THE SENATE	S.B. NO.	2589
TWENTY-FIFTH LEGISLATURE, 2010		S.D. 2
STATE OF HAWAII		Proposed

A BILL FOR AN ACT

RELATING TO CHARTER SCHOOLS.

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

     SECTION 1.  The legislature finds that the department of education is considering the closure of certain non-charter public schools due to departmental financial constraints.  At the same time, some public charter schools face daunting obstacles such as the high cost of rent and less-than-desirable location of their facilities.

     The purpose of this Act is to require the department of education to make available vacant school facilities or portions of school facilities for use by charter schools and to make changes to charter school funding to further encourage fairness in funding and the availability of resources to charter schools.

     SECTION 2.  Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Use of vacant public school facilities by charter schools. (a)  When the department considers whether to close any particular public school, it shall simultaneously give reasonable consideration to making all or portions of the facilities of the public school, if closed, available for occupancy and use by a charter school.  The department shall submit a notice of possible availability of a public school to the charter school review panel as early as possible; provided that if a vacancy is established, a notice of vacancy shall be submitted to the charter school review panel no later than      days of the establishment of the vacancy. 

(b)  Pursuant to section 302B‑  , upon receipt of a notice pursuant to subsection (a), the charter school review panel shall solicit applications from charter schools interested in using and occupying all or portions of the facilities of the public school and submit a prioritized list of charter schools to the department for final determination of which, if any, charter school shall be authorized to use and occupy the public school facilities.

(c)  Upon the selection of a charter school to use a vacant school facility or portion of a school facility, the department and the charter school review panel shall enter into necessary agreements within      days of the selection to carry out the purposes of this section.

(d)  After receipt by the charter school review panel of a notice pursuant to subsection (a), if the charter school review panel does not provide a prioritized list of charter schools because no charter school has requested to use the facilities of the public school, or if the department receives the prioritized list but determines that no charter school on the list is an appropriate candidate to occupy and use the facilities, the department shall give reasonable consideration to making all or portions of the facilities of the public school, if closed, available for occupancy and use for other educational purposes. (e)  The department shall adopt rules, pursuant to chapter 91, necessary to carry out the purposes of this section.

(f)  For purposes of this section:

"Public school" means any school that falls within the definition of public schools in section 302A-101, except for charter schools."

     SECTION 3.  Chapter 302B, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

"§302B‑   Occupancy and use of facilities of public schools. (a)  When the department considers whether to close any particular public school, the department shall submit a notice of possible availability of a public school or notice of vacancy of a public school to the charter school review panel pursuant to section 302A‑  (a).

(b)  Upon receipt of a notice pursuant to section 302A‑  (a), the charter school review panel shall solicit applications from charter schools interested in using and occupying all or portions of the facilities of the public school by:

(1) Promptly notifying all charter schools that the public school is being considered for closure;

(2) Affording each charter school an opportunity to submit an application with a written explanation and justification of why the charter school should be considered for possible occupancy and use of the facilities of the public school;

(3) Fully considering the charter school's application; and

(4) Providing a written response to each charter school's application after the application has been fully considered.

(c)  Based on the application and on other considerations, the charter school review panel shall compile a prioritized list of charter schools and submit the list to the department for final determination of which, if any, charter school shall be authorized to use and occupy the public school facilities.

(d)  Upon the selection of a charter school to use a vacant school facility or portion of a school facility, the department and the panel shall enter into necessary agreements within     days of the selection to carry out the purposes of this section; provided that any agreement between the panel and the department shall stipulate that a charter school that uses and occupies a public school facility or portion of a public school facility shall be responsible for the full or pro rata share of the repair and maintenance costs for that facility or portion of the facility, as the case may be.

(e)  The panel shall adopt rules, pursuant to chapter 91, necessary to carry out the purposes of this section, including but not limited to:

(1) Procedures for charter schools to apply in writing to use vacant school facilities;

(2) Criteria for the panel to use in determining which charter schools to include on the prioritized list to be submitted to the department; and

(3) Procedures for the panel to notify charter school applicants that are granted and not granted the use of vacant school facilities.

(f)  For purposes of this section:

"Public school" means any school that falls within the definition of public schools in section 302A-101, except for charter schools."

     SECTION 4.  Section 302A-1151, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-1151[]]  Sale of school lands unnecessary for school purposes.  The chairperson of the board of land and natural resources is hereby requested, upon the recommendation and approval of the superintendent, to sell any state lands, including the buildings thereon, once used but no longer necessary for school purposes[.]; provided that no school facility or portion of a school facility shall be sold before that facility or portion of the facility is made available for use by charter schools, pursuant to sections 302A‑   and 302B‑  ."

     SECTION 5.  Section 302B-3, Hawaii Revised Statutes, is amended by amending subsection (i) to read as follows:

     "(i)  The powers and duties of the panel shall be to:

     (1)  Appoint and evaluate the executive director and approve staff and salary levels for the charter school administrative office;

     (2)  Review, approve, or deny charter applications for new charter schools in accordance with section 302B-5 for the issuance of new charters; provided that applicants that are denied a charter may appeal to the board for a final decision pursuant to section 302B-3.5;

     (3)  Review, approve, or deny significant amendments to detailed implementation plans to maximize the school's financial and academic success, long-term organizational viability, and accountability.  Charter schools that are denied a significant amendment to their detailed implementation plan may appeal to the board for a final decision pursuant to section 302B‑3.5;

(4) Pursuant to section 302B‑  , compile and submit prioritized lists of charter schools to the department and enter into necessary agreements with the department to authorize charter schools to use and occupy vacant public school facilities or portions of school facilities;

    [(4)] (5)  Adopt reporting requirements for charter schools;

    [(5)] (6)  Review annual self-evaluation reports from charter schools and take appropriate action;

    [(6)] (7)  Evaluate any aspect of a charter school that the panel may have concerns with and take appropriate action, which may include probation or revocation;

    [(7)] (8)  Periodically adopt improvements in the panel's monitoring and oversight of charter schools;

    [(8)] (9)  Periodically adopt improvements in the office's support of charter schools and management of the charter school system;

    [(9)] (10)  Review, modify, and approve charter schools' all means of finance budget, based upon criteria and an approval process established by the panel; and

   [(10)] (11) Survey all charter school facilities prior to, and in preparation for, determining recommendations to allocate non-per-pupil facilities funds to charter schools with facilities needs.  The survey shall include, at minimum, for each charter school facility:

         (A)  The current status of the facility;

         (B)  Facilities costs, including all rents, leases, purchases, and repair and maintenance for lands and buildings;

         (C)  A prioritized list of facilities needs;

         (D)  Any capital improvement projects underway or scheduled; and

         (E)  Whether the facility is a conversion or start-up charter school, and current and projected enrollment."

     SECTION 6.  Section 302B-12, Hawaii Revised Statutes, is amended to read as follows:

     "§302B-12  Funding and finance.  (a)  Beginning with fiscal year [2009-2010,] 2010-2011, and each fiscal year thereafter, the non-facility general fund per-pupil funding request for charter school students shall [not] be [less than] the same as the general fund per-pupil amount to the department in the most recently approved executive budget recommendation for the department, as set forth in paragraph (2); provided that:

     (1)  The general fund per-pupil funding request shall [include funding for] be based upon reasonable projected enrollment figures for [each] all charter [school;] schools; and

     (2)  The general fund per-pupil request for each regular education and special education student shall:

         (A)  Include all general fund regular education cost categories, including comprehensive school support services, but excluding special education services[;], adult education, and the after-school plus program; provided that [special education] these services are provided and funded by the department;

        [(B) Include all means of financing except federal funds, as reported in the most recently-approved executive budget recommendations for the department; provided that in preparing the budget the executive director shall include an analysis of the proposed budget in relationship to the most recently published department consolidated annual financial report; and

(C)]  (B)  Exclude fringe benefit costs and debt service[.]; and

(C) If there is a balance in the over-projection appropriation account, as described in subsection (d)(2), the general fund request shall be reduced by the amount of the balance.

(b)  Fringe benefit costs for charter school employees, regardless of the payroll system utilized by a charter school, shall be included in the department of budget and finance's annual budget request.  No fringe benefit costs shall be charged directly to or deducted from the charter school per-pupil allocations.

     The legislature shall [make] consider the budget request when making an appropriation [based upon the budget request]; provided that the legislature may make additional appropriations for [fringe, workers' compensation, and other employee benefits and] facility [costs.  The legislature may make additional appropriations for other requested amounts that benefit charter schools.] and other costs.

     The governor, pursuant to chapter 37, may impose restrictions or reductions on charter school appropriations similar to those imposed on other public schools.

     (c)  Charter schools shall be eligible for all federal financial support to the same extent as all other public schools.  The department shall provide the office with all state-level federal grant proposals submitted by the department that include charter schools as potential recipients and timely reports on state-level federal grants received for which charter schools may apply or are entitled to receive.  Federal funds received by the department for charter schools shall be transferred to the office for distribution to charter schools in accordance with the federal requirements.  If administrative services related to federal grants and subsidies are provided to the charter school by the department, the charter school shall reimburse the department for the actual costs of the administrative services in an amount that shall not exceed six and one-half per cent of the charter school's federal grants and subsidies.

     Any charter school shall be eligible to receive any supplemental federal grant or award for which any other public school may submit a proposal, or any supplemental federal grants limited to charter schools; provided that if department administrative services, including funds management, budgetary, fiscal accounting, or other related services, are provided with respect to these supplemental grants, the charter school shall reimburse the department for the actual costs of the administrative services in an amount that shall not exceed six and one-half per cent of the supplemental grant for which the services are used.

     All additional funds generated by the local school boards, that are not from a supplemental grant, shall be held separate from allotted funds and may be expended at the discretion of the local school boards.

(d)  To avoid over-appropriating general funds to charter schools based on self-reported enrollment projections, the office shall:

(1) Allocate to charter schools no more than the per-pupil appropriation for each charter school student;

(2) Place in an over-projection appropriation account the amount of the difference between the projected enrollment and the actual October 15 enrollment count, as verified by the office, multiplied by the per-pupil appropriation amount; and

(3) Report to the legislature no later than twenty days prior to each regular session the amount of the funds in the account, a breakdown by school of the excess appropriation due to an over-projection of enrollment, and discussion on what modifications have been made to the projection methodology to improve the accuracy of future projections.

Funds shall not be expended from the over-projection appropriation account and may only be transferred to schools by approval of the legislature.

     [(d)] (e)  To enable charter schools to access state funding prior to the start of each school year, foster their fiscal planning, and enhance their accountability, the office shall:

     (1)  Provide fifty per cent of a charter school's per-pupil allocation based on the charter school's projected student enrollment no later than July 20 of each fiscal year; provided that the charter school shall have submitted to the office a projected student enrollment no later than May 15 of each year;

     (2)  Provide an additional forty per cent of a charter school's per-pupil allocation no later than November 15 of each year; provided that the charter school shall have submitted to the office:

         (A)  Student enrollment as verified on October 15 of each year; provided that the student enrollment shall be verified on the last business day immediately prior to October 15 should that date fall on a weekend; and

         (B)  An accounting of the percentage of student enrollment that transferred from public schools established and maintained by the department; provided that these accountings shall also be submitted by the office to the legislature no later than twenty days prior to the start of each regular session; and

     (3)  Retain no more than ten per cent of a charter school's per-pupil allocation no later than June 30 of each year as a contingency balance to ensure fiscal accountability and compliance;

provided that the panel may make adjustments in allocations based on noncompliance with board policies made in the board's capacity as the state education agency, department directives made in the department's capacity as the state education agency, the office's administrative procedures, and board-approved accountability requirements.

(f)  Any check transferring a per-pupil allocation from the office to a charter school under this section shall be co-signed by the executive director and an authorized agent of the charter school review panel.

     [(e)] (g)  The department shall provide appropriate transitional resources to a conversion charter school for its first year of operation as a charter school based upon the department's allocation to the school for the year prior to the conversion.

     [(f)] (h)  No start-up charter school or conversion charter school may assess tuition."

     SECTION 7.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 8.  This Act shall take effect on July 1, 2050.

Report Title:

Charter Schools; Vacant School Facilities

Description:

Requires the DOE to make available vacant school facilities or portions of school facilities for use by charter schools.  Requires the charter school review panel to compile a prioritized list of charter schools that wish to use vacant school facilities or portions of school facilities.  Makes changes to charter school funding.  Takes effect 7/1/2050.  (SD2)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.