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HF 935

1st Engrossment - 86th Legislature (2009 - 2010) Posted on 02/09/2010 01:43am

KEY: stricken = removed, old language.
underscored = added, new language.
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A bill for an act
relating to education; modifying charter school provisions; amending Minnesota
Statutes 2008, sections 124D.10; 124D.11, subdivision 9.

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

Section 1.

Minnesota Statutes 2008, section 124D.10, is amended to read:


124D.10 CHARTER SCHOOLS.

Subdivision 1.

Purposes.

(a) The purpose of this section is to:

(1) improve pupil learningnew text begin and achievementnew text end;

(2) increase learning opportunities for pupils;

(3) encourage the use of different and innovative teaching methods;

(4) deleted text beginrequire the measurement ofdeleted text end new text beginmeasure new text endlearning outcomes deleted text beginand createdeleted text endnew text begin through the
creation and use of
new text end different and innovative forms of measuring outcomes;

(5) establish new forms of accountability for schools; or

(6) create new professional opportunities for teachers, including the opportunity to
be responsible for the learning program at the school site.

(b) This section does not provide a means to keep open a school that otherwise
would be closed. Applicants in these circumstances bear the burden of proving that
conversion to a charter school fulfills a purpose specified in this subdivision, independent
of the school's closing.

Subd. 2.

Applicability.

This section applies only to charter schools formed and
operated under this section.

deleted text begin Subd. 2a. deleted text end

deleted text begin Charter School Advisory Council. deleted text end

deleted text begin(a) A Charter School Advisory
Council is established under section 15.059 except that the term for each council member
shall be three years. The advisory council is composed of seven members from throughout
the state who have demonstrated experience with or interest in charter schools. The
members of the council shall be appointed by the commissioner. The advisory council
shall bring to the attention of the commissioner any matters related to charter schools
that the council deems necessary and shall:
deleted text end

deleted text begin (1) encourage school boards to make full use of charter school opportunities;
deleted text end

deleted text begin (2) encourage the creation of innovative schools;
deleted text end

deleted text begin (3) provide leadership and support for charter school sponsors to increase the
innovation in and the effectiveness, accountability, and fiscal soundness of charter schools;
deleted text end

deleted text begin (4) serve an ombudsman function in facilitating the operations of new and existing
charter schools;
deleted text end

deleted text begin (5) promote timely financial management training for newly elected members of
a charter school board of directors and ongoing training for other members of a charter
school board of directors; and
deleted text end

deleted text begin (6) facilitate compliance with auditing and other reporting requirements. The
advisory council shall refer all its proposals to the commissioner who shall provide time
for reports from the council.
deleted text end

deleted text begin (b) The Charter School Advisory Council under this subdivision expires June 30,
2007.
deleted text end

Subd. 3.

deleted text beginSponsordeleted text endnew text begin Authorizernew text end.

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

new text begin "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.
new text end

new text begin "Application" to form a school under subdivision 4 means the charter school
business plan a school developer submits to an authorizer for approval 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.
new text end

new text begin "Affidavit" means a written statement the authorizer submits to the commissioner
for approval under subdivision 4 attesting to its review and approval of a school charter.
new text end

new text begin (b) The following organizations may authorize one or more charter schools:
new text end

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

new text begin (2) anew text end charitable organization under section 501(c)(3) of the Internal Revenue Code
of 1986new text begin, 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,
new text end thatnew text begin:
new text end

new text begin (i)new text end is a member of the Minnesota Council of Nonprofits or the Minnesota Council on
Foundationsdeleted text begin,deleted text endnew text begin;
new text end

new text begin (ii) isnew text end registered with the attorney general's officedeleted text begin, anddeleted text endnew text begin;
new text end

new text begin (iii)new text end reports an end-of-year fund balance of at least $2,000,000new text begin; and
new text end

new text begin (iv) is incorporated in the state of Minnesotanew text end;

new text begin (3) anew text end Minnesota private collegenew text begin, notwithstanding clause (2),new text end 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 collegedeleted text begin,deleted text end governed by the
Board of Trustees of the Minnesota State Colleges and Universities; or the University of
Minnesota deleted text beginmay sponsor one or more charter schools.deleted text endnew text begin; or
new text end

deleted text begin (b)deleted text endnew text begin (4)new text end 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 deleted text beginsponsordeleted text endnew text begin authorizenew text end one or more charter schools if the charter
school has operated for at least three years under a different deleted text beginsponsordeleted text endnew text begin authorizernew text end and if the
nonprofit corporation has existed for at least 25 years.

new text begin (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 60 business days of the application deadline. If the commissioner disapproves
the application, the commissioner must notify the applicant of the deficiencies and the
applicant then has 20 business days to address the deficiencies to the commissioner's
satisfaction. 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:
new text end

new text begin (1) capacity and infrastructure;
new text end

new text begin (2) application criteria and process;
new text end

new text begin (3) contracting process;
new text end

new text begin (4) ongoing oversight and evaluation processes; and
new text end

new text begin (5) renewal criteria and processes.
new text end

new text begin A disapproved applicant under this paragraph may resubmit an application during a
future application period.
new text end

new text begin (d) The authorizer must participate in ongoing department-approved training.
new text end

new text begin (e) 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.
new text end

new text begin (f) The commissioner shall review an authorizer's performance at least once 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 developer, operator, 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 performed satisfactorily, the commissioner may subject the authorizer to corrective
action, which may include terminating the contract with the board 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.
new text end

new text begin (g) The commissioner may take corrective action against an authorizer, including
terminating an authorizer's eligibility to charter a school for:
new text end

new text begin (1) failing to satisfy the criteria under which the commissioner approved the
authorizer;
new text end

new text begin (2) failing to perform satisfactorily as an approved authorizer; or
new text end

new text begin (3) violating a term of the chartering contract between the authorizer and charter
school board.
new text end

Subd. 4.

Formation of school.

(a) deleted text beginA sponsordeleted text endnew text begin An authorizer, after receiving an
application from a school developer,
new text end may deleted text beginauthorizedeleted text endnew text begin charter a licensed teacher under
section 122A.18, subdivision 1, or a group of individuals that includes
new text end one or more
licensed teachers under section 122A.18, subdivision 1, to operate a deleted text begincharterdeleted text end school subject
to new text beginthe commissioner'snew text end approval deleted text beginby the commissionerdeleted text end new text beginof the authorizer's affidavit under
paragraph (b)
new text end. deleted text beginA board must vote on charter school application for sponsorship no later
than 90 days after receiving the application.
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 An authorizer must not locate a newly chartered school or relocate an existing
charter school within (i) a one-mile radius of a public school site that a school board
closed under section 123B.51, (ii) the boundaries of a school district newly consolidated
under section 123A.48, or (iii) the boundaries of a dissolved school district under section
123A.46 for at least 36 months from the date the school board acted to close the school, or
consolidate or dissolve the school district unless the school board of the school district in
which the charter school would be located gives the authorizer written approval to do so.
new text end

Notwithstanding sections 465.717 and 465.719, a school districtnew text begin, subject to this
section and section 124D.11,
new text end may create a corporation for the purpose of deleted text begincreatingdeleted text endnew text begin
establishing
new text end a charter school.

(b) Before the operators may deleted text beginformdeleted text endnew text begin establishnew text end and operate a school, the deleted text beginsponsordeleted text endnew text begin
authorizer
new text end must file an affidavit with the commissioner stating its intent to deleted text beginauthorize adeleted text end
charter new text begina new text endschool. new text beginAn authorizer must file a separate affidavit for each school it intends
to charter.
new text endThe affidavit must state the terms and conditions under which the deleted text beginsponsordeleted text endnew text begin
authorizer
new text end would deleted text beginauthorize adeleted text end charter new text begina new text endschool and how the deleted text beginsponsordeleted text endnew text begin authorizernew text end intends
to oversee the fiscal and student performance of the charter school and to comply with
the terms of the written contract between the deleted text beginsponsordeleted text endnew text begin authorizernew text end and the charter school
board of directors under subdivision 6. The commissioner must approve or disapprove
the deleted text beginsponsor's proposed authorizationdeleted text end new text beginauthorizer's affidavit new text endwithin deleted text begin90deleted text end new text begin60 business new text enddays of
receipt of the affidavit. new text beginIf the commissioner disapproves the affidavit, the commissioner
shall notify the authorizer of the deficiencies in the affidavit and the authorizer then has 20
business days to address the deficiencies. If the authorizer does not address deficiencies to
the commissioner's satisfaction, the commissioner's disapproval is final.
new text endFailure to obtain
commissioner approval precludes deleted text begina sponsordeleted text end new text beginan authorizer new text endfrom deleted text beginauthorizingdeleted text endnew text begin charteringnew text end the
deleted text begin charterdeleted text end school that deleted text beginwasdeleted text endnew text begin isnew text end the subject of deleted text beginthedeleted text endnew text begin thisnew text end affidavit.

(c) new text beginThe authorizer may prevent an approved charter school from opening for
operation if, among other grounds, the charter school violates this section or does not meet
the ready-to-open standards that are part of the authorizer's oversight and evaluation
process or are stipulated in the charter school contract.
new text end

new text begin (d) new text endThe 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 a board of directors composed of at least five
membersnew text begin who are not related partiesnew text end until a timely election for members of the new text beginongoing
new text endcharter school board of directors is held according to the school's articles and bylawsnew text begin
under paragraph (f)
new text end. A charter school board of directors must be composed of at least
five membersnew text begin who are not related partiesnew text end. deleted text beginAnydeleted text end Staff members deleted text beginwho aredeleted text end employed at the
school, including teachers providing instruction under a contract with a cooperative, and
all parentsnew text begin or legal guardiansnew text end of children enrolled in the school deleted text beginmay participate in the
election for
deleted text endnew text begin are the voters eligible to elect thenew text end members of the school's board of directors.
deleted text begin Licensed teachers employed at the school, including teachers providing instruction under
a contract with a cooperative, must be a majority of the members of the board of directors
before the school completes its third year of operation, unless the commissioner waives
the requirement for a majority of licensed teachers on the board.
deleted text endnew text begin A charter school must
notify eligible voters of the school board election dates at least 30 days before the election.
new text end
Board of director meetings must comply with chapter 13D.

deleted text begin (d) deleted text end new text begin (e) Upon the request of an individual, the charter school must make available
in a timely fashion the minutes of meetings of the board of directors, and of members
and committees having any board-delegated authority; financial statements showing all
operations and transactions affecting income, surplus, and deficit during the school's last
annual accounting period; and a balance sheet summarizing assets and liabilities on the
closing date of the accounting period. A charter school also must post on its official Web
site information identifying its authorizer and indicate how to contact that authorizer and
include that same information about its authorizer in other school materials that it makes
available to the public.
new text end

new text begin (f) Every charter school board member shall attend department-approved training
on board governance, the board's role and responsibilities, employment policies and
practices, and financial management. A board member who does not complete the
required training within 12 months of being seated on the board is ineligible to continue to
serve as a board member.
new text end

new text begin (g) The ongoing board must be elected before the school completes its third year
of operation. The board of directors shall be (i) a teacher majority board made up of
licensed teachers employed at the school or (ii) a board having at least 20 percent of its
members as licensed teachers employed at the school and must include charter school
parents or guardians and interested community members. Licensed teachers employed
by the school, or those providing instruction under a contract with a cooperative, may be
members of the board of directors. The chief financial officer and chief administrator are
nonvoting board members. Board bylaws shall outline the internal process and procedures
for changing the board's governance model. A board may change its governance model
only with approval from the authorizer and a voting majority of the board of directors and
the licensed teachers employed at the school, including teachers providing instruction
under a contract with a cooperative.
new text end

new text begin (h)new text end The granting or renewal of a charter by deleted text begina sponsoring entitydeleted text endnew text begin an authorizernew text end must
not be conditioned upon the bargaining unit status of the employees of the school.

deleted text begin (e) A sponsor deleted text end new text begin (i) The granting or renewal of a charter school by an authorizer must
not be contingent on the charter school being required to contract, lease, or purchase
services from the authorizer. Any potential contract, lease, or purchase of service from
an authorizer must be disclosed to the commissioner, accepted through an open bidding
process, and be a separate contract from the charter contract. The school must document
the open bidding process. An authorizer must not enter into a contract to provide
management and financial services for a school that it authorizes, unless the school
documents that it received at least two competitive bids.
new text end

new text begin (j) The charter school shall not offer any services or goods of value to students,
parents, or guardians as an inducement, term, or condition of enrolling a student in a
charter school.
new text end

new text begin (k) An authorizernew text end may deleted text beginauthorizedeleted text endnew text begin permitnew text end the deleted text beginoperatorsdeleted text endnew text begin board of directorsnew text end 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 deleted text beginsponsor's applicationdeleted text endnew text begin authorizer's
original affidavit
new text end as approved by the commissioner only after submitting a supplemental
deleted text begin applicationdeleted text endnew text begin affidavit for approvalnew text end to the commissioner in a form and manner prescribed by
the commissioner. The supplemental deleted text beginapplicationdeleted text endnew text begin affidavitnew text end must deleted text beginprovide evidencedeleted text endnew text begin shownew text end
that:

(1) the expansion deleted text beginofdeleted text endnew text begin proposed bynew text end the charter school is supported by need and
projected enrollment;

new text begin (2) the charter school expansion is warranted, at a minimum, by longitudinal data
demonstrating students' improved academic performance and growth on statewide
assessments under chapter 120B;
new text end

deleted text begin (2)deleted text endnew text begin (3)new text end the charter school is fiscally soundnew text begin and has the financial capacity to implement
the proposed expansion
new text end;new text begin and
new text end

deleted text begin (3)deleted text endnew text begin (4)new text end the deleted text beginsponsor supports thedeleted text endnew text begin authorizer finds that the charter school has the
management capacity to carry out its
new text end expansiondeleted text begin; anddeleted text endnew text begin.
new text end

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

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

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

deleted text begin (2) establish and maintain complete, auditable records for the charter school;
deleted text end

deleted text begin (3) establish proper filing techniques;
deleted text end

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

deleted text begin (5) properly manage and retain charter school and student records;
deleted text end

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

new text begin (l) The commissioner shall have 30 business days to review and comment on the
supplemental affidavit. The commissioner shall notify the authorizer of any deficiencies
in the supplemental affidavit and the authorizer then has 30 business days to address,
to the commissioner's satisfaction, any deficiencies in the supplemental affidavit. The
school may not expand grades or add sites until the commissioner has reviewed and
commented on the supplemental affidavit. The commissioner's approval or disapproval of
a supplemental affidavit is final.
new text end

Subd. 4a.

Conflict of interest.

(a) deleted text beginA member of a charter school board of directorsdeleted text endnew text begin
An individual
new text end is prohibited from serving as a member of the new text begincharter school new text endboard of
directors deleted text beginor asdeleted text endnew text begin if the individual, an immediate family member, or the individual's partner isnew text end
an new text beginowner, new text endemployee or agent of or a contractor with a for-profit new text beginor nonprofit new text endentity with
whom the charter school contracts, directly or indirectly, for professional services, goods,
or facilities. A violation of this prohibition renders a contract voidable at the option of
the commissionernew text begin or the charter school board of directorsnew text end. A member of a charter school
board of directors who violates this prohibition deleted text beginshall bedeleted text endnew text begin isnew text end individually liable to the charter
school for any damage caused by the violation.

new text begin (b) No member of the board of directors, employee, officer, or agent of a charter
school shall participate in selecting, awarding, or administering a contract if a conflict
of interest exists. A conflict exists when:
new text end

new text begin (1) the board member, employee, officer, or agent;
new text end

new text begin (2) the immediate family of the board member, employee, officer, or agent;
new text end

new text begin (3) the partner of the board member, employee, officer, or agent; or
new text end

new text begin (4) an organization that employs, or is about to employ any individual in clauses
(1) to (3),
new text end

new text begin has a financial or other interest in the entity with which the charter school is contracting.
A violation of this prohibition renders the contract void.
new text end

new text begin (c) Any employee, agent, or board member of the authorizer who participates
in the initial review, approval, ongoing oversight, evaluation, or the charter renewal or
nonrenewal process or decision is ineligible to serve on the board of directors of a school
chartered by that authorizer.
new text end

deleted text begin (b)deleted text endnew text begin (d)new text end An individual may serve as a member of the board of directors if no conflict
of interest under paragraph (a) exists.

deleted text begin (c) 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

deleted text begin (d)deleted text endnew text begin (e)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 endnew text begin (f)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.

Subd. 5.

Conversion of existing schools.

A boardnew text begin of an independent or special
school district
new text end may convert one or more of its existing schools to charter schools under
this section if 60 percent of the full-time teachers at the school sign a petition seeking
conversion. The conversion must occur at the beginning of an academic year.

Subd. 6.

new text beginCharter new text endcontract.

The deleted text beginsponsor'sdeleted text end authorization for a charter school must
be in the form of a written contract signed by the deleted text beginsponsordeleted text endnew text begin authorizernew text end and the board of
directors of the charter school. The contract must be completed within deleted text begin90deleted text endnew text begin 45 businessnew text end
days of the commissioner's approval of the deleted text beginsponsor's proposed authorization.deleted text end new text beginauthorizer's
affidavit. The authorizer shall submit to the commissioner a copy of the signed charter
contract within ten business days of its execution.
new text endThe contract for a charter school must
be in writing and contain at least the following:

(1) a deleted text begindescription of a program that carries out one or more of the purposesdeleted text end
new text begin declaration of the purposes new text endin subdivision 1new text begin that the school intends to carry out and how
the school will report its implementation of those purposes
new text end;

(2) new text begina description of the school program and the new text endspecific new text beginacademic and nonacademic
new text endoutcomes new text beginthat new text endpupils deleted text beginare todeleted text endnew text begin mustnew text end achieve deleted text beginunder subdivision 10deleted text end;

(3) new text begina statement of new text endadmission policies and procedures;

(4) new text begina governance, new text endmanagementnew text begin,new text end and administration deleted text beginofdeleted text endnew text begin plan fornew text end the school;

(5) new text beginsigned agreements from charter school board members to comply with all federal
and state laws governing organizational, programmatic, and financial
new text endrequirements deleted text beginand
procedures for program and financial audits
deleted text endnew text begin applicable to charter schoolsnew text end;

(6) deleted text beginhow the school will comply with subdivisions 8, 13, 16, and 23deleted text endnew text begin the criteria,
processes, and procedures that the authorizer will use for ongoing oversight of operational,
financial, and academic performance
new text end;

(7) deleted text beginassumption of liability by the charter schooldeleted text endnew text begin the performance evaluation that is a
prerequisite for reviewing a charter contract under subdivision 15
new text end;

(8) types and amounts of insurance new text beginliability new text endcoverage to be obtained by the charter
school;

(9) the term of the contract, which may be up to three yearsnew text begin for an initial contract
plus an additional preoperational planning year, and up to five years for a renewed contract
if warranted by the school's academic, financial, and operational performance
new text end;

(10) deleted text beginifdeleted text endnew text begin hownew text end the board of directors or the operators of the charter school new text beginwill new text endprovide
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 beginand
deleted text end

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

new text begin (12) the plan for an orderly closing of the school under chapter 308A or 317A, if the
closure is a termination for cause, a voluntary termination, or a nonrenewal of the contract,
and that includes establishing the responsibilities of the school board of directors and the
authorizer and notifying the commissioner, authorizer, school district in which the charter
school is located, and parents of enrolled students about the closure, the transfer of student
records to students' resident districts, and procedures for closing financial operations.
new text end

Subd. 6a.

Audit report.

new text begin(a) new text endThe charter school must submit an audit report to the
commissionernew text begin and its authorizernew text end by December 31 each year.new text begin The commissioner may
withhold the charter school's state aid if the charter school does not submit an audit by
January 31.
new text end

new text begin (b)new text end The charter school, with the assistance of the auditor conducting the audit, must
include with the report a copy of all charter school agreements for corporate management
services. If the entity that provides the professional services to the charter school is
exempt from taxation under section 501 of the Internal Revenue Code of 1986, that entity
must file with the commissioner by February 15 a copy of the annual return required under
section 6033 of the Internal Revenue Code of 1986.

new text begin (c)new text end If the commissioner receives deleted text beginas part of thedeleted text endnew text begin annew text end audit report deleted text begina management letterdeleted text end
indicating that a material weakness exists in the financial reporting systems of a charter
school, the charter school must submit a written report to the commissioner explaining
how the material weakness will be resolved.

deleted text begin Upon the request of an individual, the charter school must make available in a timely
fashion the minutes of meetings of members, the board of directors, and committees
having any of the authority of the board of directors, and statements showing the financial
result of all operations and transactions affecting income and surplus during the school's
last annual accounting period and a balance sheet containing a summary of its assets and
liabilities as of the closing date of the accounting period.
deleted text end

Subd. 7.

Public status; exemption from statutes and rules.

A charter school is a
public school and is part of the state's system of public education. deleted text beginExcept as provided in
this section, a charter school is exempt from all statutes and rules applicable to a school, a
board, or a district, although it may elect to comply with one or more provisions of statutes
or rules.
deleted text endnew text begin A charter school is exempt from all statutes and rules applicable to a school,
school board, or school district unless a statute or rule is made specifically applicable to a
charter school or is included in this section.
new text end

Subd. 8.

State and local requirements.

(a) A charter school shall meet all
deleted text begin applicabledeleted text endnew text begin federal,new text end statenew text begin,new text end and local health and safety requirementsnew text begin applicable to school
districts
new text end.

(b)new text begin A school must comply with statewide education accountability requirements
governing standards and assessments in chapter 120B and must work with the Department
of Education to make available to the public valid and highly reliable comparisons
of student academic growth and achievement across schools consistent with school
performance report card information under section 120B.36.
new text end

new text begin (c)new text end A school deleted text beginsponsoreddeleted text endnew text begin authorizednew text end 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.

deleted text begin (c)deleted text endnew text begin (d)new text end A charter school must be nonsectarian in its programs, admission policies,
employment practices, and all other operations. deleted text beginA sponsordeleted text endnew text begin An authorizernew text end may not
deleted text begin authorize adeleted text end charter new text begina new text endschool deleted text beginor programdeleted text end that is affiliated with a nonpublic sectarian
school or a religious institution.new text begin A charter school student must be released for religious
instruction, consistent with section 120A.22, subdivision 12, clause (3).
new text end

deleted text begin (d)deleted text endnew 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 endnew 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 endnew text begin (g)new text end A charter school may not charge tuitionnew text begin to students who reside in Minnesotanew text end.

deleted text begin (g)deleted text endnew 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 endnew 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 endnew 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; deleted text begin123B.52, subdivision 5;deleted text end
471.38; 471.391; 471.392;new text begin andnew text end 471.425deleted text begin; 471.87; 471.88, subdivisions 1, 2, 3, 4, 5, 6,
12, 13, and 15
; 471.881; and 471.89
deleted text end. 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 commissionernew text begin and authorizernew text end.
The Department of Education, state auditor, deleted text beginordeleted text end legislative auditornew text begin, or authorizernew text end 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 endnew 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 endnew text begin (l)new text end A charter school must comply withnew text begin chapters 13 and 13D; andnew text end sections deleted text begin13.32;deleted text end
120A.22, subdivision 7; 121A.75; and 260B.171, subdivisions 3 and 5.

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

new text begin (n) A charter school is subject to chapter 181.
new text end

new text begin Subd. 8a. new text end

new text begin Aid reduction. new text end

new text begin The commissioner may reduce a charter school's state aid
under section 127A.42 or 127A.43 if the charter school board fails to correct a violation
under this section.
new text end

new text begin Subd. 8b. new text end

new text begin Aid reduction for violations. new text end

new text begin The commissioner may reduce a charter
school's state aid by an amount not to exceed 60 percent of the charter school's basic
revenue for the period of time that a violation of law occurs.
new text end

Subd. 9.

Admission requirements.

A charter school may limit admission to:

(1) pupils within an age group or grade level;new text begin or
new text end

(2) people who are eligible to participate in the graduation incentives program
under section 124D.68deleted text begin; ordeleted text endnew text begin.
new text end

deleted text begin (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.
deleted text end

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. deleted text beginIf 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.
deleted text endnew text begin The charter school must develop and
publish a lottery policy and process that it must use when accepting pupils by lot.
new text end

A charter school shall give preference for enrollment to a sibling of an enrolled pupil
and to a foster child of that pupil's parentsnew text begin and may give preference for enrolling 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 abilitynew text begin and may not establish any criteria
or requirements for admission that are inconsistent with this subdivision
new text end.

Subd. 10.

Pupil performance.

A charter school must design its programs to at
least meet the outcomes adopted by the commissioner for public school students. In the
absence of the commissioner's requirements, the school must meet the outcomes contained
in the contract with the deleted text beginsponsordeleted text endnew text begin authorizernew text end. The achievement levels of the outcomes
contained in the contract may exceed the achievement levels of any outcomes adopted by
the commissioner for public school students.

Subd. 11.

Employment and other operating matters.

A charter school must
employ or contract with necessary teachers, as defined by section 122A.15, subdivision 1,
who hold valid licenses to perform the particular service for which they are employed in
the school. The charter school's state aid may be reduced under section deleted text begin127A.42deleted text endnew text begin 127A.43new text end
if the school employs a teacher who is not appropriately licensed or approved by the
board of teaching. The school may employ necessary employees who are not required to
hold teaching licenses to perform duties other than teaching and may contract for other
services. The school may discharge teachers and nonlicensed employees. new text beginThe charter
school board is subject to section 181.932. When offering employment to a prospective
employee, a charter school must give that employee a written description of the terms and
conditions of employment and the school's personnel policies.
new text endA person, without holding
a valid administrator's license, may perform administrative, supervisory, or instructional
leadership duties.

The board of directors also shall decide matters related to the operation of the school,
including budgeting, curriculum and operating procedures.

Subd. 12.

Pupils with a disability.

A charter school must comply with sections
125A.02, 125A.03 to 125A.24, and 125A.65 and rules relating to the education of pupils
with a disability as though it were a district.

Subd. 13.

Length of school year.

A charter school must provide instruction
each year for at least the number of days required by section 120A.41. It may provide
instruction throughout the year according to sections 124D.12 to 124D.127 or 124D.128.

Subd. 14.

Annual public reports.

A charter school must new text beginpublish an annual new text endreport deleted text beginat
least annually to its sponsor and the commissioner the information required by the sponsor
or the commissioner
deleted text endnew text begin approved by the charter school board of directors. The annual report
must at least include information on school enrollment, governance and management,
staffing, finances, academic performance, operational performance, innovative practices
and implementation, and future plans. A charter school must distribute the annual
report by publication, mail, or electronic means to the commissioner, authorizer, school
employees, and parents and legal guardians of students enrolled in the charter school and
also must post the report on the charter school's official Web site
new text end. The reports are public
data under chapter 13.

Subd. 15.

Review and comment.

(a) deleted text beginThe department must review and comment on
the evaluation, by the sponsor, of the performance of a charter school before the charter
school's contract is renewed for another contract term. The sponsor must submit to
the commissioner timely information for the review and comment.
deleted text endnew text begin The commissioner
must review and comment on the authorizer's performance evaluation process at the
time the authorizer submits its application for approval as an authorizer and each time
the authorizer undergoes its five-year review under subdivision 3, paragraph (f). Before
renewing a charter contract, the authorizer shall provide the commissioner with a formal,
written evaluation of the school's performance.
new text end

(b) deleted text beginA sponsordeleted text endnew text begin An authorizernew text end shall monitor and evaluate the fiscal and student
performance of the school, and may for this purpose annually assess a charter schooldeleted text begin: (1)
in its first, second, or third year of operation up to $30 per student up to a maximum of
$10,000; and (2) in its fourth or a subsequent year of operation up to $10 per student up to
a maximum of $3,500
deleted text endnew text begin a fee according to paragraph (c)new text end.

new text begin (c) The minimum fee that each charter school must pay to an authorizer is the
basic formula allowance for that year. Beginning in fiscal year 2013, the maximum fee
is four times the formula allowance for that year. Beginning in fiscal year 2013, each
charter school's fee, subject to the minimum and maximum fees, equals the product of
.015, the formula allowance for that year, and the charter school's adjusted marginal cost
pupil units for that year.
new text end

new text begin (d) Notwithstanding paragraph (c), the following charter school fees apply, subject
to the minimum and maximum fee in paragraph (c):
new text end

new text begin (1) for fiscal year 2010 only, each charter school's fee equals the product of .01, the
formula allowance for that year, and the charter school's adjusted marginal cost pupil units
for that year and the maximum fee is two times the basic formula allowance for that year;
new text end

new text begin (2) for fiscal year 2011 only, each charter school's fee equals the product of .01, the
formula allowance for that year, and the charter school's adjusted marginal cost pupil
units for that year and the maximum fee is three times the basic formula allowance for
that year; and
new text end

new text begin (3) for fiscal year 2012 only, the product of .013, the formula allowance for that year,
and the charter school's adjusted marginal cost pupil units for that year and the maximum
fee is four times the basic formula allowance for that year.
new text end

new text begin (e) For the preoperational planning period, the authorizer may assess a charter school
the formula allowance for one pupil unit.
new text end

new text begin (f) Each year by September 30, an authorizer shall submit to the commissioner a
statement of expenditures related to authorizing activities during the previous school year
ending on June 30. The authorizer must transmit a copy of the statement to all schools
chartered by the authorizer.
new text end

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 15 cents per mile traveled, 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.

Subd. 17.

Leased space.

new text begin(a) new text endA charter school may lease space from deleted text beginadeleted text endnew text begin an independent
school
new text end board eligible to be deleted text begina sponsor ordeleted text endnew text begin an authorizer,new text end other public deleted text beginordeleted text endnew text begin organization,new text end privatenew text begin,new text end
nonprofit nonsectarian organizationnew text begin, 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
new text end. deleted text beginIf 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. 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.
deleted text end

new text begin (b) Upon approval of the authorizer, a charter school that has operated at least five
consecutive years may form a separate affiliated nonprofit building company to provide a
school facility. The authorizer shall submit a supplemental affidavit to the commissioner
stating that the authorizer has reviewed:
new text end

new text begin (1) the school's feasibility study on facility options;
new text end

new text begin (2) documents showing the school's need and projected enrollment for such a
facility; and
new text end

new text begin (3) the school's financial plan and financial status.
new text end

new text begin The school is prohibited from organizing the nonprofit building company until the
authorizer files a supplementary affidavit with the commissioner and receives approval
from the commissioner.
new text end

deleted text begin Subd. 18. deleted text end

deleted text begin Authority to raise initial working capital. deleted text end

deleted text begin A sponsor may authorize
a charter school before the applicant has secured its space, equipment, facilities, and
personnel if the applicant indicates the authority is necessary for it to raise working
capital. A sponsor may not authorize a school before the commissioner has approved the
authorization.
deleted text end

Subd. 19.

Disseminate information.

new text begin(a)new text end The deleted text beginsponsordeleted text endnew text begin authorizernew text end, the operators, and
the deleted text beginDepartment of Educationdeleted text endnew text begin departmentnew text end must disseminate information to the public
on how to form and operate a charter school deleted text beginanddeleted text endnew text begin. Charter schools must disseminate
information about
new text end how to deleted text beginutilizedeleted text endnew text begin usenew text end the offerings of a charter school. deleted text beginParticulardeleted text endnew text begin Targetednew text end
groups deleted text beginto be targeteddeleted text end include low-income families and communities, deleted text beginanddeleted text end students of
colornew text begin, and students who are at risk of academic failurenew text end.

new text begin (b) Authorizers, operators, and the department also may disseminate information
about the successful best practices in teaching and learning demonstrated by charter
schools.
new text end

Subd. 20.

Leave to teach in a charter school.

If a teacher employed by a district
makes a written request for an extended leave of absence to teach 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 deleted text beginup to 90 days before the teacher would otherwise have to report for dutydeleted text endnew text begin before
February 1 in the school year preceding the school year in which the teacher intends
to leave, or February 1 of the calendar year in which the teacher's leave is scheduled
to terminate
new text end. 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 deleted text beginby 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
deleted text endnew text begin under chapters 354 and 354A, consistent with
subdivision 22
new text end.

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 within deleted text beginthe sponsoringdeleted text endnew text begin
an authorizing
new text end district, except that bargaining units may remain part of the appropriate
unit within deleted text beginthe sponsoringdeleted text endnew text begin an authorizingnew text end district, if the employees of the school, the
board of directors of the school, the exclusive representative of the appropriate unit in the
deleted text begin sponsoringdeleted text endnew text begin authorizingnew text end district, and the board of the deleted text beginsponsoringdeleted text endnew text begin authorizingnew text end district agree
to include the employees in the appropriate unit of the deleted text beginsponsoringdeleted text endnew text begin authorizingnew text end district.

Subd. 22.

Teacher and other employee retirement.

(a) Teachers in a charter
school must be public school teachers for the purposes of chapters 354 and 354a.

(b) Except for teachers under paragraph (a), employees in a charter school must be
public employees for the purposes of chapter 353.

Subd. 23.

Causes for nonrenewal or termination of charter school contract.

(a)
The duration of the contract with a deleted text beginsponsordeleted text end new text beginauthorizer new text endmust be for the term contained in
the contract according to subdivision 6. The deleted text beginsponsordeleted text end new text beginauthorizer new text endmay or may not renew a
contract at the end of the term for any ground listed in paragraph (b). A deleted text beginsponsordeleted text end new text beginauthorizer
new text endmay unilaterally terminate a contract during the term of the contract for any ground
listed in paragraph (b). At least 60 days before not renewing or terminating a contract,
the deleted text beginsponsordeleted text endnew text begin authorizernew text end 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 deleted text beginsponsordeleted text end new text beginauthorizer new text endwithin deleted text begin14deleted text endnew text begin 15 businessnew text end 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 deleted text begin14-daydeleted text endnew text begin 15-business-daynew text end period shall be
treated as acquiescence to the proposed action. Upon receiving a timely written request
for a hearing, the deleted text beginsponsordeleted text end new text beginauthorizer new text endshall give deleted text beginreasonabledeleted text endnew text begin ten business days'new text end notice to
the charter school's board of directors of the hearing date. The deleted text beginsponsordeleted text end new text beginauthorizer new text endshall
conduct an informal hearing before taking final action. The deleted text beginsponsordeleted text endnew text begin authorizernew text end shall take
final action to renew or not renew a contract deleted text beginby 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 endnew text begin no later than 20 business days before the proposed date for
terminating the contract or the end date of the contract
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 317Adeleted text begin, except when
the commissioner approves the decision of a different eligible sponsor to authorize the
charter school
deleted text end.

(c) If deleted text beginat the end of a contract term, eitherdeleted text end the deleted text beginsponsor ordeleted text end new text beginauthorizer and new text endthe charter
school board of directors deleted text beginwantsdeleted text endnew text begin mutually agreenew text end to voluntarily terminate new text beginor not renew
new text endthe contract, a change in deleted text beginsponsorsdeleted text endnew text begin authorizersnew text end is allowed if the commissioner approves
the deleted text begindecision ofdeleted text endnew text begin transfer tonew text end a different deleted text begineligible sponsordeleted text endnew text begin approved authorizernew text end to deleted text beginauthorizedeleted text endnew text begin
charter
new text end the deleted text begincharterdeleted text end school. deleted text beginThe party intending to terminate the contract must notify the
other party and the commissioner of its intent at least 90 days before the date on which the
contract ends.
deleted text endnew text begin Both parties jointly must submit their intent in writing to the commissioner
to mutually terminate the contract.
new text end The deleted text beginsponsordeleted text endnew text begin authorizernew text end that is a party to the existing
contract deleted text beginat leastdeleted text end must inform the approved deleted text begindifferent eligible sponsordeleted text endnew text begin new authorizernew text end about
the fiscal and new text beginoperational status, and new text endstudent performance of the school. If no deleted text begindifferent
eligible sponsor
deleted text endnew text begin transfer of authorizernew text end 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 deleted text beginsponsordeleted text endnew text begin authorizernew text end, and after providing an opportunity for
a public hearing, may terminate the existing deleted text beginsponsorial relationshipdeleted text endnew text begin contract between the
authorizer and the charter school board
new text end if the charter school has a history of:

(1)new text begin failure to meet pupil performance requirements contained in the contract;
new text end

new text begin (2)new text end financial mismanagementnew text begin or failure to meet generally accepted standards of
fiscal management
new text end; or

deleted text begin (2)deleted text endnew text begin (3)new text end repeated new text beginor major new text endviolations of the law.

new text begin (e) If the commissioner terminates a charter school contract because the authorizer
fails to comply with subdivision 3, paragraph (g), the commissioner shall provide the
charter school with information about other eligible authorizers.
new text end

Subd. 23a.

Related party lease costs.

(a) A charter school is prohibited from
entering a lease of real property with a related party deleted text beginas defined in subdivision 26,deleted text end unless
the lessor is a nonprofit corporation under chapter 317A or a cooperative under chapter
308A, and the lease cost is reasonable under section 124D.11, subdivision 4, clause (1).

(b)new text begin For purposes of this section and section 124D.11:
new text end

new text begin (1) "related party" means an affiliate or immediate relative of the other party in
question, an affiliate of an immediate relative, or an immediate relative of an affiliate;
new text end

new text begin (2) "affiliate" means a person that directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with another person;
new text end

new text begin (3) "immediate family" means an individual whose relationship by blood, marriage,
adoption, or partnering is no more remote than first cousin;
new text end

new text begin (4) "person" means an individual or entity of any kind; and
new text end

new text begin (5) "control" means the ability to affect the management, operations, or policy
actions or decisions of a person, whether through ownership of voting securities, by
contract, or otherwise.
new text end

new text begin (c)new text end A lease of real property to be used for a charter school, not excluded in paragraph
(a), must contain the following statement: "This lease is subject to Minnesota Statutes,
section 124D.10, subdivision 23a."

deleted text begin (c)deleted text endnew text begin (d)new text end If a charter school enters into as lessee a lease with a related party and the
charter school subsequently closes, the commissioner has the right to recover from the
lessor any lease payments in excess of those that are reasonable under section 124D.11,
subdivision 4
, clause (1).

Subd. 24.

Pupil enrollment upon nonrenewal or termination of charter school
contract.

If a contract is not renewed or is terminated according to subdivision 23, a
pupil who attended the school, siblings of the pupil, or another pupil who resides in the
same place as the pupil may enroll in the resident district or may submit an application
to a nonresident district according to section 124D.03 at any time. Applications and
notices required by section 124D.03 must be processed and provided in a prompt manner.
The application and notice deadlines in section 124D.03 do not apply under these
circumstances. The closed charter school must transfer the student's educational records
within ten business days of closure to the student's school district of residence where the
records must be retained or transferred under section 120A.22, subdivision 7.

Subd. 25.

Extent of specific legal authority.

(a) The board of directors of a charter
school may sue and be sued.

(b) The board may not levy taxes or issue bonds.

(c) The commissioner, deleted text begina sponsordeleted text endnew text begin an authorizernew text end, members of the board of deleted text begina sponsordeleted text endnew text begin
an authorizer
new text end in deleted text begintheirdeleted text end official capacity, and employees of deleted text begina sponsordeleted text endnew text begin an authorizernew text end are
immune from civil or criminal liability with respect to all activities related to a charter
school they approve or deleted text beginsponsordeleted text endnew text begin authorizenew text end. The board of directors shall obtain at least
the amount of and types of insurance deleted text beginrequired by the contract, according to subdivision
6.
deleted text endnew text begin up to the applicable tort liability limits under chapter 466. The charter school board
must submit a copy of the insurance policy to its authorizer before starting operations.
The charter school board must submit changes in its insurance carrier or policy to its
authorizer within 20 business days of the change.
new text end

deleted text begin Subd. 26. deleted text end

deleted text begin Definitions. deleted text end

deleted text begin For purposes of this section and section 124D.11:
deleted text end

deleted text begin (1) A "Related party" is an affiliate or close relative of the other party in question, an
affiliate of a close relative, or a close relative of an affiliate.
deleted text end

deleted text begin (2) "Affiliate" means a person that directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control with, another
person.
deleted text end

deleted text begin (3) "Close relative" means an individual whose relationship by blood, marriage, or
adoption to another individual is no more remote than first cousin.
deleted text end

deleted text begin (4) "Person" means an individual or entity of any kind.
deleted text end

deleted text begin (5) "Control" includes the terms "controlling," "controlled by," and "under common
control with" and means the possession, direct or indirect, of the power to direct or cause
the direction of the management, operations, or policies of a person, whether through the
ownership of voting securities, by contract, or otherwise.
deleted text end

Sec. 2.

Minnesota Statutes 2008, section 124D.11, subdivision 9, is amended to read:


Subd. 9.

Payment of aids to charter schools.

(a) Notwithstanding section
127A.45, subdivision 3, aid payments for the current fiscal year to a charter school deleted text beginnot in
its first year of operation
deleted text end shall be of an equal amount on each of the deleted text begin23deleted text endnew text begin 24new text end payment dates.
deleted text begin A charter school in its first year of operation shall receive, on its first payment date, ten
percent of its cumulative amount guaranteed for the year and 22 payments of an equal
amount thereafter the sum of which shall equal the current year aid payment percentage
multiplied by the cumulative amount guaranteed.
deleted text end

(b) Notwithstanding paragraph (a)new text begin and section 127A.45new text end, for a charter school ceasing
operationnew text begin on ornew text end prior to deleted text beginthe end of a school year, the current year aid payment percentage
multiplied by the amount due for the school year may be paid to the school after audit
of prior fiscal year and current fiscal year pupil counts.
deleted text endnew text begin June 30 of a school year, for the
payment periods occurring after the school ceases serving students, the commissioner shall
withhold the estimated state aid owed the school. The charter school board of directors
and authorizer must submit to the commissioner a closure plan under chapter 308A or
317A, and financial information about the school's liabilities and assets. After receiving
the closure plan, financial information, an audit of pupil counts, documentation of lease
expenditures, and monitoring of special education expenditures, the commissioner may
release cash withheld and may continue regular payments up to the current year payment
percentages if further amounts are owed. If, based on audits and monitoring, the school
received state aid in excess of the amount owed, the commissioner shall retain aid withheld
sufficient to eliminate the aid overpayment.
new text end For a charter school ceasing operations
prior to, or at the end of, a school year, notwithstanding section 127A.45, subdivision
3, preliminary final payments may be made afternew text begin receiving the closure plan,new text end audit of
pupil counts, monitoring of special education expenditures, deleted text beginanddeleted text end documentation of lease
expendituresnew text begin, and school submission of Uniform Financial Accounting and Reporting
Standards (UFARS) financial data
new text end for the final year of operation. Final payment may be
made upon receipt of audited financial statements under section 123B.77, subdivision 3.

(c)new text begin If a charter school fails to comply with the commissioner's directive to return,
for cause, federal or state funds administered by the department, the commissioner may
withhold an amount of state aid sufficient to satisfy the directive.
new text end

new text begin (d) If, within the timeline under section 471.425, a charter school fails to pay the state
of Minnesota, a school district, intermediate school district, or service cooperative after
receiving an undisputed invoice for goods and services, the commissioner may withhold
an amount of state aid sufficient to satisfy the claim and shall distribute the withheld
aid to the interested state agency, school district, intermediate school district, or service
cooperative. An interested state agency, school district, intermediate school district, or
education cooperative shall notify the commissioner when a charter school fails to pay an
undisputed invoice within 75 business days of when it received the original invoice.
new text end

new text begin (e)new text end Notwithstanding section 127A.45, subdivision 3, and paragraph (a), 80 percent
of the start-up cost aid under subdivision 8 shall be paid within 45 days after the first day
of student attendance for that school year.

deleted text begin (d)deleted text endnew text begin (f)new text end In order to receive state aid payments under this subdivision, a charter school
in its first three years of operation must submit a school calendar in the form and manner
requested by the department and a quarterly report to the Department of Education. The
report must list each student by grade, show the student's start and end dates, if any,
with the charter school, and for any student participating in a learning year program,
the report must list the hours and times of learning year activities. The report must be
submitted not more than two weeks after the end of the calendar quarter to the department.
The department must develop a Web-based reporting form for charter schools to use
when submitting enrollment reports. A charter school in its fourth and subsequent year of
operation must submit a school calendar and enrollment information to the department in
the form and manner requested by the department.

deleted text begin (e)deleted text endnew text begin (g)new text end Notwithstanding sections 317A.701 to 317A.791, upon closure of a charter
school and satisfaction of creditors, cash and investment balances remaining shall be
returned to the state.

Sec. 3. new text beginEFFECTIVE DATE.
new text end

new text begin (a) This act is effective the day following final enactment and applies beginning
August 1, 2009, unless otherwise specified in this section.
new text end

new text begin (b) Section 1, subdivision 3, paragraph (b), clause (2), applies to an authorizer
seeking approval to charter a school after the effective date of this act. The changes in
section 1, subdivision 3, paragraph (b), clause (2), shall not apply to a sponsor under
Minnesota Statutes 2008, section 124D.10, that is a party to a charter contract on the
effective date of this act except that section 1, subdivision 3, paragraph (b), clause (2),
item (iv), applies to such sponsors beginning July 1, 2012.
new text end

new text begin (c) Section 1, subdivision 4, paragraph (a), applies to a school board action to close,
consolidate, or dissolve a school district taken after the effective the date of this act.
new text end