HF 3204

as introduced - 89th Legislature (2015 - 2016) Posted on 03/16/2016 11:42am

A bill for an act
relating to education; reformatting, making technical, grammatical corrections,
and correcting erroneous, ambiguous, and omitted text in certain charter school
provisions; amending Minnesota Statutes 2015 Supplement, sections 124E.01;
124E.02; 124E.03; 124E.05; 124E.06; 124E.07; 124E.08; 124E.10; 124E.12;
124E.13; 124E.15; 124E.16; 124E.17; 124E.22; 124E.24; 124E.25; 124E.26.

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

Section 1.

Minnesota Statutes 2015 Supplement, section 124E.01, is amended to read:

124E.01 PURPOSE AND APPLICABILITY.

Subdivision 1.

Purposes.

The primary purpose of this chapter charter schools is to
improve all pupil learning and all student achievement. Additional purposes include to:

(1) increase learning opportunities for all pupils;

(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.

Subd. 2.

Applicability.

This chapter applies only to charter schools formed and
operated under this chapter. Other statutes and rules that specifically apply to charter
schools also govern charter schools.

Sec. 2.

Minnesota Statutes 2015 Supplement, section 124E.02, is amended to read:

124E.02 DEFINITIONS.

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

"Application" to receive approval as an authorizer means the proposal an eligible
authorizer submits to the commissioner under section 124E.05 before that authorizer is
able to submit any affidavit to charter to a school.

"Application" under section 124E.06 means the charter school business plan a
school developer submits to an authorizer for approval to establish a charter school that
documents the school developer's mission statement, school purposes, program design,
financial plan, governance and management structure, and background and experience,
plus any other information the authorizer requests. The application also shall include a
"statement of assurances" of legal compliance prescribed by the commissioner.

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

(b) For purposes of this chapter:

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

(2) (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;.

(d) "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.

(3) (e) "Immediate family" means an individual whose relationship by blood,
marriage, adoption, or partnering partnership is no more remote than first cousin;.

(4) (f) "Person" means an individual or entity of any kind; and.

(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.

(g) "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.

(h) For purposes of this chapter, the terms defined in section 120A.05 have the
same meanings.

Sec. 3.

Minnesota Statutes 2015 Supplement, section 124E.03, is amended to read:

124E.03 APPLICABLE LAW.

Subdivision 1.

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. 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 specifically applies to a charter
school or is included in this chapter.

Subd. 2.

General Certain federal, state, and local requirements.

(a) A charter
school shall meet all federal, state, and local health and safety requirements applicable
to school districts.

(b) A school must comply with statewide accountability requirements governing
standards and assessments in chapter 120B.

(c) A charter school is subject to and must comply with the Minnesota Public School
Fee Law, sections 123B.34 to 123B.39.

(d) A charter school is a district for the purposes of tort liability under chapter 466.

(e) A charter school is subject to must comply with the Pledge of Allegiance
requirement under section 121A.11, subdivision 3.

(f) A charter school and charter school board of directors are subject to must comply
with chapter 181 governing requirements for employment.

(g) A charter school is subject to and must comply with continuing truant notification
under section 260A.03.

(h) A charter school must develop and implement a teacher evaluation and peer
review process under section 122A.40, subdivision 8, paragraph (b), clauses (2) to
(13). The teacher evaluation process in this paragraph does not create any additional
employment rights for teachers.

(i) A charter school must adopt a policy, plan, budget, and process, consistent with
section 120B.11, to review curriculum, instruction, and student achievement and strive
for the world's best workforce.

Subd. 3.

Pupils with a disability.

A charter school must comply with sections
125A.02, 125A.03 to 125A.24, 125A.65, and 125A.75 and rules relating to the education
of pupils with a disability as though it were a district. A charter school enrolling
prekindergarten pupils with a disability under section 124E.11, paragraph (h), must
comply with sections 125A.259 to 125A.48 and rules relating to the Interagency Early
Intervention System as though it were a school district.

Subd. 4.

Students' rights and related law.

(a) A charter school student must
be released release a student for religious instruction, consistent with section 120A.22,
subdivision 12, clause (3).

(b) A charter school is subject to and must comply with chapter 363A governing
the Minnesota Human Rights Act and section 121A.04 governing Title IX requirements
in schools.

(c) A charter school must comply with section 121A.031 governing policies on
prohibited conduct bullying.

Subd. 5.

Records, meetings, and data requirements.

(a) A charter school must
comply with chapters chapter 13 and 13D governing government data; and sections
120A.22, subdivision 7; 121A.75; governing access to juvenile justice records, and
260B.171, subdivisions 3 and 5, governing juvenile justice records.

(b) A charter school must comply with section 120A.22, subdivision 7, governing
the transfer of students' educational records and sections 138.163 and 138.17 governing
the management of local records.

Subd. 5a.

Open meetings.

A charter school must comply with chapter 13D
governing open meetings.

Subd. 6.

Length of school year.

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

Subd. 7.

Additional program-specific requirements.

(a) A charter school offering
online courses or programs must comply with section 124D.095 governing online learning.

(b) A charter school that provides early childhood health and developmental screening
must comply with sections 121A.16 to 121A.19 governing early childhood screening.

(c) A charter school that provides school-sponsored youth athletic activities must
comply with section 121A.38 governing policies on concussions.

Sec. 4.

Minnesota Statutes 2015 Supplement, section 124E.05, is amended to read:

124E.05 AUTHORIZERS.

Subdivision 1.

Eligible authorizers.

(a) The following organizations in this
subdivision may authorize one or more charter schools:. The authorizer must participate
in commissioner-approved training.

(1) (b) A school board, intermediate school district school board, or education
district organized under sections 123A.15 to 123A.19; may authorize a charter school.

(2) (c) A charitable organization under section 501(c)(3) of the Internal Revenue
Code of 1986, excluding a nonpublic sectarian or religious institution; any person other
than a natural person that directly or indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with the nonpublic sectarian or
religious institution; and any other charitable organization under this clause that in the
federal IRS Form 1023, Part IV, describes activities indicating a religious purpose, that
may authorize a charter school, if the organization:

(i) (1) is a member of the Minnesota Council of Nonprofits or the Minnesota Council
on Foundations;

(ii) (2) is registered with the attorney general's office; and

(iii) (3) is incorporated in the state of Minnesota and has been operating continuously
for at least five years but does not operate a charter school; and

(4) is not:

(i) a nonpublic sectarian or religious institution;

(ii) any person other than a natural person that directly or indirectly, through one
or more intermediaries, controls, is controlled by, or is under common control with the
nonpublic sectarian or religious institution; or

(iii) any other charitable organization under this paragraph that in the federal IRS
Form 1023, Part IV, describes activities indicating a religious purpose.

(3) (d) A Minnesota private college, notwithstanding clause (2), that grants two- or
four-year degrees and is registered with the Minnesota Office of Higher Education under
chapter 136A; may authorize a charter school, notwithstanding paragraph (c).

(e) community college, A state college or university, or technical college governed
by the Board of Trustees of the Minnesota State Colleges and Universities; or may
authorize a charter school.

(f) The University of Minnesota; may authorize a charter school.

(4) (g) 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 authorize one or more charter schools if the charter school
has operated for at least three years under a different authorizer and if the nonprofit
corporation has existed for at least 25 years; or.

(5) (h) A single-purpose authorizers authorizer formed as a charitable, nonsectarian
organizations organization under section 501(c)(3) of the Internal Revenue Code of 1986
and incorporated in the state of Minnesota under chapter 317A as a corporation with no
members or under section 322B.975 as a nonprofit limited liability company for the sole
purpose of chartering schools may authorize a charter school. An eligible organization
interested in being approved as an authorizer under this paragraph must submit a proposal
to the commissioner that includes the provisions of subdivision 3 and a five-year financial
plan. A single-purpose authorizer under this paragraph shall consider and approve
charter school applications using the criteria under section 124E.06 and shall not limit
the applications it solicits, considers, or approves to any single curriculum, learning
program, or method.

Subd. 2.

Requirements for authorizers.

(a) Eligible organizations interested in
being approved as an authorizer under subdivision 1, clause (5), must submit a proposal to
the commissioner that includes the provisions of subdivision 3 and a five-year financial
plan. Such authorizers shall consider and approve charter school applications using
the criteria provided in section 124E.06 and shall not limit the applications it solicits,
considers, or approves to any single curriculum, learning program, or method.

(b) The authorizer must participate in department-approved training.

Subd. 3.

Application process.

(a) An eligible authorizer under this section must
apply to the commissioner for approval as an authorizer before submitting any affidavit to
the commissioner to charter a school. The application for approval as a charter school
authorizer must demonstrate show the applicant's ability to implement the procedures
and satisfy the criteria for chartering a school under this chapter. The commissioner
must approve or disapprove an the application within 45 business days of the application
deadline for that application period. If the commissioner disapproves the application, the
commissioner must notify the applicant of the specific deficiencies in writing and the
applicant then has 20 business days to address the deficiencies to the commissioner's
satisfaction. After the 20 business days expire, the commissioner has 15 business days to
make a final decision finally decide to approve or disapprove the application. Failing to
address the deficiencies to the commissioner's satisfaction makes an applicant ineligible to
be an authorizer. The commissioner, in establishing criteria for approval to approve an
authorizer, consistent with subdivision 4, must consider the applicant's:

(1) capacity and infrastructure and capacity to serve as an authorizer;

(2) application criteria and process;

(3) contracting process;

(4) ongoing oversight and evaluation processes; and

(5) renewal criteria and processes.

(b) A disapproved applicant under this section may resubmit an application during a
future application period.

Subd. 4.

Application content.

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

(1) how the organization carries out its mission by chartering schools is a way for
the organization to carry out its mission;

(2) a description of the capacity of the organization the organization's capacity to
serve as an authorizer, including the personnel who will perform the authorizing duties,
their qualifications, the amount of time they will be are assigned to this responsibility, and
the financial resources allocated by the organization allocates to this responsibility;

(3) a description of the application and review process the authorizer will use uses to
make decisions regarding the granting of decide whether to grant charters;

(4) a description of the type of contract it will arrange arranges with the schools it
charters that meets to meet the provisions of section 124E.10;

(5) the process to be used for providing ongoing oversight of overseeing the school,
consistent with the contract expectations specified in clause (4) that assures, to ensure that
the schools chartered are complying comply with both the provisions of applicable law
and rules, and with the contract;

(6) a description of the criteria and process the authorizer will use uses to grant
expanded approve applications adding grade or sites under section 124E.06, subdivision 5;

(7) the process for making decisions regarding the renewal or termination of renewing
or terminating the school's charter based on evidence that demonstrates 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; and

(8) an assurance specifying that the organization is committed to serving the
organization's stated intent to serve as an authorizer for the full five-year term.

Subd. 5.

Review by commissioner.

The commissioner shall review an authorizer's
performance every five years in a manner and form determined by the commissioner and
may review an authorizer's performance more frequently at the commissioner's own
initiative or at the request of a charter school operator, charter school board member, or
other interested party. The commissioner, after completing the review, shall transmit a
report with findings to the authorizer.

Subd. 6.

Corrective action.

(a) If, consistent with this chapter, the commissioner
finds that an authorizer has not fulfilled met the requirements of this chapter, the
commissioner may subject the authorizer to corrective action, which may include
terminating the contract with the charter school board of directors of a school it chartered.
The commissioner must notify the authorizer in writing of any findings that may subject
the authorizer to corrective action and the authorizer then has 15 business days to request
an informal hearing before the commissioner takes corrective action. 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.

(b) The commissioner may at any time take corrective action against an authorizer,
including terminating an authorizer's ability to charter a school for:

(1) failing to demonstrate the criteria implement the application the commissioner
approved under subdivision 4 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; or

(4) any good cause shown that provides gives the commissioner a legally sufficient
reason to take corrective action against an authorizer.

Subd. 7.

Withdrawal.

If the governing board of an approved authorizer votes to
withdraw as an approved authorizer for a reason unrelated to any cause under section
124E.10, subdivision 4, governing not renewed or terminated contracts, the authorizer
must notify all its chartered schools and the commissioner in writing by July 15 of its
intent to withdraw as an authorizer on June 30 in the next calendar year, regardless of
when the authorizer's five-year term of approval ends. The commissioner may approve
the transfer of a charter school to a new authorizer under this subdivision after the new
authorizer submits an affidavit to the commissioner.

Subd. 8.

Reports.

By September 30 of each year, an authorizer shall submit to the
commissioner a statement of income and expenditures related to chartering activities
during the previous school year ending June 30. A copy of the statement shall be given
to all schools chartered by the authorizer. The authorizer must transmit a copy of the
statement to all schools it charters.

Sec. 5.

Minnesota Statutes 2015 Supplement, section 124E.06, is amended to read:

124E.06 FORMING A SCHOOL.

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 school developer's:

(i) mission statement;

(ii) school purposes;

(iii) program design;

(iv) financial plan;

(v) governance and management structure; and

(vi) background and experience;

(2) any other information the authorizer requests; and

(3) a promise to comply with the "statement of assurances" prescribed by the
commissioner.

(b) (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 (d) (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 (d) (e), and section 124E.01, subdivision 1.

Subd. 2.

Nonprofit corporation.

(a) The school must be organized and operated as
a nonprofit corporation under chapter 317A and the provisions under the applicable of that
chapter shall apply to the school except as provided in this chapter.

(b) The operators authorized to organize and operate a school, must incorporate as a
nonprofit corporation before entering into a contract or other agreement for professional
or other services, goods, or facilities, must incorporate as a nonprofit corporation under
chapter 317A.

(c) (b) Notwithstanding sections 465.717 and 465.719, a school district, subject to
this chapter, may create a corporation for the purpose of establishing a charter school.

Subd. 3.

Requirements.

(a) 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
ages five through 18 years of age. Instruction A charter school may be provided provide
instruction to people older than 18 years of age.

(b) A charter school may offer a free or fee-based preschool or prekindergarten that
meets high-quality early learning instructional program standards that are aligned with
Minnesota's early learning standards for children. The hours a student is enrolled in a
fee-based prekindergarten program do not generate pupil units under section 126C.05 and
must not be used to calculate general education revenue under section 126C.10.

(b) (c) A charter school must be nonsectarian in its programs, admission policies,
employment practices, and all other operations. An authorizer may not authorize a charter
school or program that is affiliated with a nonpublic sectarian school or a religious
institution.

(c) (d) Charter schools A charter school must not be used as a method of providing
to provide education or generating generate revenue for students who are being
home-schooled students. This paragraph does not apply to shared time aid under section
126C.19.

(d) (e) This chapter does not provide a means to keep open a school that a
school board decides to close. However, a school board may endorse or authorize the
establishment of establishing a charter school to replace the school the board decided to
close. Applicants seeking a charter under this circumstance must demonstrate to the
authorizer that the charter sought is substantially different in purpose and program from
the school the board closed and that the proposed charter satisfies the requirements of
section 124E.01, subdivision 1. If the school board that closed the school authorizes
the charter, it must document in its affidavit to the commissioner that the charter is
substantially different in program and purpose from the school it closed.

(e) (f) A school authorized by a school board may be located in any district, unless
the school board of the district of the proposed location disapproves the location by
written resolution.

(f) (g) Except as provided in paragraph (a) (b), a charter school may not charge tuition.

(g) (h) The authorizer may prevent an approved charter school from opening for
operation operating if, among other grounds, the charter school violates this chapter or
does not meet the ready-to-open standards that are part of (1) the authorizer's oversight
and evaluation process or are (2) stipulated in the charter school contract.

Subd. 4.

Authorizer's affidavit; approval process; authorizer's affidavit.

(a)
Before the operators an operator may establish and operate a school, the authorizer must
file an affidavit with the commissioner stating its intent to charter a school. An authorizer
must file a separate affidavit for each school it intends to charter. An authorizer must file
an affidavit at least 14 months before July 1 of the year the new charter school plans to
serve students. The affidavit must state:

(1) the terms and conditions under which the authorizer would charter a school and;

(2) how the authorizer intends to oversee the fiscal and student performance of the
charter school; and

(3) how the authorizer intends to comply with the terms of the written contract
between the authorizer and the charter school board of directors under section 124E.10,
subdivision 1.

(b) The commissioner must approve or disapprove the authorizer's affidavit within
60 business days of receipt of receiving the affidavit. If the commissioner disapproves the
affidavit, the commissioner shall notify the authorizer of the deficiencies in the affidavit
and the authorizer then has 20 business days to address the deficiencies. The commissioner
must notify the authorizer of the commissioner's final approval or final disapproval
within 15 business days after receiving the authorizer's response to the deficiencies
in the affidavit. If the authorizer does not address deficiencies to the commissioner's
satisfaction, the commissioner's disapproval is final. Failure to obtain commissioner
approval precludes An authorizer who fails to obtain the commissioner's approval is
precluded from chartering the school that is the subject of this affidavit.

Subd. 5.

Expansion of a charter Adding grades or sites.

(a) A charter school may
apply to the authorizer to amend the school charter to expand the operation of the school to
additional add grades or sites that would be students' primary enrollment site sites beyond
those defined in the original affidavit approved by the commissioner. After approving the
school's application, the authorizer shall submit a supplementary affidavit in the form and
manner prescribed by the commissioner. The authorizer must file a supplement affidavit to
the commissioner by October 1 to be eligible to expand add grades or sites in the next
school year. The supplementary affidavit must document that the school has demonstrated
to the authorizer's satisfaction of the authorizer the following:

(1) the need for the expansion additional grades or sites with supporting long-range
enrollment projections;

(2) a longitudinal record of demonstrated student academic performance and growth
on statewide assessments under chapter 120B or on other academic assessments that
measure longitudinal student performance and growth approved by the charter school's
board of directors and agreed upon with the authorizer;

(3) a history of sound school finances and a finance plan to implement the expansion
in a manner to promote add grades or sites that sustains the school's financial sustainability
finances; and

(4) board capacity and an administrative and management plan to implement its
expansion to administer and manage the additional grades or sites.

(b) The commissioner shall have 30 business days to review and comment on the
supplemental affidavit. The commissioner shall notify the authorizer in writing of any
deficiencies in the supplemental affidavit and the authorizer then has 20 business days to
address, to the commissioner's satisfaction, any deficiencies in the supplemental affidavit
to the commissioner's satisfaction. The commissioner must notify the authorizer of final
approval or final disapproval within 15 business days after receiving the authorizer's
response to the deficiencies in the affidavit. The school may not expand add grades or add
sites until the commissioner has approved the supplemental affidavit. The commissioner's
approval or disapproval of a supplemental affidavit is final.

Subd. 6.

Conversion of existing schools.

A board of an independent or special
school district may convert one or more of its existing schools to charter schools under
this chapter 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. 7.

Merger.

(a) Two or more charter schools may merge under chapter 317A.
The effective date of a merger must be July 1. The merged school must continue under
the identity of one of the merging schools. The authorizer and the merged school must
execute a new charter contract under section 124E.10, subdivision 1, must be executed by
July 1. The authorizer must submit to the commissioner a copy of the new signed charter
contract within ten business days of its execution executing the contract.

(b) Each merging school must submit a separate year-end report for the previous
fiscal year for that school only. After the final fiscal year of the premerger schools is
closed out, each of those schools must transfer the fund balances and debts from the
merging schools must be transferred to the merged school.

(c) For its first year of operation, the merged school is eligible to receive aid from
programs requiring approved applications equal to the sum of the aid of all of the merging
schools. For aids based on prior year data, the merged school is eligible to receive aid for
its first year of operation based on the combined data of all of the merging schools.

Sec. 6.

Minnesota Statutes 2015 Supplement, section 124E.07, is amended to read:

124E.07 BOARD OF DIRECTORS.

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, before entering into a contract or other agreement for
professional or other services, goods, or facilities, must establish a board of directors
composed of at least five members who are not related parties. 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.

Subd. 2.

Ongoing board of directors.

The ongoing board must be elected before
the school completes its third year of operation. Board elections must be held during the
school year but may not be conducted on days when the school is closed for holidays,
breaks, or vacations.

Subd. 3.

Membership criteria.

(a) The ongoing charter school board of directors
shall be composed of have at least five nonrelated members and include: (1) at least
one licensed teacher who is employed as a teacher at the school or providing provides
instruction under contract between the charter school and a 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 and, is not employed by the charter school, and does not have a child enrolled
in the school. The board may include a majority of teachers described in under this
paragraph or parents or community members, or it may have no clear majority. The chief
financial officer and the chief administrator may only serve as ex-officio nonvoting board
members. 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. An individual is prohibited from serving as a board member
if; 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.

(c) A violation of this prohibition 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 this prohibition paragraph (b) is individually liable
to the charter school for any damage caused by the violation.

(c) (d) Any employee, agent, or board member of the authorizer who participates
in the initial review, approval, ongoing oversight, evaluation, or the charter renewal or
nonrenewal process or decision 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.

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

Subd. 4.

Structure of 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 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; and

(2) with the authorizer's approval.

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

Subd. 5.

Eligible voters.

Staff members employed at 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. A charter school must
notify eligible voters of the school board election dates at least 30 days before the election.

Subd. 6.

Duties.

The board of directors also shall decide and be are responsible
for policy matters related to the operation of operating the school, including budgeting,
curriculum programming, personnel, and operating procedures. The board shall adopt a
policy on nepotism in employment policy. The board shall adopt personnel evaluation
policies and practices that, at a minimum:

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

(2) evaluate the execution of 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.

Subd. 7.

Training.

Every charter school board member shall attend annual training
throughout the member's term on the board. 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
of after being seated on the board 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 by each board member during the previous year.

Subd. 8.

Meetings and information.

(a) Board of director meetings must comply
with chapter 13D governing open meetings.

(b) A charter school shall publish and maintain on the school's official Web site:
(1) the meeting minutes of meetings of the board of directors, and of members and
committees having any board-delegated authority, for at least one calendar year 365
days from the date of publication; (2) directory information for members of the board of
directors and for the members of committees having board-delegated authority; and (3)
identifying and contact information for the school's authorizer. A charter school must
include identifying and contact information for the school's authorizer must be included in
other school materials made it makes available to the public.

Sec. 7.

Minnesota Statutes 2015 Supplement, section 124E.08, is amended to read:

124E.08 COLLABORATION BETWEEN CHARTER SCHOOL AND
SCHOOL DISTRICT COLLABORATION.

(a) A charter school board may voluntarily enter into a two-year, renewable
collaboration agreement for collaboration with a school district in which the charter
school is located to enhance student the achievement with a school district within whose
geographic boundary it operates of the students in the district and the students in the
charter school.

(b) A school district need does not need to be either an approved authorizer or the
authorizer of the charter school to enter into a collaboration agreement with a charter
school under this section. A charter school need not be authorized by the school district
with which it seeks to collaborate.

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

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

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

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

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

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

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

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

Sec. 8.

Minnesota Statutes 2015 Supplement, section 124E.10, is amended to read:

124E.10 CHARTER CONTRACT.

Subdivision 1.

Contents.

(a) The authorization for To authorize a charter school, the
authorizer and the charter school board of directors must be in the form of sign a written
contract signed by the authorizer and the board of directors of the charter school. The
contract must be completed within 45 business days of the commissioner's approval of
the authorizer's affidavit. The authorizer shall submit to the commissioner a copy of the
signed charter contract to the commissioner within ten business days of its execution after
the contract is signed by the contracting parties. The contract for a charter school must
be in writing and contain 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 for the school;

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

(7) the criteria, processes, and procedures that 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 of the school
that is a prerequisite for reviewing a charter contract under subdivision 3;

(9) types and amounts of insurance liability coverage to be obtained by 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 the authorizer and its officers, agents, and employees from any suit, claim,
or liability arising from any charter school operation of the charter school,:

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

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

(11) the term of the initial contract, which, for an initial contract, may be up to five
years plus an additional preoperational planning year, and up to five years 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 of the
charter school 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 operate to 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 renewal; and

(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 renewal; and.

(15) (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, that
includes establishing the responsibilities of the school board of directors and the authorizer
and notifying. The plan must establish who is responsible for:

(1) notifying the commissioner, authorizer, 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 sufficient to
enable the student to re-enroll in another school, the;

(3) transfer of transferring student records under section 124E.03, subdivision 5,
paragraph (b), to the school district in which the charter school is located; and

(4) procedures for closing financial operations.

(b) (c) 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 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.

Subd. 2.

Limitations Limits on charter contract school agreements.

(a) A
school must disclose to the commissioner any potential contract, lease, or purchase of
service from an authorizer must be disclosed to the commissioner,. The contract, lease, or
purchase must be accepted through an open bidding process, and be a separate contract
from the charter contract. The school must document the open bidding process. An
authorizer must not enter into a contract to provide management and financial services for
to a school that it authorizes, unless the school documents that it received receiving at
least two competitive bids.

(b) The An authorizer must not condition granting or renewal of renewing a charter
school by an authorizer must not be contingent on:

(1) the charter school being required to contract, lease, or purchase services from
the authorizer.; or

(c) The granting or renewal of a charter by an authorizer must not be conditioned
upon (2) the bargaining unit status of the school employees of the school.

Subd. 3.

Review and comment.

(a) The authorizer shall provide a formal written
evaluation of the school's performance before the authorizer renews the charter contract.
The department commissioner 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 section 124E.05, subdivision 5.

(b) An authorizer shall monitor and evaluate the academic, financial, operational,
and student performance of the school, and may for this purpose annually assess a charter
school a fee according to paragraph (c). The agreed-upon fee structure must be stated in
the charter school contract.

(c) The fee that an authorizer may annually assess is the greater of:

(1) the basic formula allowance for that year; or

(2) the lesser of:

(i) the maximum fee factor times the basic formula allowance for that year; or

(ii) the fee factor times the basic formula allowance for that year times the charter
school's adjusted pupil units for that year. The fee factor equals .015. The maximum
fee factor equals 4.0.

(d) An authorizer may not assess a fee for any required services other than as
provided in this subdivision.

(e) For the preoperational planning period, after a school is chartered, the authorizer
may assess a charter school a fee equal to the basic formula allowance.

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). The authorizer may or may not renew a
contract at the end of the term for any ground listed in paragraph (b). An authorizer may
unilaterally terminate a contract during the term of the contract for any ground listed in
paragraph (b). 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 that 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 of 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, the authorizer shall give ten
business days' notice to the charter school's board of directors of the hearing date. 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.

(b) An authorizer may terminate or not renew a contract may be terminated or not
renewed 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 is terminated or not
renewed under this paragraph, the school must be dissolved according to the applicable
provisions of chapter 317A.

(c) 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.

Subd. 5.

Mutual nonrenewal.

If the authorizer and the charter school board of
directors mutually agree not to renew the contract, a change in authorizers is allowed. The
authorizer and the school board must jointly submit a written and signed letter of their
intent to the commissioner to mutually not renew the contract. The authorizer that is a party
to the existing contract must inform the proposed authorizer about the fiscal, operational,
and student performance status of the school, as well as any outstanding contractual
obligations that exist. The charter contract between the proposed authorizer and the school
must identify and provide a plan to address any outstanding obligations from the previous
contract. The proposed authorizer and the charter school board of directors must submit
the proposed contract must be submitted at least 105 business days before the end of the
existing charter contract. The commissioner shall have has 30 business days to review
and make a determination on the change in authorizer. The proposed authorizer and
the school shall have 15 business days to respond to the determination and address any
issues identified by the commissioner. A final determination by The commissioner shall
be made must make a final determination no later than 45 business days before the end
of the current charter contract. If no the commissioner does not approve a change in
authorizer is approved, the school and the current authorizer may withdraw their letter
of nonrenewal and enter into a new contract. If the transfer of commissioner does not
approve a change in authorizers is not approved and the current authorizer and the school
do not withdraw their letter and enter into a new contract, the school must be dissolved
according to applicable law and the terms of the contract.

Subd. 6.

Pupil enrollment upon nonrenewal or termination of charter school
contract.

(a) If a contract is not renewed or is terminated according to subdivision 4 or
5, a pupil who attended the school, siblings of the pupil, or another pupil who resides
in the same place as with the pupil may enroll in the resident district or may submit
an application to a nonresident district according to section 124D.03 governing open
enrollment 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.

(b) Within ten business days of closing the charter school, 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.

Sec. 9.

Minnesota Statutes 2015 Supplement, section 124E.12, is amended to read:

124E.12 EMPLOYMENT.

Subdivision 1.

Teachers.

A charter school must employ or contract with necessary
teachers, as defined by section 122A.15, subdivision 1, who hold valid current licenses
to perform the particular service for which they are employed in the school. The
commissioner may reduce the charter school's state aid may be reduced under section
127A.43 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. The charter
school board is subject to section 181.932 governing whistle-blowers. When offering
employment to a prospective employee, a charter school must give that employee a written
description of the terms and conditions of employment and the school's personnel policies.

Subd. 2.

Administrators.

(a) A person, without holding a valid current
administrator's license, may perform administrative, supervisory, or instructional
leadership duties. The board of directors shall establish qualifications for persons that who
hold administrative, supervisory, or instructional leadership roles. The qualifications shall
include cover at least the following areas: 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.

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

Subd. 3.

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 when forming one or more bargaining units
at the school. Bargaining units at the school must be separate from any other units within
an authorizing district, except that bargaining units may remain part of the appropriate
unit within an authorizing district, if the employees of the school, the board of directors of
the school, the exclusive representative of the appropriate unit in the authorizing district,
and the board of the authorizing district agree to include the employees in the appropriate
unit of the authorizing district. The board of directors of a charter school with employees
organized under this subdivision must comply with sections 471.6161 governing group
insurance and 471.895 governing gifts.

Subd. 4.

Teacher and other employee retirement.

(a) Teachers in a charter school
must be public school teachers for the purposes of chapters 354 and 354A governing the
Teacher Retirement Act.

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

Subd. 5.

Group health insurance.

(a) A charter school board with at least 25
employees or a teacher cooperative of licensed teachers providing instruction under
a contract between a school and a cooperative that provides group health insurance
coverage shall:

(1) request proposals for group health insurance coverage from a minimum of three
sources at least every two years; and

(2) notify employees covered by the group health insurance coverage before the
effective date of the changes in the group coverage policy contract.

(b) A charter school board or a cooperative of teachers that provides group health
insurance coverage must establish and publish on its Web site the policy for the purchase
of purchasing group health insurance coverage. A charter school board policy must
include a sealed proposal process, which requires all proposals to be opened at the same
time. Upon the openings of opening the proposals in accordance with according to the
school or cooperative policy, the proposals become public data under chapter 13.

Nothing in this subdivision supersedes the right of an exclusive representative to negotiate
over the terms and conditions of employment.

Subd. 6.

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 a teacher to make the request for a leave or extension
of leave be made before February 1 in the school year preceding the school year in which
the teacher intends to leave, or February 1 of the calendar year in which the teacher's leave
is scheduled to terminate. Except as otherwise provided in this subdivision and except
for section 122A.46, subdivision 7, governing employment in another district, 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 under chapters 354 and 354A, consistent with
subdivision 4.

Sec. 10.

Minnesota Statutes 2015 Supplement, section 124E.13, is amended to read:

124E.13 FACILITIES.

Subdivision 1.

Leased space.

A charter school may lease space from: an
independent or special school board,; other public organization,; private, nonprofit,
nonsectarian organization,; private property owner,; or a sectarian organization if the
leased space is constructed as a school facility. The department commissioner must
review and approve or disapprove leases in a timely manner for purposes of determining
to determine eligibility for lease aid under section 124E.22.

Subd. 2.

Related party lease costs.

(a) A charter school is prohibited from entering
must not enter into a lease of real property with a related party unless the lessor is a
nonprofit corporation under chapter 317A or a cooperative under chapter 308A, and the
lease cost is reasonable under section 124E.22, paragraph (a), clause (1).

(b) A lease of real property to be used for a charter school, not excluded in related
party permitted to enter into a lease under paragraph (a), must contain include the
following statement in the lease: "This lease is subject to Minnesota Statutes, section
124E.13, subdivision 2."

(c) If a charter school enters into as lessee a lease with leases space from a related
party and the charter school subsequently closes, the commissioner has the right to recover
from the lessor related party any lease payments in excess of those that are reasonable
under section 124E.22, paragraph (a), clause (1).

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 (1) to purchase, expand, or renovate an existing facility to
serve as a school or (2) to construct a new school facility if the charter school:

(i) (1) has been in operation operated for at least six consecutive years;

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

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

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

(v) (5) has a plan for purchase, renovation, or new construction which 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 Web site the name, mailing address, bylaws, minutes of board
meetings, and the names of the current board of directors of the affiliated nonprofit
building corporation;

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

(5) comply with government data practices law under chapter 13.

(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.

(d) Once an affiliated nonprofit building corporation is incorporated under this
subdivision, 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 of the school must oversee the efforts of the school's board of directors
of the charter school to ensure the affiliated nonprofit building corporation complies
with all legal requirements governing the affiliated nonprofit building corporation 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 factor the consider that failure into the authorizer's
evaluation of when evaluating the charter school.

Subd. 4.

Positive review and comment.

If the amount of a purchase agreement or
construction contract exceeds the threshold specified in section 123B.71, subdivision 8,
for a school district without an outstanding capital loan, a charter school or its affiliated
nonprofit building corporation must receive a positive review and comment from the
commissioner before initiating any purchase agreement or construction contract that
requires an expenditure in excess of the threshold specified in section 123B.71, subdivision
8, for school districts that do not have a capital loan outstanding. Without a positive review
and comment from the commissioner, a purchase agreement or construction contract
finalized before a positive review and comment under this subdivision is null and void.

Sec. 11.

Minnesota Statutes 2015 Supplement, section 124E.15, is amended to read:

124E.15 TRANSPORTATION.

(a) A charter school must comply with all pupil transportation requirements in
section 123B.88, subdivision 1. A charter school must not require parents to surrender
their rights to pupil transportation under section 123B.88, subdivision 2.

(b) 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 commissioner by
July 1 of its first fiscal year of operation if it will provide its own transportation or use the
transportation services of the district in which it is located for the fiscal year. For each
subsequent year of operation, a charter school must give that district and the commissioner
notice by March 1 for the following fiscal year.

(c) If a charter school elects to provide transportation for pupils, the charter school
must provide 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 124E.23.

(d) 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. The charter
school may reimburse 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.

(d) (e) If a charter school does not elect to provide transportation, the district in which
the school is located must provide 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, governing transporting nonresident pupils, and 124D.03, subdivision 8, for
a pupil residing in the same district in which the charter school is located. The district in
which the charter school is located may provide 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, governing open enrollment transportation, 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 is within the
sole discretion, control, and management of the district.

(f) The charter school must provide the parent or guardian with information about
transportation when a pupil enrolls.

Sec. 12.

Minnesota Statutes 2015 Supplement, 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
to the extent deviations are necessary because of the program at the school when the
commissioner and authorizer approve a deviation made necessary because of school
program finances. Deviations must be approved by the commissioner and authorizer. The
Department of Education commissioner, state auditor, legislative auditor, or authorizer
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.

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

(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 management
agreements with a charter management organization or an educational management
organization and (2) service agreements or contracts over the lesser of $100,000 or ten
percent of the school's most recent annual audited expenditures. The agreements must
detail the terms of the agreement, including the services provided and the annual costs for
those 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.

(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 will
be resolved. 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,
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 Web site. A charter school also must also 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) The commissioner shall establish specifications for an authorizer's annual public
report that is part of the system to evaluate authorizer performance under section 124E.05,
subdivision 5. The report shall at least include key indicators of school academic,
operational, and financial performance.

Sec. 13.

Minnesota Statutes 2015 Supplement, section 124E.17, is amended to read:

124E.17 DISSEMINATION OF INFORMATION.

Subdivision 1.

Charter school information.

(a) Authorizers and the department
must disseminate information to the public on how to form and operate a charter school.
Charter schools must disseminate information about how to use the charter school
offerings of a charter school 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.

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

Subd. 2.

Financial information.

Upon request of an individual, the charter school
must also make available in a timely fashion financial statements showing all operations
and transactions affecting the school's income, surplus, and deficit during the school's
last annual accounting period; and a balance sheet summarizing assets and liabilities
on the closing date of the accounting period. A charter school also must include that
same information about its authorizer in other school materials that it makes available
to the public.

Sec. 14.

Minnesota Statutes 2015 Supplement, section 124E.22, is amended to read:

124E.22 BUILDING LEASE AID.

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

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

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

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

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

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

Sec. 15.

Minnesota Statutes 2015 Supplement, section 124E.24, is amended to read:

124E.24 OTHER AID, GRANTS, AND REVENUE.

(a) A charter school is eligible to receive other aids, grants, and revenue according to
chapters 120A to 129C, as though it were a district.

(b) Notwithstanding paragraph (a), a charter school may not receive aid, a grant, or
revenue if a levy is required to obtain the money, or if the aid, grant, or revenue replaces levy
revenue that is not general education revenue, except as otherwise provided in this chapter.

(c) Federal aid received by the state must be paid to the school, if it qualifies for
the aid, as though it were a school district.

(d) A charter school may receive money from any source for capital facilities needs.
In the year-end report to the commissioner of education, the charter school shall report the
total amount of funds it received from grants and other outside sources.

Sec. 16.

Minnesota Statutes 2015 Supplement, section 124E.25, is amended to read:

124E.25 PAYMENT OF AIDS TO CHARTER SCHOOLS.

Subdivision 1.

Payments.

(a) Notwithstanding section 127A.45, subdivision 3, if the
current year aid payment percentage under section 127A.45, subdivision 2, paragraph (d), is
90 or greater, aid payments for the current fiscal year to a charter school shall be of an equal
amount on each of the 24 payment dates. Notwithstanding section 127A.45, subdivision
3, if the current year aid payment percentage under section 127A.45, subdivision 2,
paragraph (d), is less than 90, aid payments for the current fiscal year to a charter school
shall be of an equal amount on each of the 16 payment dates in July through February.

Subd. 1a.

School closures; payments.

(b) (a) Notwithstanding paragraph (a)
subdivision 1 and section 127A.45, for a charter school ceasing operation on or prior
to before June 30 of a school year, for the payment periods occurring after the school
ceases serving students, the commissioner shall withhold the estimated state aid owed
the school. The charter school board of directors and authorizer must submit to the
commissioner a closure plan under chapter 308A or 317A, and financial information about
the school's liabilities and assets. After receiving the closure plan, financial information,
an audit of pupil counts, documentation of and documented lease expenditures, from
the charter school and monitoring of special education expenditures, the commissioner
may release cash withheld and may continue regular payments up to the current year
payment percentages if further amounts are owed. If, based on audits and monitoring,
the school received state aid in excess of the amount owed, the commissioner shall retain
aid withheld sufficient to eliminate the aid overpayment.

(b) For a charter school ceasing operations prior to, before or at the end of, a
school year, notwithstanding section 127A.45, subdivision 3, the commissioner may
make preliminary final payments may be made after receiving the school submits the
closure plan, an audit of pupil counts, monitoring of special education expenditures,
documentation of documented lease expenditures, and school submission of Uniform
Financial Accounting and Reporting Standards (UFARS) financial data and the
commissioner monitors special education expenditures for the final year of operation. The
commissioner may make the final payment may be made upon receipt of after receiving
audited financial statements under section 123B.77, subdivision 3.

(c) Notwithstanding sections 317A.701 to 317A.791, upon closure of after closing
a charter school and satisfaction of satisfying creditors, remaining cash and investment
balances remaining shall be returned by the commissioner to the state general fund.

Subd. 2.

Requirements.

(a) In order To receive state aid payments under this
section, a charter school in its first three years of operation must submit to the commissioner
a school calendar in the form and manner requested by the department commissioner and
a quarterly report to the Department of Education. The quarterly report must list each
student by grade, show the student's start and end dates, if any applicable, 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 charter school must submit the report must
be submitted to the commissioner not more than two weeks after the end of the calendar
quarter to the department. The department commissioner must develop a Web-based
reporting form for charter schools to use when submitting quarterly enrollment reports.

(b) To receive state aid payments under this section, a charter school in its fourth and
subsequent year of operation must submit a school calendar and enrollment information
to the department commissioner in the form and manner requested by the department
commissioner.

(b) (c) A charter school must have a valid, signed contract under section 124E.10,
subdivision 1, on file at with the Department of Education commissioner at least 15 days
prior to before the date of first payment of state aid for the fiscal year.

(c) (d) The commissioner shall compute state aid entitlements shall be computed
for a charter school only for the portion of a school year for which it has a valid, signed
contract under section 124E.10, subdivision 1.

Subd. 3.

Aid reductions.

(a) 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 chapter.

(b) The commissioner may reduce a charter school's state aid by an amount not
to exceed 60 percent of the charter school's basic revenue for the period of time that a
violation of law occurs was violated.

Subd. 4.

Aid withholding.

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

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

Sec. 17.

Minnesota Statutes 2015 Supplement, section 124E.26, is amended to read:

124E.26 USE OF STATE MONEY.

Money received from the state may not be used A charter school may not use state
money to purchase land or buildings. The charter school may own use nonstate sources to
purchase land and buildings if obtained through nonstate sources.

Sec. 18. SUPERSEDING ACTS.

Any amendments or repeals enacted in the 2016 session of the legislature to sections
also amended or repealed in this act supersede the amendments in this act regardless of
order of enactment.