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Minnesota Legislature

Office of the Revisor of Statutes

HF 3305

as introduced - 90th Legislature (2017 - 2018) Posted on 03/05/2018 02:55pm

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to education finance; creating a process to combine charter school and
school district programs; providing continuity in building lease revenue for school
districts that combine programming with a charter school; amending Minnesota
Statutes 2016, sections 124E.06, by adding a subdivision; 124E.08; 126C.40,
subdivision 1; Minnesota Statutes 2017 Supplement, section 124E.22.

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

Section 1.

Minnesota Statutes 2016, section 124E.06, is amended by adding a subdivision
to read:


new text begin Subd. 8. new text end

new text begin Combination. new text end

new text begin (a) The boards of a school district and a charter school may
convert an existing charter school to a school district program by mutually adopting a written
resolution authorizing the combination. The written resolution must be submitted to the
charter school's authorizer and the commissioner of education at least eight months prior
to the beginning of the next school year. The effective date of a combination must be July
1.
new text end

new text begin (b) A charter school that combines with a school district must submit separate year-end
reports for its last school year of operation.
new text end

new text begin (c) The charter school may transfer its fund balances and debts to the school district with
which it is combining.
new text end

new text begin (d) For school aids based on the prior year data, the combined program that was formerly
the charter school is eligible to receive aid for that site as if the combined program were a
charter school in its first year of operation.
new text end

new text begin (e) The resolution under paragraph (a) may address the future employment rights of the
staff employed by the charter school in the year preceding the combination.
new text end

Sec. 2.

Minnesota Statutes 2016, section 124E.08, is amended to read:


124E.08 CHARTER SCHOOL AND SCHOOL DISTRICT COLLABORATIONnew text begin
AND COMBINATION
new text end.

new text begin Subdivision 1. new text end

new text begin Collaboration. new text end

(a) A charter school board may voluntarily enter into a
two-year, renewable collaboration agreement with a school district in which the charter
school is geographically located to enhance the achievement of the students in the district
and the students in the charter school.

A school district does not need to be either an approved authorizer or the authorizer of
the charter school to enter into a collaboration agreement under this section.

A charter school authorizer is prohibited from requiring a collaboration agreement as a
condition of entering into or renewing a charter contract as defined in section 124E.10,
subdivision 1
.

(b) The collaboration agreement may include, but is not limited to, collaboration regarding
facilities, transportation, training, student achievement, assessments, mutual performance
standards, and other areas of mutual agreement.

(c) For purposes of student assessment and reporting to the state under section 120B.36,
the school district may include the academic performance of the students of a collaborative
charter school site under paragraph (a).

Districts, authorizers, or charter schools entering into a collaborative agreement are
equally and collectively subject to the same state and federal accountability measures for
student achievement, school performance outcomes, and school improvement strategies.
The collaborative agreement and all accountability measures must be posted on the district,
charter school, and authorizer Web sites.

(d) Nothing in this section or in the collaboration agreement may impact in any way the
authority or autonomy of the charter school.

(e) Nothing in this section or in the collaboration agreement shall cause the state to pay
twice for the same student, service, or facility or otherwise impact state funding or payment
to the school district or the charter school.

new text begin Subd. 2. new text end

new text begin Combination. new text end

new text begin A charter school board and a school board of the school district
in which the charter school is geographically located may voluntarily enter into a combination
agreement to enhance the achievement of the students in the district and the students in the
charter school.
new text end

Sec. 3.

Minnesota Statutes 2017 Supplement, section 124E.22, is amended to read:


124E.22 BUILDING LEASE AID.

(a) When a charter school finds it economically advantageous to rent or lease a building
or land for any instructional purpose and it determines that the total operating capital revenue
under section 126C.10, subdivision 13, is insufficient for this purpose, it may apply to the
commissioner for building lease aid. The commissioner must review and either approve or
deny a lease aid application using the following criteria:

(1) the reasonableness of the price based on current market values;

(2) the extent to which the lease conforms to applicable state laws and rules; and

(3) the appropriateness of the proposed lease in the context of the space needs and
financial circumstances of the charter school. The commissioner must approve aid only for
a facility lease that has (i) a sum certain annual cost and (ii) a closure clause to relieve the
charter school of its lease obligations at the time the charter contract is terminated or not
renewed. The closure clause under item (ii) must not be constructed or construed to relieve
the charter school of its lease obligations in effect before the charter contract is terminated
or not renewed.

(b) A charter school must not use the building lease aid it receives for custodial,
maintenance service, utility, or other operating costs.

(c) The amount of annual building lease aid for a charter school shall not exceed the
lesser of (1) 90 percent of the approved cost or (2) the product of the charter school building
lease aid pupil units served for the current school year times $1,314.

(d) A charter school's building lease aid pupil units equals the sum of the charter school
pupil units under section 126C.05 and the pupil units for the portion of the day that the
charter school's enrolled students are participating in the Postsecondary Enrollment Options
Act under section 124D.09 and not otherwise included in the pupil count under section
126C.05.

new text begin (e) If a charter school combines with a school district, the school district is eligible for
charter school lease aid for the first and second year after the combination for the portion
of the program that was operated by the charter school. The amount of the aid equals the
actual charter school lease aid paid to the charter school in the year preceding the
combination.
new text end

Sec. 4.

Minnesota Statutes 2016, section 126C.40, subdivision 1, is amended to read:


Subdivision 1.

To lease building or land.

(a) When an independent or a special school
district or a group of independent or special school districts finds it economically
advantageous to rent or lease a building or land for any instructional purposes or for school
storage or furniture repair, and it determines that the operating capital revenue authorized
under section 126C.10, subdivision 13, is insufficient for this purpose, it may apply to the
commissioner for permission to make an additional capital expenditure levy for this purpose.
An application for permission to levy under this subdivision must contain financial
justification for the proposed levy, the terms and conditions of the proposed lease, and a
description of the space to be leased and its proposed use.

(b) The criteria for approval of applications to levy under this subdivision must include:
the reasonableness of the price, the appropriateness of the space to the proposed activity,
the feasibility of transporting pupils to the leased building or land, conformity of the lease
to the laws and rules of the state of Minnesota, and the appropriateness of the proposed
lease to the space needs and the financial condition of the district. The commissioner must
not authorize a levy under this subdivision in an amount greater than the cost to the district
of renting or leasing a building or land for approved purposes. The proceeds of this levy
must not be used for custodial or other maintenance services. A district may not levy under
this subdivision for the purpose of leasing or renting a district-owned building or site to
itselfnew text begin, except as provided in paragraphs (d) and (e)new text end.

(c) For agreements finalized after July 1, 1997, a district may not levy under this
subdivision for the purpose of leasing: (1) a newly constructed building used primarily for
regular kindergarten, elementary, or secondary instruction; or (2) a newly constructed
building addition or additions used primarily for regular kindergarten, elementary, or
secondary instruction that contains more than 20 percent of the square footage of the
previously existing building.

(d) Notwithstanding paragraph (b), a district may levy under this subdivision for the
purpose of leasing or renting a district-owned building or site to itself only if the amount is
needed by the district to make payments required by a lease purchase agreement, installment
purchase agreement, or other deferred payments agreement authorized by law, and the levy
meets the requirements of paragraph (c). A levy authorized for a district by the commissioner
under this paragraph may be in the amount needed by the district to make payments required
by a lease purchase agreement, installment purchase agreement, or other deferred payments
agreement authorized by law, provided that any agreement include a provision giving the
school districts the right to terminate the agreement annually without penalty.

(e)new text begin Notwithstanding paragraph (b), (d), or (f), a district may include in its building lease
levy in the third, fourth, and fifth years following a combination with a charter school an
amount equal to the charter school lease aid paid to the charter school in the year prior to
the year of combination.
new text end

new text begin (f)new text end The total levy under this subdivision for a district for any year must not exceed $212
times the adjusted pupil units for the fiscal year to which the levy is attributable.

deleted text begin (f)deleted text endnew text begin (g)new text end For agreements for which a review and comment have been submitted to the
Department of Education after April 1, 1998, the term "instructional purpose" as used in
this subdivision excludes expenditures on stadiums.

deleted text begin (g)deleted text endnew text begin (h)new text end The commissioner of education may authorize a school district to exceed the
limit in paragraph deleted text begin(e)deleted text endnew text begin (f)new text end if the school district petitions the commissioner for approval. The
commissioner shall grant approval to a school district to exceed the limit in paragraph deleted text begin(e)deleted text endnew text begin
(f)
new text end for not more than five years if the district meets the following criteria:

(1) the school district has been experiencing pupil enrollment growth in the preceding
five years;

(2) the purpose of the increased levy is in the long-term public interest;

(3) the purpose of the increased levy promotes colocation of government services; and

(4) the purpose of the increased levy is in the long-term interest of the district by avoiding
over construction of school facilities.

deleted text begin (h)deleted text endnew text begin (i)new text end A school district that is a member of an intermediate school district may include
in its authority under this section the costs associated with leases of administrative and
classroom space for intermediate school district programs. This authority must not exceed
$65 times the adjusted pupil units of the member districts. This authority is in addition to
any other authority authorized under this section.

deleted text begin (i)deleted text endnew text begin (j)new text end In addition to the allowable capital levies in paragraph (a), for taxes payable in
2012 to 2023, a district that is a member of the "Technology and Information Education
Systems" data processing joint board, that finds it economically advantageous to enter into
a lease agreement to finance improvements to a building and land for a group of school
districts or special school districts for staff development purposes, may levy for its portion
of lease costs attributed to the district within the total levy limit in paragraph deleted text begin(e)deleted text endnew text begin (f)new text end. The
total levy authority under this paragraph shall not exceed $632,000.

deleted text begin (j)deleted text endnew text begin (k)new text end Notwithstanding paragraph (a), a district may levy under this subdivision for the
purpose of leasing administrative space if the district can demonstrate to the satisfaction of
the commissioner that the lease cost for the administrative space is no greater than the lease
cost for instructional space that the district would otherwise lease. The commissioner must
deny this levy authority unless the district passes a resolution stating its intent to lease
instructional space under this section if the commissioner does not grant authority under
this paragraph. The resolution must also certify that the lease cost for administrative space
under this paragraph is no greater than the lease cost for the district's proposed instructional
lease.