SF 867

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 02:16am

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 learning;

(2) increase learning opportunities for pupils;

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

(4) require the measurement of learning outcomes and create 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.

Subd. 2a.

Charter School Advisory Council.

(a) A Charter School Advisory
Council is established deleted text begin under section 15.059 except that deleted text end new text begin . new text end The term for each council
member deleted text begin shall be deleted text end new text begin is new text end three years. The advisory council is composed of deleted text begin seven deleted text end new text begin nine new text end members
deleted text begin 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 new text begin . The members may include
charter school authorizers, charter school personnel, public kindergarten through grade 12
teachers, school board members, parents of currently enrolled kindergarten through grade
12 public school students, and school district representatives.
new 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

new text begin The commissioner shall appoint the council members. The advisory council shall
advise and make recommendations to the commissioner on authorizing charter schools
and other charter school matters, including:
new text end

new text begin (1) approving, reviewing, and disciplining authorizers consistent with this section;
new text end

new text begin (2) supporting innovation, effectiveness, accountability, and fiscal soundness;
new text end

new text begin (3) providing a management training program for administrators and board members;
new text end

new text begin (4) complying with auditing and other financial reporting requirements; and
new text end

new text begin (5) reviewing new applications and proposed grade and program expansions.
new text end

(b) The Charter School Advisory Council under this subdivision expires June 30,
deleted text begin 2007 deleted text end new text begin 2015 new text end .

Subd. 3.

deleted text begin Sponsor deleted text end new text begin Authorizer new text end .

(a) new text begin 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) a new text end charitable organization under section 501(c)(3) of the Internal Revenue Code
of 1986 new text begin , excluding a house of worship and 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 house of worship, new text end that new 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
Foundations deleted text begin , deleted text end new text begin ;
new text end

new text begin (ii) is new text end registered with the attorney general's office deleted text begin , and deleted text end new text begin ;
new text end

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

new text begin (iv) resides in the state of Minnesota new text end ;

new text begin (3) a new text end Minnesota private college that grants two- or four-year degrees and is registered
with the Minnesota Office of Higher Education under chapter 136A; community college,
state university, or technical college deleted 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 begin may sponsor one or
more charter schools. deleted text end new text begin ; or
new text end

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

new text begin (b) An eligible authorizer under this subdivision must apply to the commissioner for
approval as an authorizer before submitting an 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 days of receiving the application. The commissioner, in establishing criteria for
approval, must consider the applicant's ability to:
new text end

new text begin (1) establish an application process for a charter school board that includes timelines,
requirements, and expectations;
new text end

new text begin (2) use precisely defined, rigorous criteria to evaluate the educational, organizational,
and fiscal plans of a charter school board;
new text end

new text begin (3) define in the chartering agreement the rights and responsibilities of the charter
school board for governing the school's educational program, controlling funds, and
making school management decisions;
new text end

new text begin (4) implement an accountability system that provides valid, reliable, timely, and
accessible data to the authorizer on the ability of the charter school board to satisfy its
academic, organizational, legal, and fiscal responsibilities;
new text end

new text begin (5) follow a detailed process for renewing the chartering agreement that reflects the
agreed upon rights and responsibilities of the authorizer and the charter school board, and
is consistent with this section; and
new text end

new text begin (6) base a decision to renew a chartering agreement on credible evidence that
demonstrates the academic, organizational, and financial competency of the charter school
and its board, including their success in increasing student achievement and meeting the
goals of the chartering agreement.
new text end

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

new text begin (d) An authorizer that chartered a school before August 1, 2009, must apply by June
30, 2012, to the commissioner for approval to continue as an authorizer under this section.
An authorizer that fails to submit an application is unable to charter a school.
new text end

new text begin (e) The commissioner shall review an authorizer's performance every five years in
a manner and form determined by the commissioner. The commissioner shall issue a
report to the authorizer upon completing the review. 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 a
chartering agreement with the board of a school it authorized.
new text end

new text begin (f) The commissioner may take corrective action against an authorizer or terminate
an authorizer's ability to charter a school for:
new text end

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

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

new text begin (3) violating an element of the chartering agreement between the authorizer and
charter school board.
new text end

Subd. 4.

Formation of school.

(a) deleted text begin A sponsor deleted text end new text begin An authorizer new text end may authorize one or
more licensed teachers under section 122A.18, subdivision 1, to operate a charter school
subject to approval by the commissioner. deleted text begin A board must vote on charter school application
for sponsorship no later than 90 days after receiving the application. 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. Notwithstanding sections 465.717 and 465.719,
a school district may create a corporation for the purpose of creating a charter school.

(b) Before the operators may deleted text begin form deleted text end new text begin establish new text end and operate a school, the deleted text begin sponsor deleted text end new text begin
authorizer new text end must file an affidavit with the commissioner stating its intent to deleted text begin authorize a deleted text end
charter new text begin a new text end school. The affidavit must state the terms and conditions under which the deleted text begin sponsor deleted text end new text begin
authorizer new text end would deleted text begin authorize a deleted text end charter new text begin a new text end school and how the deleted text begin sponsor deleted text end new text begin authorizer new 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 begin sponsor deleted text end new text begin authorizer new text end and the charter school
board of directors under subdivision 6. The commissioner must approve or disapprove
the deleted text begin sponsor's proposed authorization deleted text end new text begin authorizer's proposed affidavit new text end within deleted text begin 90 deleted text end new text begin 60 new text end days of
receipt of the affidavit. Failure to obtain commissioner approval precludes deleted text begin a sponsor
deleted text end new text begin an authorizer new text end from deleted text begin authorizing deleted text end new text begin chartering new text end the deleted text begin charter deleted text end school that was the subject of the
affidavit.

(c) The operators authorized to organize and operate a school, before entering into a
contract or other agreement for professional or other services, goods, or facilities, must
incorporate as a cooperative under chapter 308A or as a nonprofit corporation under
chapter 317A and must establish a board of directors composed of at least five members new text begin
who are not related parties as defined in this section new text end until a timely election for members of
the charter school board of directors is held according to the school's articles and bylaws.
A charter school board of directors must be composed of at least five members new text begin who are
not related parties as defined in this section new text end . Any staff members who are employed at the
school, including teachers providing instruction under a contract with a cooperative, and
all parents new text begin or legal guardians new text end of children enrolled in the school may participate in the
election for members of the school's board of directors. 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. Board of director meetings must comply with chapter 13D.

(d) new text begin Every charter school board member shall attend department-approved training on
board governance, the board's role and responsibilities, financial management standards
and practices, and employment policies and practices. A board member who does not
complete the required training within one year of being appointed to the board is ineligible
to continue serving on the board.
new text end

new text begin (e) new text end The granting or renewal of a charter by deleted text begin a sponsoring entity deleted text end new text begin an authorizer new 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 (f) The granting or renewing of a charter by an authorizer must
not be contingent on a requirement that the charter school board contract, lease, or
purchase goods or services from the authorizer. A party to such an arrangement between
an authorizer and a board must disclose the arrangement to the commissioner. The
commissioner may terminate a contract for goods or services under this section if the
commissioner determines that an arrangement exists.
new text end

new text begin (g) 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 (h) The authorizer may prevent an approved charter school from opening for
operation if, among other grounds, the charter school violates this section.
new text end

new text begin (i) An authorizer new text end may deleted text begin authorize deleted text end new text begin permit new text end the deleted text begin operators deleted text end new text begin board of directors new 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 begin sponsor's application deleted text end new text begin authorizer's
affidavit new text end as approved by the commissioner only after submitting a supplemental
application to the commissioner in a form and manner prescribed by the commissioner.
The supplemental application must provide evidence that:

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

new text begin (2) the expansion of the charter school is supported, at a minimum, by improved
academic performance and growth on statewide assessments under chapter 120B;
new text end

deleted text begin (2) deleted text end new text begin (3) new text end the charter school is fiscally sound;

deleted text begin (3) deleted text end new text begin (4) new text end the deleted text begin sponsor supports the deleted text end new text begin charter school has the physical and financial capacity
to implement the proposed new text end expansion; and

deleted text begin (4) deleted text end new text begin (5) new text end the building of the additional site meets all health and safety requirements to
be eligible for lease aid.

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

Subd. 4a.

Conflict of interest.

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

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

(c) deleted text begin A member of a charter school board of directors that serves as a member of the
board of directors or as an employee or agent of or a contractor with a nonprofit entity
with whom the charter school contracts, directly or indirectly, for professional services,
goods, or facilities, must disclose all potential conflicts to the commissioner.
deleted text end

deleted text begin (d) deleted text end The conflict of interest provisions under this subdivision do not apply to
compensation paid to a teacher employed by the charter school who also serves as a
member of the board of directors.

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

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

Subd. 5.

Conversion of existing schools.

A board new 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 begin Charter new text end contract.

The deleted text begin sponsor's authorization for deleted text end new text begin authorizer's chartering
of new text end a deleted text begin charter deleted text end school must be in the form of a written contract signed by the deleted text begin sponsor deleted text end new text begin
authorizer new text end and the board of directors of the charter school. The contract must be
deleted text begin completed deleted text end new text begin signed new text end within 90 days of the commissioner's approval of the deleted text begin sponsor's proposed
authorization deleted text end new text begin authorizer's proposed affidavit. The authorizer shall submit a copy of the
signed contract within ten days of its execution to the commissioner new text end . The contract for a
charter school must be in writing and contain at least the following:

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

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

(3) admission policies and procedures;

(4) management and administration of the school;

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

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

(7) assumption of liability by the charter school;

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

(9) the term of the contract, which may be up to three years new text begin for the initial contract,
and up to five years for a renewed contract based on a demonstration of the school met the
academic, financial, and operational terms of the contract new text end ;

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

(11) the process and criteria the deleted text begin sponsor deleted text end new text begin authorizer new text end intends to use to monitor
and evaluate the fiscal and student performance of the charter school, consistent with
subdivision 15 deleted text begin . deleted text end new text begin ; 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, voluntary termination, or nonrenewal of the contract,
including: establishing the respective responsibilities of the school board of directors and
the authorizer; and providing for notice to the commissioner, authorizer, and parents of
enrolled students of the closure, the transfer of student records to the students' resident
districts, and procedures for closing financial operations.
new text end

Subd. 6a.

Audit report.

new text begin (a) new text end The charter school must submit an audit report to the
commissioner new text begin and its authorizer new text end by December 31 each year.

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 begin as part of the deleted text end new text begin an new text end audit report deleted text begin a management letter deleted 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.

new text begin (d) new text end 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.

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 begin Except 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 end new 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 applicable deleted text end new text begin federal, new text end state new text begin , new text end and local health and safety requirements new 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.
new text end

new text begin (c) new text end A school deleted text begin sponsored deleted text end new text begin authorized new 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 end new text begin (d) new text end A charter school must be nonsectarian in its programs, admission policies,
employment practices, and all other operations. deleted text begin A sponsor deleted text end new text begin An authorizer new text end may not
deleted text begin authorize a deleted text end charter new text begin a new text end school or program 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 end new text begin (e) new text end Charter schools must not be used as a method of providing education or
generating revenue for students who are being home-schooled.

deleted text begin (e) deleted text end new text begin (f) new text end The primary focus of a charter school must be to provide a comprehensive
program of instruction for at least one grade or age group from five through 18 years
of age. Instruction may be provided to people younger than five years and older than
18 years of age.

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

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

deleted text begin (h) deleted text end new text begin (i) new text end A charter school is subject to and must comply with the Pupil Fair Dismissal
Act, sections 121A.40 to 121A.56, and the Minnesota Public School Fee Law, sections
123B.34 to 123B.39.

deleted text begin (i) deleted text end new text begin (j) new text end A charter school is subject to the same financial audits, audit procedures, and
audit requirements as a district. Audits must be conducted in compliance with generally
accepted governmental auditing standards, the Federal Single Audit Act, if applicable,
and section 6.65. A charter school is subject to and must comply with sections 15.054;
118A.01; 118A.02; 118A.03; 118A.04; 118A.05; 118A.06; 123B.52, subdivision 5;
471.38; 471.391; 471.392; 471.425; 471.87; 471.88, subdivisions 1, 2, 3, 4, 5, 6, 12, 13,
and 15; 471.881; and 471.89. The audit must comply with the requirements of sections
123B.75 to 123B.83, except to the extent deviations are necessary because of the program
at the school. Deviations must be approved by the commissioner new text begin and authorizer new text end . The
Department of Education, state auditor, deleted text begin or deleted text end legislative auditor new text begin , or authorizer new 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 end new text begin (k) new text end A charter school is a district for the purposes of tort liability under chapter 466.

deleted text begin (k) deleted text end new text begin (l) new text end A charter school must comply with new text begin chapters 13 and 13D; and new text end sections deleted text begin 13.32; deleted text end
120A.22, subdivision 7; 121A.75; and 260B.171, subdivisions 3 and 5.

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

new text begin (n) A school offering online courses or programs must comply with section
124D.095.
new text end

new text begin (o) 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

Subd. 9.

Admission requirements.

A charter school may limit admission to:

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

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

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

A charter school shall enroll an eligible pupil who submits a timely application,
unless the number of applications exceeds the capacity of a program, class, grade level,
or building. In this case, pupils must be accepted by lot. If a charter school is the only
school located in a deleted text begin town deleted text end new text begin municipality new text end serving pupils within a particular grade level, then
pupils that are residents of the deleted text begin town deleted text end new text begin municipality new text end 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. new 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 parents new text begin and may give preference for enrollment to
children of the school's employees new text end before accepting other pupils by lot.

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

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 begin sponsor deleted text end new text begin authorizer new 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 begin 127A.42 deleted text end new text begin 127A.43 new 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 begin The charter
school board must comply with section 181.932. The charter school board must enter into
a written contract with each teacher that outlines the terms and conditions of employment.
new text end A 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 report at least annually
to its deleted text begin sponsor deleted text end new text begin authorizer new text end and the commissioner the information required by the deleted text begin sponsor deleted text end new text begin
authorizer new text end or the commissioner. The reports are public data under chapter 13.

Subd. 15.

Review and comment.

(a) deleted text begin The 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 end new text begin The authorizer shall
provide a formal, written evaluation of the school's performance before the authorizer
renews the charter contract. The department must review and comment on the authorizer's
evaluation process at the time the authorizer submits its application for approval and each
time the authorizer undergoes its five-year review under subdivision 3.
new text end

(b) deleted text begin A sponsor deleted text end new text begin An authorizer new text end shall monitor and evaluate the fiscal and student
performance of the school, and may for this purpose annually assess a charter school deleted text begin : deleted text end deleted 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 end new text begin the greater of (1) $5,000, or (2) the lesser of (i) $25,000 or (ii) the
product of 1.0 percent of the basic formula allowance for that year and the charter school's
pupil units for that year in fiscal years 2010 through 2014. The authorizer may assess a
charter school the greater of (1) $5,000, or (2) the lesser of (i) $25,000 or (ii) the product
of 1.5 percent of the basic formula allowance for that year and the charter school's pupil
units for that year beginning in fiscal year 2015 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.

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

Subd. 18.

Authority to raise initial working capital.

deleted text begin A sponsor deleted text end new text begin An authorizer new text end
may deleted text begin authorize a deleted text end charter new text begin a new text end 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. deleted text begin A sponsor deleted text end new text begin An authorizer new text end may not deleted text begin authorize deleted text end new text begin charter new text end a school before the
commissioner has approved the authorization.

Subd. 19.

Disseminate information.

The deleted text begin sponsor deleted text end new text begin authorizer new text end , the operators, and the
Department of Education must disseminate information to the public on how to form and
operate a charter school and how to utilize the offerings of a charter school. Particular
groups to be targeted include low-income families and communities, and students of color.

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 begin up to 90 days before the teacher would otherwise have to report for duty deleted text end new text begin before
February 1 in the school year preceding the school year in which the teacher intends
to return, 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 by paying both the employer and employee
contributions based upon the annual salary of the teacher for the last full pay period before
the leave began. The retirement association may impose reasonable requirements to
efficiently administer this subdivision.

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 begin the sponsoring deleted text end new text begin
an authorizing new text end district, except that bargaining units may remain part of the appropriate
unit within deleted text begin the sponsoring deleted text end new text begin an authorizing new 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 sponsoring deleted text end new text begin authorizing new text end district, and the board of the deleted text begin sponsoring deleted text end new text begin authorizing new text end district agree
to include the employees in the appropriate unit of the deleted text begin sponsoring deleted text end new text begin authorizing new 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 deleted text begin a sponsor deleted text end new text begin an authorizer new text end must be for the term contained in
the contract according to subdivision 6. The deleted text begin sponsor deleted text end new text begin authorizer new text end may or may not renew a
contract at the end of the term for any ground listed in paragraph (b). deleted text begin A sponsor deleted text end new text begin An
authorizer new text end may 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 begin sponsor deleted text end new text begin authorizer new 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 sponsor within 14 days of receiving notice of
nonrenewal or termination of the contract. Failure by the board of directors to make a
written request for a hearing within the 14-day period shall be treated as acquiescence to
the proposed action. Upon receiving a timely written request for a hearing, the sponsor
shall give reasonable notice to the charter school's board of directors of the hearing date.
The deleted text begin sponsor deleted text end new text begin authorizer new text end shall conduct an informal hearing before taking final action. The
deleted text begin sponsor deleted text end new text begin authorizer new text end shall take final action to renew or not renew a contract deleted text begin by the last day
of classes in the school year. If the sponsor is a local board, the school's board of directors
may appeal the sponsor's decision to the commissioner deleted text end new text begin no later than 30 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 317A, except
when the commissioner approves the decision of a different eligible deleted text begin sponsor deleted text end new text begin authorizer new text end to
deleted text begin authorize the deleted text end charter new text begin the new text end school.

(c) If at the end of a contract term, deleted text begin either deleted text end the deleted text begin sponsor or deleted text end new text begin authorizer and new text end the charter
school board of directors deleted text begin wants deleted text end new text begin mutually agree new text end to voluntarily deleted text begin terminate deleted text end new text begin not renew new text end the
contract, a change in deleted text begin sponsors deleted text end new text begin authorizers new text end is allowed if the commissioner approves the
decision of a different eligible deleted text begin sponsor deleted text end new text begin authorizer new text end to deleted text begin authorize the deleted text end charter new text begin the new text end school. deleted text begin The
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 end The deleted text begin sponsor deleted text end new text begin
authorizer new text end that is a party to the existing contract at least must inform deleted text begin the approved deleted text end new text begin any new text end
different eligible deleted text begin sponsor deleted text end new text begin authorizer new text end about the fiscal and student performance of the
school. new text begin The parties seeking to not renew the contract jointly must submit their intent in
writing to the commissioner at least 90 days before the end date of the contract. Before the
commissioner determines whether to grant a change of authorizer, the commissioner must
first determine whether the charter school and prospective new authorizer can identify and
effectively resolve any circumstances that caused the current authorizer and the charter
school to not renew the contract. new text end If no different eligible deleted text begin sponsor deleted text end new text begin authorizer new 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 begin sponsor deleted text end new text begin authorizer new text end , and after providing an opportunity for
a public hearing, may terminate the existing deleted text begin sponsorial relationship deleted text end new 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 mismanagement; or

deleted text begin (2) repeated deleted text end new text begin (3) new text end violations of the law.

Subd. 23a.

Related party lease costs.

(a) A charter school is prohibited from
entering a lease of real property with a related party as defined in subdivision 26, 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 close relative of the other party in question,
an affiliate of a close relative, or a close 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) "close relative" means an individual whose relationship by blood, marriage, or
adoption to another individual 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 end new 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 begin a sponsor deleted text end new text begin an authorizer new text end , members of the board of deleted text begin a sponsor deleted text end new text begin
an authorizer new text end in their official capacity, and employees of a sponsor are immune from civil
or criminal liability with respect to all activities related to a charter school they approve or
deleted text begin sponsor deleted text end new text begin authorize new text end . The board of directors shall obtain at least the amount of and types of
insurance deleted text begin required by the contract, according to subdivision 6. deleted text end new 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 and the commissioner before starting operations. The
charter school board must submit changes in its insurance carrier or policy to its authorizer
and the commissioner within 30 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 begin not in
its first year of operation deleted text end shall be of an equal amount on each of the deleted text begin 23 deleted text end new text begin 24 new 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.45 new text end , for a charter school ceasing
operation new text begin on or new text end prior to deleted text begin the 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 end new text begin June 30 of a school year, for the
payment periods occurring after the school has ceased serving students, the commissioner
shall withhold state aid due to the school based on estimated state aid entitlements. The
charter school board of directors and authorizer must provide the commissioner with
a closure plan under chapter 308A or 317A, and financial information that details 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 cash 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 after new text begin receiving the closure plan, new text end audit of pupil counts, monitoring of special
education expenditures, deleted text begin and deleted text end documentation of lease expenditures new 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 grant funds administered by the department or, within the timeline under
section 471.425, fails to pay a 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
school district, intermediate school district, or service cooperative. A school district,
intermediate school district, or education cooperative shall notify the commissioner when
a charter school fails to pay an undisputed invoice within 90 days of when it received
the original invoice.
new text end

new text begin (d) 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 end new text begin (e) 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 end new text begin (f) 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 begin REVIVAL AND REENACTMENT.
new text end

new text begin Minnesota Statutes, section 124D.10, subdivision 2a, is revived and reenacted
effective retroactively and without interruption from June 30, 2007.
new text end