HF 2034

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to education; modifying certain provisions of charter school law;
amending Minnesota Statutes 2006, section 124D.10, subdivisions 3, 4, 4a, 6, 8,
9, 14, 16, 17, 20, 21, 23; repealing Minnesota Statutes 2006, section 124D.10,
subdivision 2a.

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

Section 1.

Minnesota Statutes 2006, section 124D.10, subdivision 3, is amended to
read:

Subd. 3.

Sponsor.

(a) A school board; intermediate school district school board;
education district organized under sections 123A.15 to 123A.19; charitable organization
under section 501(c)(3) of the Internal Revenue Code of 1986 that is a member of the
Minnesota Council of Nonprofits or the Minnesota Council on Foundations, registered
with the attorney general's office, and reports an end-of-year fund balance of at least
$2,000,000; Minnesota private college 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 may sponsor
one or more charter schools. new text begin Notwithstanding any law to the contrary, a church may not
sponsor a charter school.
new text end

(b) 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 sponsor one or more charter schools if the charter school has operated for
at least three years under a different sponsor and if the nonprofit corporation has existed
for at least 25 years.
new text begin new text end

Sec. 2.

Minnesota Statutes 2006, section 124D.10, subdivision 4, is amended to read:

Subd. 4.

Formation of school.

(a) A sponsor may authorize one or more licensed
teachers under section 122A.18, subdivision 1, to operate a charter school subject to
approval by the commissioner. deleted text begin A board must vote on charter school application for
sponsorship no later than 90 days after receiving the application. After 90 days, the
applicant may apply to the commissioner. If a board elects not to sponsor a charter school,
the applicant may appeal the board's decision to the commissioner who may elect to assist
the applicant in finding an eligible sponsor. deleted text end The school must be organized and operated as
a cooperative under chapter 308A or nonprofit corporation under chapter 317A and the
provisions under the applicable chapter shall apply to the school except as provided in
this section. new text begin A cooperative or a nonprofit corporation that operates a charter school may
operate a maximum of three separate charter schools. new text end Notwithstanding sections 465.717
and 465.719, a school district may create a corporation for the purpose of creating a
charter school.

(b) Before the operators may form and operate a school, the sponsor must file an
affidavit with the commissioner stating its intent to authorize a charter school. The
affidavit must state the terms and conditions under which the sponsor would authorize a
charter school and how the sponsor intends to oversee the fiscal and student performance
of the charter school and to comply with the terms of the written contract between the
sponsor and the charter school board of directors under subdivision 6. The commissioner
must approve or disapprove the sponsor's proposed authorization within deleted text begin 90 deleted text end new text begin 45 new text end days of
receipt of the affidavit. Failure to obtain commissioner approval precludes a sponsor from
authorizing the charter school that was the subject of the affidavit.

(c) The operators authorized to organize and operate a school, before entering into a
contract or other agreement for professional or other services, goods, or facilities, must
incorporate as a cooperative under chapter 308A or as a nonprofit corporation under
chapter 317A and must establish deleted text begin a deleted text end new text begin an initial new text end board of directors composed of at least five
new text begin nonrelated new text end members until a timely election for members of the charter school board of
directors is held according to the school's articles and bylaws.

new text begin (d) new text end deleted text begin A deleted text end new text begin The permanent new text end charter school board of directors must be composed of at least
five new text begin nonrelated new text end members. new text begin An individual may be a member of only one charter school board
at a time. new text end Any staff members who are employed at the school, including teachers providing
instruction under a contract with a cooperative, and all parents of children enrolled in the
school deleted text begin may deleted text end new text begin are eligible to new text end participate in the election for members of the school's board of
directors. new text begin The board shall establish and publish election procedures for members of the
school's board of directors in compliance with chapter 13D. new text end Licensed teachers employed
at the school, including teachers providing instruction under a contract with a cooperative,
new text begin or equal numbers of teachers, parents of children enrolled in the school, and members of
the community new text end must be a majority of the members of the board of directors before the
school completes its deleted text begin third deleted text end new text begin second new text end year of operation, unless the commissioner waives the
requirement for a majority of licensed teachers on the board. new text begin The chief financial officer
and chief administrator of a charter school may be only nonvoting members of a charter
school board. new text end Board of director meetings must comply with chapter 13D.

deleted text begin (d) deleted text end new text begin (e) new text end The granting or renewal of a charter by a sponsoring entity must not be
conditioned upon the bargaining unit status of the employees of the school.

deleted text begin (e) deleted text end new text begin (f) new text end A sponsor may authorize the operators of a charter school to expand the
operation of the charter school to additional sites or to add additional grades at the school
beyond those described in the sponsor's deleted text begin application deleted text end new text begin original affidavit new text end as approved by
the commissioner only after deleted text begin submitting deleted text end new text begin the sponsor submits new text end a supplemental deleted text begin application deleted text end new text begin
affidavit new text end to the commissioner in a form and manner prescribed by the commissioner. The
supplemental deleted text begin application deleted text end new text begin affidavit new text end must provide evidence that:

(1) the expansion of the charter school is supported by need and projected enrollment;

(2) the charter school is fiscally sound;

(3) the sponsor supports the expansion; and

(4) the building of the additional site meets all health and safety requirements to
be eligible for lease aid.

deleted text begin (f) deleted text end new text begin (g) new text end The commissioner annually must provide timely deleted text begin financial management deleted text end
training new text begin for financial management, financial record keeping, and public record keeping
new text end to deleted text begin newly elected members of a charter school board of directors and ongoing training to
other members of deleted text end a charter school board of directors. Training must address ways to:

(1) proactively assess opportunities for a charter school to maximize all available
revenue sources;

(2) establish and maintain complete, auditable records deleted text begin for deleted text end new text begin of new text end the charter school new text begin
cooperative or nonprofit corporation new text end ;

(3) establish proper new text begin procedures for new text end filing deleted text begin techniques deleted text end new text begin state required reports new text end ;

(4) document formal actions of the charter school, including meetings of the charter
school board of directors;

(5) properly manage and retain charter school new text begin financial, personnel, new text end and student
records; new text begin and
new text end

(6) comply with state and federal payroll record-keeping requirements deleted text begin ; and
deleted text end

deleted text begin (7) address other similar factors that facilitate establishing and maintaining complete
records on the charter school's operations deleted text end .

Sec. 3.

Minnesota Statutes 2006, section 124D.10, subdivision 4a, is amended to read:

Subd. 4a.

Conflict of interest.

(a) A member of a charter school board of directors
is prohibited from serving as a member of the board of directors or as an employee
or agent of or a contractor with a for-profit new text begin or nonprofit new text end entity with whom the charter
school contracts, directly or indirectly, for professional services, goods, or facilities. A
violation of this prohibition renders a contract voidable deleted text begin at the option of the commissioner deleted text end .
A member of a charter school board of directors who violates this prohibition shall be
individually liable to the charter school for any damage caused by the violation.

(b) An individual may serve as a member of the board of directors if no conflict of
interest under paragraph (a) exists.

(c) deleted text begin A member of a charter school board of directors that serves as a member of the
board of directors or as an employee or agent of or a contractor with a nonprofit entity
with whom the charter school contracts, directly or indirectly, for professional services,
goods, or facilities, must disclose all potential conflicts to the commissioner. deleted text end new text begin A sponsor is
prohibited from selling management or financial services to the charter school or schools it
sponsors. Other services of the sponsor may be purchased only through a bidding process.
new text end

deleted text begin (d) deleted text end new text begin Employees of the sponsor who are directly involved in the approval, oversight, or
renewal of the charter may not serve on the charter school board of directors. new text end The conflict
of interest provisions under this subdivision do not apply to compensation paid to a teacher
employed by the charter school who also serves as a member of the board of directors.

deleted text begin (e) deleted text end new text begin (d) new text end The conflict of interest provisions under this subdivision do not apply to a
teacher who provides services to a charter school through a cooperative formed under
chapter 308A when the teacher also serves on the charter school board of directors.

Sec. 4.

Minnesota Statutes 2006, section 124D.10, subdivision 6, is amended to read:

Subd. 6.

Contract.

The sponsor's authorization for a charter school must be in the
form of a written contract signed by the sponsor and the board of directors of the charter
school. The contract must be completed within 90 days of the commissioner's approval
of the sponsor's proposed authorization. The contract for a charter school must be in
writing and contain at least the following:

(1) a description of a program that carries out one or more of the purposes in
subdivision 1;

(2) specific outcomes pupils are to achieve under subdivision 10;

(3) admission policies and procedures;

(4) management and administration deleted text begin of deleted text end new text begin plan for new text end the school;

(5) requirements and procedures for program and financial audits;

(6) how the school will comply with subdivisions 8, 13, 16, and 23;

(7) assumption of liability by the charter school;

(8) types and amounts of insurance coverage to be obtained by the charter school;

(9) the term of the contract, which may be up to three years new text begin for the initial contract
and up to five years for a renewed contract new text end ;

(10) deleted text begin if deleted text end new text begin how new text end the board of directors or the operators of the charter school provide
special instruction and services for children with a disability under sections 125A.03
to 125A.24, and 125A.65, a description of the financial parameters within which the
charter school will operate to provide the special instruction and services to children
with a disability; deleted text begin and
deleted text end

(11) the process and criteria the sponsor intends to use to monitor and evaluate the
fiscal and student performance of the charter school, consistent with subdivision 15 deleted text begin . deleted text end new text begin ;
new text end

new text begin (12) the process and criteria the sponsor will use to determine whether to renew
the charter; and
new text end

new text begin (13) upon a closing of the school, the process and criteria the board of directors will
use to end the business of the corporation, including such responsibilities as transferring,
as required, student records, personnel records, audits, and financial reports.
new text end

Sec. 5.

Minnesota Statutes 2006, section 124D.10, subdivision 8, is amended to read:

Subd. 8.

State and local requirements.

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

(b) A school sponsored by a school board may be located in any district, unless the
school board of the district of the proposed location disapproves by written resolution.

new text begin (c) If requested by the charter school, a school board must lease available, unused
space to a charter school at market rate unless the school board disapproves locating the
school in the district under paragraph (b);
new text end

deleted text begin (c) deleted text end new text begin (d) new text end A charter school must be nonsectarian in its programs, admission policies,
employment practices, and all other operations. A sponsor may not authorize a charter
school or program that is affiliated with a nonpublic sectarian school or a religious
institution.

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

deleted text begin (e) deleted text end new text begin (f) new text end 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.

deleted text begin (f) deleted text end new text begin (g) new text end A charter school may not charge tuition.

deleted text begin (g) deleted text end new text begin (h) new text end A charter school is subject to and must comply with chapter 363A and
section 121A.04.

deleted text begin (h) deleted text end new text begin (i) new text end 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.

deleted text begin (i) deleted text end new text begin (j) new text end 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; 123B.52, subdivision 5;
471.38; 471.391; 471.392; 471.425; 471.87; 471.88, subdivisions 1, 2, 3, 4, 5, 6, 12, 13,
and 15; 471.881; and 471.89. 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. The Department
of Education, state auditor, or legislative auditor 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.

deleted text begin (j) deleted text end new text begin (k) new text end A charter school is a district for the purposes of tort liability under chapter 466.

deleted text begin (k) deleted text end new text begin (l) new text end A charter school must comply with sections 13.32; 120A.22, subdivision 7;
121A.75; and 260B.171, subdivisions 3 and 5.

deleted text begin (l) deleted text end new text begin (m) new text end A charter school is subject to the Pledge of Allegiance requirement under
section 121A.11, subdivision 3.

Sec. 6.

Minnesota Statutes 2006, section 124D.10, subdivision 9, is amended to read:

Subd. 9.

Admission requirements.

A charter school may limit admission to:

(1) pupils within an age group or grade level;

(2) people who are eligible to participate in the graduation incentives program
under section 124D.68; or

(3) residents of a specific geographic area where the percentage of the population
of non-Caucasian people of that area is greater than the percentage of the non-Caucasian
population in the congressional district in which the geographic area is located, and as
long as the school reflects the racial and ethnic diversity of the specific area.

A charter school shall enroll an eligible pupil who submits a timely application,
unless the number of applications exceeds the capacity of a program, class, grade level, or
building. In this case, pupils must be accepted by lot. new text begin The charter school must develop
and publish the lottery process. new text end If a charter school is the only school located in a town
serving pupils within a particular grade level, then pupils that are residents of the town
must be given preference for enrollment before accepting pupils by lot. If a pupil lives
within two miles of a charter school and the next closest public school is more than five
miles away, the charter school must give those pupils preference for enrollment before
accepting other pupils by lot.

A charter school shall give preference for enrollment to a sibling of an enrolled pupil
and to a foster child of that pupil's parents new text begin and to children of the school's employees new text end before
accepting other pupils by lot.

A charter school may not limit admission to pupils on the basis of intellectual ability,
measures of achievement or aptitude, or athletic ability.

Sec. 7.

Minnesota Statutes 2006, section 124D.10, subdivision 14, is amended to read:

Subd. 14.

Annual public reports.

A charter school must new text begin publish an annual
new text end report deleted text begin at least annually to its sponsor and the commissioner deleted text end new text begin of new text end the information required
by the sponsor or the commissioner new text begin and to the commissioner and the school's sponsor,
employees, and parents and guardians new text end . The reports are public data under chapter 13.

Sec. 8.

Minnesota Statutes 2006, section 124D.10, subdivision 16, is amended to read:

Subd. 16.

Transportation.

(a) A charter school after its first fiscal year of operation
by March 1 of each fiscal year and a charter school by July 1 of its first fiscal year of
operation must notify the district in which the school is located and the Department of
Education if it will provide its own transportation or use the transportation services of the
district in which it is located for the fiscal year.

(b) If a charter school elects to provide transportation for pupils, the transportation
must be provided by the charter school within the district in which the charter school is
located. The state must pay transportation aid to the charter school according to section
124D.11, subdivision 2.

For pupils who reside outside the district in which the charter school is located, the
charter school is not required to provide or pay for transportation between the pupil's
residence and the border of the district in which the charter school is located. A parent
may be reimbursed by the charter school for costs of transportation from the pupil's
residence to the border of the district in which the charter school is located if the pupil is
from a family whose income is at or below the poverty level, as determined by the federal
government. The reimbursement may not exceed the pupil's actual cost of transportation
or deleted text begin 15 cents per mile traveled deleted text end new text begin mileage at one-half the rate permitted by the Internal Revenue
Service under the federal income tax code new text end , whichever is less. Reimbursement may not be
paid for more than 250 miles per week.

At the time a pupil enrolls in a charter school, the charter school must provide the
parent or guardian with information regarding the transportation.

(c) If a charter school does not elect to provide transportation, transportation for
pupils enrolled at the school must be provided by the district in which the school is
located, according to sections 123B.88, subdivision 6, and 124D.03, subdivision 8, for a
pupil residing in the same district in which the charter school is located. Transportation
may be provided by the district in which the school is located, according to sections
123B.88, subdivision 6, and 124D.03, subdivision 8, for a pupil residing in a different
district. If the district provides the transportation, the scheduling of routes, manner and
method of transportation, control and discipline of the pupils, and any other matter relating
to the transportation of pupils under this paragraph shall be within the sole discretion,
control, and management of the district.

Sec. 9.

Minnesota Statutes 2006, section 124D.10, subdivision 17, is amended to read:

Subd. 17.

Leased space.

A charter school may lease space from a board eligible to
be a sponsor or other public or private nonprofit nonsectarian organization. deleted text begin If a charter
school is unable to lease appropriate space from an eligible board or other public or private
nonprofit nonsectarian organization, the school may lease space from another nonsectarian
organization if the Department of Education, in consultation with the Department of
Administration, approves the lease. deleted text end If the school is unable to lease appropriate space from
public or private nonsectarian organizations, the school may lease space from a sectarian
organization if the leased space is constructed as a school facility and the Department of
Education, in consultation with the Department of Administration, approves the lease.

Sec. 10.

Minnesota Statutes 2006, section 124D.10, subdivision 20, is amended to read:

Subd. 20.

Leave to teach in a charter school.

If a teacher new text begin or other licensed person
new text end employed by a district makes a written request for an extended leave of absence to teach
new text begin or work within the parameters of the person's license new text end at a charter school, the district must
grant the leave. The district must grant a leave not to exceed a total of five years. Any
request to extend the leave shall be granted only at the discretion of the school board. The
district may require that the request for a leave or extension of leave be made up to 90 days
before the teacher would otherwise have to report for duty. Except as otherwise provided
in this subdivision and except for section 122A.46, subdivision 7, the leave is governed by
section 122A.46, including, but not limited to, reinstatement, notice of intention to return,
seniority, salary, and insurance.

During a leave, the teacher may continue to aggregate benefits and credits in the
Teachers' Retirement Association account by paying both the employer and employee
contributions based upon the annual salary of the teacher for the last full pay period before
the leave began. The retirement association may impose reasonable requirements to
efficiently administer this subdivision.

Sec. 11.

Minnesota Statutes 2006, section 124D.10, subdivision 21, is amended to read:

Subd. 21.

Collective bargaining.

Employees of the board of directors of a charter
school may, if otherwise eligible, organize under chapter 179A and comply with its
provisions. The board of directors of a charter school is a public employer, for the
purposes of chapter 179A, upon formation of one or more bargaining units at the school.
Bargaining units at the school must be separate from any other units deleted text begin within the sponsoring
district, except that bargaining units may remain part of the appropriate unit within the
sponsoring district, if the employees of the school, the board of directors of the school,
the exclusive representative of the appropriate unit in the sponsoring district, and the
board of the sponsoring district agree to include the employees in the appropriate unit
of the sponsoring district deleted text end .

Sec. 12.

Minnesota Statutes 2006, section 124D.10, subdivision 23, is amended to read:

Subd. 23.

Causes for nonrenewal or termination of charter school contract.

(a)
The duration of the contract with a sponsor must be for the term contained in the contract
according to subdivision 6. The sponsor may or may not renew a contract at the end of
the term for any ground listed in paragraph (b). A sponsor may unilaterally terminate a
contract during the term of the contract for any ground listed in paragraph (b). deleted text begin At least
60 days deleted text end new text begin By the March 1 immediately new text end before not renewing or terminating a contract, the
sponsor shall notify the board of directors of the charter school of the proposed action in
writing. The notice shall state the grounds for the proposed action in reasonable detail
and that the charter school's board of directors may request in writing an informal hearing
before the sponsor within 14 days of receiving notice of nonrenewal or termination of
the contract. Failure by the board of directors to make a written request for a hearing
within the 14-day period shall be treated as acquiescence to the proposed action. Upon
receiving a timely written request for a hearing, the sponsor shall give reasonable notice
to the charter school's board of directors of the hearing date. The sponsor shall conduct
an informal hearing before taking final action. The sponsor shall take final action to
renew or not renew a contract by deleted text begin the last day of classes in the school year. If the sponsor
is a local board, the school's board of directors may appeal the sponsor's decision to the
commissioner deleted text end new text begin June 1 of that contract year new text end .

(b) A contract may be terminated or not renewed upon any of the following grounds:

(1) failure to meet the requirements for pupil performance contained in the contract;

(2) failure to meet generally accepted standards of fiscal management;

(3) violations of law; or

(4) other good cause shown.

If a contract is terminated or not renewed under this paragraph, the school must be
dissolved according to the applicable provisions of chapter 308A or 317A, except when
the commissioner approves the decision of a different eligible sponsor to authorize the
charter school.

(c) If at the end of a contract term, either the sponsor or the charter school board of
directors wants to voluntarily terminate the contract, a change in sponsors is allowed if the
commissioner approves the decision of a different eligible sponsor to authorize the charter
school. The party intending to terminate the contract must notify the other party and the
commissioner of its intent deleted text begin at least 90 days deleted text end new text begin by the March 1 immediately new text end before the date on
which the contract ends. The sponsor that is a party to the existing contract at least must
inform the approved different eligible sponsor about the fiscal and student performance
of the school. If no different eligible sponsor is approved, the school must be dissolved
according to applicable law and the terms of the contract.

(d) The commissioner, after providing reasonable notice to the board of directors
of a charter school and the existing sponsor, and after providing an opportunity for a
public hearing, may terminate the existing sponsorial relationship if the charter school
has a history of:

(1) financial mismanagement; or

(2) repeated violations of the law.

Sec. 13. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2006, section 124D.10, subdivision 2a, new text end new text begin is repealed effective
July 1, 2007.
new text end