[House Report 112-178]
[From the U.S. Government Publishing Office]
112th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 112-178
======================================================================
EMPOWERING PARENTS THROUGH QUALITY CHARTER SCHOOLS ACT
_______
July 22, 2011.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Hunter, from the Committee on Education and the Workforce,
submitted the following
R E P O R T
together with
ADDITIONAL VIEWS
[To accompany H.R. 2218]
[Including cost estimate of the Congressional Budget Office]
The Committee on Education and the Workforce, to whom was
referred the bill (H.R. 2218) to amend the charter school
program under the Elementary and Secondary Education Act of
1965, having considered the same, report favorably thereon with
an amendment and recommend that the bill as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
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section or other provision is amended or repealed, such amendment or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 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.--This subpart authorizes the Secretary 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) In General.--From the amount reserved under section 5202(b)(3),
the Secretary shall award grants to State entities having applications
approved pursuant to subsection (f) to enable such entities to--
``(1) award subgrants to eligible applicants for--
``(A) opening new charter schools;
``(B) opening replicable, high-quality charter school
models; or
``(C) expanding high-quality charter schools; and
``(2) provide technical assistance to eligible applicants and
authorized public chartering agencies in carrying out the
activities described in paragraph (1) and work with authorized
public chartering agencies in the State to improve authorizing
quality.
``(b) State Uses of Funds.--
``(1) In general.--A State entity receiving a grant under
this section shall--
``(A) use 90 percent of the grant funds to award
subgrants to eligible applicants, in accordance with
the quality charter school program described in the
entity's application approved pursuant to subsection
(f), for the purposes described in subparagraphs (A)
through (C) of subsection (a)(1); and
``(B) reserve 10 percent of such funds to carry out
the activities described in subsection (a)(2), of which
not more than 30 percent may be used for administrative
costs which may include technical assistance.
``(2) Contracts and grants.--A State entity may use a grant
received under this section to carry out the activities
described in subparagraphs (A) and (B) of paragraph (1)
directly or through grants, contracts, or cooperative
agreements.
``(c) Program Periods; Peer Review; Diversity of Projects.--
``(1) Program periods.--
``(A) Grants.--A grant awarded by the Secretary to a
State entity under this section shall be for a period
of not more than 5 years.
``(B) Subgrants.--A subgrant awarded by a State
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 State entity
receiving a grant under this section, shall use a peer review
process to review applications for assistance under this
section.
``(3) Diversity of projects.--Each State entity receiving a
grant under this section shall award subgrants under this
section in a manner that, to the extent possible, 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.
``(d) Limitations.--
``(1) Grants.--A State entity may not receive more than 1
grant under this section for a 5-year period.
``(2) Subgrants.--An eligible applicant may not receive more
than 1 subgrant under this section per charter school for a 5-
year period.
``(e) Applications.--A State 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) Description of program.--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 description--
``(A) of how the entity--
``(i) will support both new charter school
startup and the expansion and replication of
high-quality charter school models;
``(ii) will inform eligible charter schools,
developers, and authorized public chartering
agencies of the availability of funds under the
program;
``(iii) 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;
``(iv) in the case in which the entity is not
a State educational agency--
``(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;
``(v) 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;
``(vi) will support charter schools in local
educational agencies with large numbers of
schools that must comply with the requirements
of section 1116(b);
``(vii) will work with charter schools to
promote inclusion of all students and support
all students once they are enrolled to promote
retention;
``(viii) will work with charter schools on
recruitment practices, including efforts to
engage groups that may otherwise have limited
opportunities to participate in charter
schools;
``(ix) will share best and promising
practices between charter schools and other
public schools;
``(x) will ensure the charter schools they
support can meet the educational needs of their
students, including students with disabilities
and English language learners; and
``(xi) will support efforts to increase
quality initiatives, including meeting the
quality authorizing elements described in
paragraph (2)(E);
``(B) of the extent to which the entity--
``(i) is able to meet and carry out the
priorities listed in subsection (f)(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;
``(C) how the entity will carry out the subgrant
competition, including--
``(i) a description of the application each
eligible applicant desiring to receive a
subgrant will submit, including--
``(I) a description of the roles and
responsibilities of eligible
applicants, partner organizations, and
management organizations, including the
administrative and contractual roles
and responsibilities; and
``(II) 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; and
``(D) 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.--Assurances, including a description of how
the assurances will be met, that--
``(A) each charter school receiving funds under the
entity's program will have a high degree of autonomy
over budget and operations;
``(B) the entity will support charter schools in
meeting the educational needs of their students as
described in paragraph (1)(A)(x);
``(C) 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
with disabilities and English language
learners;
``(D) the entity will provide adequate technical
assistance to eligible applicants to--
``(i) meet the objectives described in
clauses (vii) and (viii) of paragraph (1)(A)
and paragraph (2)(B); and
``(ii) enroll traditionally underserved
students, including students with disabilities
and English language learners, to promote an
inclusive education environment;
``(E) 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; and
``(F) the entity will work to ensure that charter
schools are included with the traditional public school
system in decision-making about the public school
system in the State.
``(3) Requests for waivers.--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.
``(f) Selection Criteria; Priority.--
``(1) Selection criteria.--The Secretary shall award grants
to State entities under this section on the basis of the
quality of the applications submitted under subsection (e),
after taking into consideration--
``(A) the degree of flexibility afforded by the
State's public charter school law and how the entity
will work to maximize the flexibility provided to
charter schools under the law;
``(B) the ambitiousness of the entity's objectives
for the quality charter school program carried out
under this section;
``(C) the quality of the strategy for assessing
achievement of those objectives;
``(D) the likelihood that the eligible applicants
receiving subgrants under the program will meet those
objectives and improve educational results for
students;
``(E) 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;
``(F) the entity's plan to--
``(i) adequately monitor the eligible
applicants receiving subgrants under the
entity's program; and
``(ii) work with the authorized public
chartering agencies involved to avoid
duplication of work for the charter schools and
authorized public chartering agencies;
``(G) the entity's plan to provide adequate technical
assistance, as described in the entity's application
under subsection (e), for the eligible applicants
receiving subgrants under the entity's program under
this section; and
``(H) the entity's plan to support quality
authorizing efforts in the State, consistent with the
objectives described in subparagraph (B).
``(2) Priority.--In awarding grants 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
does not impose any limitation on the number or
percentage of charter schools that may exist or the
number or percentage of students that may attend
charter schools in the State.
``(C) 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.
``(D) The State entity supports full-, blended-, or
hybrid-online charter school models.
``(E) 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.
``(F) 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.
``(G) The State entity demonstrates quality policies
and practices to support and monitor charter schools
through factors, including--
``(i) the proportion of high-quality charter
schools in the State; and
``(ii) the proportion of charter schools
enrolling, at a rate similar to traditional
public schools, traditionally underserved
students, including students with disabilities
and English language learners.
``(g) 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.
``(h) Reporting Requirements.--Each State 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) 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) the progress the entity made toward meeting the
priorities described in subsection (f)(2), as applicable;
``(4) how the entity met the objectives of the quality
charter school program described in the entity's application
under subsection (e);
``(5) how the entity complied with, and ensured that eligible
applicants complied with, the assurances described in the
entity's application; and
``(6) 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.
``(i) State Entity Defined.--For purposes of this section, the term
`State entity' means--
``(1) a State educational agency;
``(2) a State charter school board; or
``(3) a Governor of a State.''.
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 at
least one grant to an eligible entity described in subsection
(a)(2)(A), at least one grant to an eligible entity described
in subsection (a)(2)(B), and at least 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 subsection (f)(1); 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 subsection (f)(1).
``(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) disseminate best practices; 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.--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),
subparagraphs (A) through (C) of section 5203(a)(1), and
section 5203(g).
``(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 to State
entities 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) a State that did not apply for a grant under
section 5203;
``(B) a State that did not receive a grant under
section 5203; or
``(C) a State that received a grant under section
5203 and is in the 4th or 5th 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--
(1) by inserting ``as quickly as possible and'' before ``to
the extent practicable''; and
(2) by striking ``section 602'' and inserting ``section
602(14)''.
SEC. 9. DEFINITIONS.
Section 5210 (20 U.S.C. 7221i) is amended--
(1) in paragraph (1)--
(A) by striking ``and'' at the end of subparagraph
(K);
(B) by striking the period at the end of subparagraph
(L) and inserting ``; and''; and
(C) by adding at the end, the following:
``(M) may serve prekindergarten or post secondary
students.'';
(2) in paragraph (3)(B), by striking ``under section
5203(d)(3)''; and
(3) by inserting 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,
which may include strong academic growth as determined
by a State;
``(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.'';
(2) by striking the item relating to section 5204 and
inserting the following:
``Sec. 5204. Facilities Financing Assistance.''; and
(3) by striking subpart 2 of part B of title V.
Purpose
H.R. 2218, the Empowering Parents through Quality Charter
Schools Act, reauthorizes and modernizes the Charter School
Program under the Elementary and Secondary Education Act. The
bill increases the number of charter schools available to
students and families, ensures charter schools share their best
practices with all public schools, and improves access to
charter schools for all students, including students with
disabilities and English language learners.
Committee Action
This bill is the second in a series of bills designed to
reauthorize the Elementary and Secondary Education Act (ESEA).
H.R. 2218 builds upon the Committee's efforts to examine the
federal investment in education and evaluate elementary and
secondary education programs.
111TH CONGRESS
Hearings
On June 4, 2009, the Committee on Education and Labor held
a hearing entitled, ``Building on What Works at Charter
Schools.'' The purpose of the hearing was to learn how
representatives from the U.S. Department of Education, states,
charter school authorizers, and charter school providers
produce high-quality charter schools and how those programs can
be replicated and brought to scale. Testifying before the
Committee were: The Honorable Barbara O'Brien, Lieutenant
Governor, State of Colorado, Denver, CO; Mr. James Shelton,
Assistant Deputy Secretary for Innovation and Improvement, U.S.
Department of Education, Washington, DC; Mr. Steve Barr,
Founder and Chairman, Green Dot Public Schools, Los Angeles,
CA; Dr. John King, Managing Director, Excellence and
Preparatory Network of Uncommon Schools, New York, NY; Mr.
David Dunn, Executive Director, Texas Charter Schools
Association, Austin, TX; and Mr. James Goenner, Executive
Director, The Center for Charter Schools at Central Michigan
University, Mount Pleasant, MI.
On February 24, 2010, the Committee on Education and Labor
held a hearing on quality charter schools and H.R. 4330, the
All Students Achieving through Reform Act. The purpose of the
hearing was to learn how charter school providers maintain
quality in charter schools, what student populations charter
schools serve, and the importance of keeping charter schools
autonomous. The hearing also focused on H.R. 4430, which
created a new program under the Charter School Program to
provide funding for the expansion and replication of charter
schools. Testifying before the Committee were: Ms. Eva
Moskowitz, Founder, Success Charter Network, New York, NY; Ms.
Robin J. Lake, Associate Director, Center on Reinventing Public
Education, Seattle, WA; Dr. Thomas Hehir, Professor of
Practice, Harvard Graduate School of Education, Cambridge, MA;
Mr. Greg Richmond, President and CEO, National Association of
Charter School Authorizers, Chicago, IL; Ms. Eileen Ahern,
Director, National Association of State Directors of Special
Education, Alexandria, VA; and Dr. Caprice Young, President and
CEO, KC Distance Learning, Portland, OR.
Legislative Action
In H.R. 3288, the FY 2010 Consolidated Appropriations Act,
the Committee on Appropriations provided $256 million for the
Charter School Program and reserved $50 million of those funds
to support the expansion and replication of existing high-
quality charter schools. H.R. 3288 was signed into law on
December 16, 2009.
112TH CONGRESS
Hearings
On April 7, 2011, the Committee on Education and the
Workforce held a hearing entitled, ``Education Reforms:
Promoting Flexibility and Innovation.'' The purpose of the
hearing was to discuss the appropriate federal role in K-12
education and explore the work of state and local education
leaders who are pushing for innovative approaches to education
reform and greater state and local flexibility. Testifying
before the Committee were: Dr. Janet Barresi, Oklahoma State
Superintendent of Public Instruction, Oklahoma City, OK; Dr.
Gary Amoroso, Superintendent, Lakeville Area Public Schools,
Lakeville, MN; Mr. Yohance Maqubela, Chief Operating Officer,
Howard University Middle School of Mathematics and Science,
Washington, DC; and Dr. Terry Grier, Superintendent, Houston
Independent School District, Houston, TX.
On June 1, 2011, the Committee on Education and the
Workforce Subcommittee on Early Childhood, Elementary, and
Secondary Education held a hearing entitled, ``Education
Reforms: Exploring the Vital Role of Charter Schools.'' The
purpose of the hearing was to examine the contributions of
charter schools to state and local efforts to improve public
education and the importance of empowering parents to choose
the best school environment for their children. Specifically,
the hearing looked at: (1) how charter schools serve special
populations, including students with disabilities and English
Language Learners; (2) how charter schools serve the needs of
the local community; and (3) how charter school authorizers
work to improve quality. Testifying before the Subcommittee
were: Ms. DeAnna Rowe, Executive Director, Arizona State Board
for Charter Schools, Phoenix, AZ; Ms. Debbie Beyer, Executive
Director, Literacy First Charter Schools, El Cajon, CA; Dr.
Gary Miron, College of Education, Western Michigan University,
Kalamazoo, MI; and Dr. Beth Purvis, Executive Director, Chicago
International Charter School, Chicago, IL.
Legislative Action
H.R. 1473, the Department of Defense and Full-Year
Continuing Appropriations Act of 2011, included $256 million
for the Charter School Program, and reserved $50 million to
support the expansion and replication of existing high-quality
charter schools. H.R. 1473 was signed into law on April 15,
2011.
On June 16, 2011, Rep. Duncan Hunter (R-CA) and Rep. John
Kline (R-MN) introduced H.R. 2218, the Empowering Parents
through Quality Charter Schools Act. This bill reauthorizes and
improves the existing charter school provisions under the
Elementary and Secondary Education Act. H.R. 2218 is
cosponsored by Rep. George Miller (D-CA), Rep. Tom Petri (R-
WI), Rep. Howard P. ``Buck'' McKeon (R-CA), Rep. Phil Roe (R-
TN), Rep. Trey Gowdy (R-SC), Rep. Larry Bucshon (R-IN), Rep.
Tim Walberg (R-MI), Rep. Scott DesJarlais (R-TN), Rep. Mike
Kelly (R-PA), Rep. Jared Polis (D-CO), Rep. Todd Rokita (R-IN),
and Rep. Ander Crenshaw (R-FL).
The Committee on Education and the Workforce considered
H.R. 2218 in legislative session on June 22, 2011, and reported
it favorably, as amended, to the House of Representatives by a
bipartisan vote of 34-5. The Committee considered and adopted
one amendment to the bill, an Amendment in the Nature of a
Substitute, offered by Rep. Duncan Hunter (R-CA).
This amendment:
Clarifies that charter schools must have autonomy
from state and local policies and practices over their budgets
and operations.
Clarifies language requiring states and charter
school authorizers to provide technical assistance to charter
schools. It provides examples of the factors that charter
school authorizers must look for as they approve and monitor
charter schools in their state.
Adds a priority in the grant application
encouraging states to support quality policies and practices in
monitoring charter schools in their state.
Clarifies that charter schools should be part of
any discussion or decision made about the public school system
in the state.
Adds a provision encouraging charter schools and
traditional public schools to share best practices.
Requires grantees to state they will assist
charter schools in ensuring they support all students in an
inclusive education environment.
Clarifies that the Secretary of Education will
examine student achievement when conducting an evaluation of
the program's effects on participating charter schools.
The Committee received letters of support for H.R. 2218
from the following organizations: The U.S. Chamber of Commerce,
Business Roundtable, Chiefs for Change, Knowledge Is Power
Program (KIPP) Foundation, Council for Exceptional Children,
Charter School Lenders Coalition, Democrats for Education
Reform, National Association for Charter School Authorizers,
National Alliance for Public Charter Schools, National
Association of State Directors of Special Education, New
Schools Venture Fund, the California Charter Schools
Association, and the Texas Charter Schools Association.
Letters of Support
Below is a summary of H.R. 2218:
Summary
H.R. 2218, the Empowering Parents through Quality Charter
Schools Act, streamlines and modernizes the existing charter
school programs under the Elementary and Secondary Education
Act (ESEA) from two provisions to one. The two current programs
are:
The Charter School Program supports grants for
charter school developers to open or start new charter schools.
The program also provides funds to disseminate best practices
and provide state facilities aid to charter schools. The
program was last authorized at $300 million in fiscal year 2002
and such sums as necessary for fiscal year 2003 through 2007.
The Charter School Credit Enhancement Program
assists charter schools in accessing better credit terms to
acquire and renovate facilities to operate a charter school.
The program was last authorized at $150 million in fiscal year
2002 and such sums as necessary for fiscal year 2003.
H.R. 2218 consolidates the two provisions in current law
into one program, refocuses the program to promote charter
schools at the state and local level, and allows states to use
federal funds to start new charter schools and expand and
replicate existing high-quality charter schools. The new
Charter School Program will consist of three parts:
State Quality Charter School Grants will be
awarded to a State Educational Agency, the State Charter School
Board, or the Governor. These grants will support the expansion
and replication of high-quality charter schools, new,
innovative charter school models, and quality initiatives to
improve charter school authorizing.
Facilities Aid will be awarded to continue credit
enhancement activities and support state facilities aid for
charter schools.
National Activities will allow the Secretary of
Education to operate a start-up competition for charter schools
in states that did not win or compete for a State Quality
Charter School Grant, or whose state is in the fourth or fifth
year of the grant. This section also requires the Secretary to
offer technical assistance to eligible grantees that are
interested in applying for the grant and technical assistance
to help grantees properly implement the grant. The Secretary
will also be allowed to disseminate best practices to ensure
all public schools may benefit from the lessons learned from
charter schools. Finally, the Secretary will conduct an
evaluation to examine the effects of the legislation on charter
schools, including student achievement.
H.R. 2218, the Empowering Parents through Quality Charter
Schools Act authorizes the Charter School Program at
$300,000,000 for fiscal year 2012 through 2017. The bill makes
technical corrections to other provisions in the Charter School
Program, including modifying the definition of a charter school
to clarify that a charter school can serve early childhood
students as well as post-secondary students. The legislation
adds three new definitions to the law: a high-quality charter
school; the expansion of a high-quality charter school; and a
replicable, high-quality charter school model.
Committee Views
Background
A public charter school is a publicly funded elementary or
secondary school operated according to the terms of a charter
or contract granted by a public chartering agency. The terms of
a charter typically provide the charter school operator with
increased autonomy in how to operate the school in exchange for
greater accountability for results or student outcomes.
Charters are usually granted for a limited time period,
typically ranging from less than five years to as many as 15
years. In order to retain or renew its charter, a school must
adhere to the accountability requirements written into its
charter and attract enough students to continue functioning as
a viable school.
Charter schools are a state education reform initiative
that began in Minnesota in 1991. The Improving America's
Schools Act of 1994 included support for starting charter
schools. The credit enhancement program, which began in 2001
through the appropriations process, provides grants to eligible
entities to leverage funds through credit enhancement
initiatives to help charter schools leverage other funds to
acquire, construct, renovate, or lease academic facilities.
The first charter school opened in 1992; today, 5,200
charter schools in 39 states and the District of Columbia serve
1.8 million students. Forty states have enacted charter school
laws, giving parents and students an education alternative to
traditional public schools. However, this growth is not enough
to meet the demand. An estimated 420,000 students are on
waitlists to enter charter schools. Charter schools also face
challenges in serving certain populations of students and, in
particular, students with disabilities, including students with
lower incidence disabilities, and English language learners.
Legislative Changes
H.R. 2218, the Empowering Parents through Quality Charter
Schools Act, builds on the success of the charter school
community, improves access for traditionally underserved
populations, supports high-quality charter schools, and
strengthens accountability. Consolidating the two charter
school provisions into one program better focuses support for
all elements important to creating high-quality charter
schools.
The charter school movement has seen robust growth over the
past decade. There are now several examples of high-quality
schools that could receive federal and state support to expand
and replicate their successes. While the Committee on
Appropriations has supported this effort through a reservation
for the Charter School Program appropriation, the Committee
believes it is important to update the authorizing legislation
to ensure states have a role in ensuring thoughtful development
of charter schools in each state. The Empowering Parents
through Quality Charter Schools Act includes the expansion and
replication of high-quality charter schools as an added use of
funds under each State Quality Charter School Grant to support
the start-up of new, innovative charter school models, as well
as the expansion and replication of high-quality charter
schools.
Charter schools receiving funds under this program must
admit their students through a lottery system, as approved by
state law, if the demand for attendance exceeds the available
slots in the schools. The more than 400,000 students on
waitlists demonstrate an intense demand for charter schools. It
is important to assist these schools in reaching all students
who may benefit from the opening or expansion of new charter
schools. But the focus must be on increasing the number of
quality education options for parents, not just increasing the
number of charter schools available. The legislation,
therefore, includes provisions to help grantees reach out to
charter school developers and school leaders to recruit
traditionally underserved students, including students with
disabilities and English language learners; promote inclusion;
and meet the needs of those students.
The Empowering Parents through Quality Charter Schools Act
supports charter schools in serving students with disabilities,
including students with lower incidence disabilities, English
language learners, and other traditionally underserved
students. The legislation recognizes that charter schools need
support in recruiting and serving students with special needs
and includes provisions to help charter schools address those
challenges. The Committee believes the technical assistance and
other provisions required of grantees will help charter schools
recruit, enroll, and serve these students.
When recruiting students, charter schools should ensure
parents have the information they need to make the best
decisions possible for their children. This includes
encouraging parents to examine the academic success of the
school, the teaching philosophy of the school, and the ability
of the school to meet the education needs of any student
admitted to the school. The legislation helps charter schools
avoid application barriers that exclude students based on
socioeconomic status, language proficiency, academic
performance, disability, or parental involvement. The
legislation supports charter schools that promote an inclusive
environment. High-quality charter schools, as defined in the
legislation, raise the achievement of all students, including
students with disabilities, English language learners, and
other traditionally underserved populations.
In modernizing the Charter School Program, H.R. 2218
includes a new provision that reserves 10 percent of each state
grant to support initiatives to improve charter school
authorizing. While a small percentage will be used for state
administrative costs, the majority of the funds will benefit
all charter schools in the state by helping charter school
authorizers identify key indicators of quality, including how
to ensure the school and the authorizer are clear on the goals
and expectations of each party, including helping charter
schools meet their obligations under existing laws and this
Act. The funds will also be used to increase the number of
quality charter schools available for students, not just the
opening of new charter schools, and support access and services
for all students by helping charter schools recruit, enroll,
and meet the needs of students with disabilities, including
students with lower incidence disabilities, and English
language learners.
The bill requires eligible applicants to describe the
quality controls agreed to with their authorizers in their
contract, and the terms of contracts with other organizations.
In the applications, charter schools must describe how their
authorizers evaluate the success of the schools primarily on
the academic achievement of all of their students, as well as
through other performance measures determined by state law, the
authorizer, and the school, as outlined in a legally binding
performance contract. The legislation requires charter schools
to be transparent about contractual relationships with
management organizations. As stipulated in the U.S. Department
of Education nonregulatory guidance for the Charter School
Program, charter schools that receive grants under this program
should avoid conflicts of interest. In promoting quality
authorizing, grantees should support authorizers that ensure
annual, independent financial audits are publicly reported and
easily accessible, such as through posting on the school or
authorizer website. The Committee believes it is important that
authorizers and charter schools have as much flexibility in
complying with these provisions as possible in order to ensure
charter schools can meet the expectations of their respective
authorizers and still operate in an autonomous manner to meet
the goals of the school.
In addition, the Empowering Parents through Quality Charter
Schools Act allows new eligible grantees to compete for funding
under State Quality Charter School Grants and provides more
flexibility in the operation of the state grant competition for
the start-up of charter schools. The bill allows state charter
school boards and governors to apply for state grants, in
addition to the State Educational Agency (SEA), which is
allowed under current law. This expansion of eligible grantees
is meant to ensure that charter schools have an opportunity to
open and expand with the support of a grantee who believes in
the benefit of charter schools and offers the greatest
assistance to those schools that win subgrants. To ensure
grantees are able to meet the requirements of the program, the
legislation allows states to partner with an entity that can
help it operate a quality program that adequately supports the
thoughtful growth of charter schools in the state. While there
may be multiple eligible grantees for each state, the Committee
supports limiting each state to one grant to avoid duplication
in the state and ensure funds reach as many states, and
therefore schools, as possible across the nation.
The new eligible grantees are also required to collaborate
with the State Educational Agency, where appropriate. While
this provision does not give the SEA any authority over the
grantee or program the grantee is running, it should ensure
that the SEA and charter school operators are working together
in a cohesive, statewide system rather than creating parallel
systems. The SEA may help distribute grants to schools, help
the entity run the grant competition, or provide guidance to
support the peer review requirement in the law.
H.R. 2218 includes a clear listing of assurances and
priorities for awarding charter school grants, which will
improve charter schools, improve access to high-quality charter
schools, and expand the availability of high-quality charter
schools as an integral component of state public school
systems. The bill includes an assurance that charter schools
comply with all applicable federal laws--an obligation that
these schools are already required to follow--such as the
Individuals with Disabilities Education Act, section 504 of the
Rehabilitation Act, Title VI of the Civil Rights Act of 1964,
and the other applicable provisions of the Elementary and
Secondary Education Act. This measure ensures state grantees
and the charter schools they support are clear about the
requirements that must be met. The bill also includes an
assurance that grantees will ensure charter schools actively
participate in decisions about the public school system,
providing charter schools, as public schools, the same voice in
decisions that will affect the schools and their students as
traditional public schools. The Committee believes this
important change is an opportunity to share best practices
between all public schools and ensure all schools have an equal
voice in the public school system. An assurance that each
charter school has a high level of autonomy, particularly over
budgets and operations, will also ensure the schools can be
innovative in responding to the needs of the community.
The legislation's priorities will provide an incentive to
states to support more high-quality charter schools that meet
the needs of the local community. Provisions that support the
elimination of caps on students or schools will help get funds
to states that can open new schools. The bill includes a
priority for those states that have more than one statewide
authorizer, or an appeals process if the only local authorizer
is the Local Educational Agency. The Committee believes this
will ensure charter schools are not held hostage to the
traditional public school system that sees charter schools as
competition rather than an enhancement to the public school
system. A priority is also included for those states whose
charter schools serve students with disabilities and other
traditionally underserved students at a similar rate as the
local schools. The Committee believes that states with a high
proportion of charter schools demonstrating this commitment
have created a state environment and the state infrastructure
to help charter schools serve these students.
The Committee believes that reporting requirements are an
important tool for evaluating the success of grantees in
fulfilling the purpose of the program. H.R. 2218 requires
grantees to report to the Secretary of Education at the end of
the third year of the five-year grant period. The information
submitted to the Secretary on the number of students served
during each year of the grant period should be reported by
subgrant, but is not intended to create any increased burdens
for the schools participating in the program.
The legislation consolidates the existing credit
enhancement program and the state facilities aid program to
clarify the law. The direction to reserve 15 percent of the
total appropriated funds ensures there are sufficient funds to
award more than one grant each year under the credit
enhancement program. This program helps charter schools access
credit to obtain or renovate facilities to open the school. The
legislative changes made to this provision increase the
administrative reservation to 2.5 percent of each grant to
ensure the grantee can reach out to, serve, and properly
monitor charter schools assisted under the grant. The bill also
removes the priority of awards under the credit enhancement
program to ensure the best grantees are winning.
The Empowering Parents through Quality Charter Schools Act
updates the national activities portion of the grant to allow
the Secretary of Education to run a competition for charter
schools that want to open in states that did not win or compete
for a state grant, or are in a state that is in the fourth or
fifth year of their grant. This will ensure students are not
left behind in states that have not demonstrated the leadership
to support charter schools or those that have already obligated
their funds under the grant. It is the Committee's expectation
that the Secretary will assess the quality of applicants in the
same manner as in the state competition. The Secretary will
also be required to offer technical assistance to assist
grantees in implementing their grants to maximize the impact of
the funds. The Secretary will also disseminate best practices
to help all public schools benefit from the success of charter
schools. Finally, the Secretary is required to conduct an
evaluation that will measure the effects of the program on
charter schools, including student achievement. A rigorous
evaluation is critical to determining whether the program has
been successful in meeting its purpose of supporting high-
quality charter schools.
Conclusion
H.R. 2218, the Empowering Parents through Quality Charter
Schools Act, modernizes and streamlines the charter school
provisions under the Elementary and Secondary Education Act.
The bill updates the Charter School Program in line with the
charter school landscape to better support high-quality charter
schools. The bill consolidates the current funding streams for
charter schools under one authorization at $300 million to
increase efficiencies within the operation of the program and
better leverage federal funding to improve the program.
Section-by-Section Analysis
Section 1--Short title
States the short title as the ``Empowering Parents through
Quality Charter Schools Act.''
Section 2--References
References the Elementary and Secondary Education Act.
Section 3--Purpose
States the purpose of the Charter School Program.
Section 4--Program authorized
Authorizes the Charter School Program.
Section 5--Grants to support quality charter schools
Specifies the general requirements of state grants to
support the startup or expansion of charter schools. Specifies
the information the Secretary of Education will look for in the
state application, what assurances the grantee will be required
to provide, the criteria the Secretary will use to determine
grant winners, and the priorities for grant awards.
Section 6--Facilities financing assistance
Specifies the general requirements for facilities financing
assistance. Prioritizes credit enhancement activities over
state facilities aid.
Section 7--National activities
Specifies the activities the Secretary of Education will
support under the program, including disseminating best
practices, providing technical assistance, operating a startup
competition, and conducting an evaluation of the program.
Section 8--Records transfer
Modifies the provision to encourage more timely delivery of
records transfer and amends the reference to the Individuals
with Disabilities Education Act.
Section 9--Definitions
Makes a change to the definition of a `charter school' and
adds definitions for `Expansion of a High-Quality Charter
School,' `High-Quality Charter School,' and `Replicable, High-
Quality Charter School Model.'
Section 10--Authorization of appropriations
Authorizes the program at $300 million for fiscal years
2012 through 2017.
Section 11--Conforming amendments
Modifies the Elementary and Secondary Education Act to
address the changes made under this legislation.
Explanation of Amendments
The amendments, including the amendment in the nature of a
substitute, are explained in the body of this report.
Application of Law to the Legislative Branch
Section 102(b)(3) of Public Law 104-1 requires a
description of the application of this bill to the legislative
branch. H.R. 2218 reforms and simplifies the federal charter
schools program within the Elementary and Secondary Education
Act. H.R. 2218 would have no direct impact on the Legislative
Branch.
Unfunded Mandate Statement
Section 423 of the Congressional Budget and Impoundment
Control Act (as amended by Section 101(a)(2) of the Unfunded
Mandates Reform Act, P.L. 104-4) requires a statement of
whether the provisions of the reported bill include unfunded
mandates. This issue is addressed in the CBO letter.
Earmark Statement
H.R. 2218 does not contain any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of House Rule XXI.
Rollcall Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee Report to include for
each record vote on a motion to report the measure or matter
and on any amendments offered to the measure or matter the
total number of votes for and against and the names of the
Members voting for and against.
Statement of General Performance Goals and Objectives
In accordance with clause (3)(c) of House Rule XIII, the
goal of H.R. 2188 is to reform and simplify the federal charter
schools program within the Elementary and Secondary Education
Act. The Committee expects the Department of Education to
comply with these provisions and implement the changes to the
law in accordance with these stated goals.
Statement of Oversight Findings and Recommendations of the Committee
In compliance with clause 3(c)(1) of rule XIII and clause
2(b)(1) of rule X of the Rules of the House of Representatives,
the Committee's oversight findings and recommendations are
reflected in the body of this report.
New Budget Authority and CBO Cost Estimate
With respect to the requirements of clause 3(c)(2) of rule
XIII of the Rules of the House of Representatives and section
308(a) of the Congressional Budget Act of 1974 and with respect
to requirements of clause 3(c)(3) of rule XIII of the Rules of
the House of Representatives and section 402 of the
Congressional Budget Act of 1974, the Committee has received
the following estimate for H.R. 2218 from the Director of the
Congressional Budget Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC, June 30, 2011.
Hon. John Kline,
Chairman, Committee on Education and the Workforce, House of
Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2218, the
Empowering Parents through Quality Charter Schools Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Justin
Humphrey.
Sincerely,
Robert A. Sunshine
(For Douglas W. Elmendorf, Director).
Enclosure.
H.R. 2218--Empowering Parents through Quality Charter Schools Act
H.R. 2218 would amend and reauthorize both the Charter
School Programs and the Credit Enhancement for Charter School
Initiatives under Title V of the Elementary and Secondary
Education Act of 1965 through fiscal year 2017 and combine them
into a single authorization. (That authorization would
automatically be extended by one year through 2018 under the
General Education Provisions Act.) The bill would authorize the
appropriation of $300 million for each of fiscal years 2012
through 2018 for grants to states to develop and expand charter
school facilities and to public and private, nonprofit entities
to develop means of enhancing credit to finance the
construction and renovation of charter schools.
For fiscal year 2011, the Department of Education allocated
$256 million for Charter School Programs and did not allocate
any funding for Credit Enhancement Initiatives. The previous
authorization for Charter School Programs expired in 2008 and
the previous authorization for Credit Enhancement for Charter
School Initiatives expired in 2004.\1\
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\1\For Charter School Programs, prior law authorized the
appropriation of $300 million for fiscal year 2002 and such sums as may
be necessary through fiscal year 2008. For Credit Enhancement for
Charter School Initiatives, prior law authorized the appropriation of
$150 million for fiscal year 2002 and such sums as may be necessary
through fiscal year 2004.
---------------------------------------------------------------------------
As shown in the following table, CBO estimates that
implementing the bill would cost about $1 billion over the
2012-2016 period, assuming appropriation of the authorized
amounts. Additional authorized amounts under H.R. 2218 would be
spent after 2016. The costs of this legislation fall within
budget function 500 (education, training, employment, and
social services). For this estimate, CBO assumes that spending
will follow historical patterns.
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------
2012 2013 2014 2015 2016 2012-2016
----------------------------------------------------------------------------------------------------------------
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Authorization Level..................................... 300 300 300 300 300 1,500
Estimated Outlays....................................... 15 150 255 300 300 1,020
----------------------------------------------------------------------------------------------------------------
Enacting the bill would have no impact on direct spending
or revenues; therefore, pay-as-you-go procedures do not apply.
H.R. 2218 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would impose no costs on state, local, or tribal governments.
State and local entities would benefit from continued federal
grant funding for charter schools. Any costs associated with
receiving such grants would be incurred voluntarily as
conditions of aid.
The CBO staff contact for this estimate is Justin Humphrey.
This estimate was approved by Peter H. Fontaine, Assistant
Director for Budget Analysis.
Committee Cost Estimate
Clause 3(d)(1) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison of the
costs that would be incurred in carrying out H.R. 2218.
However, clause 3(d)(2)(B) of that rule provides that this
requirement does not apply when the Committee has included in
its report a timely submitted cost estimate of the bill
prepared by the Director of the Congressional Budget Office
under section 402 of the Congressional Budget Act.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
ELEMENTARY AND SECONDARY EDUCATION ACT OF 1965
* * * * * * *
SEC. 2. TABLE OF CONTENTS.
The table of contents for this Act is as follows:
* * * * * * *
TITLE V--PROMOTING INFORMED PARENTAL CHOICE AND INNOVATIVE PROGRAMS
* * * * * * *
Part B--Public Charter Schools
subpart 1--charter school programs
* * * * * * *
[Sec. 5203. Applications.
[Sec. 5204. Administration.]
Sec. 5203. Grants to support high-quality charter schools.
Sec. 5204. Facilities Financing Assistance.
* * * * * * *
[subpart 2--credit enhancement initiatives to assist charter school
facility acquisition, construction, and renovation
[Sec. 5221. Purpose.
[Sec. 5222. Grants to eligible entities.
[Sec. 5223. Applications.
[Sec. 5224. Charter school objectives.
[Sec. 5225. Reserve account.
[Sec. 5226. Limitation on administrative costs.
[Sec. 5227. Audits and reports.
[Sec. 5228. No full faith and credit for grantee obligations.
[Sec. 5229. Recovery of funds.
[Sec. 5230. Definitions.
[Sec. 5231. Authorization of appropriations.]
* * * * * * *
TITLE V--PROMOTING INFORMED PARENTAL CHOICE AND INNOVATIVE PROGRAMS
* * * * * * *
PART B--PUBLIC CHARTER SCHOOLS
Subpart 1--Charter School Programs
[SEC. 5201. PURPOSE.
[It is the purpose of this subpart to increase national
understanding of the charter schools model by--
[(1) providing financial assistance for the planning,
program design, and initial implementation of charter
schools;
[(2) evaluating the effects of such schools,
including the effects on students, student academic
achievement, staff, and parents;
[(3) expanding the number of high-quality charter
schools available to students across the Nation; and
[(4) encouraging the 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.
[SEC. 5202. PROGRAM AUTHORIZED.
[(a) In General.--The Secretary may award grants to State
educational agencies having applications approved pursuant to
section 5203 to enable such agencies to conduct a charter
school grant program in accordance with this subpart.
[(b) Special Rule.--If a State educational agency elects not
to participate in the program authorized by this subpart or
does not have an application approved under section 5203, the
Secretary may award a grant to an eligible applicant that
serves such State and has an application approved pursuant to
section 5203(c).
[(c) Program Periods.--
[(1) Grants to states.--Grants awarded to State
educational agencies under this subpart shall be for a
period of not more than 3 years.
[(2) Grants to eligible applicants.--Grants awarded
by the Secretary to eligible applicants or subgrants
awarded by State educational agencies to eligible
applicants under this subpart shall be for a period of
not more than 3 years, of which the eligible applicant
may use--
[(A) not more than 18 months for planning and
program design;
[(B) not more than 2 years for the initial
implementation of a charter school; and
[(C) not more than 2 years to carry out
dissemination activities described in section
5204(f)(6)(B).
[(d) Limitation.--A charter school may not receive--
[(1) more than one grant for activities described in
subparagraphs (A) and (B) of subsection (c)(2); or
[(2) more than one grant for activities under
subparagraph (C) of subsection (c)(2).
[(e) Priority Treatment.--
[(1) In general.--In awarding grants under this
subpart for fiscal year 2002 or any succeeding fiscal
year from any funds appropriated under section 5211
(other than funds reserved to carry out section
5205(b)), the Secretary shall give priority to States
to the extent that the States meet the criteria
described in paragraph (2) and one or more of the
criteria described in subparagraph (A), (B), or (C) of
paragraph (3).
[(2) Review and evaluation priority criteria.--The
criteria referred to in paragraph (1) are that the
State provides for periodic review and evaluation by
the authorized public chartering agency of each charter
school, at least once every 5 years unless required
more frequently by State law, to determine whether the
charter school is meeting the terms of the school's
charter, and is meeting or exceeding the student
academic achievement requirements and goals for charter
schools as set forth under State law or the school's
charter.
[(3) Priority criteria.--The criteria referred to in
paragraph (1) are the following:
[(A) The State has demonstrated progress, in
increasing the number of high-quality charter
schools that are held accountable in the terms
of the schools' charters for meeting clear and
measurable objectives for the educational
progress of the students attending the schools,
in the period prior to the period for which a
State educational agency or eligible applicant
applies for a grant under this subpart.
[(B) The State--
[(i) provides for one authorized
public chartering agency that is not a
local educational agency, such as a
State chartering board, for each
individual or entity seeking to operate
a charter school pursuant to such State
law; or
[(ii) in the case of a State in which
local educational agencies are the only
authorized public chartering agencies,
allows for an appeals process for the
denial of an application for a charter
school.
[(C) The State ensures that each charter
school has a high degree of autonomy over the
charter school's budgets and expenditures.
[(f) Amount Criteria.--In determining the amount of a grant
to be awarded under this subpart to a State educational agency,
the Secretary shall take into consideration the number of
charter schools that are operating, or are approved to open, in
the State.
[SEC. 5203. APPLICATIONS.
[(a) Applications From State Agencies.--Each State
educational agency desiring a grant from the Secretary under
this subpart shall submit to the Secretary an application at
such time, in such manner, and containing or accompanied by
such information as the Secretary may require.
[(b) Contents of a State Educational Agency Application.--
Each application submitted pursuant to subsection (a) shall--
[(1) describe the objectives of the State educational
agency's charter school grant program and a description
of how such objectives will be fulfilled, including
steps taken by the State educational agency to inform
teachers, parents, and communities of the State
educational agency's charter school grant program; and
[(2) describe how the State educational agency--
[(A) will inform each charter school in the
State regarding--
[(i) Federal funds that the charter
school is eligible to receive; and
[(ii) Federal programs in which the
charter school may participate;
[(B) will ensure that each charter school in
the State receives the charter school's
commensurate share of Federal education funds
that are allocated by formula each year,
including during the first year of operation of
the charter school; and
[(C) will disseminate best or promising
practices of charter schools to each local
educational agency in the State; and
[(3) contain assurances that the State educational
agency will require each eligible applicant desiring to
receive a subgrant to submit an application to the
State educational agency containing--
[(A) a description of the educational program
to be implemented by the proposed charter
school, including--
[(i) how the program will enable all
students to meet challenging State
student academic achievement standards;
[(ii) the grade levels or ages of
children to be served; and
[(iii) the curriculum and
instructional practices to be used;
[(B) a description of how the charter school
will be managed;
[(C) a description of--
[(i) the objectives of the charter
school; and
[(ii) the methods by which the
charter school will determine its
progress toward achieving those
objectives;
[(D) a description of the administrative
relationship between the charter school and the
authorized public chartering agency;
[(E) a description of how parents and other
members of the community will be involved in
the planning, program design, and
implementation of the charter school;
[(F) a description of how the authorized
public chartering agency will provide for
continued operation of the school once the
Federal grant has expired, if such agency
determines that the school has met the
objectives described in subparagraph (C)(i);
[(G) a request and justification for waivers
of any Federal statutory or regulatory
provisions that the eligible applicant believes
are necessary for the successful operation of
the charter school, and a description of any
State or local rules, generally applicable to
public schools, that will be waived for, or
otherwise not apply to, the school;
[(H) a description of how the subgrant funds
or grant funds, as appropriate, will be used,
including a description of how such funds will
be used in conjunction with other Federal
programs administered by the Secretary;
[(I) a description of how students in the
community will be--
[(i) informed about the charter
school; and
[(ii) given an equal opportunity to
attend the charter school;
[(J) an assurance that the eligible applicant
will annually provide the Secretary and the
State educational agency such information as
may be required to determine if the charter
school is making satisfactory progress toward
achieving the objectives described in
subparagraph (C)(i);
[(K) an assurance that the eligible applicant
will cooperate with the Secretary and the State
educational agency in evaluating the program
assisted under this subpart;
[(L) a description of how a charter school
that is considered a local educational agency
under State law, or a local educational agency
in which a charter school is located, will
comply with sections 613(a)(5) and 613(e)(1)(B)
of the Individuals with Disabilities Education
Act;
[(M) if the eligible applicant desires to use
subgrant funds for dissemination activities
under section 5202(c)(2)(C), a description of
those activities and how those activities will
involve charter schools and other public
schools, local educational agencies,
developers, and potential developers; and
[(N) such other information and assurances as
the Secretary and the State educational agency
may require.
[(c) Eligible Applicant Application.--Each eligible applicant
desiring a grant pursuant to section 5202(b) shall submit an
application to the Secretary at such time, in such manner, and
accompanied by such information as the Secretary may reasonably
require.
[(d) Contents of Eligible Applicant Application.--Each
application submitted pursuant to subsection (c) shall
contain--
[(1) the information and assurances described in
subparagraphs (A) through (N) of subsection (b)(3),
except that for purposes of this subsection
subparagraphs (J), (K), and (N) of such subsection
shall be applied by striking ``and the State
educational agency'' each place such term appears;
[(2) assurances that the State educational agency--
[(A) will grant, or will obtain, waivers of
State statutory or regulatory requirements; and
[(B) will assist each subgrantee in the State
in receiving a waiver under section 5204(e);
and
[(3) assurances that the eligible applicant has
provided its authorized public chartering authority
timely notice, and a copy, of the application, except
that the State educational agency (or the Secretary, in
the case of an application submitted to the Secretary)
may waive the requirement of this paragraph in the case
of an application for a precharter planning grant or
subgrant if the authorized public chartering authority
to which a charter school proposal will be submitted
has not been determined at the time the grant or
subgrant application is submitted.
[SEC. 5204. ADMINISTRATION.
[(a) Selection Criteria for State Educational Agencies.--The
Secretary shall award grants to State educational agencies
under this subpart on the basis of the quality of the
applications submitted under section 5203(b), after taking into
consideration such factors as--
[(1) the contribution that the charter schools grant
program will make to assisting educationally
disadvantaged and other students in meeting State
academic content standards and State student academic
achievement standards;
[(2) the degree of flexibility afforded by the State
educational agency to charter schools under the State's
charter schools law;
[(3) the ambitiousness of the objectives for the
State charter school grant program;
[(4) the quality of the strategy for assessing
achievement of those objectives;
[(5) the likelihood that the charter school grant
program will meet those objectives and improve
educational results for students;
[(6) the number of high-quality charter schools
created under this subpart in the State; and
[(7) in the case of State educational agencies that
propose to use grant funds to support dissemination
activities under subsection (f)(6)(B), the quality of
those activities and the likelihood that those
activities will improve student academic achievement.
[(b) Selection Criteria for Eligible Applicants.--The
Secretary shall award grants to eligible applicants under this
subpart on the basis of the quality of the applications
submitted under section 5203(c), after taking into
consideration such factors as--
[(1) the quality of the proposed curriculum and
instructional practices;
[(2) the degree of flexibility afforded by the State
educational agency and, if applicable, the local
educational agency to the charter school;
[(3) the extent of community support for the
application;
[(4) the ambitiousness of the objectives for the
charter school;
[(5) the quality of the strategy for assessing
achievement of those objectives;
[(6) the likelihood that the charter school will meet
those objectives and improve educational results for
students; and
[(7) in the case of an eligible applicant that
proposes to use grant funds to support dissemination
activities under subsection (f)(6)(B), the quality of
those activities and the likelihood that those
activities will improve student achievement.
[(c) Peer Review.--The Secretary, and each State educational
agency receiving a grant under this subpart, shall use a peer
review process to review applications for assistance under this
subpart.
[(d) Diversity of Projects.--The Secretary and each State
educational agency receiving a grant under this subpart, shall
award grants and subgrants under this subpart in a manner that,
to the extent possible, ensures that such grants and
subgrants--
[(1) are distributed throughout different areas of
the Nation and each State, including urban and rural
areas; and
[(2) will assist charter schools representing a
variety of educational approaches, such as approaches
designed to reduce school size.
[(e) Waivers.--The Secretary may waive any statutory or
regulatory requirement over which the Secretary exercises
administrative authority except any such requirement relating
to the elements of a charter school described in section
5210(1), if--
[(1) the waiver is requested in an approved
application under this subpart; and
[(2) the Secretary determines that granting such a
waiver will promote the purpose of this subpart.
[(f) Use of Funds.--
[(1) State educational agencies.--Each State
educational agency receiving a grant under this subpart
shall use such grant funds to award subgrants to one or
more eligible applicants in the State to enable such
applicant to plan and implement a charter school in
accordance with this subpart, except that the State
educational agency may reserve not more than 10 percent
of the grant funds to support dissemination activities
described in paragraph (6).
[(2) Eligible applicants.--Each eligible applicant
receiving funds from the Secretary or a State
educational agency shall use such funds to plan and
implement a charter school, or to disseminate
information about the charter school and successful
practices in the charter school, in accordance with
this subpart.
[(3) Allowable activities.--An eligible applicant
receiving a grant or subgrant under this subpart may
use the grant or subgrant funds only for--
[(A) post-award planning and design of the
educational program, which may include--
[(i) refinement of the desired
educational results and of the methods
for measuring progress toward achieving
those results; and
[(ii) professional development of
teachers and other staff who will work
in the charter school; and
[(B) initial implementation of the charter
school, which may include--
[(i) informing the community about
the school;
[(ii) acquiring necessary equipment
and educational materials and supplies;
[(iii) acquiring or developing
curriculum materials; and
[(iv) other initial operational costs
that cannot be met from State or local
sources.
[(4) Administrative expenses.--
[(A) State educational agency administrative
expenses.--Each State educational agency
receiving a grant pursuant to this subpart may
reserve not more than 5 percent of such grant
funds for administrative expenses associated
with the charter school grant program assisted
under this subpart.
[(B) Local administrative expenses.--A local
educational agency may not deduct funds for
administrative fees or expenses from a subgrant
awarded to an eligible applicant, unless the
eligible applicant enters voluntarily into a
mutually agreed upon arrangement for
administrative services with the relevant local
educational agency. Absent such approval, the
local educational agency shall distribute all
such subgrant funds to the eligible applicant
without delay.
[(5) Revolving loan funds.--Each State educational
agency receiving a grant pursuant to this subpart may
reserve not more than 10 percent of the grant funds for
the establishment of a revolving loan fund. Such fund
may be used to make loans to eligible applicants that
have received a subgrant under this subpart, under such
terms as may be determined by the State educational
agency, for the initial operation of the charter school
grant program of the eligible applicant until such time
as the recipient begins receiving ongoing operational
support from State or local financing sources.
[(6) Dissemination.--
[(A) In general.--A charter school may apply
for funds under this subpart, whether or not
the charter school has applied for or received
funds under this subpart for planning, program
design, or implementation, to carry out the
activities described in subparagraph (B) if the
charter school has been in operation for at
least 3 consecutive years and has demonstrated
overall success, including--
[(i) substantial progress in
improving student academic achievement;
[(ii) high levels of parent
satisfaction; and
[(iii) the management and leadership
necessary to overcome initial start-up
problems and establish a thriving,
financially viable charter school.
[(B) Activities.--A charter school described
in subparagraph (A) may use funds reserved
under paragraph (1) to assist other schools in
adapting the charter school's program (or
certain aspects of the charter school's
program), or to disseminate information about
the charter school, through such activities
as--
[(i) assisting other individuals with
the planning and start-up of one or
more new public schools, including
charter schools, that are independent
of the assisting charter school and the
assisting charter school's developers,
and that agree to be held to at least
as high a level of accountability as
the assisting charter school;
[(ii) developing partnerships with
other public schools, including charter
schools, designed to improve student
academic achievement in each of the
schools participating in the
partnership;
[(iii) developing curriculum
materials, assessments, and other
materials that promote increased
student achievement and are based on
successful practices within the
assisting charter school; and
[(iv) conducting evaluations and
developing materials that document the
successful practices of the assisting
charter school and that are designed to
improve student performance in other
schools.
[(g) Tribally Controlled Schools.--Each State that receives a
grant under this subpart and designates a tribally controlled
school as a charter school shall not consider payments to a
school under the Tribally Controlled Schools Act of 1988 (25
U.S.C. 2507) in determining--
[(1) the eligibility of the school to receive any
other Federal, State, or local aid; or
[(2) the amount of such aid.
[SEC. 5205. NATIONAL ACTIVITIES.
[(a) In General.--The Secretary shall reserve for each fiscal
year the greater of 5 percent or $5,000,000 of the amount
appropriated to carry out this subpart, except that in no
fiscal year shall the total amount so reserved exceed
$8,000,000, to carry out the following activities:
[(1) To provide charter schools, either directly or
through State educational agencies, with--
[(A) information regarding--
[(i) Federal funds that charter
schools are eligible to receive; and
[(ii) other Federal programs in which
charter schools may participate; and
[(B) assistance in applying for Federal
education funds that are allocated by formula,
including assistance with filing deadlines and
submission of applications.
[(2) To provide for other evaluations or studies that
include the evaluation of the impact of charter schools
on student academic achievement, including information
regarding--
[(A) students attending charter schools
reported on the basis of race, age, disability,
gender, limited English proficiency, and
previous enrollment in public school; and
[(B) the professional qualifications of
teachers within a charter school and the
turnover of the teaching force.
[(3) To provide--
[(A) information to applicants for assistance
under this subpart;
[(B) assistance to applicants for assistance
under this subpart with the preparation of
applications under section 5203;
[(C) assistance in the planning and startup
of charter schools;
[(D) training and technical assistance to
existing charter schools; and
[(E) for the dissemination to other public
schools of best or promising practices in
charter schools.
[(4) To provide (including through the use of one or
more contracts that use a competitive bidding process)
for the collection of information regarding the
financial resources available to charter schools,
including access to private capital, and to widely
disseminate to charter schools any such relevant
information and model descriptions of successful
programs.
[(5) To carry out evaluations of, technical
assistance for, and information dissemination
regarding, the per-pupil facilities aid programs. In
carrying out the evaluations, the Secretary may carry
out one or more evaluations of State programs assisted
under this subsection, which shall, at a minimum,
address--
[(A) how, and the extent to which, the
programs promote educational equity and
excellence; and
[(B) the extent to which charter schools
supported through the programs are--
[(i) held accountable to the public;
[(ii) effective in improving public
education; and
[(iii) open and accessible to all
students.
[(b) Per-Pupil Facilities Aid Programs.--
[(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 made
available to carry out this subsection under
paragraphs (2) and (3)(B) of section 5211(b)
for any fiscal year, 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.
[(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.
[(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.--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.
[(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.
[(6) Priorities.--In making grants under this
subsection, the Secretary shall give priority to States
that meet the criteria described in paragraph (2), and
subparagraphs (A), (B), and (C) of paragraph (3), of
section 5202(e).
[(c) Rule of Construction.--Nothing in this section shall be
construed to require charter schools to collect any data
described in subsection (a).]
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 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. 5202. PROGRAM AUTHORIZED.
(a) In General.--This subpart authorizes the Secretary 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. 5203. GRANTS TO SUPPORT HIGH-QUALITY CHARTER SCHOOLS.
(a) In General.--From the amount reserved under section
5202(b)(3), the Secretary shall award grants to State entities
having applications approved pursuant to subsection (f) to
enable such entities to--
(1) award subgrants to eligible applicants for--
(A) opening new charter schools;
(B) opening replicable, high-quality charter
school models; or
(C) expanding high-quality charter schools;
and
(2) provide technical assistance to eligible
applicants and authorized public chartering agencies in
carrying out the activities described in paragraph (1)
and work with authorized public chartering agencies in
the State to improve authorizing quality.
(b) State Uses of Funds.--
(1) In general.--A State entity receiving a grant
under this section shall--
(A) use 90 percent of the grant funds to
award subgrants to eligible applicants, in
accordance with the quality charter school
program described in the entity's application
approved pursuant to subsection (f), for the
purposes described in subparagraphs (A) through
(C) of subsection (a)(1); and
(B) reserve 10 percent of such funds to carry
out the activities described in subsection
(a)(2), of which not more than 30 percent may
be used for administrative costs which may
include technical assistance.
(2) Contracts and grants.--A State entity may use a
grant received under this section to carry out the
activities described in subparagraphs (A) and (B) of
paragraph (1) directly or through grants, contracts, or
cooperative agreements.
(c) Program Periods; Peer Review; Diversity of Projects.--
(1) Program periods.--
(A) Grants.--A grant awarded by the Secretary
to a State entity under this section shall be
for a period of not more than 5 years.
(B) Subgrants.--A subgrant awarded by a State
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 State
entity receiving a grant under this section, shall use
a peer review process to review applications for
assistance under this section.
(3) Diversity of projects.--Each State entity
receiving a grant under this section shall award
subgrants under this section in a manner that, to the
extent possible, 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.
(d) Limitations.--
(1) Grants.--A State entity may not receive more than
1 grant under this section for a 5-year period.
(2) Subgrants.--An eligible applicant may not receive
more than 1 subgrant under this section per charter
school for a 5-year period.
(e) Applications.--A State 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) Description of program.--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
description--
(A) of how the entity--
(i) will support both new charter
school startup and the expansion and
replication of high-quality charter
school models;
(ii) will inform eligible charter
schools, developers, and authorized
public chartering agencies of the
availability of funds under the
program;
(iii) 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;
(iv) in the case in which the entity
is not a State educational agency--
(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;
(v) 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;
(vi) will support charter schools in
local educational agencies with large
numbers of schools that must comply
with the requirements of section
1116(b);
(vii) will work with charter schools
to promote inclusion of all students
and support all students once they are
enrolled to promote retention;
(viii) will work with charter schools
on recruitment practices, including
efforts to engage groups that may
otherwise have limited opportunities to
participate in charter schools;
(ix) will share best and promising
practices between charter schools and
other public schools;
(x) will ensure the charter schools
they support can meet the educational
needs of their students, including
students with disabilities and English
language learners; and
(xi) will support efforts to increase
quality initiatives, including meeting
the quality authorizing elements
described in paragraph (2)(E);
(B) of the extent to which the entity--
(i) is able to meet and carry out the
priorities listed in subsection (f)(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;
(C) how the entity will carry out the
subgrant competition, including--
(i) a description of the application
each eligible applicant desiring to
receive a subgrant will submit,
including--
(I) a description of the
roles and responsibilities of
eligible applicants, partner
organizations, and management
organizations, including the
administrative and contractual
roles and responsibilities; and
(II) 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; and
(D) 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.--Assurances, including a description
of how the assurances will be met, that--
(A) each charter school receiving funds under
the entity's program will have a high degree of
autonomy over budget and operations;
(B) the entity will support charter schools
in meeting the educational needs of their
students as described in paragraph (1)(A)(x);
(C) 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 with disabilities
and English language learners;
(D) the entity will provide adequate
technical assistance to eligible applicants
to--
(i) meet the objectives described in
clauses (vii) and (viii) of paragraph
(1)(A) and paragraph (2)(B); and
(ii) enroll traditionally underserved
students, including students with
disabilities and English language
learners, to promote an inclusive
education environment;
(E) 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; and
(F) the entity will work to ensure that
charter schools are included with the
traditional public school system in decision-
making about the public school system in the
State.
(3) Requests for waivers.--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.
(f) Selection Criteria; Priority.--
(1) Selection criteria.--The Secretary shall award
grants to State entities under this section on the
basis of the quality of the applications submitted
under subsection (e), after taking into consideration--
(A) the degree of flexibility afforded by the
State's public charter school law and how the
entity will work to maximize the flexibility
provided to charter schools under the law;
(B) the ambitiousness of the entity's
objectives for the quality charter school
program carried out under this section;
(C) the quality of the strategy for assessing
achievement of those objectives;
(D) the likelihood that the eligible
applicants receiving subgrants under the
program will meet those objectives and improve
educational results for students;
(E) 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;
(F) the entity's plan to--
(i) adequately monitor the eligible
applicants receiving subgrants under
the entity's program; and
(ii) work with the authorized public
chartering agencies involved to avoid
duplication of work for the charter
schools and authorized public
chartering agencies;
(G) the entity's plan to provide adequate
technical assistance, as described in the
entity's application under subsection (e), for
the eligible applicants receiving subgrants
under the entity's program under this section;
and
(H) the entity's plan to support quality
authorizing efforts in the State, consistent
with the objectives described in subparagraph
(B).
(2) Priority.--In awarding grants 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 does not impose any limitation on the
number or percentage of charter schools that
may exist or the number or percentage of
students that may attend charter schools in the
State.
(C) 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.
(D) The State entity supports full-, blended-
, or hybrid-online charter school models.
(E) 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.
(F) 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.
(G) The State entity demonstrates quality
policies and practices to support and monitor
charter schools through factors, including--
(i) the proportion of high-quality
charter schools in the State; and
(ii) the proportion of charter
schools enrolling, at a rate similar to
traditional public schools,
traditionally underserved students,
including students with disabilities
and English language learners.
(g) 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.
(h) Reporting Requirements.--Each State 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) 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) the progress the entity made toward meeting the
priorities described in subsection (f)(2), as
applicable;
(4) how the entity met the objectives of the quality
charter school program described in the entity's
application under subsection (e);
(5) how the entity complied with, and ensured that
eligible applicants complied with, the assurances
described in the entity's application; and
(6) 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.
(i) State Entity Defined.--For purposes of this section, the
term ``State entity'' means--
(1) a State educational agency;
(2) a State charter school board; or
(3) a Governor of a State.
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 at least one grant to an eligible entity
described in subsection (a)(2)(A), at least one grant
to an eligible entity described in subsection
(a)(2)(B), and at least 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 subsection (f)(1); 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 subsection (f)(1).
(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. 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) disseminate best practices; 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.--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), subparagraphs (A) through (C) of
section 5203(a)(1), and section 5203(g).
(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 to State entities 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) a State that did not apply for a grant
under section 5203;
(B) a State that did not receive a grant
under section 5203; or
(C) a State that received a grant under
section 5203 and is in the 4th or 5th 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. 5208. RECORDS TRANSFER.
State educational agencies and local educational agencies, as
quickly as possible and to the extent practicable, shall ensure
that a student's records and, if applicable, a student's
individualized education program as defined in [section 602]
section 602(14) of the Individuals with Disabilities Education
Act, are transferred to a charter school upon the transfer of
the student to the charter school, and to another public school
upon the transfer of the student from a charter school to
another public school, in accordance with applicable State law.
* * * * * * *
SEC. 5210. DEFINITIONS.
In this subpart:
(1) Charter school.--The term ``charter school''
means a public school that--
(A) * * *
* * * * * * *
(K) operates in accordance with State law;
[and]
(L) has a written performance contract with
the authorized public chartering agency in the
State that includes a description of how
student performance will be measured in charter
schools pursuant to State assessments that are
required of other schools and pursuant to any
other assessments mutually agreeable to the
authorized public chartering agency and the
charter school[.]; and
(M) may serve prekindergarten or post
secondary students.
* * * * * * *
(3) Eligible applicant.--The term ``eligible
applicant'' means a developer that has--
(A) * * *
(B) provided adequate and timely notice to
that authority [under section 5203(d)(3)].
* * * * * * *
(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, which may include strong academic
growth as determined by a State;
(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. 5211. AUTHORIZATION OF APPROPRIATIONS.
[(a) In General.--There are authorized to be appropriated to
carry out this subpart $300,000,000 for fiscal year 2002 and
such sums as may be necessary for each of the 5 succeeding
fiscal years.
[(b) Reservation.--From the amount appropriated under
subsection (a) for each fiscal year, the Secretary shall
reserve--
[(1) $200,000,000 to carry out this subpart, other
than section 5205(b); and
[(2) any funds in excess of $200,000,000, that do not
exceed $300,000,000, to carry out section 5205(b); and
[(3)(A) 50 percent of any funds in excess of
$300,000,000 to carry out this subpart, other than
section 5205(b); and
[(B) 50 percent of any funds in excess of
$300,000,000 to carry out section 5205(b).]
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.
[Subpart 2--Credit Enhancement Initiatives To Assist Charter School
Facility Acquisition, Construction, and Renovation
[SEC. 5221. PURPOSE.
[The purpose of this subpart is to provide grants to eligible
entities to permit the eligible entities to demonstrate
innovative credit enhancement initiatives that assist charter
schools to address the cost of acquiring, constructing, and
renovating facilities.
[SEC. 5222. GRANTS TO ELIGIBLE ENTITIES.
[(a) Grants.--The Secretary shall use 100 percent of the
amount available to carry out this subpart to award not less
than three grants to eligible entities that have applications
approved under this subpart 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.
[(b) Grantee Selection.--
[(1) Evaluation of application.--The Secretary shall
evaluate each application submitted under section 5223,
and shall determine whether the application is
sufficient to merit approval.
[(2) Distribution of grants.--The Secretary shall
award at least one grant to an eligible entity
described in section 5230(2)(A), at least one grant to
an eligible entity described in section 5230(2)(B), and
at least one grant to an eligible entity described in
section 5230(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 this subpart 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) Special Rule.--In the event the Secretary determines
that the funds made available under this subpart are
insufficient to permit the Secretary to award not less than
three grants in accordance with subsections (a) through (c),
such three-grant minimum and subsection (b)(2) shall not apply,
and the Secretary may determine the appropriate number of
grants to be awarded in accordance with subsection (c).
[SEC. 5223. APPLICATIONS.
[(a) In General.--To receive a grant under this subpart, an
eligible entity shall submit to the Secretary an application in
such form as the Secretary may reasonably require.
[(b) Contents.--An application submitted under subsection (a)
shall contain--
[(1) a statement identifying the activities proposed
to be undertaken with funds received under this
subpart, 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;
[(2) a description of the involvement of charter
schools in the application's development and the design
of the proposed activities;
[(3) a description of the eligible entity's expertise
in capital market financing;
[(4) 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;
[(5) 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;
[(6) 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;
and
[(7) such other information as the Secretary may
reasonably require.
[SEC. 5224. CHARTER SCHOOL OBJECTIVES.
[An eligible entity receiving a grant under this subpart
shall use the funds deposited in the reserve account
established under section 5225(a) 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, or the
renovation, repair, or alteration of existing
facilities, necessary to commence or continue the
operation of a charter school.
[SEC. 5225. RESERVE ACCOUNT.
[(a) Use of Funds.--To assist charter schools to accomplish
the objectives described in section 5224, an eligible entity
receiving a grant under this subpart shall, in accordance with
State and local law, directly or indirectly, alone or in
collaboration with others, deposit the funds received under
this subpart (other than funds used for administrative costs in
accordance with section 5226) 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:
[(1) Guaranteeing, insuring, and reinsuring bonds,
notes, evidences of debt, loans, and interests therein,
the proceeds of which are used for an objective
described in section 5224.
[(2) Guaranteeing and insuring leases of personal and
real property for an objective described in section
5224.
[(3) 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.
[(4) 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).
[(b) Investment.--Funds received under this subpart and
deposited in the reserve account established under subsection
(a) shall be invested in obligations issued or guaranteed by
the United States or a State, or in other similarly low-risk
securities.
[(c) Reinvestment of Earnings.--Any earnings on funds
received under this subpart shall be deposited in the reserve
account established under subsection (a) and used in accordance
with such subsection.
[SEC. 5226. LIMITATION ON ADMINISTRATIVE COSTS.
[An eligible entity may use not more than 0.25 percent of the
funds received under this subpart for the administrative costs
of carrying out its responsibilities under this subpart.
[SEC. 5227. AUDITS AND REPORTS.
[(a) Financial Record Maintenance and Audit.--The financial
records of each eligible entity receiving a grant under this
subpart shall be maintained in accordance with generally
accepted accounting principles and shall be subject to an
annual audit by an independent public accountant.
[(b) Reports.--
[(1) Grantee annual reports.--Each eligible entity
receiving a grant under this subpart annually shall
submit to the Secretary a report of its operations and
activities under this subpart.
[(2) Contents.--Each annual report submitted under
paragraph (1) shall include--
[(A) 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;
[(B) a copy of any report made on an audit of
the financial records of the eligible entity
that was conducted under subsection (a) during
the reporting period;
[(C) an evaluation by the eligible entity of
the effectiveness of its use of the Federal
funds provided under this subpart in leveraging
private funds;
[(D) a listing and description of the charter
schools served during the reporting period;
[(E) a description of the activities carried
out by the eligible entity to assist charter
schools in meeting the objectives set forth in
section 5224; and
[(F) a description of the characteristics of
lenders and other financial institutions
participating in the activities undertaken by
the eligible entity under this subpart during
the reporting period.
[(3) Secretarial report.--The Secretary shall review
the reports submitted under paragraph (1) and shall
provide a comprehensive annual report to Congress on
the activities conducted under this subpart.
[SEC. 5228. NO FULL FAITH AND CREDIT FOR GRANTEE OBLIGATIONS.
[No financial obligation of an eligible entity entered into
pursuant to this subpart (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 subpart.
[SEC. 5229. RECOVERY OF FUNDS.
[(a) In General.--The Secretary, in accordance with chapter
37 of title 31, United States Code, shall collect--
[(1) all of the funds in a reserve account
established by an eligible entity under section 5225(a)
if the Secretary determines, not earlier than 2 years
after the date on which the eligible entity first
received funds under this subpart, that the eligible
entity has failed to make substantial progress in
carrying out the purposes described in section 5225(a);
or
[(2) all or a portion of the funds in a reserve
account established by an eligible entity under section
5225(a) 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 section 5225(a).
[(b) Exercise of Authority.--The Secretary shall not exercise
the authority provided in subsection (a) to collect from any
eligible entity any funds that are being properly used to
achieve one or more of the purposes described in section
5225(a).
[(c) Procedures.--The provisions of sections 451, 452, and
458 of the General Education Provisions Act shall apply to the
recovery of funds under subsection (a).
[(d) Construction.--This section 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.
[SEC. 5230. DEFINITIONS.
[In this subpart:
[(1) Charter school.--The term ``charter school'' has
the meaning given such term in section 5210.
[(2) Eligible entity.--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).
[SEC. 5231. AUTHORIZATION OF APPROPRIATIONS.
[For the purpose of carrying out this subpart, there are
authorized to be appropriated $150,000,000 for fiscal year 2002
and such sums as may be necessary for fiscal year 2003.]
* * * * * * *
ADDITIONAL VIEWS
I appreciate the bipartisan efforts of the Committee to
work together on the Empowering Parents through Quality Charter
School Act (H.R. 2118). However, I have strong concerns that
H.R. 2218 does not do nearly enough to advance our goal of
providing equal, high-quality education for all students.
For example, I believe this legislation failed to
adequately address serving students with disabilities and
language barriers, proper oversight and monitoring, increased
transparency and disclosure, as well as understanding funding
streams that function within the charter school program.
I am troubled by the research that shows only a very small
proportion of charter schools have similar demographic
compositions as the local districts they serve.\1\
Additionally, I am concerned of increasing reports that charter
schools are using tests as a condition of admissions,
placement, or grade promotion tests, which have implications
for the access and persistence of certain types of students,
especially students with disabilities and English language
learners.\2\
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\1\Miron, G., Urschel, J. L., Mathis, W, J., & Tornquist, E.
(2010). Schools without Diversity: Education Management Organizations,
Charter Schools and the Demographic Stratification of the American
School System. Boulder and Tempe: Education and the Public Interest
Center & Education Policy Research Unit. Available from http://
epicpolicy.org/publication/schools-without-diversity
\2\Miron, G., Urschel, J.L., & Saxton, N. (2011). What makes KIPP
work? A study of student characteristics, attrition, and school
finance. New York, NY: National Center for the Study of Privatization
in Education, Teachers College, Columbia University: http://ncspe.org/
publications files/OP195 3.pdf; O'Brien, T., Hupfeld, K., & Teske, P.
(2008). Challenges and Charter Schools: How Families with Special-Needs
Students Perceive and Use Charter School Options. Seattle, WA: National
Charter Research Project at the Center on Reinventing Public Education,
University of Washington
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Further, as charter schools become a more prominent
component of the public school system, and in the context of
the accountability provisions under No Child Left Behind, the
effectiveness of the public chartering agencies (authorizers)
that license, monitor and evaluate charter schools has become
increasingly important. Nevertheless, many authorizers lack
oversight and resources. Charter contracts are often vague,
incomplete and not based in measurable outcomes.\3\
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\3\U.S. Department of Education. (2010) Supporting Charter School
Excellence Through Quality Authorizing: http://
www.charterschoolcenter.orgresource/supporting-charter-school-
excellence-through-quality-authorizing0
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Finally, charter schools have veered away from their
original purpose and are primarily serving to divide limited
public resources across parallel systems that perform at
similar levels and suffer from similar breaches in
accountability.\4\ Many states allow private schools to convert
to public charter schools, and the proportion of charter
schools operated by a private management organization is
increasing.
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\4\Testimony of Gary Miron. (2011). Education Reforms: Exploring
the Vital Role of Charter Schools. Washington, DC.
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I believe more must be done to ensure charter schools
operate as part of the public school system and support
district wide collaborative approaches that improve educational
options for all students.
In conclusion, I believe that the role of the federal
government is to ensure that all public school students have
equal access to high-quality education and H.R. 2118 falls
short of that goal.
John F. Tierney.