2016 -- S 2739

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2016

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A N   A C T

RELATING TO EDUCATION - FUNDING OF CHARTER PUBLIC SCHOOLS

     Introduced By: Senators Pearson, Satchell, Picard, Miller, and Lombardi

     Date Introduced: March 10, 2016

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 16-7.2-4 and 16-7.2-5 of the General Laws in Chapter 16-7.2

entitled "The Education Equity and Property Tax Relief Act" are hereby amended to read as

follows:

     16-7.2-4. Determination of state's share. -- (a) For each district, the state's share of the

foundation education aid calculated pursuant to § 16-7.2-3(a) shall use a calculation that

considers a district's revenue generating capacity and concentration of high-need students. The

calculation is the square root of the sum of the state share ratio for the community calculation

(SSRC), pursuant to § 16-7-20, squared plus the district's percentage of students eligible for

USDA reimbursable school meals in grades PK-6 (PK6FRPL) squared, divided by two.

      (b) For purposes of determining the state's share, school district student data used in this

calculation shall include charter school and state school students. These ratios are used in the

permanent foundation education aid formula calculation described in § 16-7.2-5. Provided,

effective July 1, 2016, the state shall fund mayoral academies for both state and local shares,

pursuant to the provisions of this chapter.

     16-7.2-5. Charter public schools, the William M. Davies, Jr. Career and Technical

High School, and the Metropolitan Regional Career and Technical Center. -- (a) Charter

public schools defined in chapter 77 of this title, the William M. Davies, Jr. Career and Technical

High School (Davies) and the Metropolitan Regional Career and Technical Center (the Met

Center) shall be funded pursuant to § 16-7.2-3, except as provided for in subsections (c),(d), and

(e) of this section. If the October 1 actual enrollment data for any charter public school shows a

ten percent (10%) or greater change from the prior year enrollment which is used as the reference

year average daily membership, the third and fourth quarter payments to the charter public school

will be adjusted to reflect actual enrollment. The state share of the permanent foundation

education aid shall be paid by the state directly to the charter public schools, Davies, and the Met

Center pursuant to § 16-7.2-9 and shall be calculated using the state share ratio of the district of

residence of the student as set forth in § 16-7.2-4. The department of elementary and secondary

education shall provide the general assembly with the calculation of the state share of permanent

foundation education aid for charter public schools delineated by school district. The department

shall also provide the general assembly a performance dashboard indicating the per-pupil

expenditures of each school district and charter school broken down by revenue sources and

expenditure categories. The department shall provide, within the same dashboard, student

performance indicators for each school district or charter school. The local share of education

funding, as defined by the department of elementary and secondary education and approved by

the General Assembly, shall be paid to the charter public school, Davies, and the Met Center by

the district of residence of the student and shall be the local per-pupil cost calculated by dividing

the local appropriation to education from property taxes, net of debt service and capital projects,

as defined in the uniform chart of accounts by the average daily membership for each city and

town, pursuant to § 16-7-22, for the reference year.

      (b) Local district payments to charter public schools, Davies, and the Met Center for

each district's students enrolled in these schools shall be made on a quarterly basis in July,

October, January and April; however, the first local district payment shall be made by August 15

instead of July. Failure of the community to make the local district payment for its student(s)

enrolled in a charter public school, Davies, and/or the Met Center may result in the withholding

of state education aid pursuant to § 16-7-31.

     (c) Effective July 1, 2016, the state shall fund the state and local share for all mayoral

academies as calculated under §§16-7.2-3, 16-7.2-4, and 16-7.2-5. The local share shall be paid

by the state, not the sending district.

     (d) Charter public schools other than mayoral academies, including district and

independent charter public schools, which are in existence as of July 1, 2016, shall continue to be

funded pursuant to the provisions of this section, but in the event such charter public schools seek

to expand beyond what has already been approved by the board of education, the council on

elementary and secondary education, or a successor to such entities, then such expansion shall be

subject to the provisions of subsection (e) of this section.

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     (e) As to any proposed new charter public school or any existing charter public school

which is seeking to expand at any time after July 1, 2016, such schools shall be funded either in

full by the state or by the state paying its share pursuant to §16-7.2-4 and the sending district(s)

paying the local share calculated pursuant to §16-7.2-5(a). The department of elementary and

secondary education shall establish a dual pathway application process for such proposed charter

public schools. Provided:

     (i) A proposed new charter public school or an existing charter public school seeking to

expand which seeks funding in full from the state shall need the approval of the commissioner of

education, the council on elementary and secondary education, and the general assembly in order

to open or expand; and

     (ii) A proposed new charter public school or an existing charter public school seeking to

expand which seeks funding from both the state and the local sending district(s) shall require the

approval of the commissioner of education, the council on elementary and secondary education,

and the city or town council of each of the local sending districts identified in the school's

application or proposal, in order to open or expand.

     SECTION 2. Chapter 16-7.2 of the General Laws entitled "The Education Equity and

Property Tax Relief Act" is hereby amended by adding thereto the following sections:

     16-7.2-11. Municipal core instruction fund. -- (a) Findings.

     (1) Core education spending includes teachers’ salaries, textbooks, and programming,

and other elements required as part of the state’s basic education program.

     (2) Non-core education spending includes a variety of services ancillary to but necessary

to the operation of a public school system and include elements such as, but not limited to, food

service, busing, maintenance, and charter school tuitions.

     (3) The general assembly recognizes that when faced with financial and other mounting

pressures by the increasing cost of high-quality public education, some communities have not met

their share of both core education and non-core educational spending.

     (b) Establishment of municipal education incentive fund. The general assembly hereby

establishes the municipal education incentive fund, hereinafter referred to in this chapter as the

"incentive fund," to improve the ability of cities and towns to support core instructional activities

through local expenditures, while also ensuring that local education agencies ("LEAs") are

limiting the amounts they spend on non-core expenses.

     16-7.2-12. Operation of fund. -- (a) As used herein, the term "eligible school district or

LEA" means a school district or local education agency which receives funds through the state

funding formula established in §16-7.2-3.

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     (b) Eligible school districts and LEAs shall receive:

     (1) One dollar ($1.00) in aid for each dollar by which the municipality increases its local

contribution to its local share of the total foundation education in excess of the amount expended

in the immediately preceding fiscal year, provided the municipality is currently underfunding the

local share of the core amount; and

     (2) One dollar ($1.00) in aid for each dollar reduction in non-core expenditures the

district or LEA makes in comparison to the amount expended in the immediately preceding fiscal

year.

     (c) The department of elementary and secondary education (the "department") shall

prorate the funds available for distribution among those eligible school districts if the total

eligible adjustments for which school districts and LEAs are seeking reimbursement exceed the

amount of funding available in any fiscal year.

     (d) The department shall promulgate rules and regulations to implement the provisions of

this section.

     SECTION 3. Section 16-77-5.1 of the General Laws in Chapter 16-77 entitled

"Establishment of Charter Public Schools [See Title 16 Chapter 97 - The Rhode Island Board of

Education Act]" is hereby amended to read as follows:

     16-77-5.1. Oversight by commissioner. -- (a) Individuals or groups may complain to a

charter public school's governing body concerning any claimed violation of the provisions of this

chapter by the school. If, after presenting their complaint to the governing body, the individuals

or groups believe their complaint has not been adequately addressed, they may submit their

complaint to the commissioner who shall hear and decide the issue pursuant to §§ 16-39-1 and

16-39-2. Provided, the term "charter public schools" as used herein means and includes district

charter schools, independent charter schools, or mayoral academies, as defined by §16-77-2.1.

      (b) Charter public school approval for establishment or continuation shall be for up to a

five (5) year period. In either case, board of regents approval of the council on elementary and

secondary education is required. However, the charter may be revoked at any time if the school:

      (1) Materially violates provisions contained in the charter;

      (2) Fails to meet or pursue the educational objectives contained in the charter;

      (3) Fails to comply with fiscal accountability procedures as specified in the charter;

      (4) Violates provisions of law that have not been granted variance by the board of

regents; or

      (5) After three (3) consecutive years of operation, is not a "high-performing charter

school," defined as a charter public school that has demonstrated overall success, including: (i)

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Substantial progress in improving student achievement; and (ii) The management and leadership

necessary to establish a thriving, financially viable charter public school.

      (c) After denying or prior to non-renewing or revoking a charter, the department of

elementary and secondary education will hold a hearing on the issues in controversy under § 16-

39-1.

      (d) The establishment of new charter public schools or the expansion of existing charter

public schools, which establishment or expansion has not been approved prior to (the effective

date of this act), shall be contingent upon state approval and appropriation. subject to a dual-path

application process as follows:

     (i) A proposed new charter public school or an existing charter public school seeking to

expand which seeks funding in full from the state shall need the approval of the commissioner of

education, the council on elementary and secondary education, and the general assembly in order

to open or expand; and

     (ii) A proposed new charter public school or an existing charter public school seeking to

expand which seeks funding from both the state and the local sending district(s) shall require the

approval of the commissioner of education, the council on elementary and secondary education,

and the city or town council of each of the local sending districts identified in the school's

application or proposal, in order to open or expand.

     (e) On and after July 1, 2016, any new charter public school or any proposed expansion

of an existing charter public school shall need to receive final approval from the council on

elementary and secondary education on or before May 15 in order to be eligible for state

education aid, provided pursuant to chapter 7.2 of title 16 ("the education equity and property tax

relief act") for the new school or the expanded school, in the subsequent fiscal year.

     SECTION 4. Sections 16-77.4-2, 16-77.4-3 and 16-77.4-5 of the General Laws in

Chapter 16-77.4 entitled "Mayoral Academies [See Title 16 Chapter 97 - The Rhode Island Board

of Education Act]" are hereby amended to read as follows:

     16-77.4-2. Procedure for creation of a mayoral academy. -- (a) Any persons or entities

eligible to establish a mayoral academy may submit a proposed charter to the commissioner. The

proposed charter shall:

      (1) Be submitted to the commissioner no later than December 1st of the school year

before the school year in which the mayoral academy is to be established;

      (2) Describe a plan for education, including the mission, objective, method of providing

a basic education, measurable student academic goals that the mayoral academy will meet, and

process for improving student learning and fulfilling the charter and fulfilling state and national

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educational goals and standards;

      (3) Provide a minimum of one hundred eighty (180) days of instruction to students per

year;

      (4) Indicate performance criteria that will be used to measure student learning and to

comply with the charter, state, and national educational goals and standards;

      (5) Include an agreement to provide a yearly report to parents, the community, the school

committee of the sending districts, and the commissioner, which indicates the progress made by

the mayoral academy during the previous year in meeting the charter objectives;

      (6) Present a plan for the governance, administration, and operation of the mayoral

academy, including the manner in which the governing board of the school will be chosen, the

nature and extent of parental, professional educator, and community involvement in the

governance and operation of the mayoral academy, and the means of ensuring accountability to

the commissioner, the sending school district(s), and the board of regents;

      (7) Identify the building that will house the mayoral academy and from whom and under

what terms and conditions it is to be provided;

      (8) Describe what support services will be provided by the sending school district(s) and

under what terms and conditions those services are to be provided, and describe what support

services the mayoral academy will obtain directly from third parties and, to the extent known,

under what terms and conditions those services are to be provided;

      (9) Explain the procedures that will be followed to ensure the health and safety of pupils

and staff;

      (10) Describe enrollment procedures including the permissible criteria for admission in

accordance with applicable state and federal law, along with a policy or policies that outline

outreach and recruitment programs to encourage the enrollment of a diverse student population;

      (11) Explain the student discipline procedures;

      (12) Explain the relationship that will exist between the proposed mayoral academy and

its employees, including the terms and conditions of employment and the qualifications that the

employees must meet. Teachers and administrators in mayoral academies must be certified

pursuant to state law and regulation.

      (13) Each mayoral academy established pursuant to this chapter may, by written notice

to the commissioner of elementary and secondary education, elect to have this subsection apply

(or not apply) to its teachers, administrators, and employees:

      (i) Teachers and administrators in a mayoral academy shall be entitled to prevailing

wages and benefits as enjoyed by other public school teachers and administrators;

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      (ii) Teachers and administrators in a mayoral academy shall be entitled to participate in

the state teachers' retirement system under chapter 8 of title 36;

      (iii) Employment in a mayoral academy shall be considered "service" as that term is

defined in chapter 16 of this title.

      (14) Identify with particularity the state laws, state regulations, and school district rules

from which variances are sought in order to facilitate operation of the mayoral academy. Explain

the reasons for each variance and the alternative method by which the concern that gave rise to

the regulation or provision will be addressed;

      (15) Provide a financial plan including a proposed budget for the term of the charter, and

an annual audit of the financial and administrative operations of the mayoral academy, and the

manner in which the funds allocated to the mayoral academy will be managed and disbursed;

      (16) Provide procedures by which teaching personnel and parents can legally challenge

decisions of the governing board of the mayoral academy which do not conform to the mayoral

academy's charter; and

      (17) Provide a copy of the proposed bylaws of the mayoral academy.; and

      (18) Provide a fiscal impact statement which details the anticipated fiscal impact of the

mayoral academy on the state budget if the mayoral academy is permitted to operate and grows to

its highest projected enrollment for the five (5) year period following approval.

     16-77.4-3. Process for consideration of proposed charter. -- (a) If the commissioner

finds the proposed charter to be incomplete, further information may be requested and required.

The commissioner shall develop regulations for amending an approved charter, consistent with

the provisions of this chapter.

      (b) After having received a satisfactory proposed charter, the commissioner will provide

for a public comment period of not less than sixty (60) days, during which they will hold at least

two (2) public hearings on the proposed charter. These hearings will be held in the district where

the proposed mayoral academy is to be located. Any person may file with the committee and/or

the commissioner comments, recommendations, and/or objections relevant to the granting of a

charter.

      (c) The commissioner will decide whether to recommend the granting of the charter to

the board of regents within ninety (90) days after the conclusion of the public comment period.

      (d) If the commissioner recommends the granting of the proposed charter, the matter

shall be referred to the board of regents council on elementary and secondary education

(hereinafter referred to as the "council") for a decision on whether to grant a charter. The board of

regents council may grant a charter for a period of up to five (5) years. In making its decision, the

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council shall consider among its deliberations the fiscal impact of the school on the state's

finances and budget. The decision of the board of regents, council, complete with reasons and

conditions, shall be made available to the public and to the applicant. Charter public school

approval for establishment or continuation shall be for up to a five (5) year period. At the

conclusion of each five (5) year period, the board of regents council may conduct a subsequent

review of the mayoral academy's charter. If the board of regents council does not conduct such a

review, the charter shall renew for another five (5) year period. The commissioner, with approval

of the board of regents council, shall promulgate rules and regulations for these five (5) year

reviews.

      (e) The commissioner, with the approval of the board of regents council, may grant a

variance to any provision of title 16 other than those enumerated in § 16-77.4-7 and to any

department of education regulation and to any school district regulation which does not affect the

health and safety or civil rights of pupils in a mayoral academy.

      (f) All proposed charters shall be matters of public record and will be provided to

members of the public upon request.

     16-77.4-5. Budgets and funding. -- (a) It is the intent of the general assembly that

funding pursuant to this chapter shall be neither a financial incentive nor a financial disincentive

to the establishment of a mayoral academy. Funding for each mayoral academy shall consist of

state revenue and municipal or district revenue in the same proportions that funding is provided

for other schools within the sending school district(s). Provided, effective July 1, 2016, the state

of Rhode Island shall assume all funding of charter public schools pursuant to §16-7.2-5.

      (b) The amount of funding which shall be allocated to the mayoral academy by the

sending school district(s) shall be equal to a percentage of the total budgeted expenses of the

sending school district(s) which is determined by dividing the number of students enrolled in the

mayoral academy by the total resident average daily number of students in the sending school

district(s). Provided, effective July 1, 2016, the state of Rhode Island shall assume all funding of

charter public schools pursuant to §16-7.2-5, and the local school district shall have no obligation

to provided funding to a mayoral academy.

     (c) Funding additional to that authorized from the sending school district(s) by subsection

(b) may be allocated to the mayoral academy from the sending school district(s) to the extent that

the combined percentage of students eligible for free or reduced cost lunch, students with limited

English proficiency, and students requiring special education exceed the combined percentage of

those students in the sending school district(s) as a whole. The commissioner shall promulgate

rules and regulations consistent with this section regarding the allocation of funds from sending

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school districts to mayoral academies. Provided, effective July 1, 2016, the state of Rhode Island

shall assume all funding of charter public schools pursuant to §16-7.2-5.

      (d) A mayoral academy shall be eligible to receive other aids, grants, Medicaid revenue,

and other revenue according to Rhode Island law, as though it were a school district. Federal aid

received by the state shall be used to benefit students in a mayoral academy, if the school

qualifies for the aid, as though it were a school district.

      (e) A mayoral academy may negotiate and contract directly with third parties for the

purchase of books, instructional materials, and any other goods and services. which are not being

provided by the sending school district(s) pursuant to the charter.

      (f) Any career/technical charter public school enrolling special education students from

outside school districts with verifiable individual education program (IEP) designations shall

receive from the sending school district(s) the average per pupil special education cost of the

sending district(s), in accordance with standards established by the Rhode Island department of

elementary and secondary education.

     SECTION 5. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO EDUCATION - FUNDING OF CHARTER PUBLIC SCHOOLS

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     This act would: (1) Provide that mayoral academies would be funded in full by the state

for both core and non-core expenditures; (2) Provide a dual-path application process for charter

schools other than mayoral academies to be funded either in full by the state, or by both local

communities and the state; (3) Require applicants for mayoral academies to provide a fiscal

impact statement which details the anticipated fiscal impact of the mayoral academy on the state

budget if the mayoral academy is permitted to operate and grows to its highest projected

enrollment for the five year period following approval; (4) Establish a municipal core instruction

fund to improve the ability of cities and towns to support core instructional activities through

local expenditures; and (5) Provide that local city and town councils would have the opportunity

to approve applications for new charter public schools or the expansion of charter public schools

in their communities if the charter public schools are seeking to be funded by the local

communities.

     This act would take effect upon passage.

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