, as well as the academic performance of
the schools in the school district in which the charter
school is located, taking into account the composition of
the pupil population that is served at the charter school.
e) Has qualified for an alternative accountability system
pursuant to subdivision (h) of Section 52052
FISCAL EFFECT : Unknown
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COMMENTS : According to the California Department of Education
(CDE), the 2008-09 count of operating charter schools is 746
with student enrollment of more than 285,000 in this state.
This includes four charter schools approved under the provisions
of the statewide benefit charter law and eight other
SBE-approved charters. Some charter schools are new, while
others are conversions from existing public schools. Charter
schools are part of the state's public education system and are
funded by public dollars. A charter school is usually created
or organized by a group of teachers, parents and community
leaders, a community-based organization, or an education
management organization. Charter schools are authorized by
school district boards, county boards of education or the state
board of education. A charter school is generally exempt from
most laws governing school districts, except where specifically
noted in the law. Specific goals and operating procedures for
the charter school are detailed in an agreement (or "charter")
between the sponsoring board and charter organizers.
The measure ensures successful conditions for high performing
charter schools by specifying how charter authorizers shall
monitor and hold charter schools accountable, especially with
regard to student achievement by:
1)Allowing a charter authorizer to consider track record, if
any, a charter school petitioner has made at other charter
schools they operate as part of the authorization process of
new charter schools.
2)Prohibiting renewal of a charter if the school is eligible for
state intervention or if the charter school is in federal PI
year five.
3)Prohibiting renewal of a charter for more than three years if
the school is in federal PI.
4)Deleting the authorization for charter schools to be renewed
if the academic performance is equal to the academic
performance of the public schools that the charter school
students would otherwise have been required to attend.
5)Requiring charter school audits to be conducted by the same
quality auditors as for audits of other schools.
6)The measure encourages charter schools to serve student
populations that are similar to local district student
populations, especially relative to high-need students, by
requiring a charter authorizer to consider the degree to which
a charter school serves these student populations in the
charter renewal process.
7)Allowing charter authorizers to renew a charter school for
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between one and five years.
8)Prohibiting charter schools from being operated by for-profit
corporations.
Charter Schools Serving High Need Students . This bill requires
charter authorizers to consider, as one aspect of a charter
renewal petition, the extent to which the school serves similar
student populations as the local district, especially students
with disabilities, students living in poverty and English
learners. This requirement is consistent with the original
Legislative intent to establish charter schools to, among other
things, increase learning opportunities for all students, with
special emphasis on expanded learning experiences for students
who are identified as academically low achieving. The 2009
EdSource report on charter schools found that charter high
schools enroll 13% fewer students who are either English
learners or redesignated as fluent English proficient (RFEP)
students compared to noncharter schools; charter middle schools
enroll English learner and RFEP students at a 7% lower rate than
noncharter schools; and charter elementary schools enroll 11%
fewer English learner and RFEP students compared with noncharter
schools. Similarly, the EdSource report found that charter
schools serve lower proportions of students with disabilities
compared to noncharter schools at all grade levels. The study
also found that charter schools serve fewer students that
participate in the Free and Reduced-Price Meal Program in both
elementary and middle school compared to noncharter schools, but
slightly more students in highschool compared to noncharter
schools.
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------------------------------------------------------------------ (Source: Charter Schools in California: 2009 Update on Issues
and Performance, EdSource)
A November 2009 report by The Civil Rights Project makes policy
recommendations with regard to segregation in charter schools.
They recommend that charter schools could "use many of the same
provisions that helped magnet schools use choice to increase
diversity. These include providing full and extensive
information, outreach to all racial/ethnic, socioeconomic and
linguistic groups, no admissions/attendance/parent involvement
requirements, and free transportation." They also recommend
that "tracking and publicly reporting basic information about
students should be a requirement for any school that receives
public funding. Charter schools should be evaluated to ensure
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that they are enrolling, retaining, and graduating proportional
shares of students by race/ethnicity, ELL status, socioeconomic
status, and students with disabilities as their surrounding
districts. Schools could also be required to report the number
of students in different subgroups who apply to the charter
school compared to those who actually enroll, among schools that
are over-subscribed. OCR could and should do this. The federal
government should also reinstate its former practice of
providing annual reports on the state of charter schools."
The committee should consider, with this data in mind, whether
chartering authorities should consider, as one factor in
determining whether to grant a renewal, the degree to which a
charter school serves student populations that are similar to
local district student populations, especially related to
high-need students, including, but not limited to, students with
disabilities, students living in poverty and English learners.
Academic Accountability . In creating charter schools, the
Legislature declared that the intent of charter schools was to
provide opportunities for teachers, parents, students and
community members to establish and maintain schools that operate
independently from the existing school district structure, as a
method to, among other things:
1)Improve student learning.
2)Increase learning opportunities for all students, with special
emphasis on expanded learning experiences for students who are
identified as academically low achieving.
3)Hold the schools established under this part accountable for
meeting measurable student outcomes, and provide the schools
with a method to change from rule-based to performance-based
accountability systems.
4)Provide vigorous competition within the public school system
to stimulate continual improvements in all public schools.
With Legislative intent in mind, AB 1950 establishes academic
accountability standards that will ensure that charter schools
are providing opportunities for improved student learning. If
charter schools are not demonstrating improved student learning,
AB 1950 will establish a system to close those low-performing
charter schools. This bill will prohibit renewal of a charter
if the school is eligible for state intervention or if the
charter school is in federal PI year five and prohibit renewal
of a charter for more than three years if the school is in
federal PI. This bill will allow a charter authorizer to
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consider track record, if any, a charter school petitioner has
made at other charter schools they operate as part of the
authorization process of new charter schools. The bill will
further delete the authorization for charter schools to be
renewed if the academic performance is equal to the academic
performance of the public schools that the charter school
students would otherwise have been required to attend. These
conditions for renewal will ensure that high quality charter
schools will continue to thrive and low achieving charter
schools will close.
The June 2009 Center for Research on Education Outcomes (CREDO)
report, "reveals that a decent fraction of charter schools, 17
percent, provide superior education opportunities for their
students. Nearly half of the charter schools nationwide have
results that are no different from the local public school
options and over a third, 37 percent, deliver learning results
that are significantly worse than their student would have
realized had they remained in traditional public schools. These
findings underlie the parallel findings of significant
statebystate differences in charter school performance and in
the national aggregate performance of charter schools. The
policy challenge is how to deal constructively with varying
levels of performance today and into the future."
Fiscal Accountability . This bill requires charter schools to
complete annual independent audits using a charter school
supplement to the audit guide and requires the same high quality
auditors to complete charter school audits that complete school
district audits. Existing law requires charter schools to have
annual audits, but does not provide a charter school supplement
to the audit guide and does not require charter schools to hire
qualified auditors approved by the Controller. Further the bill
prohibits charter schools from being operated by for-profit
corporations. These requirements will ensure that state
taxpayer dollars spent in charter schools to educate public
school children are accurately accounted for and utilized to
support student instruction.
For-Profit Corporations . This bill would prohibit charter
schools from being operated by for-profit corporations. To
avoid the misuse of public funds, for-profit corporations must
be prohibited from operating charter schools. Because charter
schools are fully funded with state taxpayer dollars, it is
inappropriate for a for-profit corporation to make a profit off
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of state funded public schools.
Renewal Timeline . This bill allows a charter authorizer to
grant a charter renewal for between one and five years.
Existing law requires that charter renewals be granted for five
years. By giving authorizers more flexibility to grant renewals
for between one and five years, authorizers will be able to more
closely monitor charter schools that are struggling. For
example, if a charter authorizer has reservations about renewing
a charter school for fiscal mismanagement, the authorizer would
have the flexibility to renew the charter school for a shorter
period of time enabling the authorizer to examine the schools
fiscal stability earlier than the current five year renewal
model. According to the Los Angeles County Office of Education,
permitting initial charter renewals for less than five years
would increase the likelihood of renewals by original
authorizers and appeal bodies. Requiring a five year renewal
may not be prudent when there is question as to the soundness of
a charter school's fiscal, educational, or management/governance
status. A shorter renewal length allows the charter to continue
while the authorizer monitors. This is particularly pertinent
when the term of the original charter was less than five years.
Committee Amendments : As a result of technical assistance from
the California State Controller's office, staff recommends
making technical amendments related to the charter school
supplement to the audit guide, the manner in which charter
audits shall employ governing auditing standards, and the
qualifications for charter school auditors.
Related legislation : AB 1982 (Ammiano) from 2010, pending in
the Assembly Education Committee, establishes a state-wide cap
of 1450, on the number of charter schools that can operate;
requires the Legislative Analyst's Office (LAO) to make
recommendations regarding the cap by July 1, 2015; prohibits
charter school personnel with hiring authority from employing
relatives; and, authorizes school districts to approve a charter
school only if the petition meets specific criteria.
AB 1991 (Arambula) from 2010, pending in the Assembly Education
Committee, requires charter school petitions to be granted for 5
years; authorizes charter school renewals to be granted for 5 to
10 years; establishes an alternative renewal process for charter
schools identified as persistently lowest achieving and schools
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that do not meet specified academic criteria; authorizes the
Superintendent of Public Instruction (SPI) to establish
alternative academic accountability standards for charter
schools; and, combines the renewal appeals process with the
revocation appeals process.
AB 2320 (Swanson) from 2010, pending in the Assembly Education
Committee, requires charter school petitions to describe the
different and innovative teaching methods the school will use,
how the school will provide vigorous competition and stimulate
continual improvements within the public school system, and the
means by which the school will achieve a balance of pupils who
live in poverty, are English learners or are individuals with
exceptional needs; limits the role of county boards of education
(CBE) in the appeal process, deletes the authorization for a
charter school to present a petition directly to a CBE, for a
district to convert its schools to charter schools, and for the
state board of education (SBE) to approve charter school
petitions on appeal; and, limits state wide benefit charter
schools to those that partner with specific entities.
AB 572 (Brownley) from 2009, pending on the Senate Floor,
requires charter schools to comply with the same conflict of
interest requirements as school districts.
Previous legislation : AB 8 X5 (Brownley) from 2009 proposed
comprehensive changes to the Education Code consistent with the
federal Race to the Top (RTTT) program; this bill addressed the
four RTTT policy reform areas of standards and assessments, data
systems to support instruction, great teachers and leaders and
turning around the lowest-achieving schools. Deleted the
statewide charter school cap; proposed enhanced charter school
fiscal and academic accountability standards. This bill was
held in the Senate Education Committee at the request of the
author.
AB 3 X5 (Torlakson) from 2009 deleted the statewide charter
school cap and proposed changes to the measurable student
outcomes, renewal and revocation procedures for charter schools.
This bill was introduced but was not referred to a committee.
REGISTERED SUPPORT / OPPOSITION :
Support
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California Federation of Teachers
California School Employees Association
Opposition
California Charter Schools Association
School for Integrated Academics and Technologies
An individual
Analysis Prepared by : Chelsea Kelley / ED. / (916) 319-2087