BILL ANALYSIS �
AB 1086
Page 1
Date of Hearing: April 3, 2013
ASSEMBLY COMMITTEE ON EDUCATION
Joan Buchanan, Chair
AB 1086 (Morrell) - As Introduced: February 22, 2013
SUBJECT : Charter schools: financial reports
SUMMARY : Changes financial reporting requirements for charter
schools whose authorizing authority is a school district.
Specifically, this bill :
1)Repeals the requirement for school district-authorized charter
schools to submit the following financial reports to their
county superintendent of schools:
a) The preliminary budget by July 1;
b) The first interim report, to reflect changes through
October 31, by December 15;
c) The second interim report, to reflect changes through
January 31, by March 15; and
d) The final unaudited report by September 15.
2)Requires school districts to submit financial reports for
charter schools that they have authorized to the county
superintendent of schools according to the following schedule:
a) The preliminary budget by July 15;
b) The first interim report, to reflect changes through
October 31, by December 31;
c) The second interim report, to reflect changes through
January 31, by March 31; and
d) The final unaudited report by September 30.
3)States that the bill does not create a reimbursable mandate,
because districts have the authority to levy service charges,
fees, or assessments that may be sufficient to pay for the new
requirements.
EXISTING LAW
1)Requires school district-authorized charter schools to submit
financial reports to their authorizing district and the county
superintendent of schools according to the schedule described
in 1) above.
AB 1086
Page 2
2)Requires school districts to exercise supervisorial oversight
over charter schools they have authorized.
3)Authorizes school districts to charge the charter school a fee
for the actual cost of supervisorial oversight, subject to the
following:
a) Not to exceed 1% of the revenue of the charter school;
b) Not to exceed 3% of the revenue of the charter school if
the charter school is able to obtain substantially rent
free facilities from the district; and
c) Actual costs of oversight if the charter school was
authorized by the State Board of Education and for which
the district has been designated as the supervising
authority.
FISCAL EFFECT : State-mandated local program
COMMENTS : Existing law requires school districts to monitor
the fiscal condition of each charter school under their
authority. Existing law also requires county superintendents of
schools to review school district budgets and certify them as
positive, conditional, or negative, depending on the
superintendent's determination of the district's ability to meet
its financial obligations. As part of the county review of
school district budgets, county superintendents determine
whether a district has conducted its own required review of the
financial reports of the charter schools it has authorized.
This is because a school district may be liable for a charter
school's losses or other financial damage.
District financial reports are due to the county superintendent
of schools according to the schedule described in 1) in the bill
summary above. In order to allow authorizing districts time to
review the charter school reports, some counties require
district-authorized charter schools to submit their reports to
their districts one or two weeks prior to the deadline for the
submission of district reports. Some district authorizers also
require their charter schools to submit their reports early.
This bill requires school district authorizers to submit the
financial reports of the charter schools they have authorized to
AB 1086
Page 3
the county superintendent of schools according to the schedule
described in 2) in the bill summary above, which is two weeks
after the district reports are due,. According to the author's
office, this change "would provide a brief time period to allow
the authorizer to 'sign off' on the charter school's budget
before it is submitted to [the county superintendent]."
However, current practice already allows for this review period.
In addition, the due dates prescribed by this bill are two
weeks after the date that districts are statutorily required to
submit their reports to the county superintendent. Thus, this
bill does not add additional time for the authorizing district
to review the charter school's reports. However, the bill does
add to the existing workload of school districts that have
authorized and oversee charter schools. To the extent the fee
that districts are allowed to assess for oversight does not
cover the cost of this additional duty, Legislative Counsel
states the bill would impose a state-mandated local program.
REGISTERED SUPPORT / OPPOSITION :
Support
None received
Opposition
None received
Analysis Prepared by : Rick Pratt / ED. / (916) 319-2087