[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 1566 Introduced in Senate (IS)]

112th CONGRESS
  1st Session
                                S. 1566

 To amend the Elementary and Secondary Education Act of 1965 regarding 
                        public charter schools.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 15, 2011

   Mr. Kirk (for himself, Mr. Alexander, Mr. Burr, Mr. Isakson, Mr. 
    McCain, Mr. Roberts, Mr. Rubio, and Mr. Wicker) introduced the 
 following bill; which was read twice and referred to the Committee on 
                 Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL


 
 To amend the Elementary and Secondary Education Act of 1965 regarding 
                        public charter schools.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Empowering Parents through Quality 
Charter Schools Act''.

SEC. 2. REFERENCES.

    Except as otherwise specifically provided, whenever in this Act a 
section or other provision is amended or repealed, such amendment or 
repeal shall be considered to be made to that section or other 
provision of the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 6301 et seq.).

SEC. 3. PURPOSE.

    Section 5201 (20 U.S.C. 7221) is amended to read as follows:

``SEC. 5201. PURPOSE.

    ``It is the purpose of this subpart to--
            ``(1) provide financial assistance for the planning, 
        program design, and initial implementation of charter schools;
            ``(2) expand the number of high-quality charter schools 
        available to students across the Nation;
            ``(3) evaluate the impact of such schools on student 
        achievement, families, and communities, and share best 
        practices between charter schools and other public schools;
            ``(4) encourage States to provide support to charter 
        schools for facilities financing in an amount more nearly 
        commensurate to the amount the States have typically provided 
        for traditional public schools;
            ``(5) improve student services to increase opportunities 
        for students who are children with disabilities, English 
        language learners, and other traditionally underserved students 
        to attend charter schools and meet challenging State academic 
        achievement standards; and
            ``(6) support efforts to strengthen the charter school 
        authorizing process to improve performance management, 
        including transparency, monitoring, and evaluation of such 
        schools.''.

SEC. 4. PROGRAM AUTHORIZED.

    Section 5202 (20 U.S.C. 7221a) is amended to read as follows:

``SEC. 5202. PROGRAM AUTHORIZED.

    ``(a) In General.--The Secretary is authorized to carry out a 
charter school program that supports charter schools that serve 
elementary school and secondary school students by--
            ``(1) supporting the startup, replication, and expansion of 
        charter schools;
            ``(2) assisting charter schools in accessing credit to 
        acquire and renovate facilities for school use; and
            ``(3) carrying out national activities to support--
                    ``(A) charter school development;
                    ``(B) the dissemination of best practices of 
                charter schools for all schools; and
                    ``(C) the evaluation of the impact of the program 
                on schools participating in the program.
    ``(b) Funding Allotment.--From the amount made available under 
section 5211 for a fiscal year, the Secretary shall--
            ``(1) reserve 15 percent to support charter school 
        facilities assistance under section 5204;
            ``(2) reserve not more than 5 percent to carry out national 
        activities under section 5205; and
            ``(3) use the remaining amount after the Secretary reserves 
        funds under paragraphs (1) and (2) to carry out section 5203.
    ``(c) Prior Grants and Subgrants.--The recipient of a grant or 
subgrant under this subpart, as such subpart was in effect on the day 
before the date of enactment of the Empowering Parents through Quality 
Charter Schools Act, shall continue to receive funds in accordance with 
the terms and conditions of such grant or subgrant.''.

SEC. 5. GRANTS TO SUPPORT HIGH-QUALITY CHARTER SCHOOLS.

    Section 5203 (20 U.S.C. 7221b) is amended to read as follows:

``SEC. 5203. GRANTS TO SUPPORT HIGH-QUALITY CHARTER SCHOOLS.

    ``(a) Definitions.--In this section:
            ``(1) Charter management organization.--The term `charter 
        management organization' means a nonprofit organization that 
        operates, manages, or oversees multiple charter schools by 
        centralizing or sharing certain functions and resources among 
        schools, or a group or consortium of such organizations.
            ``(2) Eligible entity.--The term `eligible entity' means--
                    ``(A) a State entity;
                    ``(B) an authorized public chartering agency;
                    ``(C) a local educational agency; or
                    ``(D) a charter management organization.
            ``(3) State entity.--The term `State entity' means--
                    ``(A) a State educational agency;
                    ``(B) a State charter school board; or
                    ``(C) a Governor of a State.
    ``(b) Program Authorized.--From the amount reserved under section 
5202(b)(3), the Secretary shall award grants, on a competitive basis, 
to eligible entities to enable--
            ``(1) eligible entities described in subparagraph (A), (B), 
        or (C) of subsection (a)(2) to--
                    ``(A) award subgrants to eligible applicants--
                            ``(i) to open new charter schools;
                            ``(ii) to open replicable, high-quality 
                        charter school models; or
                            ``(iii) to expand high-quality charter 
                        schools; and
                    ``(B) provide technical assistance to eligible 
                applicants and authorized public chartering agencies in 
                carrying out the activities described in subparagraph 
                (A) and work with authorized public chartering agencies 
                in the State to improve authorizing quality; or
            ``(2) eligible entities described in subparagraph (B), (C), 
        or (D) of subsection (a)(2) to open new charter schools or 
        replicable high-quality charter school models or to expand 
        high-quality charter schools.
    ``(c) Uses of Funds.--
            ``(1) Special rule for subgranting entities.--An eligible 
        entity receiving a grant under subsection (b)(1) shall--
                    ``(A) use 90 percent of the grant funds to carry 
                out subsection (b)(1)(A), in accordance with the 
                quality charter school program described in the 
                entity's application approved pursuant to subsection 
                (g); and
                    ``(B) reserve 10 percent of such funds to carry out 
                the activities described in subsection (b)(1)(B), of 
                which not more than 30 percent may be used for 
                administrative costs which may include technical 
                assistance.
            ``(2) Contracts and grants.--An eligible entity may use a 
        grant received under this section to carry out the activities 
        described in subsection (b) directly or through grants, 
        contracts, or cooperative agreements.
    ``(d) Program Periods; Peer Review; Diversity of Projects.--
            ``(1) Program periods.--
                    ``(A) Grants.--A grant awarded by the Secretary to 
                an eligible entity under this section shall be for a 
                period of 5 years.
                    ``(B) Subgrants.--A subgrant awarded by an eligible 
                entity under this section shall be for a period of not 
                more than 5 years, of which an eligible applicant may 
                use not more than 18 months for planning and program 
                design.
            ``(2) Peer review.--The Secretary, and each eligible entity 
        awarding subgrants under this section, shall use a peer review 
        process to review applications for assistance under this 
        section.
            ``(3) Diversity of projects.--Each eligible entity awarding 
        subgrants under this section shall award subgrants in a manner 
        that, to the extent practicable and applicable, ensures that 
        such subgrants--
                    ``(A) are distributed throughout different areas, 
                including urban, suburban, and rural areas; and
                    ``(B) will assist charter schools representing a 
                variety of educational approaches.
    ``(e) Limitations.--
            ``(1) Grants.--An eligible entity may not receive more than 
        1 grant under this section for a 5-year period, unless the 
        eligible entity demonstrates to the Secretary that, for each 
        charter school supported under the first grant, the education 
        results, in the areas described in subparagraphs (A) and (D) of 
        section 5210(6), for the students enrolled in the charter 
        school have improved for not less than 3 consecutive years 
        during the grant period.
            ``(2) Subgrants.--An eligible applicant may not receive 
        more than 1 subgrant under this section per charter school for 
        a 5-year period.
    ``(f) Applications.--An eligible entity desiring to receive a grant 
under this section shall submit an application to the Secretary at such 
time and in such manner as the Secretary may require. The application 
shall include the following:
            ``(1) A description of the entity's objectives in running a 
        quality charter school program under this section and how the 
        objectives of the program will be carried out, including--
                    ``(A) a description of how the entity will--
                            ``(i) support both new charter school 
                        startup and the expansion and replication of 
                        high-quality charter school models;
                            ``(ii) will work with charter schools to 
                        promote inclusion of all students and support 
                        all students once they are enrolled to promote 
                        retention;
                            ``(iii) will work with charter schools on 
                        recruitment practices, including efforts to 
                        engage groups that may otherwise have limited 
                        opportunities to participate in charter 
                        schools;
                            ``(iv) will share best and promising 
                        practices between charter schools and other 
                        public schools;
                            ``(v) will ensure the charter schools the 
                        eligible entity supports can meet the 
                        educational needs of their students, including 
                        students who are children with disabilities and 
                        English language learners; and
                            ``(vi) will support efforts to increase 
                        quality initiatives, including meeting the 
                        quality authorizing elements described in 
                        paragraph (2)(D)(ii);
                    ``(B) in the case of any eligible entity that will 
                be awarding subgrants under subsection (b)(1)(A), a 
                description of how the entity--
                            ``(i) will inform eligible charter schools, 
                        developers, authorized public chartering 
                        agencies, and other entities of the 
                        availability of funds under the program;
                            ``(ii) will work with eligible applicants 
                        to ensure that the applicants access all 
                        Federal funds that they are eligible to 
                        receive, and help the charter schools supported 
                        by the applicants and the students attending 
                        the charter schools--
                                    ``(I) participate in the Federal 
                                programs in which the schools and 
                                students are eligible to participate; 
                                and
                                    ``(II) receive the commensurate 
                                share of Federal funds the schools and 
                                students are eligible to receive under 
                                such programs;
                            ``(iii) will ensure eligible applicants 
                        that receive a subgrant under the entity's 
                        program are prepared to continue to operate the 
                        charter schools receiving the subgrant funds 
                        once the funds have expired;
                            ``(iv) will support charter schools in 
                        local educational agencies with large numbers 
                        of schools that are required to comply with the 
                        requirements of section 1116(b); and
                            ``(v) will carry out the subgrant 
                        competition, including--
                                    ``(I) a description of the 
                                application each eligible applicant 
                                desiring to receive a subgrant will 
                                submit, which application shall 
                                include--
                                            ``(aa) a description of the 
                                        roles and responsibilities of 
                                        eligible applicants, partner 
                                        organizations, and management 
                                        organizations, including the 
                                        administrative and contractual 
                                        roles and responsibilities; and
                                            ``(bb) a description of the 
                                        quality controls agreed to 
                                        between the eligible applicant 
                                        and the authorized public 
                                        chartering agency involved, 
                                        such as a contract or 
                                        performance agreement, and how 
                                        a school's performance on the 
                                        State's academic accountability 
                                        system will be a primary factor 
                                        for renewal; and
                                    ``(II) a description of how the 
                                entity will review applications;
                    ``(C) except in the case of an eligible entity 
                described in subsection (a)(3)(A), a description of how 
                the entity--
                            ``(i) will work with the State educational 
                        agency and the charter schools in the State to 
                        maximize charter school participation in 
                        Federal and State programs for charter schools; 
                        and
                            ``(ii) will work with the State educational 
                        agency to adequately operate the entity's 
                        program under this section, where applicable;
                    ``(D) in the case of an eligible entity that is a 
                State entity, a description of the extent to which the 
                entity--
                            ``(i) is able to meet and carry out the 
                        priorities described in subsection (g)(2); and
                            ``(ii) is working to develop or strengthen 
                        a cohesive statewide system to support the 
                        opening of new charter schools and replicable, 
                        high-quality charter school models, and 
                        expanding high-quality charter schools; and
                    ``(E) in the case of an entity that partners with 
                an outside organization to carry out the entity's 
                quality charter school program, in whole or in part, of 
                the roles and responsibilities of this partner.
            ``(2) Assurances, including a description of how the 
        assurances will be met, that--
                    ``(A) the eligible entity, if awarding subgrants, 
                will--
                            ``(i) consider applications from eligible 
                        charter schools, authorized public chartering 
                        agencies, charter management organizations, and 
                        other entities as applicable under State law; 
                        and
                            ``(ii) provide adequate technical 
                        assistance to eligible applicants to--
                                    ``(I) meet the objectives described 
                                in clauses (ii) and (iii) of paragraph 
                                (1)(A) and subparagraph (B); and
                                    ``(II) enroll traditionally 
                                underserved students, including 
                                students who are children with 
                                disabilities and English language 
                                learners, to promote an inclusive 
                                education environment;
                    ``(B) each charter school receiving funds under the 
                entity's program will have a high degree of autonomy 
                over budget and operations;
                    ``(C) the entity will support charter schools in 
                meeting the educational needs of their students as 
                described in paragraph (1)(A)(v);
                    ``(D) in the case of an eligible entity that is a 
                State entity--
                            ``(i) the entity will ensure that the 
                        authorized public chartering agency of any 
                        charter school that receives funds under the 
                        entity's program--
                                    ``(I) ensures that the charter 
                                school is meeting the obligations under 
                                this Act, part B of the Individuals 
                                with Disabilities Education Act, title 
                                VI of the Civil Rights Act of 1964, and 
                                section 504 of the Rehabilitation Act 
                                of 1973; and
                                    ``(II) adequately monitors and 
                                helps the schools in recruiting, 
                                enrolling, and meeting the needs of all 
                                students, including students who are 
                                children with disabilities and English 
                                language learners; and
                            ``(ii) the entity will promote quality 
                        authorizing, such as through providing 
                        technical assistance, to support all authorized 
                        public chartering agencies in the State to 
                        improve the monitoring of their charter 
                        schools, including by--
                                    ``(I) using annual performance 
                                data, which may include graduation 
                                rates and student growth data, as 
                                appropriate, to measure the progress of 
                                their schools toward becoming high-
                                quality charter schools; and
                                    ``(II) reviewing the schools' 
                                independent, annual audits of financial 
                                statements conducted in accordance with 
                                generally accepted accounting 
                                principles, and ensuring any such 
                                audits are publically reported.
            ``(3) A request and justification for waivers of any 
        Federal statutory or regulatory provisions that the entity 
        believes are necessary for the successful operation of the 
        charter schools that will receive funds under the entity's 
        program under this section, and a description of any State or 
        local rules, generally applicable to public schools, that will 
        be waived, or otherwise not apply to such schools.
    ``(g) Selection Criteria; Priority.--
            ``(1) Selection criteria.--The Secretary shall award grants 
        to eligible entities under this section on the basis of the 
        quality of the applications submitted under subsection (f), 
        after taking into consideration--
                    ``(A) the degree of flexibility afforded by the 
                State's public charter school law and, in the case of 
                an eligible entity described in subsection (a)(2)(A), 
                how the entity will work to maximize the flexibility 
                provided to charter schools under the law;
                    ``(B) the quality of the strategy for assessing 
                achievement of the entity's objectives under subsection 
                (f)(1);
                    ``(C) the likelihood that the eligible entity, and 
                any eligible applicants receiving subgrants from the 
                eligible entity, will meet those objectives and improve 
                educational results for students;
                    ``(D) the proposed number of new charter schools to 
                be opened, and the number of high-quality charter 
                schools to be replicated or expanded under the program;
                    ``(E) in the case of an eligible entity awarding 
                subgrants under subsection (b)(1)(A), the entity's plan 
                to--
                            ``(i) adequately monitor the eligible 
                        applicants receiving subgrants under the 
                        entity's program;
                            ``(ii) work with the authorized public 
                        chartering agencies involved to avoid 
                        duplication of work for the charter schools and 
                        authorized public chartering agencies; and
                            ``(iii) provide adequate technical 
                        assistance, as described in the entity's 
                        application under subsection (f), for the 
                        eligible applicants receiving subgrants under 
                        the entity's program; and
                    ``(F) the entity's plan to support quality 
                authorizing efforts in the State, consistent with the 
                objectives under subsection (f)(1).
            ``(2) Priority.--In selecting State entities to receive a 
        portion of the grants awarded under this section, the Secretary 
        shall give priority to State entities to the extent that they 
        meet the following criteria:
                    ``(A) In the case in which a State entity is 
                located in a State that allows an entity other than the 
                State educational agency to be an authorized public 
                chartering agency or a State in which only a local 
                educational agency may be an authorized public 
                chartering agency, the State has an appeals process for 
                the denial of an application for a charter school.
                    ``(B) The State entity is located in a State that 
                ensures equitable financing, as compared to traditional 
                public schools, for charter schools and students in a 
                prompt manner.
                    ``(C) The State entity is located in a State that 
                uses charter schools and best practices from charter 
                schools to help improve struggling schools and local 
                educational agencies.
                    ``(D) The State entity partners with an 
                organization that has a demonstrated record of success 
                in developing management organizations to support the 
                development of charter schools in the State.
                    ``(E) The State entity supports charter schools 
                that support at-risk students through activities such 
                as dropout prevention or dropout recovery.
    ``(h) Local Uses of Funds.--An eligible applicant receiving a 
subgrant under this section shall use such funds to open new charter 
schools or replicable, high-quality charter school models, or expand 
existing high-quality charter schools.
    ``(i) Reporting Requirements.--Each eligible entity receiving a 
grant under this section shall submit to the Secretary, at the end of 
the third year of the 5-year grant period and at the end of such grant 
period, a report on--
            ``(1) the number of students served and, if applicable, how 
        many new students were served during each year of the grant 
        period;
            ``(2) in the case of an eligible entity awarding subgrants 
        under subsection (b)(1)(A), the number of subgrants awarded 
        under this section to carry out each of the following:
                    ``(A) the opening of new charter schools;
                    ``(B) the opening of replicable, high-quality 
                charter school models; and
                    ``(C) the expansion of high-quality charter 
                schools;
            ``(3) in the case of an eligible entity receiving a grant 
        under subsection (b)(2), the number of new charter schools 
        opened, the number of replicable high-quality charter school 
        models opened, and the number of high-quality charter schools 
        expanded under the grant;
            ``(4) in the case of a State entity, the progress the State 
        entity made toward meeting the priorities described in 
        subsection (g)(2), as applicable;
            ``(5) how the entity met the objectives of the quality 
        charter school program described in the entity's application 
        under subsection (f);
            ``(6) how the entity complied with, and, if applicable, 
        ensured that eligible applicants complied with, the assurances 
        described in the entity's application; and
            ``(7) how the entity worked with authorized public 
        chartering agencies, including how the agencies worked with the 
        management company or leadership of the schools in which the 
        subgrants were awarded, if applicable.''.

SEC. 6. FACILITIES FINANCING ASSISTANCE.

    Section 5204 (20 U.S.C. 7221c) is amended to read as follows:

``SEC. 5204. FACILITIES FINANCING ASSISTANCE.

    ``(a) Grants to Eligible Entities.--
            ``(1) In general.--From the amount reserved under section 
        5202(b)(1), the Secretary shall award not less than 3 grants to 
        eligible entities that have applications approved under 
        subsection (d) to demonstrate innovative methods of assisting 
        charter schools to address the cost of acquiring, constructing, 
        and renovating facilities by enhancing the availability of 
        loans or bond financing.
            ``(2) Eligible entity defined.--For purposes of this 
        section, the term `eligible entity' means--
                    ``(A) a public entity, such as a State or local 
                governmental entity;
                    ``(B) a private nonprofit entity; or
                    ``(C) a consortium of entities described in 
                subparagraphs (A) and (B).
    ``(b) Grantee Selection.--
            ``(1) Evaluation of application.--The Secretary shall 
        evaluate each application submitted under subsection (d), and 
        shall determine whether the application is sufficient to merit 
        approval.
            ``(2) Distribution of grants.--The Secretary shall award 
        not less than one grant to an eligible entity described in 
        subsection (a)(2)(A), not less than one grant to an eligible 
        entity described in subsection (a)(2)(B), and not less than one 
        grant to an eligible entity described in subsection (a)(2)(C), 
        if applications are submitted that permit the Secretary to do 
        so without approving an application that is not of sufficient 
        quality to merit approval.
    ``(c) Grant Characteristics.--Grants under subsection (a) shall be 
of a sufficient size, scope, and quality so as to ensure an effective 
demonstration of an innovative means of enhancing credit for the 
financing of charter school acquisition, construction, or renovation.
    ``(d) Applications.--
            ``(1) In general.--To receive a grant under subsection (a), 
        an eligible entity shall submit to the Secretary an application 
        in such form as the Secretary may reasonably require.
            ``(2) Contents.--An application submitted under paragraph 
        (1) shall contain--
                    ``(A) a statement identifying the activities 
                proposed to be undertaken with funds received under 
                subsection (a), including how the eligible entity will 
                determine which charter schools will receive 
                assistance, and how much and what types of assistance 
                charter schools will receive;
                    ``(B) a description of the involvement of charter 
                schools in the application's development and the design 
                of the proposed activities;
                    ``(C) a description of the eligible entity's 
                expertise in capital market financing;
                    ``(D) a description of how the proposed activities 
                will leverage the maximum amount of private-sector 
                financing capital relative to the amount of government 
                funding used and otherwise enhance credit available to 
                charter schools, including how the entity will offer a 
                combination of rates and terms more favorable than the 
                rates and terms that a charter school could receive 
                without assistance from the entity under this section;
                    ``(E) a description of how the eligible entity 
                possesses sufficient expertise in education to evaluate 
                the likelihood of success of a charter school program 
                for which facilities financing is sought; and
                    ``(F) in the case of an application submitted by a 
                State governmental entity, a description of the actions 
                that the entity has taken, or will take, to ensure that 
                charter schools within the State receive the funding 
                the charter schools need to have adequate facilities.
    ``(e) Charter School Objectives.--An eligible entity receiving a 
grant under this section shall use the funds deposited in the reserve 
account established under subsection (f) to assist one or more charter 
schools to access private sector capital to accomplish one or both of 
the following objectives:
            ``(1) The acquisition (by purchase, lease, donation, or 
        otherwise) of an interest (including an interest held by a 
        third party for the benefit of a charter school) in improved or 
        unimproved real property that is necessary to commence or 
        continue the operation of a charter school.
            ``(2) The construction of new facilities, including 
        predevelopment costs, or the renovation, repair, or alteration 
        of existing facilities, necessary to commence or continue the 
        operation of a charter school.
    ``(f) Reserve Account.--
            ``(1) Use of funds.--To assist charter schools to 
        accomplish the objectives described in subsection (e), an 
        eligible entity receiving a grant under subsection (a) shall, 
        in accordance with State and local law, directly or indirectly, 
        alone or in collaboration with others, deposit the funds 
        received under subsection (a) (other than funds used for 
        administrative costs in accordance with subsection (g)) in a 
        reserve account established and maintained by the eligible 
        entity for this purpose. Amounts deposited in such account 
        shall be used by the eligible entity for one or more of the 
        following purposes:
                    ``(A) Guaranteeing, insuring, and reinsuring bonds, 
                notes, evidences of debt, loans, and interests therein, 
                the proceeds of which are used for an objective 
                described in subsection (e).
                    ``(B) Guaranteeing and insuring leases of personal 
                and real property for an objective described in 
                subsection (e).
                    ``(C) Facilitating financing by identifying 
                potential lending sources, encouraging private lending, 
                and other similar activities that directly promote 
                lending to, or for the benefit of, charter schools.
                    ``(D) Facilitating the issuance of bonds by charter 
                schools, or by other public entities for the benefit of 
                charter schools, by providing technical, 
                administrative, and other appropriate assistance 
                (including the recruitment of bond counsel, 
                underwriters, and potential investors and the 
                consolidation of multiple charter school projects 
                within a single bond issue).
            ``(2) Investment.--Funds received under this section and 
        deposited in the reserve account established under paragraph 
        (1) shall be invested in obligations issued or guaranteed by 
        the United States or a State, or in other similarly low-risk 
        securities.
            ``(3) Reinvestment of earnings.--Any earnings on funds 
        received under subsection (a) shall be deposited in the reserve 
        account established under paragraph (1) and used in accordance 
        with such subsection.
    ``(g) Limitation on Administrative Costs.--An eligible entity may 
use not more than 2.5 percent of the funds received under subsection 
(a) for the administrative costs of carrying out its responsibilities 
under this section (excluding subsection (k)).
    ``(h) Audits and Reports.--
            ``(1) Financial record maintenance and audit.--The 
        financial records of each eligible entity receiving a grant 
        under subsection (a) shall be maintained in accordance with 
        generally accepted accounting principles and shall be subject 
        to an annual audit by an independent public accountant.
            ``(2) Reports.--
                    ``(A) Grantee annual reports.--Each eligible entity 
                receiving a grant under subsection (a) annually shall 
                submit to the Secretary a report of its operations and 
                activities under this section.
                    ``(B) Contents.--Each annual report submitted under 
                subparagraph (A) shall include--
                            ``(i) a copy of the most recent financial 
                        statements, and any accompanying opinion on 
                        such statements, prepared by the independent 
                        public accountant reviewing the financial 
                        records of the eligible entity;
                            ``(ii) a copy of any report made on an 
                        audit of the financial records of the eligible 
                        entity that was conducted under paragraph (1) 
                        during the reporting period;
                            ``(iii) an evaluation by the eligible 
                        entity of the effectiveness of its use of the 
                        Federal funds provided under subsection (a) in 
                        leveraging private funds;
                            ``(iv) a listing and description of the 
                        charter schools served during the reporting 
                        period, including the amount of funds used by 
                        each school, the type of project facilitated by 
                        the grant, and the type of assistance provided 
                        to the charter schools;
                            ``(v) a description of the activities 
                        carried out by the eligible entity to assist 
                        charter schools in meeting the objectives set 
                        forth in subsection (e); and
                            ``(vi) a description of the characteristics 
                        of lenders and other financial institutions 
                        participating in the activities undertaken by 
                        the eligible entity under this section 
                        (excluding subsection (k)) during the reporting 
                        period.
                    ``(C) Secretarial report.--The Secretary shall 
                review the reports submitted under subparagraph (A) and 
                shall provide a comprehensive annual report to Congress 
                on the activities conducted under this section 
                (excluding subsection (k)).
    ``(i) No Full Faith and Credit for Grantee Obligation.--No 
financial obligation of an eligible entity entered into pursuant to 
this section (such as an obligation under a guarantee, bond, note, 
evidence of debt, or loan) shall be an obligation of, or guaranteed in 
any respect by, the United States. The full faith and credit of the 
United States is not pledged to the payment of funds which may be 
required to be paid under any obligation made by an eligible entity 
pursuant to any provision of this section.
    ``(j) Recovery of Funds.--
            ``(1) In general.--The Secretary, in accordance with 
        chapter 37 of title 31, United States Code, shall collect--
                    ``(A) all of the funds in a reserve account 
                established by an eligible entity under subsection 
                (f)(1) if the Secretary determines, not earlier than 2 
                years after the date on which the eligible entity first 
                received funds under this section (excluding subsection 
                (k)), that the eligible entity has failed to make 
                substantial progress in carrying out the purposes 
                described in such subsection; or
                    ``(B) all or a portion of the funds in a reserve 
                account established by an eligible entity under 
                subsection (f)(1) if the Secretary determines that the 
                eligible entity has permanently ceased to use all or a 
                portion of the funds in such account to accomplish any 
                purpose described in such subsection.
            ``(2) Exercise of authority.--The Secretary shall not 
        exercise the authority provided in paragraph (1) to collect 
        from any eligible entity any funds that are being properly used 
        to achieve one or more of the purposes described in subsection 
        (f)(1).
            ``(3)  Procedures.--The provisions of sections 451, 452, 
        and 458 of the General Education Provisions Act shall apply to 
        the recovery of funds under paragraph (1).
            ``(4) Construction.--This subsection shall not be construed 
        to impair or affect the authority of the Secretary to recover 
        funds under part D of the General Education Provisions Act.
    ``(k) Per-Pupil Facilities Aid Program.--
            ``(1) Definition of per-pupil facilities aid program.--In 
        this subsection, the term `per-pupil facilities aid program' 
        means a program in which a State makes payments, on a per-pupil 
        basis, to charter schools to provide the schools with 
        financing--
                    ``(A) that is dedicated solely for funding charter 
                school facilities; or
                    ``(B) a portion of which is dedicated for funding 
                charter school facilities.
            ``(2) Grants.--
                    ``(A) In general.--From the amount reserved under 
                section 5202(b)(1) remaining after the Secretary makes 
                grants under subsection (a), the Secretary shall make 
                grants, on a competitive basis, to States to pay for 
                the Federal share of the cost of establishing or 
                enhancing, and administering per-pupil facilities aid 
                programs.
                    ``(B) Period.--The Secretary shall award grants 
                under this subsection for periods of not more than 5 
                years.
                    ``(C) Federal share.--The Federal share of the cost 
                described in subparagraph (A) for a per-pupil 
                facilities aid program shall be not more than--
                            ``(i) 90 percent of the cost, for the first 
                        fiscal year for which the program receives 
                        assistance under this subsection;
                            ``(ii) 80 percent in the second such year;
                            ``(iii) 60 percent in the third such year;
                            ``(iv) 40 percent in the fourth such year; 
                        and
                            ``(v) 20 percent in the fifth such year.
                    ``(D) State share.--A State receiving a grant under 
                this subsection may partner with 1 or more 
                organizations to provide up to 50 percent of the State 
                share of the cost of establishing or enhancing, and 
                administering the per-pupil facilities aid program.
                    ``(E) Multiple grants.--A State may receive more 
                than 1 grant under this subsection, so long as the 
                amount of such funds provided to charter schools 
                increases with each successive grant.
            ``(3) Use of funds.--
                    ``(A) In general.--A State that receives a grant 
                under this subsection shall use the funds made 
                available through the grant to establish or enhance, 
                and administer, a per-pupil facilities aid program for 
                charter schools in the State of the applicant.
                    ``(B) Evaluations; technical assistance; 
                dissemination.--From the amount made available to a 
                State through a grant under this subsection for a 
                fiscal year, the State may reserve not more than 5 
                percent to carry out evaluations, to provide technical 
                assistance, and to disseminate information.
                    ``(C) Supplement, not supplant.--Funds made 
                available under this subsection shall be used to 
                supplement, and not supplant, State and local public 
                funds expended to provide per-pupil facilities aid 
                programs, operations financing programs, or other 
                programs, for charter schools.
            ``(4) Requirements.--
                    ``(A) Voluntary participation.--No State may be 
                required to participate in a program carried out under 
                this subsection.
                    ``(B) State law.--
                            ``(i) In general.--To be eligible to 
                        receive a grant under this subsection, a State 
                        shall establish or enhance, and administer, a 
                        per-pupil facilities aid program for charter 
                        schools in the State, that--
                                    ``(I) is specified in State law; 
                                and
                                    ``(II) provides annual financing, 
                                on a per-pupil basis, for charter 
                                school facilities.
                            ``(ii) Special rule.--A State that is 
                        required under State law to provide its charter 
                        schools with access to adequate facility space 
                        may be eligible to receive a grant under this 
                        subsection if the State agrees to use the funds 
                        to develop a per-pupil facilities aid program 
                        consistent with the requirements of this 
                        subsection.
            ``(5) Applications.--To be eligible to receive a grant 
        under this subsection, a State shall submit an application to 
        the Secretary at such time, in such manner, and containing such 
        information as the Secretary may require.''.

SEC. 7. NATIONAL ACTIVITIES.

    Section 5205 (20 U.S.C. 7221d) is amended to read as follows:

``SEC. 5205. NATIONAL ACTIVITIES.

    ``(a) In General.--From the amount reserved under section 
5202(b)(2), the Secretary shall--
            ``(1) use not less than 50 percent of such funds to award 
        grants in accordance with subsection (b); and
            ``(2) use the remainder of such funds to--
                    ``(A) disseminate technical assistance to State 
                entities in awarding subgrants under section 
                5203(b)(1)(A);
                    ``(B) disseminate best practices regarding public 
                charter schools; and
                    ``(C) evaluate the impact of the charter school 
                program, including the impact on student achievement, 
                carried out under this subpart.
    ``(b)  Grants.--
            ``(1) In general.--From the amounts described in subsection 
        (a)(1), the Secretary shall make grants, on a competitive 
        basis, to eligible applicants for the purpose of carrying out 
        the activities described in section 5202(a)(1) and section 
        5203(b).
            ``(2) Terms and conditions.--Except as otherwise provided 
        in this subsection, grants awarded under this subsection shall 
        have the same terms and conditions as grants awarded under 
        section 5203.
            ``(3) Eligible applicant defined.--For purposes of this 
        subsection, the term `eligible applicant' means an eligible 
        applicant that desires to open a charter school in a State 
        that--
                    ``(A) did not apply for a grant under section 5203;
                    ``(B) did not receive a grant under section 5203; 
                or
                    ``(C) received a grant under section 5203 and is in 
                the fourth or fifth year of the grant period for such 
                grant.
    ``(c) Contracts and Grants.--The Secretary may carry out any of the 
activities described in this section directly or through grants, 
contracts, or cooperative agreements.''.

SEC. 8. RECORDS TRANSFER.

    Section 5208 (20 U.S.C. 7221g) is amended by inserting ``as quickly 
as possible and'' before ``to the extent practicable''.

SEC. 9. DEFINITIONS.

    Section 5210 (20 U.S.C. 7221i) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (K), by striking ``and'' at the 
                end;
                    (B) in subparagraph (L), by striking the period at 
                the end and inserting ``; and''; and
                    (C) by adding at the end, the following:
                    ``(M) may serve prekindergarten or postsecondary 
                students.'';
            (2) in paragraph (3), by striking ``under section 
        5203(d)(3)''; and
            (3) by adding at the end the following:
            ``(5) Expansion of a high-quality charter school.--The term 
        `expansion of a high-quality charter school' means a high-
        quality charter school that either significantly increases its 
        enrollment or adds one or more grades to its school.
            ``(6) High-quality charter school.--The term `high-quality 
        charter school' means a charter school that--
                    ``(A) shows evidence of strong academic results;
                    ``(B) has no significant issues in the areas of 
                student safety, financial management, or statutory or 
                regulatory compliance;
                    ``(C) has demonstrated success in significantly 
                increasing student academic achievement and attainment 
                for all students served by charter schools; and
                    ``(D) has demonstrated success in increasing 
                student academic achievement for the subgroups of 
                students described in section 1111(b)(2)(C)(v)(II).
            ``(7) Replicable, high-quality charter school model.--The 
        term `replicable, high-quality charter school model' means a 
        high-quality charter school that will open a new campus under 
        an existing charter.''.

SEC. 10. AUTHORIZATION OF APPROPRIATIONS.

    Section 5211 (20 U.S.C. 7221j) is amended to read as follows:

``SEC. 5211. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this subpart 
$300,000,000 for fiscal year 2012 and each of the 5 succeeding fiscal 
years.''.

SEC. 11. CONFORMING AMENDMENTS.

    (a) Repeal.--Subpart 2 of part B of title V (20 U.S.C. 7223 et 
seq.) is repealed.
    (b) Table of Contents.--The table of contents in section 2 is 
amended--
            (1) by striking the item relating to section 5203 and 
        inserting the following:

``Sec. 5203. Grants to support high-quality charter schools.'';
        and
            (2) by striking the item relating to section 5204 and 
        inserting the following:

``Sec. 5204. Facilities financing assistance.''.
                                 <all>