1.1 	A bill for an act
1.2 	relating to education; authorizing the commissioner of
1.3 	education to approve up to five charitable
1.4 	organizations as charter school sponsors; amending
1.5 	Minnesota Statutes 2004, section 124D.10, subdivision
1.6 	3.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. Minnesota Statutes 2004, section 124D.10,
1.9 	subdivision 3, is amended to read:
1.10 		Subd. 3.Sponsor.  (a) A school board; intermediate
1.11 	school district school board; education district organized under
1.12 	sections 123A.15 to 123A.19; charitable organization under
1.13 	section 501(c)(3) of the Internal Revenue Code of 1986 that is a
1.14 	member of the Minnesota Council of Nonprofits or the Minnesota
1.15 	Council on Foundations, registered with the attorney general's
1.16 	office, and reports an end-of-year fund balance of at least
1.17 	$2,000,000; Minnesota private college that grants two- or
1.18 	four-year degrees and is registered with the Higher Education
1.19 	Services Office under chapter 136A; community college, state
1.20 	university, or technical college, governed by the Board of
1.21 	Trustees of the Minnesota State Colleges and Universities; or
1.22 	the University of Minnesota may sponsor one or more charter
1.23 	schools.
1.24 	(b) A nonprofit corporation subject to chapter 317A,
1.25 	described in section 317A.905, and exempt from federal income
1.26 	tax under section 501(c)(6) of the Internal Revenue Code of
2.1 	1986, may sponsor one or more charter schools if the charter
2.2 	school has operated for at least three years under a different
2.3 	sponsor and if the nonprofit corporation has existed for at
2.4 	least 25 years.
2.5 	(c) The commissioner of education may approve up to five
2.6 	charitable organizations under section 501(c)(3) of the Internal
2.7 	Revenue Code of 1986 that sponsor charter schools as their
2.8 	principle charitable purpose.  Eligible charitable organizations
2.9 	interested in being approved as a sponsor under this paragraph
2.10 	must submit a proposal to the commissioner that includes:
2.11 	(1) the articles, bylaws, and initial membership of the
2.12 	charitable organization's board of directors;
2.13 	(2) financial information consistent with section 309.53,
2.14 	subdivision 3;
2.15 	(3) a description of how the charitable organization plans
2.16 	to realize its principle charitable purpose; and 
2.17 	(4) other information requested by the commissioner.
2.18 	A charitable organization that is approved as a sponsor
2.19 	under this paragraph annually must report to the commissioner in
2.20 	the form and manner the commissioner determines.  The report
2.21 	must describe the charter schools authorized by the charitable
2.22 	organization, the effectiveness of those charter schools in
2.23 	promoting student achievement, and the governance structure of
2.24 	those charter schools, and also must include other information
2.25 	requested by the commissioner.  An approved charitable
2.26 	organization may sponsor one or more charter schools.  The
2.27 	commissioner may withdraw the approval of a charitable
2.28 	organization to sponsor a charter school under this paragraph if
2.29 	the commissioner determines that the charitable organization
2.30 	fails to meet generally accepted standards of fiscal management,
2.31 	violates the law, or shows other good cause.  The commissioner's
2.32 	determination is final.  When the commissioner withdraws the
2.33 	approval of a charitable organization to sponsor a charter
2.34 	school, the commissioner may approve the decision of a different
2.35 	eligible sponsor to authorize the charter school or may apply
2.36 	subdivision 24 governing student enrollment when a charter
3.1 	school contract is not renewed or terminated.
3.2 	
EFFECTIVE DATE. This section is effective the day
3.3 	following final enactment.