HF 2790

as introduced - 87th Legislature (2011 - 2012) Posted on 03/12/2012 01:54pm

A bill for an act
relating to education; creating education boards; allowing school boards to
reorganize as education boards; amending Minnesota Statutes 2010, section
123B.045; Minnesota Statutes 2011 Supplement, section 124D.10, subdivisions
3, 8, 17; proposing coding for new law in Minnesota Statutes, chapter 123A.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [123A.80] EDUCATION BOARDS.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin An education board has the powers and duties of a
school board as defined in sections 123B.02 and 123B.09. An education board approves,
oversees, and holds accountable a system of schools that provides for the division of the
oversight of schools from their operation, improving accountability and the conditions for
innovation. The education board provides for a system of public schooling through the
supervision of performance contracts or agreements with the school sites organized as
site-governed schools as defined in section 123B.045, area learning centers as defined in
section 123A.06, contract alternative schools as defined in section 123A.05, or chartered
schools as defined in section 124D.10.
new text end

new text begin Subd. 2. new text end

new text begin Conversion to education board. new text end

new text begin A school board, as defined in sections
123B.02 and 123B.09, may become an education board by adopting a resolution to convert
and converting all of the school sites in that district to site-governed schools as defined
in section 123B.045, or a combination of site-governed schools, area learning centers as
defined in section 123A.06, contract alternative schools as defined in section 123A.05, or
chartered schools as defined in section 124D.10.
new text end

new text begin Subd. 3. new text end

new text begin Elected conversion. new text end

new text begin (a) The eligible voters of any school district may
petition the county auditor to convert a school board into an education board. The petition
must be signed by a number of registered voters within the district at least equal to 15
percent of those voting in the last general election.
new text end

new text begin (b) Upon receipt of a valid petition, the proposal shall be submitted to voters at the
next general election. The proposals for conversion to an education board shall be stated
on the ballot substantially as follows: "Shall the school board of the district convert to an
education board? A school board operates schools through a central office; an education
board oversees agreements with schools that are responsible for their own operation." Two
choices in order "Yes" and "No" must be clearly available to the voter.
new text end

new text begin (c) If a majority of the votes cast on the question of conversion to an education
board is in the affirmative, a school board must convert its schools by September 1 of the
calendar year following the election. The school board shall convert to an education
board at the first board meeting following conversion of all schools and shall remain in
effect unless abandoned by a majority of voters at a subsequent election at which an
alternative is submitted to the electorate.
new text end

new text begin Subd. 4. new text end

new text begin Purpose of education boards. new text end

new text begin The purpose of an education board is
to change the relationship between a district's board and its schools by dividing the
oversight of schools from their operation and improving accountability while improving
the conditions for innovation. Education boards improve pupil learning by:
new text end

new text begin (1) creating schools that combine the accountability for a school's performance
with site-level authority over its function;
new text end

new text begin (2) ensuring that a variety of quality public school options are available for all
school-age persons within district boundaries, including the publication of requests for
proposals nationally or internationally for new school creation;
new text end

new text begin (3) promoting innovation among school providers by seeking innovative curricular,
pedagogical, organizational models, leadership models, evaluation designs, significant use
of digital technology, and other innovations;
new text end

new text begin (4) assessing the needs of the community and providing learning models to address
current needs and opportunities; and
new text end

new text begin (5) seeking to maximize the range of skills and expertise available for schooling
in the district by partnering with teachers, school leaders, and private organizations to
lead and manage schools.
new text end

new text begin Subd. 5. new text end

new text begin Duties. new text end

new text begin The education board has all the powers and duties of school boards
including:
new text end

new text begin (1) seeking input from families including students, the community, teachers, and
administrators to determine the models of schools needed by the students and to approve
school sites consistent with the needs of students in the community;
new text end

new text begin (2) seeking applications from district staff and publishing requests for proposals
nationally and internationally for new school proposals;
new text end

new text begin (3) approving sites as site-governed, area learning center, contract alternative, or
chartered to implement the plan. Education boards may use the provisions of the joint
powers statute as defined in section 471.59 to enter into agreements with organizations to
implement the plan;
new text end

new text begin (4) developing a performance agreement with each site, including the accountability
to the education board;
new text end

new text begin (5) allocating the revenue earned by the attending pupils as provided by law to
the sites attended by the pupils;
new text end

new text begin (6) providing oversight of the performance agreements; and
new text end

new text begin (7) holding sites accountable for the performance indicators in the performance
contract.
new text end

new text begin Subd. 6. new text end

new text begin Facilities. new text end

new text begin (a) The education board shall direct all revenue received by
the district under sections 123B.53, 123B.55, 123B.57, 123B.58, 123B.59, 123B.591,
123B.63, 126C.10, subdivision 13, 126C.40, and 126C.46 for facility construction,
purchase, and maintenance as allowed under each section. Any facility constructed or
purchased as part of a school site is property of the school district.
new text end

new text begin (b) Upon termination or expiration of a board's contract with a school site, the
education board may reassign or sell the facilities used by that school. Up to five percent
of any net revenue generated by the sale of facilities by the education board may be
retained by the board for administrative purposes. The remaining revenue must be used
to construct, purchase, improve, or maintain the district's facilities or be distributed on a
per-pupil basis to the schools overseen by the education board.
new text end

new text begin (c) The education board may lease a facility to a charter school that it authorizes
consistent with section 124D.10, subdivision 17.
new text end

new text begin Subd. 7. new text end

new text begin Relationship with school site and limit of powers. new text end

new text begin The education board
shall set learning objectives, provide financing, and evaluate results pursuant to the
performance agreement with the school site. Neither the education board nor any of its
members shall dictate the appointment of any person to office or employment by the
school site, nor shall it control school decisions as to learning strategies or methods.
Except for the purpose of inquiry, the education board and its members shall deal with and
control school sites through the governance body of the school only.
new text end

new text begin Subd. 8. new text end

new text begin Area learning centers. new text end

new text begin Area learning centers shall be operated consistent
with section 123A.06 but shall also be afforded the autonomy and revenue provided to
site-governed schools as defined in section 123B.045.
new text end

new text begin Subd. 9. new text end

new text begin Revenue to schools. new text end

new text begin Each school site under this section shall be allocated
the revenue earned by the students in attendance consistent with section 123A.05,
123A.06, 123B.045, or 124D.10. A minimum of 95 percent of local, state, and federal
revenue, excluding revenue under subdivision 6, received must be allocated to school
sites. The district may retain additional funds, as part of an agreement, to provide specific
services for the site, including legal counsel, finance, contract oversight, districtwide and
out-of-district special education programs, and other services. These schools may also
raise added revenue through grants, gifts, or other methods of fund-raising. Other than for
charter schools, the district shall maintain separate accounts for each site. Revenue shall
not cancel at the end of the year but shall be carried forward to the following year.
new text end

new text begin Subd. 10. new text end

new text begin Exemption from statutes and rules. new text end

new text begin Except as outlined in this section,
an education board and the schools under its direction are exempt from and subject to the
same laws and rules as are chartered schools under section 124D.10, except that section
123B.045 shall apply to site-governed schools and area learning centers. Education boards
must comply with section 123B.09.
new text end

new text begin Subd. 11. new text end

new text begin Notice to commissioner. new text end

new text begin The school board shall inform the commissioner
of its decision to convert to an education board at least 90 days prior to the conversion. The
education board shall inform the commissioner as to which sites are to be site-governed,
area learning center, contract alternative, or chartered schools consistent with the
provisions of applicable sections. If the education board intends to approve sites as
chartered schools, the education board shall first be approved as an authorizer of chartered
schools as provided for in section 124D.10.
new text end

Sec. 2.

Minnesota Statutes 2010, section 123B.045, is amended to read:

123B.045 DISTRICT-CREATED SITE-GOVERNED SCHOOLS.

Subdivision 1.

Authority.

(a) A school new text begin or education new text end board may approve
site-governed schools under this section by requesting site-governing school proposals.
The request for proposals must include what types of schools or education innovations the
board intends to create. new text begin A school board that has adopted a conversion resolution under
section 123A.80, subdivision 2, or must convert to an education board under section
123A.80, subdivision 3, may require each school site to submit (1) an initial proposal and
(2) an amended proposal if the initial proposal was returned under paragraph (c). new text end A current
site may submit a proposal to create a different model for the site if 60 percent or more of
the teachers at the site support the proposal. A group of licensed district professionals
from one or multiple district sites may submit a proposal. The group submitting the
proposal must include parents or other community members in the development of the
proposal. A proposal may request approval for a model of a school not included in the
request for proposal of the board.

(b) The school new text begin or education new text end board and the applicable bargaining unit representing
district employees must enter into memoranda of understanding specifying how applicable
sections of current contracts will enable the provisions of subdivision 2, paragraph (a),
clauses (7) and (8), to be implemented.

(c) Within 60 days of receipt of the application, the school new text begin or education new text end board shall
determine whether to approve, deny, or return the application to the applicants for further
information or development. new text begin A school board converting to an education board under
section 123A.80 may not deny a school site's initial proposal.
new text end

(d) Upon approval of the proposal, an agreement between the district and the site
council shall be developed identifying the powers and duties delegated to the site and
outlining the details of the proposal including the provisions of subdivisions 2, 3, and 5.
Any powers or duties not specifically delegated to the school site in the agreement remains
with the school new text begin or education new text end board.

Subd. 2.

Roles and responsibilities of site-governed schools.

(a) Site-governed
schools approved by the school new text begin or education new text end board have the following autonomy and
responsibilities at the discretion of the site:

(1) to create the site-governing council of the school. The council shall include
teachers, administrators, parents, students if appropriate, community members, and other
representatives of the community as determined by the site-governing council. Teachers
may comprise a majority of the site-governing council at the option of a majority of
the teachers at the site. The number of members on the site-governing council and the
composition shall be included in the proposal approved by the school board;

(2) to determine the leadership model for the site including: selecting a principal,
operating as a teacher professional practices model with school leadership functions
performed by one or more teachers or administrators at the school or other model
determined by the site;

(3) to determine the budget for the site and the allocation and expenditure of the
revenue based on provisions of subdivision 3;

(4) to determine the learning model and organization of the school consistent with
the application approved by the school new text begin or education new text end board;

(5) to select and develop its curriculum and determine formative and summative
assessment practices;

(6) to set policies for the site including student promotion, attendance, discipline,
graduation requirements which may exceed the school new text begin or education new text end board standards, and
other such rules as approved by the school new text begin or education new text end board consistent with the mission,
goals, and learning program of the school site;

(7) to determine the length of the school day and year and employee work rules
covered by the terms and conditions of the employment contract;

(8) to select teachers and other staff consistent with current law and collective
bargaining agreements and memoranda of understanding provided for in subdivision 1,
paragraph (b). At least 70 percent of the teachers must be selected by the site prior to final
approval of the agreement. Prior to requesting the district to employ staff not currently
employed by the district, the site must first select current district staff including those
on requested and unrequested leave as provided for in sections 122A.40 and 122A.41.
The school new text begin or education new text end board shall be the legal employer of all staff at the site and all
teachers and other staff members of the applicable bargaining units. Teachers and other
employees may be required to sign an individual work agreement with the site-governing
council committing themselves to the mission and learning program of the school and the
requirements of the site-governing council; and

(9) to fulfill other provisions as agreed to by the district and site-governing council.

(b) If a self-governed school created under this section is supervised by a principal,
that principal must be licensed, consistent with section 123B.147, subdivision 2.

Subd. 3.

Revenue to self-governed school.

(a) The revenue that shall be allocated
by the site includes the general education revenue generated by the students at the site from
state, local, and private sources, referendum revenue, federal revenue from the Elementary
and Secondary Education Act, Individuals with Disabilities Education Act, Carl Perkins
Act, and other federal programs as agreed to by the school board and site council.

(b) The district may retain an administrative fee for managing the federal programs,
private revenues, and general administrative functions including school new text begin or education
new text end board, superintendent, district legal counsel, finance, accountability and self-governed
school contract oversight, facilities maintenance, districtwide special education programs,
and other such services as agreed to by the site and school new text begin or education new text end board. The
administrative fee shall be included in the agreement.

(c) As part of the agreement, the district may provide specific services for the site
and may specify the amount to be paid for each service and retain the revenues for that
amount. The formula or procedures for determining the amount of revenue to be allocated
to the site each year shall be consistent with this subdivision and incorporated in the site
budget annually following a timeline and process that is included in the agreement with
the school board. The site is responsible for allocating revenue for all staff at the site and
for the other provisions of the agreement with the deleted text begin district deleted text end new text begin school or education new text end board.

(d) All unspent revenue shall be carried over to following years for the sole use
of the site.

Subd. 4.

Exemption from statutes and rules.

Except as outlined in this section,
site-governed schools established under this section are exempt from and subject to the
same laws and rules as are chartered schools under section 124D.10, except that the
schools shall be subject to chapters 13, 13D, and 179A, and sections 122A.40, 122A.41,
122A.50, and 122A.51.

Subd. 5.

Performance standards.

(a) The school new text begin or education new text end board and the site
council shall include in the agreement performance standards and expectations that shall
include at least the following:

(1) student achievement targets on multiple indicators including either a growth
model or value-added growth model;

(2) the criteria and process to be followed if it is determined that the site failed
to comply with district oversight and accountability requirements as outlined in the
agreement; and

(3) other performance provisions as agreed to.

(b) All agreements shall be filed with the commissioner. The initial agreement
shall be for up to three years, shall be reviewed annually, and may be renewed by the
deleted text begin district deleted text end new text begin school or education new text end board for additional terms of up to five years based on the
performance of the school.

Subd. 6.

Board termination of self-governed school authority.

(a) The deleted text begin district deleted text end new text begin
school or education new text end board may terminate the agreement for one or more of the following
reasons:

(1) failure of the site to meet the provisions specified in the agreement in subdivision
5;

(2) violations of law; or

(3) other good cause shown.

(b) Site-governed schools that are terminated or not renewed for reasons other than
cause may request to convert to charter school status as provided for in section 124D.10
and, if chartered by the board, shall become the owner of all materials, supplies, and
equipment purchased during the period the school was a site-governed school.

Sec. 3.

Minnesota Statutes 2011 Supplement, section 124D.10, subdivision 3, is
amended to read:

Subd. 3.

Authorizer.

(a) For purposes of this section, the terms defined in this
subdivision have the meanings given them.

"Application" to receive approval as an authorizer means the proposal an eligible
authorizer submits to the commissioner under paragraph (c) before that authorizer is able
to submit any affidavit to charter to a school.

"Application" under subdivision 4 means the charter school business plan a
school developer submits to an authorizer for approval to establish a charter school that
documents the school developer's mission statement, school purposes, program design,
financial plan, governance and management structure, and background and experience,
plus any other information the authorizer requests. The application also shall include a
"statement of assurances" of legal compliance prescribed by the commissioner.

"Affidavit" means a written statement the authorizer submits to the commissioner
for approval to establish a charter school under subdivision 4 attesting to its review and
approval process before chartering a school.

(b) The following organizations may authorize one or more charter schools:

(1) a school board; new text begin education board; new text end intermediate school district school board;
education district organized under sections 123A.15 to 123A.19;

(2) a charitable organization under section 501(c)(3) of the Internal Revenue Code
of 1986, excluding a nonpublic sectarian or religious institution, any person other than a
natural person that directly or indirectly, through one or more intermediaries, controls,
is controlled by, or is under common control with the nonpublic sectarian or religious
institution, and any other charitable organization under this clause that in the federal IRS
Form 1023, Part IV, describes activities indicating a religious purpose, that:

(i) is a member of the Minnesota Council of Nonprofits or the Minnesota Council on
Foundations;

(ii) is registered with the attorney general's office; and

(iii) is incorporated in the state of Minnesota and has been operating continuously
for at least five years but does not operate a charter school;

(3) a Minnesota private college, notwithstanding clause (2), that grants two- or
four-year degrees and is registered with the Minnesota Office of Higher Education under
chapter 136A; community college, state university, or technical college governed by the
Board of Trustees of the Minnesota State Colleges and Universities; or the University
of Minnesota;

(4) a nonprofit corporation subject to chapter 317A, described in section 317A.905,
and exempt from federal income tax under section 501(c)(6) of the Internal Revenue Code
of 1986, may authorize one or more charter schools if the charter school has operated
for at least three years under a different authorizer and if the nonprofit corporation has
existed for at least 25 years; or

(5) single-purpose authorizers that are charitable, nonsectarian organizations formed
under section 501(c)(3) of the Internal Revenue Code of 1986 and incorporated in the state
of Minnesota whose sole purpose is to charter schools. Eligible organizations interested
in being approved as an authorizer under this paragraph must submit a proposal to the
commissioner that includes the provisions of paragraph (c) and a five-year financial plan.
Such authorizers shall consider and approve applications using the criteria provided in
subdivision 4 and shall not limit the applications it solicits, considers, or approves to any
single curriculum, learning program, or method.

(c) An eligible authorizer under this subdivision must apply to the commissioner for
approval as an authorizer before submitting any affidavit to the commissioner to charter
a school. The application for approval as a charter school authorizer must demonstrate
the applicant's ability to implement the procedures and satisfy the criteria for chartering a
school under this section. The commissioner must approve or disapprove an application
within 45 business days of the application deadline. If the commissioner disapproves
the application, the commissioner must notify the applicant of the specific deficiencies
in writing and the applicant then has 20 business days to address the deficiencies to the
commissioner's satisfaction. After the 20 business days expire, the commissioner has 15
business days to make a final decision to approve or disapprove the application. Failing to
address the deficiencies to the commissioner's satisfaction makes an applicant ineligible to
be an authorizer. The commissioner, in establishing criteria for approval, must consider
the applicant's:

(1) capacity and infrastructure;

(2) application criteria and process;

(3) contracting process;

(4) ongoing oversight and evaluation processes; and

(5) renewal criteria and processes.

(d) An applicant must include in its application to the commissioner to be an
approved authorizer at least the following:

(1) how chartering schools is a way for the organization to carry out its mission;

(2) a description of the capacity of the organization to serve as an authorizer,
including the personnel who will perform the authorizing duties, their qualifications, the
amount of time they will be assigned to this responsibility, and the financial resources
allocated by the organization to this responsibility;

(3) a description of the application and review process the authorizer will use to
make decisions regarding the granting of charters;

(4) a description of the type of contract it will arrange with the schools it charters
that meets the provisions of subdivision 6;

(5) the process to be used for providing ongoing oversight of the school consistent
with the contract expectations specified in clause (4) that assures that the schools chartered
are complying with both the provisions of applicable law and rules, and with the contract;

(6) a description of the criteria and process the authorizer will use to grant expanded
applications under subdivision 4, paragraph (j);

(7) the process for making decisions regarding the renewal or termination of
the school's charter based on evidence that demonstrates the academic, organizational,
and financial competency of the school, including its success in increasing student
achievement and meeting the goals of the charter school agreement; and

(8) an assurance specifying that the organization is committed to serving as an
authorizer for the full five-year term.

(e) A disapproved applicant under this section may resubmit an application during a
future application period.

(f) If the governing board of an approved authorizer that has chartered multiple
schools votes to withdraw as an approved authorizer for a reason unrelated to any
cause under subdivision 23, the authorizer must notify all its chartered schools and the
commissioner in writing by July 15 of its intent to withdraw as an authorizer on June 30 in
the next calendar year. The commissioner may approve the transfer of a charter school
to a new authorizer under this paragraph after the new authorizer submits an affidavit to
the commissioner.

(g) The authorizer must participate in department-approved training.

(h) An authorizer that chartered a school before August 1, 2009, must apply by
June 30, 2012, to the commissioner for approval, under paragraph (c), to continue as an
authorizer under this section. For purposes of this paragraph, an authorizer that fails to
submit a timely application is ineligible to charter a school.

(i) The commissioner shall review an authorizer's performance every five years in
a manner and form determined by the commissioner and may review an authorizer's
performance more frequently at the commissioner's own initiative or at the request of a
charter school operator, charter school board member, or other interested party. The
commissioner, after completing the review, shall transmit a report with findings to the
authorizer. If, consistent with this section, the commissioner finds that an authorizer has
not fulfilled the requirements of this section, the commissioner may subject the authorizer
to corrective action, which may include terminating the contract with the charter school
board of directors of a school it chartered. The commissioner must notify the authorizer
in writing of any findings that may subject the authorizer to corrective action and
the authorizer then has 15 business days to request an informal hearing before the
commissioner takes corrective action. If the commissioner terminates a contract between
an authorizer and a charter school under this paragraph, the commissioner may assist the
charter school in acquiring a new authorizer.

(j) The commissioner may at any time take corrective action against an authorizer,
including terminating an authorizer's ability to charter a school for:

(1) failing to demonstrate the criteria under paragraph (c) under which the
commissioner approved the authorizer;

(2) violating a term of the chartering contract between the authorizer and the charter
school board of directors;

(3) unsatisfactory performance as an approved authorizer; or

(4) any good cause shown that provides the commissioner a legally sufficient reason
to take corrective action against an authorizer.

Sec. 4.

Minnesota Statutes 2011 Supplement, section 124D.10, subdivision 8, is
amended to read:

Subd. 8.

Federal, state, and local requirements.

(a) A charter school shall meet all
federal, state, and local health and safety requirements applicable to school districts.

(b) A school must comply with statewide accountability requirements governing
standards and assessments in chapter 120B.

(c) A school authorized by a school new text begin or education new text end board may be located in any
district, unless the school new text begin or education new text end board of the district of the proposed location
disapproves by written resolution.

(d) A charter school must be nonsectarian in its programs, admission policies,
employment practices, and all other operations. An authorizer may not authorize a charter
school or program that is affiliated with a nonpublic sectarian school or a religious
institution. A charter school student must be released for religious instruction, consistent
with section 120A.22, subdivision 12, clause (3).

(e) Charter schools must not be used as a method of providing education or
generating revenue for students who are being home-schooled.

(f) The primary focus of a charter school must be to provide a comprehensive
program of instruction for at least one grade or age group from five through 18 years
of age. Instruction may be provided to people younger than five years and older than
18 years of age.

(g) A charter school may not charge tuition.

(h) A charter school is subject to and must comply with chapter 363A and section
121A.04.

(i) A charter school is subject to and must comply with the Pupil Fair Dismissal
Act, sections 121A.40 to 121A.56, and the Minnesota Public School Fee Law, sections
123B.34 to 123B.39.

(j) A charter school is subject to the same financial audits, audit procedures, and
audit requirements as a district. Audits must be conducted in compliance with generally
accepted governmental auditing standards, the federal Single Audit Act, if applicable,
and section 6.65. A charter school is subject to and must comply with sections 15.054;
118A.01; 118A.02; 118A.03; 118A.04; 118A.05; 118A.06; 471.38; 471.391; 471.392; and
471.425. The audit must comply with the requirements of sections 123B.75 to 123B.83,
except to the extent deviations are necessary because of the program at the school.
Deviations must be approved by the commissioner and authorizer. The Department of
Education, state auditor, legislative auditor, or authorizer may conduct financial, program,
or compliance audits. A charter school determined to be in statutory operating debt under
sections 123B.81 to 123B.83 must submit a plan under section 123B.81, subdivision 4.

(k) A charter school is a district for the purposes of tort liability under chapter 466.

(l) A charter school must comply with chapters 13 and 13D; and sections 120A.22,
subdivision 7; 121A.75; and 260B.171, subdivisions 3 and 5.

(m) A charter school is subject to the Pledge of Allegiance requirement under
section 121A.11, subdivision 3.

(n) A charter school offering online courses or programs must comply with section
124D.095.

(o) A charter school and charter school board of directors are subject to chapter 181.

(p) A charter school must comply with section 120A.22, subdivision 7, governing
the transfer of students' educational records and sections 138.163 and 138.17 governing
the management of local records.

(q) A charter school that provides early childhood health and developmental
screening must comply with sections 121A.16 to 121A.19.

(r) A charter school that provides school-sponsored youth athletic activities must
comply with section 121A.38.

Sec. 5.

Minnesota Statutes 2011 Supplement, section 124D.10, subdivision 17, is
amended to read:

Subd. 17.

Leased space.

A charter school may lease space from an independent or
special school new text begin or education new text end board eligible to be an authorizer, other public organization,
private, nonprofit nonsectarian organization, private property owner, or a sectarian
organization if the leased space is constructed as a school facility. The department must
review and approve or disapprove leases in a timely manner.