Expanding Opportunity through Quality Charter Schools Act - Revises subpart 1 (Charter School Programs) of part B (Public Charter Schools) of title V (Promoting Informed Parental Choice and Innovative Programs) of the Elementary and Secondary Education Act of 1965, including by subsuming subpart 2 (Credit Enhancement Initiatives to Assist Charter School Facility Acquisition, Construction, and Renovation) under subpart 1.
Replaces the current charter school grant program with a program awarding competitive grants to state entities (state educational agencies, state charter school boards, Governors, or charter school support organizations) and, through such grantees, competitive subgrants to charter school developers to open new charter schools and expand and replicate high-quality charter schools.
Requires grantees to use at least 7% of the grant funds to: (1) provide technical assistance to subgrantees and authorized public chartering agencies, and (2) work with those agencies to improve the charter school authorization process.
Permits the Secretary of Education to waive certain statutory or regulatory requirements if the waiver is requested by a grant applicant and promotes the purpose of the Charter School program without tampering with what is definitionally required of charter schools.
Requires the Secretary to award at least three credit enhancement grants to public entities, private nonprofit entities, or consortia of such entities that have the highest-quality applications. (Currently, the Secretary is required to award at least three grants, including at least one to a public entity, one to a private nonprofit entity, and one to a consortium of such entities, provided an application from each merits approval.)
Revises the per-pupil facilities aid program (under which the Secretary makes competitive matching grants to states to provide per-pupil financing to charter schools) to allow states to: (1) partner with organizations to provide up to 50% of the state share of funding for the program; and (2) receive more than one program grant, so long as the amount of the grant funds provided to charter schools increases with each successive grant.
Directs the Secretary to conduct national activities that include:
Requires states and local educational agencies to ensure that a student's records are transferred as quickly as possible to a charter school or another public school when the student transfers from one such school to the other.
Allows charter schools to serve prekindergarten or postsecondary school students.
Reauthorizes appropriations through FY2020.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 2304 Introduced in Senate (IS)]
113th CONGRESS
2d Session
S. 2304
To amend the charter school program under the Elementary and Secondary
Education Act of 1965.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 7, 2014
Mr. Kirk (for himself, Ms. Landrieu, Mr. Alexander, Mr. Bennet, Mrs.
Feinstein, Mr. Paul, Mr. Isakson, Mr. Rubio, Mr. Vitter, Mr. Cornyn,
Mr. Scott, Mr. Booker, Mr. Hatch, Mr. Carper, Mr. McConnell, and Mr.
Cruz) introduced the following bill; which was read twice and referred
to the Committee on Health, Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To amend the charter school program under the Elementary and Secondary
Education Act of 1965.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Expanding Opportunity 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) improve the United States education system and
educational opportunities for all individuals in the United
States by supporting innovation in public education in public
school settings that prepare students to compete in, and
contribute to, the global economy;
``(2) provide financial assistance for the planning,
program design, and initial implementation of charter schools;
``(3) increase the number of high-quality charter schools
available to students across the Nation;
``(4) evaluate the impact of such schools on student
achievement, families, and communities, and share best
practices among charter schools and other public schools;
``(5) 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;
``(6) expand opportunities for students with disabilities,
students who are limited English proficient, and other
traditionally underserved students to attend charter schools
and meet challenging State academic achievement standards; and
``(7) support efforts to strengthen the charter school
authorizing process in order to improve performance management,
including transparency, monitoring, and evaluation of such
schools.''.
SEC. 4. PROGRAM AUTHORIZED.
Section 5202 (20 U.S.C. 7221a) is amended to read as follows:
``SEC. 5202. PROGRAM AUTHORIZED.
``(a) In General.--The Secretary is authorized to carry out a
charter school program that supports charter schools that serve
elementary school and secondary school students by--
``(1) supporting the startup of charter schools, the
replication of high-quality charter schools, and the expansion
of high-quality 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) the startup of charter schools, the
replication of high-quality charter schools, and the
expansion of high-quality charter schools;
``(B) the dissemination of best practices of
charter schools for all schools;
``(C) the evaluation of the impact of the charter
school program on schools participating in such
program; and
``(D) stronger charter school authorizing.
``(b) Funding Allotment.--From the amount made available under
section 5211 for a fiscal year, the Secretary shall--
``(1) reserve 12.5 percent to support charter school
facilities assistance under section 5204;
``(2) reserve not less than 25 percent to carry out
national activities under section 5205; and
``(3) use the remaining amount after the reservations 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 Expanding Opportunity 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) State Entity Defined.--For purposes of this section, the term
`State entity' means--
``(1) a State educational agency;
``(2) a State charter school board;
``(3) a Governor of a State; or
``(4) a charter school support organization.
``(b) Program Authorized.--From the amount available under section
5202(b)(3), the Secretary shall award, on a competitive basis, grants
to State entities having applications approved under subsection (f) to
enable such entities to--
``(1) award subgrants to eligible applicants--
``(A) to open new charter schools;
``(B) to replicate high-quality charter schools; or
``(C) to expand 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.
``(c) State Entity Uses of Funds.--
``(1) In general.--A State entity receiving a grant under
this section shall--
``(A) use not less than 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 pursuant to
subsection (f), for the purposes described in
subparagraphs (A) through (C) of subsection (b)(1);
``(B) reserve not less than 7 percent of such funds
to carry out the activities described in subsection
(b)(2); and
``(C) reserve not more than 3 percent of such funds
for administrative costs, which may include the
administrative costs of providing technical assistance.
``(2) Contracts and grants.--A State entity may use a grant
received under this section to carry out the activities
described in subparagraph (A) of paragraph (1) directly or
through grants, contracts, or cooperative agreements.
``(3) Rule of construction.--Nothing in this Act shall
prohibit the Secretary from awarding grants to State entities,
or State entities from awarding subgrants to eligible
applicants, that use a weighted lottery, or an equivalent
lottery mechanism, to give better chances for school admission
to all or a subset of educationally disadvantaged students if--
``(A) the use of a weighted lottery in favor of
such students is not prohibited by State law, and such
State law is consistent with the laws described in
subparagraph (G) of section 5210(2); and
``(B) such weighted lottery is not used for the
purpose of creating schools exclusively to serve a
particular subset of students.
``(d) Program Periods; Peer Review; Distribution of Subgrants;
Waivers.--
``(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 3 years, and may be renewed by the
Secretary for 1 additional 2-year period.
``(B) Subgrants.--A subgrant awarded by a State
entity under this section--
``(i) shall be for a period of not more
than 3 years, of which an eligible applicant
may use not more than 18 months for planning
and program design; and
``(ii) may be renewed by the State entity
for 1 additional 2-year period.
``(2) Peer review.--The Secretary, and each State entity
awarding subgrants under this section, shall use a peer review
process to review applications for assistance under this
section.
``(3) Distribution of subgrants.--Each State entity
awarding subgrants under this section shall award subgrants in
a manner that, to the extent practicable and applicable,
ensures that such subgrants--
``(A) prioritize eligible applicants that plan to
serve a significant number of students from low-income
families;
``(B) are distributed throughout different areas,
including urban, suburban, and rural areas; and
``(C) will assist charter schools representing a
variety of educational approaches.
``(4) 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(2), if--
``(A) the waiver is requested in an approved
application under this section; and
``(B) the Secretary determines that granting such a
waiver will promote the purposes of this subpart.
``(e) Limitations.--
``(1) Grants.--A State entity may not receive more than 1
grant under this section at a time.
``(2) Subgrants.--An eligible applicant may not receive
more than 1 subgrant under this section for each individual
charter school for each grant period or renewal period, unless
the eligible applicant demonstrates to the State entity that
the charter school has demonstrated a strong track record of
positive results over the course of the grant period regarding
the elements described in subparagraphs (A) and (D) of section
5210(8).
``(f) 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 State
entity's objectives in running a quality charter school program
under this section and how the objectives of the program will
be carried out, including--
``(A) a description of how the State entity will--
``(i) support the opening of new charter
schools and, if applicable, the replication of
high-quality charter schools and the expansion
of high-quality charter schools, and the
proposed number of charter schools to be
opened, replicated, or expanded under the State
entity's program;
``(ii) inform eligible charter schools,
developers, and authorized public chartering
agencies of the availability of funds under the
program;
``(iii) work with eligible applicants to
ensure that the eligible applicants access all
Federal funds that such applicants are eligible
to receive, and help the charter schools
supported by such applicants and the students
attending those 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 of a State entity that
is not a State educational agency--
``(I) 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) work with the State
educational agency to operate the State
entity's program under this section, if
applicable;
``(v) ensure each eligible applicant that
receives a subgrant under the State entity's
program--
``(I) is opening or expanding
schools that meet the definition of a
charter school under section 5210(2);
and
``(II) is prepared to continue to
operate such charter schools once the
subgrant funds under this section are
no longer available;
``(vi) support charter schools in local
educational agencies with large numbers of
schools that have been identified by the State
for improvement;
``(vii) work with charter schools to
promote inclusion of all students and support
all students upon enrollment in order to
promote retention of students in the school;
``(viii) work with charter schools on
recruitment practices, including efforts to
engage groups that may otherwise have limited
opportunities to attend charter schools;
``(ix) share best and promising practices
among charter schools and other public schools;
``(x) ensure that charter schools receiving
funds under the State entity's program meet the
educational needs of their students, including
students with disabilities and students who are
limited English proficient; and
``(xi) support efforts to increase charter
school quality initiatives, including meeting
the quality authorizing elements described in
paragraph (2)(D);
``(B) a description of how the State will actively
monitor and hold authorized public chartering agencies
accountable to ensure high-quality authorizing
activity, including by establishing authorizing
standards and by approving, re-approving, and revoking
the authority of an authorized public chartering agency
based on the performance of the charter schools
authorized by such agency in the areas of student
achievement, student safety, financial management, and
compliance with all applicable statutes;
``(C) a description of the extent to which the
State entity--
``(i) is able to meet and carry out the
priorities described in subsection (g)(2); and
``(ii) is working to develop or strengthen
a cohesive statewide system to support the
opening of new charter schools and, if
applicable, the replication of high-quality
charter schools and the expansion of high-
quality charter schools;
``(D) a description of how the State entity will
award subgrants, on a competitive basis, including--
``(i) a description of the application each
eligible applicant desiring to receive a
subgrant will be required to submit, which
application shall include--
``(I) a description of the roles
and responsibilities of eligible
applicants and of any charter
management organizations or other
organizations with which the eligible
applicant will partner to open charter
schools, including administrative and
contractual roles and responsibilities;
``(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
and impact on student achievement,
which may include student growth, will
be primary factors for renewal or
revocation of the school's charter; and
``(III) a description of how the
autonomy and flexibility granted to the
charter school are consistent with the
definition of a charter school in
section 5210(2); and
``(IV) a description of the planned
activities and expenditures of subgrant
funds for purposes of opening a new
charter school, replicating a high-
quality charter school, or expanding a
high-quality charter school, and how
the charter school will maintain
financial sustainability after the end
of the subgrant period; and
``(ii) a description of how the State
entity will review applications from eligible
applicants;
``(E) in the case of a State entity that partners
with an outside organization to carry out the State
entity's quality charter school program, in whole or in
part, a description of the roles and responsibilities
of the partner; and
``(F) a description of how the State entity will
help the charter schools receiving funds under the
State entity's program address the transportation needs
of the schools' students.
``(2) Assurances.--Assurances that--
``(A) each charter school receiving funds through
the State entity's grant program will have a high
degree of autonomy over budget and operations,
including autonomy over personnel decisions;
``(B) the State entity will support charter schools
in meeting the educational needs of their students, as
described in paragraph (1)(A)(x);
``(C) the State entity will ensure that the
authorized public chartering agency of any charter
school that receives funds under the entity's program--
``(i) ensures that each charter school
under the authority of such agency is meeting
the requirements of 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 provides
adequate technical assistance to each charter
school under the authority of such agency in
recruiting, enrolling, and meeting the needs of
all students, including students with
disabilities and students who are limited
English proficient;
``(D) the State entity will promote quality
authorizing, such as through providing technical
assistance, to support all authorized public chartering
agencies in the State in improving the monitoring of
the charter schools authorized by such agency,
including by--
``(i) using annual performance data, which
may include graduation rates and student
academic growth data, as appropriate, to
measure a school's progress toward becoming a
high-quality charter school;
``(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
``(iii) holding charter schools accountable
to the academic, financial, and operational
quality controls agreed to between the charter
school and the authorized public chartering
agency involved, such as through renewal, non-
renewal, or revocation of the school's charter;
and
``(E) the State entity will ensure that each
charter school in the State makes publicly available,
consistent with the dissemination requirements of the
annual State report card, information to help parents
make informed decisions about the education options
available to their children, including information on
the educational program, student support services, and
annual performance and enrollment data for the groups
of students described in section 1111(b)(2)(C)(v)(II).
``(3) Requests for waivers.--A request and justification
for waivers of any Federal statutory or regulatory provisions
that the State 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 or, in the case of a State entity defined in subsection
(a)(4), a description of how the State entity will work with
the State to request necessary waivers, if applicable.
``(g) 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 (f),
after taking into consideration--
``(A) the degree of flexibility afforded by the
State's public charter school law and how the State
entity will work to maximize the flexibility provided
to charter schools under the law;
``(B) the proposed number of new charter schools to
be opened, and, if applicable, the number of high-
quality charter schools to be replicated or expanded
under the program, and the number of new students to be
served by such schools;
``(C) the likelihood that the schools opened,
replicated, or expanded by eligible applicants
receiving subgrant funds will increase the academic
achievement of the school's students and progress
toward becoming high-quality charter schools; and
``(D) the quality of the State entity's plan to--
``(i) monitor the eligible applicants
receiving subgrants under the State entity's
program; and
``(ii) provide technical assistance and
support for--
``(I) the eligible applicants
receiving subgrants under the State
entity's program; and
``(II) quality authorizing efforts
in the State.
``(2) Priority.--In awarding grants under this section, the
Secretary shall give priority to a State entity to the extent
that the entity meets the following criteria:
``(A) The State entity is located in a State that--
``(i) allows at least one entity that is
not a local educational agency to be an
authorized public chartering agency for each
developer seeking to open a charter school in
the State; or
``(ii) in the case of a State in which
local educational agencies are the only
authorized public chartering agencies, the
State has an appeals process for the denial of
an application for a charter school.
``(B) The State entity is located in a State that
ensures that charter schools receive equitable
financing, as compared to traditional public schools,
in a prompt manner.
``(C) The State entity is located in a State that
provides charter schools one or more of the following:
``(i) Funding for facilities.
``(ii) Assistance with facilities
acquisition.
``(iii) Access to public facilities.
``(iv) The ability to share in bonds or
mill levies.
``(v) The right of first refusal to
purchase public school buildings.
``(vi) Low- or no-cost leasing privileges.
``(D) The State entity is located in a State that
uses best practices from charter schools to help
improve struggling schools and local educational
agencies.
``(E) The State entity supports charter schools
that support at-risk students through activities such
as dropout prevention or dropout recovery.
``(F) The State entity ensures that each charter
school has a high degree of autonomy over the charter
school's budget and operations, including autonomy over
personnel decisions.
``(G) The State entity has taken steps to ensure
that all authorizing public chartering agencies
implement best practices for charter school
authorizing.
``(h) Local Uses of Funds.--An eligible applicant receiving a
subgrant under this section shall use such funds to carry out
activities related to opening a new charter school, replicating a high-
quality charter school, or expanding a high-quality charter school,
which may include--
``(1) supporting the acquisition, expansion, or preparation
of a charter school building to meet increasing enrollment
needs, including financing the development of a new building
and ensuring that a school building complies with applicable
statutes and regulations;
``(2) paying costs associated with hiring additional
teachers to serve additional students;
``(3) providing transportation to students to and from the
charter school;
``(4) providing instructional materials, implementing
teacher and principal professional development programs, and
hiring additional non-teaching staff; and
``(5) supporting any necessary activities that assist the
charter school in carrying out the purposes of this section,
such as preparing individuals to serve as members of the
charter school's board.
``(i) 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 grant period and at the end of any renewal period, a
report that includes the following:
``(1) The number of students served by each subgrant
awarded under this section and, if applicable, the number of
new students served during each year of the subgrant period.
``(2) The number and amount of subgrants awarded under this
section to carry out each of the following:
``(A) The opening of new charter schools.
``(B) The replication of high-quality charter
schools.
``(C) The expansion of high-quality charter
schools.
``(3) The progress the State entity made toward meeting the
priorities described in subsection (g)(2), as applicable.
``(4) A description of--
``(A) how the State entity complied with, and
ensured that eligible applicants complied with, the
assurances described in the State entity's application;
and
``(B) how the State entity worked with authorized
public chartering agencies, including how the agencies
worked with the management company or leadership of the
schools that received subgrant funds, if applicable.''.
SEC. 6. FACILITIES FINANCING ASSISTANCE.
Section 5204 (20 U.S.C. 7221c) is amended to read as follows:
``SEC. 5204. FACILITIES FINANCING ASSISTANCE.
``(a) Grants to Eligible Entities.--
``(1) In general.--From the amount reserved under section
5202(b)(1), the Secretary shall use not less than 50 percent to
award not less than 3 grants, on a competitive basis, to
eligible entities that have the highest-quality 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.--The Secretary shall evaluate each
application submitted under subsection (d), and shall determine whether
the application is sufficient 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 in accessing private sector capital to accomplish one or more
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.
``(3) The predevelopment costs required to assess sites for
purposes of paragraph (1) or (2) and which are 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 such
subsection.
``(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 the entity's
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 such subsection.
``(2) Exercise of authority.--The Secretary shall not
exercise the authority provided in paragraph (1) to collect
from any eligible entity any funds that are being properly used
to achieve one or more of the purposes described in subsection
(f)(1).
``(3) Procedures.--The provisions of sections 451, 452,
and 458 of the General Education Provisions Act shall apply to
the recovery of funds under paragraph (1).
``(4) Construction.--This subsection shall not be construed
to impair or affect the authority of the Secretary to recover
funds under part D of the General Education Provisions Act.
``(k) Per-Pupil Facilities Aid Program.--
``(1) Definition of per-pupil facilities aid program.--In
this subsection, the term `per-pupil facilities aid program'
means a program in which a State makes payments, on a per-pupil
basis, to charter schools to provide the schools with
financing--
``(A) that is dedicated solely for funding charter
school facilities; or
``(B) a portion of which is dedicated for funding
charter school facilities.
``(2) Grants.--
``(A) In general.--From the amount reserved under
section 5202(b)(1) and 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 for the second such year;
``(iii) 60 percent for the third such year;
``(iv) 40 percent for the fourth such year;
and
``(v) 20 percent for 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 grant 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.
``(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 charter
schools in the State 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 80 percent of such funds to award
grants in accordance with subsection (b); and
``(2) use the remainder of such funds to--
``(A) disseminate technical assistance to State
entities in awarding subgrants under section
5203(b)(1)(A);
``(B) disseminate best practices regarding public
charter schools;
``(C) evaluate the impact of the charter school
program carried out under this subpart, including the
impact on student achievement; and
``(D) make grants, on a competitive basis, for the
purpose of carrying out the activities described in
section 5203(h), to eligible applicants that desire to
open a charter school, replicate a high-quality charter
school, or expand a high-quality charter school in--
``(i) a State that did not apply for a
grant under section 5203; or
``(ii) a State that did not receive a grant
under section 5203.
``(b) Grants for the Replication and Expansion of High-Quality
Charter Schools.--The Secretary shall make grants, on a competitive
basis, to eligible entities having applications approved under
paragraph (2) to enable such entities to replicate a high-quality
charter school or expand a high-quality charter school.
``(1) Definition of eligible entity.--For purposes of this
subsection, the term `eligible entity' means--
``(A) a charter management organization that, at
the time of the application, operates or manages one or
more high-quality charter schools; or
``(B) a nonprofit organization that oversees and
coordinates the activities of a group of such charter
management organizations.
``(2) Application requirements.--An eligible entity
desiring to receive a grant under this subsection 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:
``(A) A description of the eligible entity's
objectives for implementing a high-quality charter
school program with funding under this subsection,
including a description of the proposed number of high-
quality charter schools to be replicated or expanded
with funding under this subsection.
``(B) A description of the educational program that
the eligible entity will implement in the charter
schools that the eligible entity proposes to replicate
or expand, including information on how the program
will enable all students to meet challenging State
academic standards, the grade levels or ages of
students that will be served, and the instructional
practices that will be used.
``(C) A multi-year financial and operating model
for the eligible entity, including a description of how
the operation of the charter schools to be replicated
or expanded will be sustained after the grant under
this subsection has ended.
``(D) A description of how the eligible entity will
inform all students in the community, including
students with disabilities, students who are limited
English proficient, and other educationally
disadvantaged students, about the charter schools to be
replicated or expanded with funding under this
subsection.
``(E) For each charter school currently operated or
managed by the eligible entity--
``(i) student assessment results for all
students and for the subgroups of students
described in section 1111(b)(2)(C)(v)(II); and
``(ii) attendance and student retention
rates for the most recently completed school
year and, if applicable, the most recent
available 4-year adjusted cohort high school
graduation rate (as defined in section
200.19(b)(1)(i)(A) of title 34, Code of Federal
Regulations, or a successor regulation).
``(F) Information on any significant compliance
issues encountered, within the last 3 years, by any
school operated or managed by the eligible entity,
including in the areas of student safety and financial
management.
``(G) A request and justification for any waivers
of Federal statutory or regulatory requirements that
the eligible entity believes are necessary for the
successful operation of the charter schools to be
opened or expanded with funding under this subsection.
``(3) Selection criteria.--The Secretary shall select
eligible entities to receive grants under this subsection, on
the basis of the quality of the applications submitted under
paragraph (2), after taking into consideration such factors
as--
``(A) the degree to which the eligible entity has
demonstrated success in increasing academic achievement
and attainment for all students attending the charter
schools the eligible entity operates or manages;
``(B) the degree to which the eligible entity has
demonstrated success in increasing academic achievement
and attainment for the subgroups of students described
in section 1111(b)(2)(C)(v)(II);
``(C) the quality of the eligible entity's
financial and operating model as described under
paragraph (2)(C), including the quality of the eligible
entity's plan for sustaining the operation of the
charter schools to be replicated or expanded after the
grant under this subsection has ended;
``(D) a determination that the eligible entity has
not operated or managed a significant proportion of
charter schools that--
``(i) have been closed;
``(ii) have had a school charter revoked
due to problems with statutory or regulatory
compliance; or
``(iii) have had the school's affiliation
with the eligible entity revoked; and
``(E) a determination that the eligible entity has
not experienced significant problems with statutory or
regulatory compliance that could lead to the revocation
of a school's charter.
``(4) Priority.--In awarding grants under this section, the
Secretary shall give priority to eligible entities that operate
or manage charter schools that, in the aggregate, serve
students at least 60 percent of whom are eligible for a free or
reduced price lunch under the Richard B. Russell National
School Lunch Act.
``(5) Terms and conditions.--Except as otherwise provided
in this subsection, grants awarded under subsection (a)(2)(D)
and subsection (b) shall have the same terms and conditions as
grants awarded to State entities under section 5203.''.
SEC. 8. RECORDS TRANSFER.
Section 5208 (20 U.S.C. 7221g) is amended by inserting ``as quickly
as possible and'' before ``to the extent practicable''.
SEC. 9. DEFINITIONS.
Section 5210 (20 U.S.C. 7221i) is amended--
(1) by redesignating paragraphs (1), (2), and (3) as
paragraphs (2), (5), and (6), respectively;
(2) by redesignating paragraph (4) as paragraph (1), and
moving such paragraph so as to precede paragraph (2), as
redesignated by paragraph (1) of this section;
(3) in paragraph (2), as redesignated by paragraph (1)--
(A) in subparagraph (G), by striking ``, and part
B'' and inserting ``, the Americans with Disabilities
Act of 1990 (42 U.S.C. 12101 et seq.), section 444 of
the General Education Provisions Act (20 U.S.C. 1232)
(commonly referred to as the `Family Educational Rights
and Privacy Act of 1974'), and part B'';
(B) by striking subparagraph (H) and inserting the
following:
``(H) is a school to which parents choose to send
their children, and which--
``(i) admits students on the basis of a
lottery, if more students apply for admission
than can be accommodated; or
``(ii) in the case of a school that has an
affiliated charter school (such as a school
that is part of the same network of schools),
automatically enrolls students who are enrolled
in the immediate prior grade level of the
affiliated charter school and, for any
additional student openings or student openings
created through regular attrition in student
enrollment in the affiliated charter school and
the enrolling school, admits students on the
basis of a lottery as described in clause
(i);'';
(C) by striking subparagraph (I) and inserting the
following:
``(I) agrees to comply with the same Federal and
State audit requirements as do other elementary schools
and secondary schools in the State, unless such State
audit requirements are waived by the State;'';
(D) in subparagraph (K), by striking ``and'' at the
end;
(E) in subparagraph (L), by striking the period at
the end and inserting a semicolon; and
(F) by adding at the end the following:
``(M) may serve prekindergarten or postsecondary
students.'';
(4) by inserting after paragraph (2), as redesignated by
paragraph (1), the following:
``(3) Charter management organization.--The term `charter
management organization' means a nonprofit organization that
operates or manages multiple charter schools by centralizing or
sharing certain functions or resources.
``(4) Charter school support organization.--The term
`charter school support organization' means a nonprofit,
nongovernmental entity that is not an authorized public
chartering agency and provides on a statewide basis--
``(A) assistance to developers during the planning,
program design, and initial implementation of a charter
school; and
``(B) technical assistance to operating charter
schools.'';
(5) in paragraph (5)(B), as redesignated by paragraph (1),
by striking ``under section 5203(d)(3)''; and
(6) by adding at the end the following:
``(7) Expansion of a high-quality charter school.--The term
`expansion of a high-quality charter school' means increasing
the enrollment at a high-quality charter school by not less
than 50 percent or adding 2 or more grades to a high-quality
charter school.
``(8) 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, including
graduation rates where applicable, for all students
served by the charter school; and
``(D) has demonstrated success in increasing
student academic achievement, including graduation
rates where applicable, for the subgroups of students
described in section 1111(b)(2)(C)(v)(II), except that
such demonstration is not required in a case in which
the number of students in a group is insufficient to
yield statistically reliable information or the results
would reveal personally identifiable information about
an individual student.
``(9) Replication of a high-quality charter school.--The
term `replication of a high-quality charter school' means the
opening of a charter school--
``(A) under an existing charter or an additional
charter, if permitted by State law;
``(B) based on the model of a high-quality charter
school; and
``(C) that will be operated or managed by the same
nonprofit organization that operates or manages such
high-quality charter school 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 2015 and such sums as may be necessary for
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 subpart 1 of part B of
title V and inserting the following:
``subpart 1--charter school program'';
(2) by striking the item relating to section 5203 and
inserting the following:
``Sec. 5203. Grants to support high-quality charter schools.'';
and
(3) by striking the item relating to section 5204 and
inserting the following:
``Sec. 5204. Facilities financing assistance.''.
(c) Subpart Heading.--The heading for subpart 1 of part B of title
V (20 U.S.C. 7221 et seq.) is amended to read as follows: ``Charter
School Program''.
<all>
Introduced in Senate
Read twice and referred to the Committee on Health, Education, Labor, and Pensions.
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