SF 1694

as introduced - 92nd Legislature (2021 - 2022) Posted on 03/04/2021 02:29pm

A bill for an act
relating to education; making policy and technical changes for charter school
provisions; amending Minnesota Statutes 2020, sections 124E.01, subdivision 1;
124E.02; 124E.05, subdivisions 2, 4, 5, 6; 124E.06, subdivision 1; 124E.07,
subdivisions 1, 2, 3, 4, 5, 6, 7; 124E.09; 124E.10, subdivisions 1, 4; 124E.11;
124E.12, subdivision 2; 124E.13, subdivision 3; 124E.14; 124E.16; 124E.17,
subdivision 1.

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

Section 1.

Minnesota Statutes 2020, section 124E.01, subdivision 1, is amended to read:

Subdivision 1.

new text begin Goal and new text end purposes.

The deleted text begin primary purpose deleted text end new text begin goal new text end of deleted text begin charter deleted text end new text begin chartered public new text end
schools is to improve deleted text begin all pupil deleted text end new text begin the new text end learning deleted text begin and all student deleted text end new text begin , new text end achievement new text begin , and success of all
students new text end . deleted text begin Additional purposes include deleted text end new text begin The purposes of chartered public schools are new text end to:

(1) increase new text begin quality new text end learning opportunities for all deleted text begin pupils deleted text end new text begin students new text end ;

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

(3) measure learning outcomes and create different and innovative forms of measuring
outcomes;

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

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

new text begin A charter school must identify the purposes it will address in the charter contract and
document the implementation of those purposes in the school's annual report. Documentation
of the implementation of those purposes shall be a component of the authorizer's performance
review of the school.
new text end

Sec. 2.

Minnesota Statutes 2020, section 124E.02, is amended to read:

124E.02 DEFINITIONS.

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

(b) "Affidavit" means a written statement the authorizer submits to the commissioner
for approval to establish a charter school under section 124E.06, subdivision 4, attesting to
its review and approval process before chartering a school.

(c) "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 begin (d) "Charter management organization" means any nonprofit or for-profit entity that
contracts with a charter school board of directors to provide, manage, or oversee all or
substantially all of a school's education program or a school's administrative, financial,
business, or operational functions.
new text end

deleted text begin (d) deleted text end new text begin (e) new text end "Control" means the ability to affect the management, operations, or policy actions
or decisions of a person, whether by owning voting securities, by contract, or otherwise.

new text begin (f) "Educational management organization" means a nonprofit or for-profit entity that
provides, manages, or oversees all or substantially all of the education program, or the
school's administrative, financial, business, or operational functions.
new text end

deleted text begin (e) deleted text end new text begin (g) new text end "Immediate family" means an individual whose relationship by blood, marriage,
adoption, or partnership is no more remote than first cousin.

new text begin (h) "Market need and demand study" means a study that includes the following for the
proposed locations of the school or additional site:
new text end

new text begin (1) current and projected demographic information of student populations in the
geographic area;
new text end

new text begin (2) current student enrollment patterns in the geographic area;
new text end

new text begin (3) information on existing schools and types of educational programs currently available;
new text end

new text begin (4) documentation of the plan to do outreach to diverse and underrepresented populations;
new text end

new text begin (5) information on the availability of properly zoned and classified facilities; and
new text end

new text begin (6) quantification of existing demand for the new school, site expansion, or preschool
program.
new text end

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

deleted text begin (g) deleted text end new text begin (j) new text end "Related party" means an affiliate or immediate relative of the other interested
party, an affiliate of an immediate relative who is the other interested party, or an immediate
relative of an affiliate who is the other interested party.

deleted text begin (h) deleted text end new text begin (k) new text end For purposes of this chapter, the terms defined in section 120A.05 have the same
meanings.

Sec. 3.

Minnesota Statutes 2020, section 124E.05, subdivision 2, is amended to read:

Subd. 2.

deleted text begin Requirements for authorizers deleted text end new text begin Role, responsibilities, and requirements of
authorizers new text end .

deleted text begin The authorizer must participate in department-approved training. deleted text end new text begin (a) The role
of an authorizer is to ensure that a school has autonomy, fulfills the goal and purposes of a
chartered public school, and is accountable to the agreed upon terms of the charter school
contract in order to safeguard quality educational opportunities for students and maintain
public trust and confidence.
new text end

new text begin (b) An authorizer has the following responsibilities:
new text end

new text begin (1) review applications for new schools, including grade and site expansions and transfers
of current schools, and determine whether to approve or deny the application based on the
authorizer's approved criteria;
new text end

new text begin (2) negotiate and execute the performance charter contracts with the schools it authorizes;
new text end

new text begin (3) conduct ongoing monitoring, oversight, and evaluation of the school's academic,
operational, and financial performance commensurate with the school's circumstances during
the term of the charter contract; and
new text end

new text begin (4) evaluate the academic, operational, and financial performance of the school as defined
in the charter contract prior to the end of the contract to determine the renewal, nonrenewal,
or termination of the contract.
new text end

new text begin (c) The commissioner may not require an authorizer to undertake a role or responsibility
beyond those in statute or the charter contract or perform any function that the department
exercises in relation to a public school, school board, or school district.
new text end

new text begin (d) The authorizer must document in the annual income and expenditure report under
subdivision 8 the completion of competency-based training by its staff and consultants
during the previous year on the charter school law and the authorizer's role or responsibilities.
new text end

Sec. 4.

Minnesota Statutes 2020, section 124E.05, subdivision 4, is amended to read:

Subd. 4.

Application content.

(a) To be approved as an authorizer, an applicant must
include in its application to the commissioner at least the following:

(1) how the organization carries out its mission by chartering schools;

(2) a description of the capacity of the organization to serve as an authorizer, including
the positions allocated to authorizing duties, the qualifications for those positions, the
full-time equivalencies of those positions, and the financial resources available to fund the
positions;

(3) the application and review process the authorizer uses to decide whether to grant
charters;

(4) the type of contract it arranges with the schools it charters to meet the provisions of
section 124E.10;

(5) the process for overseeing the school, consistent with clause (4), to ensure that the
schools chartered comply with applicable law and rules and the contract;

(6) the criteria and process the authorizer uses to approve applications adding grades or
sites under section 124E.06, subdivision 5; new text begin and
new text end

(7) the process for renewing or terminating the school's charter based on evidence
showing the academic, organizational, and financial competency of the school, including
its success in increasing student achievement and meeting the goals of the charter school
agreement deleted text begin ; and deleted text end new text begin .
new text end

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

(b) Notwithstanding paragraph (a), an authorizer that is a school district may satisfy the
requirements of paragraph (a), clauses (1) and (2), and any requirement governing a conflict
of interest between an authorizer and its charter schools or ongoing evaluation or continuing
education of an administrator or other professional support staff by submitting to the
commissioner a written promise to comply with the requirements.

Sec. 5.

Minnesota Statutes 2020, section 124E.05, subdivision 5, is amended to read:

Subd. 5.

Review by commissioner.

(a) The commissioner shall review an authorizer's
performance every five years in a manner and form determined by the commissioner, subject
to paragraphs (b) and (c), and may review an authorizer's performance more frequently at
the commissioner's own initiative or at the request of a charter school deleted text begin operator deleted text end new text begin administrator,
school employee new text end , charter school board deleted text begin member deleted text end new text begin of directors new text end , or other interested party. The
commissioner, after completing the review, shall transmit a report with findings to the
authorizer new text begin and the schools authorized by the authorizer new text end .

(b) Consistent with this subdivision, the commissioner must:

deleted text begin (1) use criteria appropriate to the authorizer and the schools it charters to review the
authorizer's performance; and
deleted text end

deleted text begin (2) consult with authorizers, charter school operators, and other charter school
stakeholders in developing review criteria under this paragraph.
deleted text end

new text begin (1) develop the form and manner of the performance review system in consultation with
authorizers, school administrators, charter school boards of directors, and other charter
school stakeholders;
new text end

new text begin (2) publish the form and manner of the authorizer performance review process at least
12 months before the beginning of the review cycle;
new text end

new text begin (3) base the performance review system on authorizer roles and responsibilities in
subdivision 2 and section 124E.10;
new text end

new text begin (4) base an authorizer's performance review on adherence to and implementation of the
authorizer's policies, procedures, and processes approved by the commissioner;
new text end

new text begin (5) base an authorizer's performance review on the authorizer's self-assessment and input
from the school administrators, charter school boards of directors, and other charter school
stakeholders who interact with the authorizer;
new text end

new text begin (6) base an authorizer's performance review on the full period since the last review; and
new text end

new text begin (7) develop and maintain a portfolio of all reports and data submitted to the department
since the last review to minimize any duplicative submission and reporting of information
for the review.
new text end

(c) The commissioner's form must use existing department data on the authorizer to
minimize duplicate reporting to the extent practicable. When reviewing an authorizer's
performance under this subdivision, the commissioner must not:

(1) fail to credit; new text begin or
new text end

(2) withhold points deleted text begin ; or deleted text end new text begin .
new text end

deleted text begin (3) otherwise penalize an authorizer for failing to charter additional schools or for the
absence of complaints against the authorizer's current portfolio of charter schools.
deleted text end

new text begin (d) Consistent with this subdivision, the commissioner must not penalize an authorizer
for:
new text end

new text begin (1) not chartering additional schools or for the absence of complaints against an authorizer
or an authorizer's portfolio of schools;
new text end

new text begin (2) missing a submission deadline, except if there is a documented pattern of failing to
meet submission deadlines; or
new text end

new text begin (3) not undertaking a role or responsibility beyond those defined in this section, the
charter contract, or the authorizer's approved policies, procedures, or processes.
new text end

Sec. 6.

Minnesota Statutes 2020, section 124E.05, subdivision 6, is amended to read:

Subd. 6.

Corrective action.

(a) If, consistent with this chapter, the commissioner finds
that an authorizer has not met the requirements of this chapter, the commissioner may subject
the authorizer to new text begin a new text end corrective action new text begin plan new text end , which deleted text begin may deleted text end new text begin must new text end include deleted text begin terminating the contract
with the charter school board of directors of a school it chartered. deleted text end new text begin specific deadlines no
longer than 130 business days. During the period when an authorizer is subject to a corrective
action plan, the commissioner may:
new text end

new text begin (1) prohibit the authorizer from accepting a transfer application from a charter school;
and
new text end

new text begin (2) prohibit the authorizer from accepting an application to establish a charter school.
new text end

new text begin (b) new text end The commissioner must notify the authorizer in writing of any findings new text begin of deficiencies
new text end that may subject the authorizer to corrective action deleted text begin and deleted text end new text begin . new text end The authorizer then has 15 business
days to request an informal hearing before the commissioner takes corrective action. deleted text begin If the
commissioner terminates a contract between an authorizer and a charter school under this
paragraph, the commissioner may assist the charter school in acquiring a new authorizer. deleted text end new text begin
The commissioner must hold a hearing within 15 business days of a request. If the
deficiencies are not resolved at an informal hearing, the authorizer must address unresolved
deficiencies and submit a response within 45 business days. The commissioner must review
the response and notify the authorizer of any outstanding deficiencies within 20 business
days. The authorizer must address and correct those deficiencies within 20 business days.
The commissioner must determine if the authorizer's changes are sufficient to take corrective
action. If no corrective action is taken by the authorizer within 130 business days, the charter
school's board of directors may submit to the commissioner a request to transfer to a new
authorizer without the approval or consent of the current authorizer.
new text end

deleted text begin (b) deleted text end new text begin (c) new text end The commissioner may at any time take corrective action against an authorizer,
including terminating an authorizer's ability to charter a school new text begin , terminating a contract with
a charter school, and other sanctions the commissioner deems appropriate new text end for:

(1) failing to demonstrate the criteria under subdivision 3 under which the commissioner
approved the authorizer;

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

(3) unsatisfactory performance as an approved authorizer; deleted text begin or
deleted text end

(4) any good cause shown that gives the commissioner a legally sufficient reason to take
corrective action against an authorizer deleted text begin . deleted text end new text begin ; or
new text end

new text begin (5) failing to meet the terms of a corrective action plan by the specified deadline.
new text end

new text begin (d) The commissioner must assist a charter school with a terminated contract in acquiring
a new authorizer.
new text end

Sec. 7.

Minnesota Statutes 2020, section 124E.06, subdivision 1, is amended to read:

Subdivision 1.

Individuals eligible to organize.

(a) An authorizer, after receiving an
application from a charter school developer, may charter either a licensed teacher under
section 122A.18, subdivision 1, or a group of individuals that includes one or more licensed
teachers under section 122A.18, subdivision 1, to operate a school subject to the
commissioner's approval of the authorizer's affidavit under subdivision 4.

(b) "Application" under this section means the charter school business plan a charter
school developer submits to an authorizer for approval to establish a charter school. This
application must include:

(1) the deleted text begin school developer's deleted text end new text begin proposed school's new text end :

(i) mission deleted text begin statement deleted text end new text begin and vision statements new text end ;

(ii) deleted text begin school deleted text end purposes new text begin and goals new text end ;

(iii) new text begin educational new text end program design new text begin and how the program will improve student learning,
success, and achievement new text end ;

new text begin (iv) plan to address the social and emotional learning needs of students and student
support services;
new text end

new text begin (v) plan to provide special education management and services;
new text end

new text begin (vi) plan for staffing the school with appropriately qualified and licensed personnel;
new text end

deleted text begin (iv) deleted text end new text begin (vii) multi-year new text end financial plan;

deleted text begin (v) deleted text end new text begin (viii) new text end governance new text begin structure new text end and management deleted text begin structure deleted text end new text begin plan new text end ; deleted text begin and
deleted text end

deleted text begin (vi) background and experience;
deleted text end

new text begin (ix) market need and demand study; and
new text end

new text begin (x) plan for ongoing outreach and dissemination of information about the school's
offerings and enrollment procedure to families that reflect the diversity of Minnesota's
population and to targeted groups under section 124E.17, subdivision 1, paragraph (a);
new text end

new text begin (2) the school developer's experience and background, including criminal history and
bankruptcy background checks;
new text end

deleted text begin (2) deleted text end new text begin (3) new text end any other information the authorizer requests; and

deleted text begin (3) deleted text end new text begin (4) new text end a "statement of assurances" of legal compliance prescribed by the commissioner.

(c) An authorizer shall not approve an application submitted by a charter school developer
under paragraph (a) if the application does not comply with subdivision 3, paragraph (e),
and section 124E.01, subdivision 1. The commissioner shall not approve an affidavit
submitted by an authorizer under subdivision 4 if the affidavit does not comply with
subdivision 3, paragraph (e), and section 124E.01, subdivision 1.

Sec. 8.

Minnesota Statutes 2020, section 124E.07, subdivision 1, is amended to read:

Subdivision 1.

Initial board of directors.

Before entering into a contract or other
agreement for professional or other services, goods, or facilities, the operators authorized
to organize and operate a school must establish a board of directors composed of at least
five members deleted text begin who are not related parties deleted text end . new text begin The initial board members must not be related
parties. new text end The initial board continues to serve until a timely election for members of the
ongoing charter school board of directors is held according to the school's articles and
bylaws under subdivision 4. new text begin The initial board of directors and school developers must
comply with the training requirements in subdivision 7 upon the incorporation of the school.
new text end

Sec. 9.

Minnesota Statutes 2020, section 124E.07, subdivision 2, is amended to read:

Subd. 2.

Ongoing board of directors.

deleted text begin The ongoing board must be elected before the
school completes its third year of operation. deleted text end new text begin The ongoing board must begin to be elected
by the end of the first year of operation and be completed by the end of the third year of
operation. The terms of board members shall begin on July 1. A term shall be at least two
years. The bylaws shall establish the length of the term and the number of terms an individual
may serve on the board or as an officer of the board. new text end Board elections must be held during
the school year but may not be conducted on days when the school is closed.

Sec. 10.

Minnesota Statutes 2020, section 124E.07, subdivision 3, is amended to read:

Subd. 3.

Membership criteria.

(a) The ongoing charter school board of directors shall
have at least five deleted text begin nonrelated deleted text end members deleted text begin and include deleted text end new text begin . The board members must not be related.
The ongoing board members must include new text end : (1) at least one licensed teacher new text begin , school counselor,
social worker licensed by the Professional Educator Licensing and Standards Board who
provides direct instruction to students and new text end who is employed new text begin by a school new text end as a teacher deleted text begin at the
school or provides instruction deleted text end new text begin , or social worker who provides direct services for at least 80
percent of their schedule or is new text end under contract between the charter school and a new text begin teacher
new text end cooperative; (2) at least one parent or legal guardian of a student enrolled in the charter
school who is not an employee of the charter school; and (3) at least one interested
community member who resides in Minnesota, is not employed by the charter school, and
does not have a child enrolled in the school. new text begin The board structure must be defined in the
bylaws. new text end The board structure may deleted text begin include deleted text end new text begin be: (1) new text end a majority of teachers under this paragraph
deleted text begin or deleted text end new text begin ; (2) a majority of new text end parents deleted text begin or deleted text end new text begin ; (3) a majority of new text end community members deleted text begin , deleted text end new text begin ; new text end or deleted text begin it may deleted text end new text begin (4) new text end have
no clear majority. The deleted text begin chief financial officer and the deleted text end chief administrator may only serve as
new text begin an new text end ex-officio nonvoting board deleted text begin members deleted text end new text begin member new text end . No charter school employees shall serve
on the board other than teachers under clause (1). Contractors providing facilities, goods,
or services to a charter school shall not serve on the board of directors of the charter school.

(b) An individual is prohibited from serving as a member of the charter school board of
directors if: (1) the individual, an immediate family member, or the individual's partner is
a full or part owner or principal with a for-profit or nonprofit entity or independent contractor
with whom the charter school contracts, directly or indirectly, for professional services,
goods, or facilities; or (2) an immediate family member is an employee of the school. An
individual may serve as a member of the board of directors if no conflict of interest exists
under this paragraph, consistent with this section. new text begin An individual is prohibited from serving
on more than one charter school board at the same time.
new text end

(c) A violation of paragraph (b) renders a contract voidable at the option of the
commissioner or the charter school board of directors. A member of a charter school board
of directors who violates paragraph (b) is individually liable to the charter school for any
damage caused by the violation.

(d) Any employee, agent, or board member of the authorizer who participates in initially
reviewing, approving, overseeing, evaluating, renewing, or not renewing the charter school
is ineligible to serve on the board of directors of a school chartered by that authorizer.

Sec. 11.

Minnesota Statutes 2020, section 124E.07, subdivision 4, is amended to read:

Subd. 4.

Board structure.

Board bylaws shall outline the process and procedures for
changing the board's governance structure, consistent with chapter 317A. A board may
change its governance structure only:

(1) by a majority vote of the board of directors deleted text begin and a majority vote of the licensed teachers
employed by the school as teachers, including licensed teachers providing instruction under
a contract between the school and a cooperative deleted text end ; deleted text begin and
deleted text end

new text begin (2) by a majority vote of the licensed teachers employed by the school as teachers who
provide instruction to students, including licensed teachers providing instruction under a
contract between the school and a cooperative; and
new text end

deleted text begin (2) deleted text end new text begin (3) new text end with the authorizer's approval.

Any change in board governance structure must conform with the board composition
established under this section.

Sec. 12.

Minnesota Statutes 2020, section 124E.07, subdivision 5, is amended to read:

Subd. 5.

deleted text begin Eligible voters deleted text end new text begin Board elections new text end .

new text begin (a) new text end Staff members employed deleted text begin at deleted text end new text begin by new text end the school,
including teachers providing instruction under a contract with a cooperative, members of
the board of directors, and all parents or legal guardians of children enrolled in the school
are the voters eligible to elect the members of the school's board of directors. deleted text begin A charter
school must notify eligible voters of the school board election dates at least 30 days before
the election.
deleted text end

new text begin (b) The board of directors must establish and publish election policies and procedures
on the school's website.
new text end

new text begin (c) The board of directors must notify eligible voters of the school board election dates
and voting procedures at least 30 calendar days before the election and post this information
on the school's website.
new text end

new text begin (d) The board of directors must notify eligible voters of the candidates' names,
biographies, and candidate statements at least ten calendar days before the election and post
this information on the school's website.
new text end

Sec. 13.

Minnesota Statutes 2020, section 124E.07, subdivision 6, is amended to read:

Subd. 6.

Duties.

new text begin (a) new text end The board of directors deleted text begin also shall decide and deleted text end is responsible for new text begin all
decision making on new text end policy matters related to operating the school, including budgeting,
curriculum programming, personnel, and operating procedures. deleted text begin The board shall adopt a
nepotism policy. deleted text end The board deleted text begin shall deleted text end new text begin must new text end adopt personnel evaluation policies and practices
that, at a minimum:

(1) carry out the school's mission and goals;

(2) evaluate how charter contract goals and commitments are executed;

(3) evaluate student achievement, postsecondary and workforce readiness, and student
engagement and connection goals;

(4) establish a teacher evaluation process under section 124E.03, subdivision 2, paragraph
(h); and

(5) provide professional development related to the individual's job responsibilities.

new text begin (b) The board must adopt a nepotism policy that prohibits the employment of immediate
family members of a board member, a school employee, or a teacher who provides instruction
under a contract between the charter school and a cooperative. The board may waive this
policy if: (1) the position is publicly posted for 20 business days; and (2) a two-thirds
majority of the board of directors vote to approve the hiring. A board member, school
employee, or teacher under contract with a cooperative must not be involved in an interview,
selection process, hiring, supervision, or evaluation of an employee who is an immediate
family member.
new text end

Sec. 14.

Minnesota Statutes 2020, section 124E.07, subdivision 7, is amended to read:

Subd. 7.

Training.

deleted text begin Every charter school board member shall attend annual training
throughout the member's term. All new board members shall attend initial training on the
board's role and responsibilities, employment policies and practices, and financial
management. A new board member who does not begin the required initial training within
six months after being seated and complete that training within 12 months after being seated
is automatically ineligible to continue to serve as a board member. The school shall include
in its annual report the training each board member attended during the previous year. deleted text end new text begin (a)
Every voting charter school board member and nonvoting ex-officio member shall attend
board training.
new text end

new text begin (b) Prior to a board term that begins on July 1, or within three months of being seated
on the board to fill a vacancy, a new board member must complete training on a charter
school board's role and responsibilities, open meeting law, and data practices law. An
ex-officio member must complete this training within three months of starting employment
at the school.
new text end

new text begin (c) A new board member must complete training on employment policies and practices
under chapter 181; public school funding and financial management; and the board's roles
and responsibilities regarding student success, achievement, and performance within 12
months of being seated on the board or the individual is automatically ineligible to continue
to serve as a board member. A board member who does not complete training within the
12-month period is ineligible to be elected or appointed to a charter school board for a period
of 18 months.
new text end

new text begin (d) Every charter school board member must complete annual training modules
throughout the member's term based on an annual assessment of the training needs of
individual members and the full board. Ongoing training modules include but are not limited
to: budgeting, financial management, recruiting and hiring a charter school director,
evaluating a charter school director, governance-management relationships, student support
services, student fair dismissal, state standards, cultural diversity, succession planning,
strategic planning, program oversight and evaluation, compensation systems, human resources
policies, effective parent and community relationships, authorizer contract and relationships,
charter school law, legal liability, board recruitment and elections, board meetings and
operations, policy development and review, and school health and safety.
new text end

new text begin (e) The organization or person providing training under paragraphs (b), (c), and (d) must
certify the individual's completion of the training provided.
new text end

new text begin (f) The charter school is responsible for covering the costs related to board training. The
charter school must include in its annual report the training each board member completed
during the previous year.
new text end

new text begin (g) The board must ensure that an annual assessment of the board's performance is
conducted and the results are reported in the school's annual report.
new text end

Sec. 15.

Minnesota Statutes 2020, section 124E.09, is amended to read:

124E.09 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, an authorizer, members of the board of an authorizer in their
official capacity, and employees of an authorizer are immune from civil or criminal liability
with respect to all activities related to a charter school they approve or authorize. The board
of directors shall obtain at least the amount of and types of insurance 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.

(d) Notwithstanding section 3.736, the charter school shall assume full liability for its
activities and indemnify and hold harmless the authorizer and its officers, agents, and
employees from any suit, claim, or liability arising from any operation of the charter school
and the commissioner and department officers, agents, and employees. A charter school is
not required to indemnify or hold harmless a state employee if the state would not be required
to indemnify and hold the employee harmless under section 3.736, subdivision 9.

new text begin (e) The board of directors may enter into joint powers agreements with organizations
under section 471.59, subdivision 1, or with other charter schools for the purposes of
providing special education services.
new text end

Sec. 16.

Minnesota Statutes 2020, section 124E.10, subdivision 1, is amended to read:

Subdivision 1.

Contents.

(a) To authorize a charter school, the authorizer and the charter
school board of directors must sign a written contract within 45 business days of the
commissioner's approval of the authorizer's affidavit. The authorizer shall submit a copy of
the charter contract to the commissioner within ten business days after the contract is signed
by the contracting parties. The contract must include at least the following:

(1) a declaration that the charter school will carry out the primary purpose in section
124E.01, subdivision 1, and indicate how the school will report its implementation of the
primary purpose to its authorizer;

(2) a declaration of the additional purpose or purposes in section 124E.01, subdivision
1, that the school intends to carry out and indicate how the school will report its
implementation of those purposes to its authorizer;

(3) a description of the school program and the specific academic and nonacademic
outcomes that pupils must achieve;

(4) a statement of admission policies and procedures;

(5) a school governance, management, and administration plan;

(6) signed agreements from charter school board members to comply with the federal
and state laws governing organizational, programmatic, and financial requirements applicable
to charter schools;

(7) the criteria, processes, and procedures the authorizer will use to monitor and evaluate
the fiscal, operational, and academic performance, consistent with subdivision 3, paragraphs
(a) and (b);

(8) for contract renewal, the formal written performance evaluation that is a prerequisite
for reviewing a charter contract under subdivision 3;

(9) types and amounts of insurance liability coverage the charter school must obtain,
consistent with section 124E.03, subdivision 2, paragraph (d);

(10) consistent with section 124E.09, paragraph (d), a provision to indemnify and hold
harmless from any suit, claim, or liability arising from any charter school operation:

(i) the authorizer and its officers, agents, and employees; and

(ii) notwithstanding section 3.736, the commissioner and department officers, agents,
and employees;

(11) the term of the contract, which, for an initial contract, may be up to five years plus
a preoperational planning period, or for a renewed contract or a contract with a new authorizer
after a transfer of authorizers, may be up to five years, if warranted by the school's academic,
financial, and operational performance;

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

(13) the specific conditions for contract renewal that identify the performance of all
students under the primary purpose of section 124E.01, subdivision 1, as the most important
factor in determining whether to renew the contract; deleted text begin and
deleted text end

(14) the additional purposes under section 124E.01, subdivision 1, and related
performance obligations under clause (7) contained in the charter contract as additional
factors in determining whether to renew the contract deleted text begin . deleted text end new text begin ; and
new text end

new text begin (15) how the charter school will conduct ongoing outreach and dissemination of
information about the school's offerings and enrollment procedure to families that reflect
the diversity of Minnesota's population and to targeted groups under section 124E.17,
subdivision 1, paragraph (a).
new text end

(b) In addition to the requirements of paragraph (a), the charter contract must contain
the plan for an orderly closing of the school under chapter 317A, that establishes the
responsibilities of the school board of directors and the authorizer, whether the closure is a
termination for cause, a voluntary termination, or a nonrenewal of the contract. The plan
must establish who is responsible for:

(1) notifying the commissioner, school district in which the charter school is located,
and parents of enrolled students about the closure;

(2) providing parents of enrolled students information and assistance to enable the student
to re-enroll in another school;

(3) transferring student records under section 124E.03, subdivision 5, paragraph (b), to
the student's resident school district; and

(4) closing financial operations.

(c) A charter school must design its programs to at least meet the outcomes adopted by
the commissioner for public school students, including world's best workforce goals under
section 120B.11, subdivision 1. In the absence of the commissioner's requirements governing
state standards and benchmarks, the school must meet the outcomes contained in the contract
with the authorizer. 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.

new text begin (d) A charter school contract for a charter school with at least 70 percent of enrolled
students eligible to participate in the graduation incentives program under section 124D.68
must include innovative academic, college, and workforce readiness measures and student
engagement accountability measures that assist students in meeting achievement levels.
new text end

Sec. 17.

Minnesota Statutes 2020, section 124E.10, subdivision 4, is amended to read:

Subd. 4.

Causes for nonrenewal or termination of charter school contract.

(a) The
duration of the contract with an authorizer must be for the term contained in the contract
according to subdivision 1, paragraph (a). new text begin A charter school board of directors must formally
submit a request to renew the contract with the authorizer by the date set forth in the charter
contract. A charter school board of directors that does not submit a request for renewal,
mutual nonrenewal, or transfer of authorizer must cease operation at the end of the current
contract.
new text end

new text begin (b) new text end The authorizer may or may not renew a contract at the end of the term for any ground
listed in paragraph deleted text begin (b) deleted text end new text begin (c) new text end . An authorizer may unilaterally terminate a contract during the
term of the contract for any ground listed in paragraph deleted text begin (b) deleted text end new text begin (c) new text end . At least 60 business days
before not renewing or terminating a contract, the authorizer 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 describe the informal hearing
process, consistent with this paragraph. The charter school's board of directors may request
in writing an informal hearing before the authorizer within 15 business days after receiving
notice of nonrenewal or termination of the contract. Failure by the board of directors to
make a written request for an informal hearing within the 15-business-day period shall be
treated as acquiescence to the proposed action. Upon receiving a timely written request for
a hearing new text begin open to the public new text end , the authorizer shall give ten business days' notice to the charter
school's board of directors of the hearing date. new text begin The hearing must be recorded by video or a
court reporter. The recording must be preserved for three years from the date of the final
decision of the authorizer and made available to the public. new text end The authorizer shall conduct
an informal hearing before taking final action. The authorizer shall take final action to renew
or not renew a contract no later than 20 business days before the proposed date for terminating
the contract or the end date of the contract.

deleted text begin (b) deleted text end new text begin (c) new text end An authorizer may terminate or not renew a contract upon any of the following
grounds:

(1) failure to demonstrate satisfactory academic achievement for all students, including
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 the authorizer terminates or does not renew a contract under this paragraph, the school
must be dissolved according to the applicable provisions of chapter 317A.

deleted text begin (c) deleted text end new text begin (d) new text end The commissioner, after providing reasonable notice to the board of directors of
a charter school and the existing authorizer, and after providing an opportunity for a public
hearing, may terminate the existing contract between the authorizer and the charter school
board if the charter school has a history of:

(1) failure to meet pupil performance requirements, consistent with state law;

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

(3) repeated or major violations of the law.

Sec. 18.

Minnesota Statutes 2020, section 124E.11, is amended to read:

124E.11 ADMISSION REQUIREMENTS AND ENROLLMENT.

(a) A charter school, including its preschool or prekindergarten program established
under section 124E.06, subdivision 3, paragraph (b), may limit admission to:

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

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

(3) residents of a specific geographic area new text begin defined in the charter new text end in which the school is
located when the majority of students deleted text begin served by the school deleted text end new text begin that reside in that area new text end are
members of underserved populations.

(b) A charter school, including its preschool or prekindergarten program established
under section 124E.06, subdivision 3, paragraph (b), deleted text begin shall deleted text end new text begin must new text end 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. The
charter school must develop and publish, including on its website, a lottery policy and
process that it must use when accepting pupils by lot. new text begin The lottery must be held at an open
public meeting that facilitates attendance of potential families.
new text end

(c) A charter school deleted text begin shall deleted text end new text begin must new text end give enrollment preference to a sibling of an enrolled
pupil and to a foster child of that pupil's parents and may give preference for enrolling
children of the school's staff new text begin who are eligible for employment benefits new text end before accepting
other pupils by lot. A charter school that is located in Duluth township in St. Louis County
and admits students in kindergarten through grade 6 must give enrollment preference to
students residing within a five-mile radius of the school and to the siblings of enrolled
children. A charter school may give enrollment preference to children currently enrolled in
the school's free preschool or prekindergarten program under section 124E.06, subdivision
3, paragraph (b), who are eligible to enroll in kindergarten in the next school year.

(d) A deleted text begin person shall deleted text end new text begin child must new text end not be admitted to a charter school (1) as a kindergarten
pupil, unless the pupil is at least five years of age on September 1 of the calendar year in
which the school year for which the pupil seeks admission commences; or (2) as a first
grade student, unless the pupil is at least six years of age on September 1 of the calendar
year in which the school year for which the pupil seeks admission commences or has
completed kindergarten; except that a charter school may establish and publish on its website
a policy for admission of selected pupils at an earlier age, consistent with the enrollment
process in paragraphs (b) and (c).

(e) Except as permitted in paragraph (d), a charter school, including its preschool or
prekindergarten program established under section 124E.06, subdivision 3, paragraph (b),
may not limit admission to pupils on the basis of intellectual ability, measures of achievement
or aptitude, or athletic ability and may not establish any criteria or requirements for admission
that are inconsistent with this section.

(f) The charter school deleted text begin shall deleted text end new text begin or any agent of the school must new text end not distribute any services
deleted text begin or deleted text end new text begin , new text end goods new text begin , payments, or other incentives new text end of value to students, parents, or guardians as an
inducement, term, or condition of enrolling a student in a charter school.

(g) Once a student is enrolled in the school, the student is considered enrolled in the
school until the deleted text begin student formally withdraws deleted text end new text begin school receives a request for the transfer of
educational records from another school, or written election by the parent or legal guardian
of the withdrawing student, new text end or is expelled under the Pupil Fair Dismissal Act in sections
121A.40 to 121A.56.

(h) A charter school with at least 90 percent of enrolled students who are eligible for
special education services and have a primary disability of deaf or hard-of-hearing may
enroll prekindergarten pupils with a disability under section 126C.05, subdivision 1,
paragraph (a), and must comply with the federal Individuals with Disabilities Education
Act under Code of Federal Regulations, title 34, section 300.324, subsection (2), clause
(iv).

Sec. 19.

Minnesota Statutes 2020, section 124E.12, subdivision 2, is amended to read:

Subd. 2.

Administrators.

deleted text begin (a) A person, without holding a valid administrator's license,
may perform administrative, supervisory, or instructional leadership duties. The board of
directors shall establish qualifications for all persons who hold administrative, supervisory,
or instructional leadership roles. The qualifications shall cover at least: instruction and
assessment; human resource and personnel management; financial management; legal and
compliance management; effective communication; and board, authorizer, and community
relationships. The board of directors shall use those qualifications as the basis for job
descriptions, hiring, and performance evaluations of those who hold administrative,
supervisory, or instructional leadership roles.
deleted text end

deleted text begin (b) The board of directors and an individual who does not hold a valid administrative
license and who serves in an administrative, supervisory, or instructional leadership position
shall develop a professional development plan. The school's annual report must include
public personnel information documenting the professional development plan.
deleted text end

new text begin (a) A charter school board of directors must establish qualifications for all persons who
hold administrative, supervisory, or instructional leadership positions. The qualifications
must include a requirement that a person hold a minimum of a four-year degree from an
accredited institution. Other qualifications for these positions shall include as appropriate
for the specific position: instruction and assessment, curriculum design, human resource
and personnel management, professional ethics, child development, financial management,
legal and compliance management, special education oversight, contract management,
effective communication, cultural competency, board and authorizer relationships, parent
relationships, and community partnerships. A charter school board of directors must use
those qualifications as the basis for the job description, hiring, and performance evaluation
of the charter school director. The charter school director must use those qualifications as
the basis for the job descriptions, hiring, and performance review for the administrative,
supervisory, and instructional leaders who report to the charter school director.
new text end

new text begin (b) A person who does not hold a valid administrator's license may perform
administrative, supervisory, or instructional leadership duties. A person without a valid
administrator's license must complete a minimum of 25 hours annually of competency-based
training modules corresponding to the individual's annual professional development needs
and plan approved by the charter school board of directors. Training modules include but
are not limited to: instruction and curriculum; state standards; teacher and staff hiring,
development, support, and evaluation; social-emotional learning; data collection and usage;
assessment methodologies; use of technology for learning and management; charter school
law and requirements; code of professional ethics; financial management and state accounting
requirements; grant management; legal and compliance management; special education
management; health and safety laws; restorative justice; cultural competencies; effective
communication; parent relationships; board and management relationships; community
partnerships; charter contract and authorizer relationships; and public accountability.
new text end

new text begin (c) A person serving as a new charter school director with a valid administrator's license
must complete a minimum of ten hours of competency-based training during their first year
of employment on the following: charter school law and requirements, board and management
relationships, and charter contract and authorizer relationships.
new text end

new text begin (d) The training a person must complete under paragraphs (b) and (c) may not be
self-instructional. The organization or instructor providing the training must certify
completion of the training. The person must submit the certification of completion of training
to the charter school board of directors and certifications must be maintained in the personnel
file. Completion of requisite training must be a component of annual performance evaluations.
new text end

new text begin (e) A charter school's annual report must document the school director's professional
development training completed in the previous academic year.
new text end

new text begin (f) No charter school administrator may serve as a paid administrator or consultant with
another charter school without the knowledge and a two-thirds vote of approval of the boards
of directors of the charter schools involved in such an arrangement. The boards of directors
involved in such arrangements must send notice of this arrangement to authorizers upon
approval by the boards.
new text end

Sec. 20.

Minnesota Statutes 2020, section 124E.13, subdivision 3, is amended to read:

Subd. 3.

Affiliated nonprofit building corporation.

(a) An affiliated nonprofit building
corporation may purchase, expand, or renovate an existing facility to serve as a school or
may construct a new school facility. A charter school may organize an affiliated nonprofit
building corporation if the charter school:

(1) has operated for at least six consecutive years;

(2) as of June 30, has a net positive unreserved general fund balance in the preceding
three fiscal years;

(3) has long-range strategic and financial plans that include enrollment projections for
at least five years;

(4) completes a feasibility study of facility options that outlines the benefits and costs
of each option; and

(5) has a plan that describes project parameters and budget.

(b) An affiliated nonprofit building corporation under this subdivision must:

(1) be incorporated under section 317A;

(2) comply with applicable Internal Revenue Service regulations, including regulations
for "supporting organizations" as defined by the Internal Revenue Service;

(3) post on the school website the name, mailing address, bylaws, minutes of board
meetings, and names of the current board of directors new text begin , including ex-officio board members, new text end
of the affiliated nonprofit building corporation;

(4) submit to the commissioner a copy of its annual audit by December 31 of each year;
deleted text begin and
deleted text end

(5) comply with government data practices law under chapter 13 deleted text begin . deleted text end new text begin ; and
new text end

new text begin (6) comply with chapter 13D governing open meetings.
new text end

(c) An affiliated nonprofit building corporation must not serve as the leasing agent for
property or facilities it does not own. A charter school that leases a facility from an affiliated
nonprofit building corporation that does not own the leased facility is ineligible to receive
charter school lease aid. The state is immune from liability resulting from a contract between
a charter school and an affiliated nonprofit building corporation.

new text begin (d) The board of directors of an affiliated nonprofit building company, including
ex-officio board members, must be composed of members who are not immediate family
members or related parties. An individual on the affiliated nonprofit building company
board, including ex-officio board members, must not be a family member or contractor of
the charter school.
new text end

deleted text begin (d) deleted text end new text begin (e) new text end The board of directors of the charter school must ensure the affiliated nonprofit
building corporation complies with all applicable legal requirements. The charter school's
authorizer must oversee the efforts of the board of directors of the charter school to ensure
legal compliance of the affiliated building corporation. A school's board of directors that
fails to ensure the affiliated nonprofit building corporation's compliance violates its
responsibilities and an authorizer must consider that failure when evaluating the deleted text begin charter
school deleted text end new text begin school's performance new text end .

Sec. 21.

Minnesota Statutes 2020, section 124E.14, is amended to read:

124E.14 CONFLICTS OF INTEREST.

(a) 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:

(1) the board member, employee, officer, or agent;

(2) the immediate family of the board member, employee, officer, or agent;

(3) the partner of the board member, employee, officer, or agent; or

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

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.

(b) The conflict of interest provisions under this section do not apply to compensation
paid to a teacher employed as a teacher by the charter school or a teacher who provides
instructional services to the charter school through a cooperative formed under chapter
308A when the teacher also serves on the charter school board of directors.

(c) A charter school board member, employee, or officer is a local official for purposes
of section 471.895 with regard to receipt of gifts as defined under section 10A.071,
subdivision 1, paragraph (b). A board member, employee, or officer must not receive
compensation from a group health insurance provider.

new text begin (d) No charter school board member, employee, or teacher employed under a contract
with a cooperative may serve on the board of, be employed by, or serve as a paid consultant
for the school's authorizer.
new text end

Sec. 22.

Minnesota Statutes 2020, section 124E.16, is amended to read:

124E.16 REPORTS.

Subdivision 1.

Audit report.

(a) A charter school is subject to the same financial audits,
audit procedures, and audit requirements as a district, except as required under this
subdivision. Audits must be conducted in compliance with generally accepted governmental
auditing standards, the federal Single Audit Act, if applicable, and section 6.65 governing
auditing procedures. 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 governing government property
and financial investments; and sections 471.38; 471.391; 471.392; and 471.425 governing
municipal contracting. The audit must comply with the requirements of sections 123B.75
to 123B.83 governing school district finance, except when the commissioner and authorizer
approve a deviation made necessary because of school program finances. The commissioner,
state auditor, legislative auditor, or authorizer may conduct financial, program, or compliance
audits. A charter school in statutory operating debt under sections 123B.81 to 123B.83 must
submit a plan under section 123B.81, subdivision 4.

(b) The charter school must submit an audit report to the commissioner and its authorizer
annually by December 31.

(c) The charter school, with the assistance of the auditor conducting the audit, must
include with the report, as supplemental information: (1) a copy of new text begin a new new text end management
deleted text begin agreements deleted text end new text begin agreement or an amendment to a current agreement new text end with a charter management
organization or an educational management organization deleted text begin and (2) service agreements or
contracts over the lesser of $100,000 or ten percent of the school's most recent annual audited
expenditures deleted text end new text begin signed during the audit year; and (2) a copy of a service agreement or contract
with a company or individual totaling over five percent of the audited expenditures for the
most recent audit year new text end . The agreements must detail the terms of the agreement, including
the services provided and the annual costs for those services. deleted text begin 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.
deleted text end

(d) A charter school independent audit report shall include audited financial data of an
affiliated building corporation under section 124E.13, subdivision 3, or other component
unit.

(e) If the audit report finds 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 charter school will resolve that material weakness. An
auditor, as a condition of providing financial services to a charter school, must agree to
make available information about a charter school's financial audit to the commissioner and
authorizer upon request.

Subd. 2.

Annual public reports.

(a) A charter school must publish an annual report
approved by the board of directors. The annual report must at least include information on
school enrollment, student attrition, governance and management, staffing, finances,
new text begin management agreements with a charter management organization or educational management
organization, new text end academic performance, innovative practices and implementation, and future
plans. A charter school may combine this report with the reporting required under section
120B.11 governing the world's best workforce. A charter school must post the annual report
on the school's official website. A charter school also must distribute the annual report by
publication, mail, or electronic means to its authorizer, school employees, and parents and
legal guardians of students enrolled in the charter school. The reports are public data under
chapter 13.

(b) An authorizer must submit an annual public report in a manner specified by the
commissioner by January 15 for the previous school year ending June 30 that shall at least
include key indicators of school academic, operational, and financial performance. The
report is part of the system to evaluate authorizer performance under section 124E.05,
subdivision 5.

Sec. 23.

Minnesota Statutes 2020, section 124E.17, subdivision 1, is amended to read:

Subdivision 1.

Charter school information.

(a) deleted text begin Charter schools must disseminate
information about how to use the charter school offerings to targeted groups, among others.
Targeted groups include low-income families and communities, students of color, and
students who are at risk of academic failure. deleted text end new text begin A charter school must conduct outreach and
disseminate information on the school's offerings and enrollment procedure to families that
reflect the diversity of Minnesota's population and targeted groups. Targeted groups include
low-income families and communities, students of color, students at risk of academic failure,
and students underrepresented in the school's student body relative to Minnesota's population.
A charter school must document its ongoing outreach and information dissemination activities
in the charter school's annual report and must include the documentation as a component
of the authorizer's performance review of the school.
new text end

(b) Authorizers and the commissioner must disseminate information to the public on
how to form and operate a charter school. Authorizers, operators, and the commissioner
also may disseminate information to interested stakeholders about the successful best
practices in teaching and learning demonstrated by charter schools.