Charter Schools

House Bill 2295: An act relating to charter schools

Passed Legislature - 2004 Regular Session

Be it enacted by the legislature of the state of Washington:

{+ NEW SECTION. +} Sec. 1. INTENT. The legislature intends toauthorize the establishment of public charter schools within the general anduniform system of public schools for the primary purpose of providing morehigh-quality learning environments to assist educationally disadvantagedstudents and other students in meeting the state's academic standards. Thelegislature intends for charter schools to function as an integral element ofthe public school system maintained at public expense, free fromdiscrimination, and open to all students in the state, and to be subject tothe same or greater academic standards and performance outcomes as otherpublic schools. The legislature intends to encourage school districts toconsider using the chartering process as an optional tool to achieve stateand federal academic accountability goals. The legislature finds that inaddition to providing more high-quality public school choices for families,teachers, and students, public charter schools may be a tool to improveschools in which significant numbers of students persistently fail to meetstate or federal standards. The legislature also intends to authorize theuse of the chartering process as a state intervention strategy, consistentwith the provisions of the federal no child left behind act of 2001, toprovide assistance to schools in which significant numbers of studentspersistently fail to meet state and federal standards. The legislature alsointends to ensure accountability of charter schools through the use ofperformance audits and a comprehensive study of charter schools, and to usethe information generated to demonstrate how charter schools can contributeto existing education reform efforts focused on raising student academicachievement.

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{+ NEW SECTION. +} Sec. 2. DEFINITIONS. The definitions in thissection apply throughout this chapter unless the context clearly requiresotherwise. (1) "Alternate sponsor" means: (a) The board of directors of aneducational service district that has agreed to assume the rights andresponsibilities of an alternate sponsor and to implement and administer acharter approved by the superintendent of public instruction under section 7of this act; or (b) the superintendent of public instruction if thesuperintendent has approved a charter under section 7 of this act. (2) "Applicant" means a nonprofit corporation that has submitted anapplication to a sponsor or has filed an appeal with the superintendent ofpublic instruction to obtain approval to operate a charter school. Thenonprofit corporation must be either a public benefit nonprofit corporationas defined in RCW 24.03.490, or a nonprofit corporation as defined in RCW24.03.005 that has applied for tax-exempt status under section 501(c)(3) ofthe internal revenue code of 1986 (26 U.S.C. Sec. 501(c)(3)). The nonprofitcorporation may not be a sectarian or religious organization and must meetall of the requirements for a public benefit nonprofit corporation beforereceiving any funding under section 12 of this act. (3) "Charter school board" means the board of directors appointed orelected by the applicant to manage and operate the charter school, and mayinclude one member of the local school district board of directors who mayserve as an ex officio member. (4) "Charter" means a five-year contract between an applicant and asponsor or an alternate sponsor. The charter establishes, in accordance withthis chapter, the terms and conditions for the management, operation, andeducational program of the charter school. (5) "Charter school" means a public school managed by a charter schoolboard and operating according to the terms of a charter approved under thischapter and includes a new charter school and a conversion charter school. (6) "Conversion charter school" means a charter school created byconverting an existing public school in its entirety to a charter schoolunder this chapter. (7) "Educationally disadvantaged students" includes students withlimited English proficiency; students with special needs, including studentswith disabilities; economically disadvantaged students, including studentswho qualify for free and reduced priced meals; students exercising choiceoptions and seeking supplemental services under the federal no child leftbehind act of 2001; and other students who may be at risk of failing to meetstate and federal academic performance standards. (8) "New charter school" means any charter school created under thischapter that is not a conversion charter school. (9) "Sponsor" means the board of directors of the school district inwhich the proposed charter school will be located, if the board has approveda charter or if the board has agreed to administer and implement a charterapproved and authorized by the superintendent of public instruction under theappeal process in section 7 of this act.

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{+ NEW SECTION. +} Sec. 3. CHARTER SCHOOLS--POWERS. (1) To carry outits duty to manage and operate the charter school, the charter school boardmay: (a) Hire, manage, and discharge any charter school employee inaccordance with the terms of this chapter and that school's charter; (b) Enter into a contract with any school district, or any other publicor private entity, also empowered to enter into contracts, for any and allreal property, equipment, goods, supplies, and services, includingeducational instructional services; however, this authority does not permitassigning, delegating, or contracting out the administration and managementof a charter school to a for-profit entity; (c) Rent, lease, or own property, but may not acquire property byeminent domain. All charters and charter school contracts with other publicand private entities must include provisions regarding the disposition of theproperty if the charter school fails to open as planned or closes, or thecharter is revoked or not renewed; (d) Issue secured and unsecured debt to manage cash flow, improveoperations, or finance the acquisition of real property or equipment. Theissuance is not a general, special, or moral obligation of the state, thecharter school sponsor, the school district in which the charter school islocated, or any other political subdivision or agency of the state. Neitherthe full faith and credit nor the taxing power of the state, the charterschool sponsor, the school district in which the charter school is located,or any other political subdivision or agency of the state may be pledged forthe payment of the debt; (e) Accept and administer for the benefit of the charter school and itsstudents, gifts, grants, and donations from other governmental and privateentities, excluding sectarian or religious organizations. Charter schoolsmay not accept any gifts or donations the conditions of which violate thischapter. (2) A charter school may not charge tuition, levy taxes, or issue tax-backed bonds, however it may charge fees for optional noncreditextracurricular events. (3) Neither a charter school sponsor nor an alternate sponsor is liablefor acts or omissions of a charter school or its charter school board,including but not limited to acts or omissions related to the application,the charter, the operation, the performance, and the closure of the charterschool. (4) A local school district board may appoint one of its directors toserve as an ex officio member of the board of directors of a charter schoollocated in the school district.

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{+ NEW SECTION. +} Sec. 4. LEGAL STATUS. A charter school is a publicschool including one or more of grades kindergarten through twelve, operatedby a board of directors appointed or elected by a charter school applicant,according to the terms of a renewable five-year contract granted by a sponsoror an alternate sponsor. A charter school may offer any program or course ofstudy that another public school may offer. A charter school must allowstudents who are receiving home-based instruction under chapter 28A.200 RCWto participate in its programs on a part-time basis.

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{+ NEW SECTION. +} Sec. 5. CHARTER SCHOOLS--EXEMPTIONS. (1) A charterschool shall operate according to the terms of a charter approved by asponsor or by the superintendent of public instruction under this chapter. (2) Charter schools are exempt from all state statutes and rulesapplicable to school districts and school district boards of directors,including but not limited to rules regarding the expenditure of stateallocations as provided in section 12 of this act, except those statutes andrules as provided for and made applicable to charter schools in accordancewith this chapter and in the school's approved charter. (3) A charter school's board of directors shall implement a qualitymanagement system and conduct annual self-assessments. (4) All approved charter schools shall: (a) Comply with state and federal health, safety, parents' rights, civilrights, and nondiscrimination laws, including, but not limited to, the familyeducational rights and privacy act (20 U.S.C. 1232g), chapter 28A.640 RCW(sexual equality), and Title IX of the education amendments of 1972 (20U.S.C. Sec. 1681 et seq.) applicable to school districts, and to the sameextent as school districts; (b) Participate in free and reduced priced meal programs to the sameextent as is required for other public schools; (c) Participate in nationally normed standardized achievement tests asrequired in RCW 28A.230.190, 28A.230.193, and 28A.230.230 and the elementary,middle school, and high school standards, requirements, and assessmentexaminations as required in chapter 28A.655 RCW; (d) Employ certificated instructional staff as required in RCW28A.410.010, however charter schools may hire noncertificated instructionalstaff of unusual competence and in exceptional cases as specified in RCW28A.150.260; (e) Comply with the employee record check requirements in RCW28A.400.303; (f) Be subject to financial examinations and audits as determined by thestate auditor, including annual audits for legal and fiscal compliance; (g) Be subject to independent performance audits by a qualifiedcontractor selected jointly by the state auditor and the joint legislativeaudit and review committee beginning at the conclusion of the third year ofthe school's operation, and at least once every three years thereafter;however, a charter school is not required to bear the expense of the audits; (h) Comply with the annual performance report under RCW 28A.655.110; (i) Follow the performance improvement goals and requirements adopted bythe academic achievement and accountability commission by rule under RCW28A.655.030; (j) Be subject to the accountability requirements of the federal nochild left behind act of 2001, including Title I requirements; (k) Comply with and be subject to the requirements under the individualswith disabilities education act, as amended in 1997; (l) Comply with and be subject to the requirements under the federaleducational rights and privacy act; (m) Report at least annually to the board of directors of the schooldistrict in which the charter school is located, to the school's alternatesponsor if the school is not sponsored by a school district, and to parentsof children enrolled at the charter school on progress toward the studentperformance goals specified in the charter; (n) Comply with the open public meetings act in chapter 42.30 RCW andopen public records requirements in RCW 42.17.250; (o) Be subject to and comply with legislation enacted after theeffective date of this section governing the operation and management ofcharter schools; and (p) Conduct annual self assessments of its quality management program. (5) A member of a board of directors of a charter school is a boardmember of a school district for the purposes of public disclosurerequirements and must comply with the reporting requirements in RCW42.17.240.

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{+ NEW SECTION. +} Sec. 6. ADMISSION REQUIREMENTS. (1) To effectuatethe primary purpose for which the legislature established charter schools, acharter school must be willing to enroll educationally disadvantaged studentsand may not limit admission on any basis other than age group and gradelevel. Consistent with the legislative intent of this chapter, a charterschool shall conduct timely outreach and marketing efforts to educationallydisadvantaged students in the school district in which the charter schoolwill be located. (2) A conversion charter school must be structured to provide sufficientcapacity to enroll all students who wish to remain enrolled in the schoolafter its conversion to a charter school, and may not displace studentsenrolled before the chartering process. If, after enrollment of thesestudents, capacity is insufficient to enroll all other students remaining whohave submitted a timely application, the charter school must give enrollmentpriority to siblings of students who are currently enrolled in the school. Students selected to fill any remaining spaces must be selected only throughan equitable selection process, such as a lottery. (3) A new charter school must enroll all students who submit a timelyapplication if capacity is sufficient. If capacity is insufficient to enrollall students who apply, students must be selected to fill any remainingspaces only through an equitable selection process, such as a lottery. Siblings of enrolled students must be given priority in enrollment.

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{+ NEW SECTION. +} Sec. 7. CHARTER APPLICATION--CHARTERING PROCESS. (1) An applicant may apply to a sponsor or may appeal to the superintendentof public instruction for approval to establish a charter school under thissection. An application may not be submitted earlier than eighteen monthsbefore, nor later than four months before, the proposed date of opening theschool. (2) The superintendent of public instruction shall establish guidelinesfor the timely receipt and approval of applications to facilitate theefficient implementation of this act. Guidelines established under thissubsection shall reflect efficient processes for the expeditious and orderlystart-up of charter schools in a timely manner for the purpose of servingstudents. (3) An application for a charter school must be submitted first to theboard of directors of the school district in which the proposed charterschool will be located, allowing for the board's consideration of theapplication in accordance with subsections (4) and (5) of this section,before an appeal may be filed with the superintendent of public instruction. A copy of each application submitted to a sponsor also must be provided tothe superintendent of public instruction. (4) The school district board of directors must decide, within forty-five days of receipt of the application, whether to hold a public hearing inthe school district to take public comment on the application and, if ahearing is to be held, must schedule it within seventy-five days of receiptof the application. If the school board intends to accept the application,one or more public hearings must be held before granting a charter; however aschool board is not required to hold a public hearing before rejecting anapplication. The school board must either accept or reject the applicationwithin one hundred five days after receipt of the application. The onehundred five-day deadline for accepting or rejecting the charter schoolapplication may be extended for an additional thirty days if both partiesagree in writing. (5) If the school board does not hold a public hearing or rejects theapplication after holding one or more public hearings, the school board mustnotify the applicant in writing of the reasons for that decision. Theapplicant may submit a revised application for the school board'sreconsideration and the school board may provide assistance to improve theapplication. If the school board rejects the application after a revisedapplication is submitted, the school board must notify the applicant inwriting of the reasons for the rejection. (6) At the request of the applicant or the sponsor, the superintendentof public instruction may review the charter application and providetechnical assistance. (7) If a school district board does not approve an application to starta new charter school, the applicant may file an appeal to the superintendentof public instruction for further review of the application. (8) Upon receipt of a request for review, the superintendent mustattempt to mediate a resolution between the applicant and the school districtboard, and may recommend to the applicant and school district board revisionsto the application. (9) If the school district board does not accept the revisions and doesnot approve the application, the superintendent must review the application. The superintendent, after exercising due diligence and good faith, mustapprove the application if the superintendent finds: (a) The criteria insection 9 of this act have been met; (b) the approval will be within theannual limits in section 16 (1) and (2) of this act; and (c) the approval isconsistent with the legislative intent for which charter schools areauthorized and is in the best interests of the children of the proposedschool. The superintendent may permit the board of directors of aneducational service district to assume the rights and responsibilities ofimplementing and administering a charter approved under this section, but ifno such board agrees to assume the role of alternate sponsor, thesuperintendent of public instruction shall assume the rights andresponsibilities of implementing and administering the charter and shallbecome the alternate sponsor. (10) The superintendent must reject the application if thesuperintendent finds: (a) The criteria in section 9 of this act have notbeen met; (b) the approval will not be within the annual limits establishedin section 16 (1) and (2) of this act; or (c) the approval is inconsistentwith the legislative intent for which charter schools are authorized and isnot in the best interests of the children of the proposed school. If thesuperintendent rejects the application, the superintendent must notify theapplicant in writing of the reasons for the rejection. (11) Educational service districts and the superintendent of publicinstruction are encouraged to assist schools and school districts in whichsignificant numbers of students persistently fail to meet state standardswith completing the chartering process. Assistance from an educationalservice district or from the superintendent of public instruction mayinclude, but is not limited to, identifying potential eligible applicants,and assisting with the charter application and approval processes. (12) Consistent with the corrective action provisions in the federal nochild left behind act of 2001, the superintendent of public instruction mayuse the chartering process as an intervention strategy to meet federalstudent achievement and accountability requirements. The superintendent mayrequire a local school district board of directors to convert a public schoolto a charter public school or, if the superintendent determines it would bemore appropriate, may require a local school district board of directors toconsent to conversion of the school by an educational service district boardof directors or the superintendent.

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{+ NEW SECTION. +} Sec. 8. APPLICATION REQUIREMENTS. The charterschool application is a proposed contract and must include: (1) The identification and description of the nonprofit corporationsubmitting the application, including the names, descriptions, curriculumvitae, and qualifications of the individuals who will operate the school, allof which are subject to verification and review; (2) The nonprofit corporation's articles of incorporation, bylaws, andmost recent financial statement and balance sheet; (3) A mission statement for the proposed school, consistent with thedescription of legislative intent in this chapter, including a statement ofwhether the proposed charter school's primary purpose is to serveeducationally disadvantaged students; (4) A description of the school's educational program, curriculum, andinstructional strategies, including but not limited to how the charter schoolwill assist its students, including educationally disadvantaged students, inmeeting the state's academic standards; (5) A description of the school's admissions policy and marketingprogram, and its deadlines for applications and admissions, including itsprogram for community outreach to families of educationally disadvantagedstudents; (6) A description of the school's student performance standards andrequirements that must meet or exceed those determined under chapter 28A.655RCW, and be measured according to the assessment system determined underchapter 28A.655 RCW; (7) A description of the school's plan to evaluate student performanceand the procedures for taking corrective action if student performance at thecharter school falls below standards established in its charter; (8) A description of the financial plan for the school. The plan shallinclude: (a) A proposed five-year budget of projected revenues andexpenditures; (b) a plan for starting the school; (c) a five-year facilitiesplan; (d) evidence supporting student enrollment projections of at leasttwenty students; and (e) a description of major contracts planned foradministration, management, equipment, and services, including consultingservices, leases, improvements, real property purchases, and insurance; (9) A description of the proposed financial management procedures andadministrative operations, which shall meet or exceed generally acceptedstandards of management and public accounting; (10) An assessment of the school's potential legal liability and adescription of the types and limits of insurance coverage the nonprofitcorporation plans to obtain. A liability insurance policy of at least fivemillion dollars is required; (11) A description of the procedures to discipline, suspend, and expelstudents; (12) A description of procedures to assure the health and safety ofstudents, employees, and guests of the school and to comply with applicablefederal and state health and safety laws and regulations; (13) A description of the school's program for parent involvement in thecharter school; (14) Documentation sufficient to demonstrate that the charter schoolwill have the liquid assets available to operate the school on an ongoing andsound financial basis; (15) Supporting documentation for any additional requirements that areappropriate and reasonably related to operating the charter school that asponsor or alternate sponsor may impose as a condition of approving thecharter; and (16) A description of the quality management plan for the school,including its specific components.

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{+ NEW SECTION. +} Sec. 9. APPROVAL CRITERIA. A sponsor or alternatesponsor may approve an application for a charter school, if in the sponsor'sor alternate sponsor's reasonable judgment, after exercising due diligenceand good faith, the sponsor or alternate sponsor finds: (1) The applicant is an eligible public benefit nonprofit corporationand the individuals it proposes to manage and operate the school arequalified to operate a charter school and implement the proposed educationalprogram that is free from religious or sectarian influence; (2) The public benefit nonprofit corporation has been approved orconditionally approved by the internal revenue service for tax exempt statusunder section 501(c)(3) of the internal revenue code of 1986 (26 U.S.C. Sec.501(c)(3)); (3) The mission statement is consistent with the description oflegislative intent and restrictions on charter school operations in thischapter. The sponsor or alternate sponsor must make a finding of whether ornot the charter school's primary purpose is to serve educationallydisadvantaged students; (4) The school's educational program, including its curriculum andinstructional strategies, is likely to assist its students, including itseducationally disadvantaged students, in meeting the state's academicstandards; (5) The school's admissions policy and marketing program is consistentwith state and federal law, and includes community outreach to families ofeducationally disadvantaged students; (6) The school's proposed educational program includes student academicperformance standards and requirements that meet or exceed those determinedunder chapter 28A.655 RCW and are measured according to the assessment systemdetermined under chapter 28A.655 RCW; (7) The application includes a viable plan to evaluate pupil performanceand procedures to take appropriate corrective action if pupil performance atthe charter school falls below standards established in its charter; (8) The financial plan for the school is designed to reasonably supportthe charter school's educational program based on a review of the proposedfive-year budget of projected revenues, expenditures, and facilities; (9) The school's financial and administrative operations, including itsaudits, meet or exceed generally accepted standards of accounting andmanagement; (10) The assessment of the school's potential legal liability, and thetypes and limits of insurance coverage the school plans to obtain, areadequate. A minimum liability insurance policy of five million dollars isrequired; (11) The procedures the school plans to follow to discipline, suspend,and expel students are reasonable and comply with state and federal law; (12) The procedures the school plans to follow to assure the health andsafety of students, employees, and guests of the school comply withapplicable state and federal health and safety laws and regulations; (13) The school has developed a program for parent involvement in thecharter school; (14) The charter school will have the liquid assets available to operatethe school on an ongoing and sound financial basis; (15) The applicant has met any additional requirements that areappropriate and reasonably related to the operation of a charter school thata sponsor or alternate sponsor imposed as a condition for approval of thecharter; and (16) The quality management plan for the school is adequate.

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{+ NEW SECTION. +} Sec. 10. CHARTER AGREEMENT--AMENDMENT. (1) Acharter application approved by a sponsor or an alternate sponsor with anychanges or additions, and signed by an authorized representative of theapplicant and the sponsor or alternate sponsor, constitutes a charter. Acharter to convert a public school must include provisions for thedisposition, including assignment or reassignment, of the employees of theschool before its conversion and after conversion. (2) A charter may be amended during its term at the request of thecharter school board of directors and on the approval of the sponsor oralternate sponsor. (3) A charter may not prohibit and must provide for the application oflaws applicable to charter schools or to charter school boards of directorsenacted after the effective date of this section.

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{+ NEW SECTION. +} Sec. 11. CHARTER RENEWAL AND REVOCATION. (1) Anapproved plan to establish a charter school is effective for five years fromthe first day of operation. At the conclusion of the first three years ofoperation, the charter school may apply to the original sponsor or alternatesponsor for renewal. A request for renewal must be submitted no later thansix months before the expiration of the charter. (2) A charter school renewal application must include: (a) A report on the progress of the charter school in achieving thegoals; student performance standards, including the student performancestandards adopted by rule by the academic achievement and accountabilitycommission in accordance with RCW 28A.655.030; the number and percentage ofeducationally disadvantaged students served; and other terms of the charter; (b) A financial statement that discloses the costs of administration,instruction, and other expenditure objects and activities of the charterschool; and (c) All audit information from independent sources regarding the charterschool, if available, and all self assessments and corresponding correctiveaction plans. (3) The sponsor or alternate sponsor shall reject the application forrenewal if the academic progress of students in the charter school, asmeasured by the standards and assessments in chapter 28A.655 RCW, isinferior, for the most recent two consecutive years, to the average progressof students in the district in which the charter school is located whensimilar student populations are compared. (4) The sponsor or alternate sponsor may reject the application forrenewal if any of the following occurred: (a) The charter school materially violated its charter with the sponsoror alternate sponsor; (b) The students enrolled in the charter school failed to meet studentperformance standards identified in the charter, including the studentperformance standards adopted by rule by the academic achievement andaccountability commission in accordance with RCW 28A.655.030; (c) The charter school failed to meet generally accepted standards offiscal management; or (d) The charter school violated provisions in law that have not beenwaived in accordance with this chapter. (5) A sponsor or alternate sponsor shall give written notice of itsintent not to renew the charter school's request for renewal to the charterschool within three months of the request for renewal in order to allow thecharter school an opportunity to correct identified deficiencies in itsoperation. At the request of the board of directors of the charter school,the sponsor or alternate sponsor shall review its decision for nonrenewalwithin forty-five days of receiving a request for review and supportingdocumentation sufficient to demonstrate that any deficiencies have beencorrected. (6)(a) The sponsor or alternate sponsor may revoke a previously approvedcharter before the expiration of the term of the charter, and beforeapplication for renewal, if any of the following occurred: (i) The charter school materially violated its charter with the sponsoror alternate sponsor; (ii) The charter school failed to meet generally accepted standards offiscal management; or (iii) The charter school violated provisions in law that have not beenwaived in accordance with this chapter. (b) Except in cases of emergency where the health and safety of childrenare at risk, a charter may not be revoked unless the sponsor or alternatesponsor first provides: (i) Written notice to the charter school of the specific violationsalleged; (ii) One or more public hearings in the school district in which thecharter school is located; and (iii) A reasonable opportunity and a sufficient period of time for thecharter school to correct the identified deficiencies. (c) If, after following the procedures in (b) of this subsection, thesponsor or alternate sponsor determines that revoking the charter isnecessary to further the intent of this chapter, the sponsor or alternatesponsor may revoke the charter. The sponsor or alternate sponsor shallprovide for an appeal process upon such a determination. (d) If a sponsor or alternate sponsor revokes the charter, the sponsoror alternate sponsor, upon a request by the charter school, shall providetechnical assistance to the charter school to complete the plan required andcarry out the tasks identified in subsection (7) of this section. (7) A charter school planning to close or anticipating revocation ornonrenewal of its charter shall provide a plan setting forth a timeline andthe responsible parties for disposition of students and student records anddisposition of finances. (a) Immediately following the decision to close a school, the schoolmust: (i) Submit to the sponsor or alternate sponsor a list of parentaddresses and proof that the school has communicated the impending closure ofthe school to all parents and staff; (ii) Assign staff responsible for transition of student records and forproviding assistance to students and parents in transferring from the charterschool to the district public, private, or home school chosen by the family; (iii) Provide the names and contact information for staff responsiblefor transfer of student records, as well as the projected transition tasksand timelines to the sponsor or alternate sponsor, and upon completion ofstudent transition, provide a list of students and a brief description of thedisposition of their student records to the sponsor or alternate sponsor. (b) Before closing the charter school the charter school board ofdirectors shall: (i) Identify a trustee who will, through the process of closing theschool and for a term of ten years after closing, assume responsibility forschool and student records, and notify the sponsor or alternate sponsor ofthe name and contact information for the trustee; (ii) Determine the amount of anticipated revenue due to the school aswell as anticipated liabilities, and provide a complete asset and liabilityreport to the sponsor or alternate sponsor; (iii) Create a current and projected payroll and payroll benefitscommitment; (iv) List each employee, job, and the funds necessary to complete theeducational calendar balance of the year, the transition of students andrecords, and the administrative close-down tasks; (v) Determine the total moneys required to complete contracts; (vi) Schedule an audit and set aside funds to cover costs; and (vii) Provide the sponsor or alternate sponsor with a plan to close theschool and to dispose of all property owned by the charter school.

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{+ NEW SECTION. +} Sec. 12. FUNDING. (1) The superintendent of publicinstruction shall provide prompt and timely funding for a charter schoolincluding regular apportionment, special education, categorical, studentachievement, and other nonbasic education moneys. Allocations shall be basedon the statewide average staff mix ratio of all noncharter public schoolsfrom the prior school year and the school's actual FTE enrollment, exceptthat vocational education funding for grades nine through twelve shall beprovided based on eighteen and one-half percent of the charter school'sactual FTE enrollment for grades nine through twelve. Enhanced staff ratiofunding provided to school districts through the omnibus appropriations actshall be allocated to a charter school regardless of whether the schoolmaintains the enhanced staffing ratio. A charter school is not eligible forenhanced small school assistance funding. Categorical funding shall beallocated to a charter school based on the same funding criteria used fornoncharter public schools, except that the charter school is exempt fromrules and statutes regarding the expenditure of these funds. A charterschool is eligible to apply for state grants on the same basis as a schooldistrict. Those allocations to a charter school that are included in RCW84.52.0531(3) (a) through (c) shall be included in the levy base of thedistrict in which the charter school is located. (2) For charter schools sponsored by a school district: (a) Conversion charter schools are eligible for local levy moneysapproved by the voters before the start-up date of the school as determinedby the sponsor, and the school district shall allocate levy moneys to aconversion charter school. (b) New charter schools are not eligible for local levy moneys approvedby the voters before the start-up date of the school as determined by thesponsor, and the district shall not allocate those levy moneys to a newschool. (c) For levies submitted to voters after the start-up date of a charterschool, the school shall be included in levy planning, budgets, and fundingdistribution in the same manner as other district-sponsored public schools. (d) A conversion charter school is eligible for state matching funds forcommon school construction if a sponsoring school district determines it hasreceived voter approval of local capital funds for the project. (e) A conversion charter school is entitled to the continued rent-freeuse of its existing facility, regardless of whether the conversion school issponsored by the local school district or by an alternate sponsor. Thedistrict remains responsible for major repairs and safety upgrades that maybe required for the continued use of the facility as a public school. Thecharter school is responsible for routine maintenance of the facility,including but not limited to, cleaning, painting, gardening, and landscaping. (3) No local levy money may be allocated to a charter school if thecharter school is sponsored by an alternate sponsor. (4) Within available funds as the legislature may appropriate, newcharter schools operating for the primary purpose of serving educationallydisadvantaged students under section 16(2) of this act that are not otherwiseeligible for levy money shall receive state funding in an amount not greaterthan the amount the school would have received if eligible. (5) Sponsors and alternate sponsors shall submit, by November 1st ofeach year, to the office of the superintendent of public instruction, annualyear-end financial information, as prescribed by the superintendent, for eachcharter school sponsored in the previous school year.

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{+ NEW SECTION. +} Sec. 13. ADMINISTRATION FEE. To offset costs tooversee and administer the charter, a sponsor or an alternate sponsor mayretain up to three percent of state funding and local excess levy funding, ifapplicable, allocated to the charter school. Except for the administrationfee in this section, no other offsets or deductions are allowed, whether forcentral administration or other off-site support services, from a charterschool's per-pupil share of state appropriations, local levies, or otherfunds, unless the charter school has contracted with a school district toobtain specific additional services.

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{+ NEW SECTION. +} Sec. 14. LEAVES OF ABSENCE. If a school districtemployee makes a written request for an extended leave of absence to work ata charter school, the school district shall grant the request. The schooldistrict may require that the request for leave be made up to ninety daysbefore the employee would otherwise have to report for duty. The leave shallbe granted for any request for up to two years. If the employee returns tothe school district within the two-year period, the employee shall be hiredbefore the district hires anyone else with fewer years of statewide service,with respect to any position for which the returning employee is certificatedor otherwise qualified.

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{+ NEW SECTION. +} Sec. 15. STUDY OF CHARTER SCHOOLS. Subject tofunding, the Washington institute for public policy shall study theimplementation and effectiveness of this act. The institute shall report tothe legislature on the effectiveness of charter schools in raising studentachievement and the impact of charter schools. The institute also shallexamine and discuss whether and how charter schools have enhanced educationreform efforts and recommend whether relaxing or eliminating certainregulatory requirements for other public schools could result in improvedschool performance at those schools. The institute shall recommend changesto this chapter including improvements that could be made to the applicationand approval process. A preliminary report of the study is due to thelegislature by March 1, 2007, and a final report is due September 1, 2008.

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{+ NEW SECTION. +} Sec. 16. NUMBER OF CHARTER SCHOOLS. (1) A maximumof forty-five new charter schools may be established statewide during the sixconsecutive years in which new charter schools are authorized to be createdunder this chapter. (a) For purposes of this section, a year begins on July 1st and ends onJune 30th. In each of the three years beginning July 1, 2004, and endingJune 30, 2007, not more than five new charter schools may be established. Ineach of the three years beginning July 1, 2007, and ending June 30, 2010, notmore than ten new charter schools may be established. (b) These annual allocations are cumulative so that if the maximumnumber of allowable new charters is not reached in any given year themaximums are increased accordingly for the successive years, but in no caseshall the total number exceed forty-five without further legislativeauthorization. (c) Applications for charter schools may be submitted on the effectivedate of this section. (d) The superintendent of public instruction shall maintain copies ofall approved charter applications. An applicant may obtain copies of thoseapplications from the office of the superintendent of public instruction. (2) Consistent with the legislative intent of this chapter, a majorityof the annual number of new charter schools that may be established undersubsection (1) of this section are reserved to implement charter schoolsestablished for the primary purpose of serving educationally disadvantagedstudents, and that are located in, or accessible to students who live in,geographic areas in which a large proportion of the students have difficultymeeting state academic content and student achievement standards, orgeographic areas, including urban and rural areas, in which a largeproportion or number of public schools have been identified for improvement,corrective action, or restructuring under the federal no child left behindact of 2001, as follows: (a) For new schools allowed during the first year beginning July 1,2004, a majority are reserved until the thirty-first day after the effectivedate of this section; and (b) For new schools allowed during the second through sixth years, amajority are reserved until March 31st of each year. (3) To ensure compliance with the annual limits for establishing newcharter schools, authorization from the superintendent of public instructionmust be obtained before implementing an approved charter for a new school. Sponsors and alternate sponsors shall promptly notify the superintendent ofpublic instruction when a charter is approved, and shall indicate whether thecharter school's primary purpose is to serve educationally disadvantagedstudents. Upon the receipt of notice from a sponsor or alternate sponsorthat a charter has been approved, the superintendent shall authorizeimplementing the approved charter establishing the school in compliance withthe limits on the maximum number of new charters allowed under subsection (1)of this section and in compliance with the dates until which the majority ofnew charters each year are reserved under subsection (2) of this section. Ifthe superintendent receives simultaneous notification of approved chartersthat exceed the annual allowable limits in subsections (1) and (2) of thissection, the superintendent shall select approved charters for authorizationthrough a lottery process, and shall assign implementation dates accordingly. (4) If the number of charters reserved each year under subsection (2) ofthis section is not reached by the thirty-first day after the effective dateof this section, or by March 31st of the second through sixth years, thesuperintendent of public instruction shall notify the sponsors or alternatesponsors of any other approved charters for which authorization has not beengranted under subsection (3) of this section, and shall authorizeimplementing those charters within the annual limits, regardless of whetherthose charters meet the requirements of subsection (2) of this section. (5) The superintendent of public instruction shall notify eligiblesponsors and eligible alternate sponsors when the maximum allowable number ofnew charters has been reached each year. If the maximum number is notreached by the thirty-first day after the effective date of this section, orby March 31st of the second through sixth years, the superintendent shallreport on the number of charters approved. (6) A school district board of directors may establish a conversioncharter school during the six consecutive years in which charter schools areauthorized under this chapter for any school, including an alternativeschool, that has failed to make adequate yearly progress for the most recentthree consecutive years, or is eligible for school improvement assistance. Determinations regarding adequate yearly progress and eligibility for schoolimprovement assistance must be made by the superintendent of publicinstruction. (7) A new charter school or a conversion charter school operatingaccording to the terms of its charter to the satisfaction of its sponsor oralternate sponsor may continue to operate after June 30, 2010, under acharter renewed by its sponsor or alternate sponsor under section 11 of thisact.

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{+ NEW SECTION. +} Sec. 17. A new section is added to chapter 41.56RCW to read as follows: In addition to the entities listed in RCW 41.56.020, this chapterapplies to new charter schools created under chapter 28A.-- RCW (sections 1through 16 and 25 of this act). Notwithstanding RCW 41.56.060 and 41.56.070,the bargaining units of classified employees of a new charter school must belimited to the employees of the new charter school and must be separate fromother bargaining units in the school district or educational service districtfor at least the first five years of operation of the new charter school. After the five-year period, the employees in a bargaining unit of a newcharter school may indicate by a majority vote that they desire to becomemembers of a bargaining unit in the school district in which the new charterschool is located.

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{+ NEW SECTION. +} Sec. 18. A new section is added to chapter 41.56RCW to read as follows: At the time of creation of a conversion charter school under chapter28A.-- RCW (sections 1 through 16 and 25 of this act), the employees of aconversion charter school remain in any existing appropriate bargaining unitof employees of the school district in which the conversion charter school islocated. If an applicant for a charter school or a charter school boardrequests one or more variances from a collective bargaining agreement thatapplies to the relevant school district bargaining unit to address needs thatare specific to the charter school and the employees of the charter school,the following applies: (1) At the request of either party, the public employer, in consultationwith the applicant or charter school board, and the bargaining representativeof the bargaining unit shall negotiate concerning the issues raised in thevariance request. (2) If the parties are unable to conclude an agreement regarding thevariance request within twenty days of negotiations, either party may declarean impasse and submit the dispute to the commission for mediation. Thecommission shall appoint a mediator within two days of the submission. Mediation under this subsection shall continue for up to ten days unless theparties agree otherwise.

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{+ NEW SECTION. +} Sec. 19. A new section is added to chapter 41.59RCW to read as follows: In addition to school districts, this chapter applies to new charterschools created under chapter 28A.-- RCW (sections 1 through 16 and 25 ofthis act). Notwithstanding RCW 41.59.070 and 41.59.080, the bargaining unitsof educational employees of a new charter school must be limited to theeducational employees of the new charter school and must be separate from thebargaining units in the school district or educational service district forat least the first five years of operation of the new charter school. Afterthe five-year period, the employees in a bargaining unit of a new charterschool may indicate by a majority vote that they desire to become members ofa bargaining unit in the school district in which the new charter school islocated.

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{+ NEW SECTION. +} Sec. 20. A new section is added to chapter 41.59RCW to read as follows: At the time of creation of a conversion charter school under chapter28A.-- RCW (sections 1 through 16 and 25 of this act), the employees of aconversion charter school remain in any existing appropriate bargaining unitof employees of the school district in which the conversion charter school islocated. If an applicant for a charter school or a charter school boardrequests one or more variances from a collective bargaining agreement thatapplies to the relevant school district bargaining unit to address needs thatare specific to the charter school and the employees of the charter school,the following applies: (1) At the request of either party, the employer, in consultation withthe applicant or charter school board, and the exclusive bargainingrepresentative of the bargaining unit shall negotiate concerning the issuesraised in the variance request. (2) If the parties are unable to conclude an agreement regarding thevariance request within twenty days of negotiations, either party may declarean impasse and submit the dispute to the commission for mediation. Thecommission shall appoint a mediator within two days of the submission. Mediation under this subsection shall continue for up to ten days unless theparties agree otherwise.

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{+ NEW SECTION. +} Sec. 21. A new section is added to chapter 41.32RCW to read as follows: This section designates charter schools as employers and charter schoolemployees as members, and applies only if the department of retirementsystems receives determinations from the internal revenue service and theUnited States department of labor that participation does not jeopardize thestatus of these retirement systems as governmental plans under the federalemployees' retirement income security act and the internal revenue code.

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{+ NEW SECTION. +} Sec. 22. A new section is added to chapter 41.35RCW to read as follows: This section designates charter schools as employers and charter schoolemployees as members, and applies only if the department of retirementsystems receives determinations from the internal revenue service and theUnited States department of labor that participation does not jeopardize thestatus of these retirement systems as governmental plans under the federalemployees' retirement income security act and the internal revenue code.

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{+ NEW SECTION. +} Sec. 23. A new section is added to chapter 41.40RCW to read as follows: This section designates charter schools as employers and charter schoolemployees as members, and applies only if the department of retirementsystems receives determinations from the internal revenue service and theUnited States department of labor that participation does not jeopardize thestatus of these retirement systems as governmental plans under the federalemployees' retirement income security act and the internal revenue code.

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Sec. 24. RCW 28A.150.010 and 1969 ex.s. c 223 s 28A.01.055 are eachamended to read as follows: Public schools (({- shall -})) mean{+ s +} the common schools asreferred to in Article IX of the state Constitution and those schools andinstitutions of learning having a curriculum below the college or universitylevel as now or may be established by law and maintained at public expense{+, including charter schools under chapter 28A.-- RCW (sections 1 through 16and 25 of this act) +}.

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{+ NEW SECTION. +} Sec. 25. CAPTIONS NOT LAW. Captions used in thischapter are not any part of the law.

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{+ NEW SECTION. +} Sec. 26. Sections 1 through 16 and 25 of this actconstitute a new chapter in Title 28A RCW.

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{+ NEW SECTION. +} Sec. 27. If any provision of this act or itsapplication to any person or circumstance is held invalid, the remainder ofthe act or the application of the provision to other persons or circumstancesis not affected.

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Evergreen Freedom Foundation P.O. Box 552, Olympia, WA 98507 Phone: (360) 956-3482, Fax: (360) 352-1874 Email: effwa@effwa.org