II 

114TH CONGRESS 

1ST SESSION S. 102 

To amend the public charter school provisions of the Elementary and 

Secondary Education Act of 1965, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 7, 2015 

Mr. VITTER introduced the following bill; which was read twice and referred 

to the Committee on Health, Education, Labor, and Pensions 

A BILL 

To amend the public charter school provisions of the Elementary and Secondary Education Act of 1965, and for 

other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘21st Century Charter School Act’’. 

6 (b) TABLE OF CONTENTS.—The table of contents of 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Purpose. 

Sec. 3. Program authorized. 

Sec. 4. Applications. 

Sec. 5. Administration. 


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Sec. 6. National activities. 

Sec. 7. Federal formula allocation. 

Sec. 8. Credit enhancement. 

Sec. 9. Definitions. 

Sec. 10. Authorization of appropriations. 

Sec. 11. Reorganization. 

Sec. 12. Conforming amendments. 

1 SEC. 2. PURPOSE. 

2 Section 5201 of the Elementary and Secondary Edu3 cation Act of 1965 (20 U.S.C. 7221) is amended— 

4 (1) in paragraph (3), by striking ‘‘and’’; 

5 (2) by redesignating paragraph (4) as para6 graph (6); 

7 (3) by inserting after paragraph (3) the fol8 lowing: 

9 ‘‘(4) encouraging the growth of high-quality 

10 charter schools through the replication and expan11 sion of successful charter school models; 

12 ‘‘(5) disseminating charter school innovations 

13 throughout public education; and’’; and 

14 (4) in paragraph (6) (as redesignated by para15 graph (2))— 

16 (A) by striking ‘‘more nearly’’; and 

17 (B) by striking ‘‘have typically provided’’ 

18 and inserting ‘‘provide’’. 

19 SEC. 3. PROGRAM AUTHORIZED. 

20 Section 5202 of the Elementary and Secondary Edu21 cation Act of 1965 (20 U.S.C. 7221a) is amended— 

22 (1) in subsection (a)— 


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1 (A) by striking ‘‘State educational agen2 cies’’ and inserting ‘‘eligible entities’’; 

3 (B) by striking ‘‘such agencies’’ and insert4 ing ‘‘such entities’’; and 

5 (C) by striking ‘‘this subpart’’ and insert6 ing ‘‘section 5204’’; 

7 (2) in subsection (b)— 

8 (A) by striking ‘‘SPECIAL RULE.—If’’ and 

9 inserting the following: ‘‘SPECIAL RULE; RE10 SERVE ACCOUNT.— 

11 ‘‘(1) SPECIAL RULE.—If’’; 

12 (B) by striking ‘‘a State educational agen13 cy’’ and inserting ‘‘an eligible entity’’; 

14 (C) by striking ‘‘subpart’’ and inserting 

15 ‘‘section’’; and 

16 (D) by adding at the end the following: 

17 ‘‘(2) RESERVE ACCOUNTS.— 

18 ‘‘(A) IN GENERAL.—In order to assist eli19 gible entities to accomplish the purposes de20 scribed in section 5201, an eligible entity receiv21 ing a grant under this section shall, directly or 

22 indirectly, alone or in collaboration with others, 

23 deposit the funds received under this section in 

24 a reserve account established and maintained 


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1 by the eligible entity for this purpose, in accord2 ance with State and local law. 

3 ‘‘(B) INVESTMENT.—Funds received under 

4 this section that are deposited in the reserve ac5 count established under subparagraph (A), shall 

6 be invested, to the extent practicable, in obliga7 tions issued or guaranteed by the United States 

8 or a State, or in other similarly low risk securi9 ties, in the same manner as funds of a State 

10 are invested under chapter 65 of title 31, 

11 United States Code. 

12 ‘‘(C) REINVESTMENT OF EARNINGS.—Any 

13 earnings on funds received under this section 

14 shall be deposited in a reserve account and used 

15 in support of public charter schools in accord16 ance with activities authorized under this Act.’’; 

17 (3) in subsection (c)— 

18 (A) by striking ‘‘subpart’’ each place the 

19 term occurs and inserting ‘‘section’’; 

20 (B) in paragraph (1)— 

21 (i) in the paragraph heading, by strik22 ing ‘‘STATES’’ and inserting ‘‘ELIGIBLE

23 ENTITIES’’; 


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1 (ii) by striking ‘‘State educational 

2 agencies’’ and inserting ‘‘eligible entities’’; 

3 and 

4 (iii) by striking ‘‘not more than 3 

5 years’’ and inserting ‘‘not more than 5 

6 years’’; and 

7 (C) in paragraph (2)— 

8 (i) by striking ‘‘State educational 

9 agencies’’ and inserting ‘‘eligible entities’’; 

10 and 

11 (ii) by striking ‘‘not more than 3 

12 years’’ and all that follows through the pe13 riod at the end and inserting ‘‘not more 

14 than 5 years. An eligible applicant may use 

15 a portion of the grant period for planning 

16 and program design.’’; 

17 (4) by striking subsection (d) and inserting the 

18 following: 

19 ‘‘(d) CHARTER SCHOOLS WITH MULTIPLE CAM20 PUSES.—The Secretary shall allow an eligible entity to 

21 award multiple subgrants under section 5204(f)(1) to an 

22 eligible applicant in order to support multiple campuses 

23 of a charter school.’’; 

24 (5) in subsection (e)— 


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1 (A) by striking paragraph (1) and insert2 ing the following: 

3 ‘‘(1) IN GENERAL.—In awarding grants under 

4 this section for fiscal year 2015 or any succeeding 

5 fiscal year from any funds appropriated under sec6 tion 5212 (other than funds reserved to carry out 

7 section 5205(c)), the Secretary shall give priority to 

8 an eligible entity to the extent that the State in 

9 which the eligible entity proposes to carry out the 

10 activities under the grant meets the criteria de11 scribed in paragraph (2) and one or more of the cri12 teria described in subparagraphs (A) through (H) of 

13 paragraph (3).’’; 

14 (B) in paragraph (3)— 

15 (i) in subparagraph (A)— 

16 (I) by striking ‘‘a State edu17 cational agency’’ and inserting ‘‘an el18 igible entity’’; and 

19 (II) by striking ‘‘subpart’’ and 

20 inserting ‘‘section’’; 

21 (ii) by redesignating subparagraph 

22 (C) as subparagraph (D); 

23 (iii) in subparagraph (B)— 

24 (I) by redesignating clause (ii) as 

25 subparagraph (C), and aligning the 


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1 margins of such subparagraph with 

2 the margins of subparagraph (A); 

3 (II) by striking ‘‘The State’’ and 

4 all that follows through ‘‘provides’’ 

5 and inserting ‘‘The State provides’’; 

6 and 

7 (III) by striking ‘‘law; or’’ and 

8 inserting ‘‘law.’’; 

9 (iv) in subparagraph (C) (as redesig10 nated by clause (iii)(I)), by striking ‘‘in the 

11 case’’ and all that follows through ‘‘allows’’ 

12 and inserting ‘‘The State allows’’; 

13 (v) in subparagraph (D) (as redesig14 nated by clause (ii))— 

15 (I) by striking ‘‘school has a’’ 

16 and inserting ‘‘school has— 

17 ‘‘(i) a’’; 

18 (II) by striking ‘‘expenditures.’’ 

19 and inserting ‘‘expenditures; and’’; 

20 and 

21 (III) by adding at the end the 

22 following: 

23 ‘‘(ii) an independent governing board 

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1 tract with an authorized public chartering 

2 agency.’’; and 

3 (vi) by adding at the end the fol4 lowing: 

5 ‘‘(E) The State— 

6 ‘‘(i) provides public charter schools 

7 with funding commensurate with the fund8 ing provided to other public schools, in9 cluding capital or facilities aid distributed 

10 through a formula or revenue generated by 

11 bonds; and 

12 ‘‘(ii) ensures that the State edu13 cational agency and local educational agen14 cies provide public charter schools with the 

15 Federal, State, and local funds to which 

16 the public charter schools are entitled in a 

17 timely manner. 

18 ‘‘(F) The State makes it a priority to cre19 ate charter schools in local educational agencies 

20 with large numbers of schools designated as in 

21 need of improvement, corrective action, or re22 structuring under paragraph (1), (7), or (8) of 

23 section 1116(b). 

24 ‘‘(G) The State has developed a trans25 parent authorizer accreditation, training, or reVerDate Sep 11 2014 01:39 Jan 14, 2015 Jkt 049200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S102.IS S102

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1 view process for evaluating the effectiveness and 

2 quality of the State’s authorized public char3 tering agencies, or each authorized public char4 tering agency in the State has implemented 

5 such a process, including— 

6 ‘‘(i) a process for reviewing and evalu7 ating the performance of the authorized 

8 public chartering agencies in the State in 

9 authorizing or approving public charter 

10 schools, including a process that enables 

11 the authorized public chartering agencies 

12 to respond to any State concerns or defi13 ciencies regarding such authorizing or ap14 proving; and 

15 ‘‘(ii) any other necessary policies to 

16 ensure effective charter school authorizing 

17 in the State that are developed in conjunc18 tion with the State’s charter school com19 munity and in accordance with the prin20 ciples of high quality charter school au21 thorizing, as determined by the State in 

22 consultation with the charter school com23 munity and stakeholders. 

24 ‘‘(H) The State does not have a cap on 

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1 its parental options in an unreasonable man2 ner.’’; and 

3 (6) in subsection (f)— 

4 (A) by striking ‘‘subpart to a State edu5 cational agency’’ and inserting ‘‘section to an 

6 eligible entity’’; and 

7 (B) by striking ‘‘in the State.’’ and insert8 ing ‘‘in the State where the grant activities will 

9 be carried out.’’. 

10 SEC. 4. APPLICATIONS. 

11 Section 5203 of the Elementary and Secondary Edu12 cation Act of 1965 (20 U.S.C. 7221b) is amended— 

13 (1) by striking ‘‘this subpart’’ each place the 

14 term appears and inserting ‘‘section 5202’’; 

15 (2) in subsection (a), by striking ‘‘STATE

16 AGENCIES.—Each State educational agency’’ and in17 serting ‘‘ELIGIBLE ENTITIES.—An eligible entity’’; 

18 (3) in subsection (b)— 

19 (A) in the subsection heading, by striking 

20 ‘‘A STATE EDUCATIONAL AGENCY’’ and insert21 ing ‘‘AN ELIGIBLE ENTITY’’; 

22 (B) in paragraph (1)— 

23 (i) by striking ‘‘State educational 

24 agency’s’’ each place the term appears and 

25 inserting ‘‘eligible entity’s’’; and 


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1 (ii) by striking ‘‘State educational 

2 agency to’’ and inserting ‘‘eligible entity 

3 to’’; 

4 (C) in paragraph (2)— 

5 (i) in the matter preceding subpara6 graph (A), by striking ‘‘describe how the 

7 State educational agency—’’ and inserting 

8 ‘‘describe the State’s level of participation 

9 and involvement in the grant, including a 

10 letter from the State describing how the 

11 State—’’; 

12 (ii) in the matter preceding clause (i) 

13 of subparagraph (A), by striking ‘‘in the 

14 State’’ and inserting ‘‘in the area served by 

15 the grant’’; 

16 (iii) in subparagraph (B)— 

17 (I) by striking ‘‘in the State’’ and 

18 inserting ‘‘in the area served by the 

19 grant’’; and 

20 (II) by striking ‘‘and’’ after the 

21 semicolon; 

22 (iv) in subparagraph (C), by striking 

23 ‘‘to each local’’ and all that follows 

24 through ‘‘; and’’ and inserting ‘‘related to 

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1 ing, and instruction to public schools, in2 cluding public charter schools in the 

3 State;’’; and 

4 (v) by adding at the end the following: 

5 ‘‘(D) will ensure the proper handling and 

6 management of Federal funds; and 

7 ‘‘(E) will oversee and hold accountable the 

8 authorized public chartering agencies in the 

9 State, including through a transparent author10 izer accreditation, training, and review process 

11 described in section 5202(e)(3)(G);’’; 

12 (D) by redesignating paragraph (3) as 

13 paragraph (4); 

14 (E) by inserting after paragraph (2) the 

15 following: 

16 ‘‘(3) describe the criteria that the eligible entity 

17 will use to award subgrants to eligible applicants to 

18 ensure high-quality charter schools;’’; 

19 (F) in paragraph (4) (as redesignated by 

20 subparagraph (D))— 

21 (i) in the matter preceding subpara22 graph (A), by striking ‘‘State educational 

23 agency’’ each place the term appears and 

24 inserting ‘‘eligible entity’’; 

25 (ii) in subparagraph (A)— 


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1 (I) by redesignating clauses (ii) 

2 and (iii) as clauses (iii) and (iv), re3 spectively; and 

4 (II) by inserting after clause (i) 

5 the following: 

6 ‘‘(ii) the charter school’s plan for 

7 using academic assessments to measure 

8 and report student academic progress;’’; 

9 (iii) in subparagraph (B), by striking 

10 ‘‘managed;’’ and inserting the following: 

11 ‘‘managed, including— 

12 ‘‘(i) the charter school’s financial plan 

13 and policies, including financial controls 

14 and annual audit requirements; 

15 ‘‘(ii) a clear description of the roles 

16 and responsibilities for the charter school’s 

17 governing board, leadership, and manage18 ment team, and any other organizations 

19 critical to the charter school’s operations 

20 or success; 

21 ‘‘(iii) plans for recruiting and devel22 oping the charter school’s leadership and 

23 staff; 


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1 ‘‘(iv) the charter school’s leadership 

2 and teacher employment policies, including 

3 performance evaluation plans; 

4 ‘‘(v) the proposed governing bylaws of 

5 the charter school; and 

6 ‘‘(vi) a detailed charter school start-up 

7 plan that identifies tasks, timelines, and 

8 responsible parties;’’; 

9 (iv) in subparagraph (E), by inserting 

10 ‘‘, including documentation of the parents’ 

11 and community members’ support for the 

12 school’’ before the semicolon; 

13 (v) in subparagraph (F), by striking 

14 ‘‘a description of how’’ and inserting ‘‘an 

15 assurance from the authorized public char16 tering agency that’’; 

17 (vi) in subparagraph (H), by inserting 

18 ‘‘and how such funds will be used for plan19 ning, program design, and the initial im20 plementation of a charter school’’ before 

21 the semicolon at the end; 

22 (vii) in subparagraph (I)(ii), by insert23 ing ‘‘, including through a lottery process 

24 if the number of applicants exceeds the 


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1 number of seats available at the charter 

2 school’’ before the semicolon; 

3 (viii) in subparagraphs (J) and (K), 

4 by striking ‘‘State educational agency’’ 

5 each place the term appears and inserting 

6 ‘‘eligible entity’’; 

7 (ix) by striking subparagraph (M); 

8 (x) by redesignating subparagraph 

9 (N) as subparagraph (O); 

10 (xi) by inserting after subparagraph 

11 (L) the following: 

12 ‘‘(M) a demonstration of support for the 

13 charter school from the State’s charter school 

14 community; 

15 ‘‘(N) a description of how the independent 

16 governing board of the charter school, including 

17 a board overseeing multi-campus charters, is 

18 encouraged to include individuals with a diver19 sity of skills, including business management, 

20 financial management, real estate finance, and 

21 curriculum and instruction; and’’; and 

22 (xii) in subparagraph (O) (as redesig23 nated by clause (x))— 


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1 (I) by striking ‘‘State educational 

2 agency’’ and inserting ‘‘eligible enti3 ty’’; and 

4 (II) by striking the period at the 

5 end and inserting ‘‘; and’’; and 

6 (G) by adding at the end the following: 

7 ‘‘(5) in the case of an eligible entity that is an 

8 authorized public chartering agency— 

9 ‘‘(A) describe such eligible entity’s stra10 tegic goal for chartering schools and progress 

11 towards that goal; and 

12 ‘‘(B) provide an assurance that the eligible 

13 entity will annually file a plan with the State in 

14 which the eligible entity is located that covers 

15 such topics necessary for effective charter 

16 school oversight, including, at a minimum— 

17 ‘‘(i) the academic and financial per18 formance of all operating public charter 

19 schools overseen by the eligible entity, ac20 cording to the performance expectations 

21 for each public charter school set forth in 

22 the school’s contract; 

23 ‘‘(ii) the status of the eligible entity’s 

24 public charter school portfolio, identifying 

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1 lowing categories: approved (but not yet 

2 open), operating, renewed, transferred, re3 voked, not renewed, voluntarily closed, or 

4 never opened; 

5 ‘‘(iii) the authorizing functions pro6 vided by the eligible entity to the public 

7 charter schools the eligible entity oversees, 

8 including the eligible entity’s operating 

9 costs and expenses detailed in annual au10 dited financial statements that conform 

11 with generally accepted accounting prin12 ciples; and 

13 ‘‘(iv) the services purchased from the 

14 eligible entity by the public charter schools 

15 overseen by the eligible entity, including an 

16 itemized accounting of the actual costs of 

17 these services.’’; and 

18 (4) in subsection (d)— 

19 (A) in paragraph (1)— 

20 (i) by striking ‘‘(A) through (N) of 

21 subsection (b)(3)’’ and inserting ‘‘(A) 

22 through (O) of subsection (b)(4)’’; 

23 (ii) by striking ‘‘and (N)’’ and insert24 ing ‘‘and (O)’’; and 


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1 (iii) by striking ‘‘State educational 

2 agency’’ and inserting ‘‘eligible entity’’; 

3 and 

4 (B) in paragraph (2)— 

5 (i) in the matter preceding subpara6 graph (A), by striking ‘‘State educational 

7 agency’’ and inserting ‘‘eligible entity’’; 

8 and 

9 (ii) in paragraph (3)— 

10 (I) by striking ‘‘State educational 

11 agency’’ and inserting ‘‘eligible enti12 ty’’; and 

13 (II) by striking ‘‘subgrant if’’ 

14 and all that follows through the period 

15 and inserting ‘‘subgrant.’’. 

16 SEC. 5. ADMINISTRATION. 

17 Section 5204 of the Elementary and Secondary Edu18 cation Act of 1965 (20 U.S.C. 7221c) is amended— 

19 (1) in subsection (a)— 

20 (A) in the subsection heading, by striking 

21 ‘‘STATE EDUCATIONAL AGENCIES’’ and insert22 ing ‘‘ELIGIBLE ENTITIES’’; 

23 (B) by striking ‘‘this subpart’’ each place 

24 the term appears and inserting ‘‘section 5202’’; 


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1 (C) in the matter preceding paragraph (1), 

2 by striking ‘‘State educational agencies’’ and in3 serting ‘‘eligible entities’’; 

4 (D) in paragraph (1), by inserting ‘‘, in5 cluding efforts at closing the achievement gap 

6 by meeting the annual objectives described in 

7 section 1111(b)(2)(C)(v)’’ before the semicolon; 

8 (E) in paragraph (2), by inserting ‘‘and 

9 autonomy’’ after ‘‘flexibility’’; 

10 (F) in paragraph (5), by inserting ‘‘and’’ 

11 after the semicolon; 

12 (G) in paragraph (6), by striking ‘‘; and’’ 

13 and inserting a period; and 

14 (H) by striking paragraph (7); 

15 (2) in subsection (b)— 

16 (A) by striking ‘‘this subpart’’ and insert17 ing ‘‘section 5202’’; 

18 (B) in paragraph (5), by inserting ‘‘and’’ 

19 after the semicolon; 

20 (C) in paragraph (6), by striking ‘‘; and’’ 

21 and inserting a period; and 

22 (D) by striking paragraph (7); 

23 (3) in subsection (c)— 

24 (A) by striking ‘‘this subpart’’ and insert25 ing ‘‘section 5202’’; and 


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1 (B) by striking ‘‘State educational agency’’ 

2 and inserting ‘‘eligible entity’’; 

3 (4) in subsection (d)— 

4 (A) in the matter preceding paragraph 

5 (1)— 

6 (i) by striking ‘‘State educational 

7 agency receiving a grant under this sub8 part’’ and inserting ‘‘eligible entity receiv9 ing a grant under section 5202’’; and 

10 (ii) by striking ‘‘this subpart in’’ and 

11 inserting ‘‘such section in’’; and 

12 (B) in paragraph (2), by inserting ‘‘or use 

13 non-traditional curricula’’ before the period at 

14 the end; 

15 (5) in subsection (e)— 

16 (A) in the matter preceding subparagraph 

17 (1), by striking ‘‘5210(1)’’ and inserting 

18 ‘‘5211(2)’’; and 

19 (B) in paragraph (1), by striking ‘‘this 

20 subpart’’ and inserting ‘‘section 5203’’; 

21 (6) in subsection (f)— 

22 (A) in paragraph (1)— 

23 (i) in the paragraph heading, by strik24 ing ‘‘STATE EDUCATIONAL AGENCIES.—’’ 


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1 and inserting the following: ‘‘STATE EDU2 CATIONAL AGENCIES.— 

3 ‘‘(A) IN GENERAL.—Each eligible entity’’; 

4 (ii) by striking ‘‘under this subpart’’ 

5 and inserting ‘‘under section 5202’’; 

6 (iii) by inserting ‘‘, including a new 

7 campus or expansion of an existing charter 

8 school,’’ after ‘‘charter school’’; 

9 (iv) by striking ‘‘in the State’’ and in10 serting ‘‘in the area to be served by the 

11 grant’’; and 

12 (v) by striking ‘‘, except that’’ and all 

13 that follows through ‘‘paragraph (6).’’ and 

14 inserting a period; 

15 (B) by striking paragraph (6); 

16 (C) by redesignating paragraphs (2) 

17 through (5) as paragraphs (4) through (7), re18 spectively; 

19 (D) by inserting after paragraph (1) the 

20 following: 

21 ‘‘(2) CHARTER SCHOOL DEVELOPERS.—In 

22 awarding subgrants under this section, an eligible 

23 entity shall ensure that— 


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1 ‘‘(A) most of the subgrant funds are 

2 awarded to eligible applicants described in sec3 tion 5211(5)(A); and 

4 ‘‘(B) subgrants are awarded, to the extent 

5 practicable, to a mix of such eligible applicants. 

6 ‘‘(3) AMOUNT OF SUBGRANTS.—An eligible en7 tity may vary the amount of a subgrant under this 

8 section based upon a variety of factors, including— 

9 ‘‘(A) whether the eligible applicant is a 

10 start-up charter school or a conversion charter 

11 school (as defined by the eligible entity); and 

12 ‘‘(B) whether the eligible applicant is cre13 ating a charter school under a new charter or 

14 an existing charter.’’; 

15 (E) in paragraph (4) (as redesignated by 

16 subparagraph (C))— 

17 (i) by striking ‘‘a State educational 

18 agency’’ and inserting ‘‘an eligible entity’’; 

19 and 

20 (ii) by striking ‘‘, or to disseminate in21 formation about the charter school and 

22 successful practices in the charter school,’’; 

23 (F) in paragraph (5) (as redesignated by 

24 subparagraph (C))— 


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1 (i) in the matter preceding subpara2 graph (A), by striking ‘‘this subpart’’ and 

3 inserting ‘‘section 5202’’; 

4 (ii) in subparagraph (A)(ii), by strik5 ing ‘‘and’’ after the semicolon; 

6 (iii) in subparagraph (B)(iv), by strik7 ing the period and inserting ‘‘; and’’; and 

8 (iv) by adding at the end the fol9 lowing: 

10 ‘‘(C) providing assistance, through activi11 ties described in section 5205(b)(4), in imple12 menting charter school innovations and dissemi13 nating information regarding such innova14 tions.’’; 

15 (G) in paragraph (6)(A) (as redesignated 

16 by subparagraph (C))— 

17 (i) in the subparagraph heading, by 

18 striking ‘‘STATE EDUCATIONAL AGENCY’’ 

19 and inserting ‘‘ELIGIBLE ENTITY’’; 

20 (ii) by striking ‘‘State educational 

21 agency’’ and inserting ‘‘eligible entity’’; 

22 (iii) by striking ‘‘pursuant to this sub23 part’’ and inserting ‘‘pursuant to section 

24 5202’’; 


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1 (iv) by striking ‘‘this subpart’’ and in2 serting ‘‘such section’’; and 

3 (v) by adding at the end the following: 

4 ‘‘An eligible entity may use a portion of 

5 the reserved funds to improve the charter 

6 school authorizing policies and practices of 

7 the area served by the eligible entity, which 

8 may include the approval, monitoring, and 

9 renewal of charter schools.’’; and 

10 (H) in paragraph (7) (as redesignated by 

11 subparagraph (C))— 

12 (i) by striking ‘‘State educational 

13 agency’’ and inserting ‘‘eligible entity’’; 

14 (ii) by striking ‘‘this subpart’’ and in15 serting ‘‘section 5202’’; 

16 (iii) by striking ‘‘10’’ and inserting 

17 ‘‘20’’; and 

18 (iv) by striking ‘‘the State educational 

19 agency’’ and all that follows through 

20 ‘‘sources.’’ and inserting ‘‘the eligible enti21 ty, for expenses necessary to plan, begin 

22 operations, and subsequently operate a 

23 public charter school.’’; and 

24 (7) by striking subsection (g). 


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1 SEC. 6. NATIONAL ACTIVITIES. 

2 Section 5205 of the Elementary and Secondary Edu3 cation Act of 1965 (20 U.S.C. 7221d) is amended— 

4 (1) in subsection (a)— 

5 (A) in paragraph (3)(E), by striking 

6 ‘‘schools’’ each place the term occurs and in7 serting ‘‘schools, authorized public chartering 

8 agencies, and charter support organizations’’; 

9 and 

10 (B) by adding at the end the following: 

11 ‘‘(6) To provide technical assistance to charter 

12 schools on how to meet the requirements of part B 

13 of the Individuals with Disabilities Education Act.’’; 

14 (2) by redesignating subsections (b) and (c) as 

15 subsections (c) and (d), respectively; 

16 (3) by inserting after subsection (a) the fol17 lowing: 

18 ‘‘(b) NATIONAL DISSEMINATION.— 

19 ‘‘(1) IN GENERAL.—To carry out this sub20 section, the Secretary shall reserve for each fiscal 

21 year not more than $8,000,000 of the amount ap22 propriated to carry out this subpart. 

23 ‘‘(2) ELIGIBILITY.—In order to receive a grant 

24 under this subsection, an entity shall— 

25 ‘‘(A) be— 

26 ‘‘(i) a charter school; 


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1 ‘‘(ii) an eligible applicant; 

2 ‘‘(iii) an eligible entity; or 

3 ‘‘(iv) a consortium of entities de4 scribed in clauses (i), (ii), or (iii); and 

5 ‘‘(B) submit an application to the Sec6 retary at such time, in such manner, and con7 taining such information as the Secretary may 

8 require. 

9 ‘‘(3) CRITERIA.—The Secretary shall award 

10 grants under this subsection on the basis of— 

11 ‘‘(A) the quality of the application; 

12 ‘‘(B) the capacity of the applicant to exe13 cute the application; and 

14 ‘‘(C) the scale of the expected impact of 

15 the application. 

16 ‘‘(4) ACTIVITIES.—A recipient of a grant under 

17 this subsection shall use funds received under the 

18 grant to assist other schools in the recipient’s State 

19 and in other States in adopting charter school inno20 vations, or to disseminate information about charter 

21 school innovations, through activities such as— 

22 ‘‘(A) assisting other entities with the plan23 ning and start-up of one or more new public 

24 schools, including charter schools; 


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1 ‘‘(B) developing partnerships designed to 

2 improve student academic achievement; 

3 ‘‘(C) developing curriculum materials, as4 sessments, and other materials that promote in5 creased student achievement and are based on 

6 successful practices at charter schools; 

7 ‘‘(D) conducting evaluations and devel8 oping materials that document successful prac9 tices at charter schools and that are designed to 

10 improve student performance in other schools; 

11 and 

12 ‘‘(E) training, regarding the innovative 

13 practices developed at the original site, for per14 sonnel of— 

15 ‘‘(i) local educational agencies that 

16 are adopting innovations or successful 

17 practices used at charter schools; 

18 ‘‘(ii) authorized public chartering 

19 agencies; or 

20 ‘‘(iii) charter support organizations.’’; 

21 and 

22 (4) in subsection (c) (as redesignated by para23 graph (2))— 


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1 (A) in paragraph (2)(A), by striking 

2 ‘‘paragraphs (2) and (3)(B) of section 5211(b)’’ 

3 and inserting ‘‘section 5212’’; 

4 (B) by redesignating paragraphs (5) and 

5 (6) as paragraphs (6) and (7), respectively; 

6 (C) by inserting after paragraph (4) the 

7 following: 

8 ‘‘(5) SPECIAL RULE.—A State that provides 

9 public charter schools with access to existing ade10 quate facility space may apply for a grant under this 

11 subsection, if the State agrees that the State will, 

12 upon receipt of the grant, develop a capital aid pro13 gram consistent with the program described in this 

14 subsection during the grant period.’’; and 

15 (D) in paragraph (7) (as redesignated by 

16 subparagraph (B)), by striking ‘‘(A), (B), and 

17 (C)’’ and inserting ‘‘(A) through (F)’’. 

18 SEC. 7. FEDERAL FORMULA ALLOCATION. 

19 Section 5206 of the Elementary and Secondary Edu20 cation Act of 1965 (20 U.S.C. 7221e) is amended— 

21 (1) by striking the section heading and insert22 ing the following: 

23 ‘‘SEC. 5206. FEDERAL FORMULA ALLOCATION.’’; 

24 and 


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1 (2) in subsection (a), by inserting ‘‘or is in op2 eration’’ after ‘‘actually opens’’. 

3 SEC. 8. CREDIT ENHANCEMENT. 

4 Subpart 1 of part B of title V of the Elementary and 

5 Secondary Education Act of 1965 (as amended by this 

6 Act) (20 U.S.C. 7221 et seq.) is further amended— 

7 (1) by redesignating sections 5207 through 

8 5211 as sections 5208 through 5212, respectively; 

9 and 

10 (2) by inserting after section 5206 the fol11 lowing: 

12 ‘‘SEC. 5207. CREDIT ENHANCEMENT FOR CHARTER SCHOOL 

13 FACILITIES PROGRAMS. 

14 ‘‘(a) PURPOSE.—The purpose of this section is to 

15 provide grants to eligible entities to permit the eligible en16 tities to demonstrate innovative credit enhancement initia17 tives that assist charter schools to address the cost of ac18 quiring, constructing, and renovating facilities. 

19 ‘‘(b) GRANTS TO ELIGIBLE ENTITIES.—After reserv20 ing any funds as necessary for grant evaluation or admin21 istration consistent with any applicable provisions (includ22 ing section 9601(a) of this Act and section 402(b)(1) of 

23 the Department of Education Organization Act), the Sec24 retary shall use the amounts available to carry out this 

25 section to award, on a competitive basis, not less than 3 


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1 grants to eligible entities that have applications approved 

2 under this section to demonstrate innovative methods of 

3 assisting charter schools to address the cost of acquiring, 

4 constructing, and renovating facilities by enhancing the 

5 availability of loans or bond financing for charter schools. 

6 ‘‘(c) GRANTEE SELECTION.— 

7 ‘‘(1) EVALUATION OF APPLICATION.—The Sec8 retary shall evaluate each application submitted 

9 under subsection (e), and shall determine whether 

10 the application is sufficient to merit approval. 

11 ‘‘(2) DISTRIBUTION OF GRANTS.— 

12 ‘‘(A) IN GENERAL.—Subject to subpara13 graph (B) and paragraph (3), the Secretary 

14 shall award— 

15 ‘‘(i) not less than 1 grant to an eligi16 ble entity described in section 5211(6)(A); 

17 ‘‘(ii) not less than 1 grant to an eligi18 ble entity described in section 5211(6)(B); 

19 and 

20 ‘‘(iii) not less than 1 grant to an eligi21 ble entity described in section 5211(6)(C). 

22 ‘‘(B) EXCEPTION.—Subparagraph (A) 

23 shall only apply if applications are submitted 

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1 proving an application that is not of sufficient 

2 quality to merit approval. 

3 ‘‘(3) SPECIAL RULE.—In the event the Sec4 retary determines that the funds made available 

5 under this section are insufficient to permit the Sec6 retary to award not less than 3 grants in accordance 

7 with this section, the 3-grant minimum under para8 graph (2) shall not apply, and the Secretary may de9 termine the appropriate number of grants to be 

10 awarded in accordance with subsection (d). 

11 ‘‘(d) GRANT CHARACTERISTICS.—Grants under this 

12 section shall be of a sufficient size, scope, and quality so 

13 as to ensure an effective demonstration of an innovative 

14 means of enhancing credit for the financing of charter 

15 school acquisition, construction, or renovation. 

16 ‘‘(e) APPLICATIONS.— 

17 ‘‘(1) IN GENERAL.—To receive a grant under 

18 this section, an eligible entity shall submit to the 

19 Secretary an application in such form as the Sec20 retary may reasonably require. 

21 ‘‘(2) CONTENTS.—An application submitted 

22 under paragraph (1) shall contain— 

23 ‘‘(A) a statement identifying the activities 

24 proposed to be undertaken with funds received 

25 under this section, including how the eligible 


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1 entity will determine which charter schools will 

2 receive assistance, and how much and what 

3 types of assistance charter schools will receive; 

4 ‘‘(B) a description of the involvement of 

5 charter schools in the application’s development 

6 and the design of the proposed activities; 

7 ‘‘(C) a description of the eligible entity’s 

8 expertise in capital market financing; 

9 ‘‘(D) a description of how the proposed ac10 tivities will leverage the maximum amount of 

11 private-sector financing capital relative to the 

12 amount of Federal and State funds used and 

13 otherwise enhance credit available to charter 

14 schools, including how the applicant will offer a 

15 combination of rates and terms more favorable 

16 than rates and terms that a charter school 

17 could receive without assistance under this sec18 tion; 

19 ‘‘(E) a description of how the eligible enti20 ty possesses sufficient expertise in education to 

21 evaluate the likelihood of success of a charter 

22 school program for which facilities financing is 

23 sought; 

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1 ernmental entity, a description of the actions 

2 that the entity has taken, or will take, to ensure 

3 that charter schools within the State receive the 

4 funding needed to have adequate facilities; and 

5 ‘‘(G) such other information as the Sec6 retary may reasonably require. 

7 ‘‘(f) CHARTER SCHOOL OBJECTIVES.—An eligible en8 tity receiving a grant under this section shall use the funds 

9 deposited in the reserve account established under sub10 section (g)(1) to assist 1 or more charter schools to access 

11 private sector capital in order to accomplish one or more 

12 of the following objectives: 

13 ‘‘(1) The acquisition (by purchase, lease, dona14 tion, or otherwise) of an interest (including an inter15 est held by a third party for the benefit of a charter 

16 school) in improved or unimproved real property 

17 that is necessary to commence or continue the oper18 ation of a charter school. 

19 ‘‘(2) The construction (including pre20 development costs in a case where construction or 

21 renovation cannot proceed as a result of 

22 predevelopment findings) of new facilities, or the 

23 renovation, repair, or alteration of existing facilities, 

24 necessary to commence or continue the operation of 

25 a charter school. 


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1 ‘‘(g) RESERVE ACCOUNT.— 

2 ‘‘(1) USE OF FUNDS.—To assist charter schools 

3 to accomplish the objectives described in subsection 

4 (f), an eligible entity receiving a grant under this 

5 section shall, in accordance with State and local law, 

6 directly or indirectly, alone or in collaboration with 

7 others, deposit the funds received under this section 

8 (other than funds used for administrative costs in 

9 accordance with subsection (h)) in a reserve account 

10 established and maintained by the eligible entity for 

11 this purpose. Amounts deposited in such account 

12 shall be used by the eligible entity for one or more 

13 of the following purposes: 

14 ‘‘(A) Guaranteeing, insuring, and rein15 suring bonds, notes, evidences of debt, loans, 

16 and interests therein, the proceeds of which are 

17 used for an objective described in subsection (f). 

18 ‘‘(B) Guaranteeing and insuring leases of 

19 personal and real property for an objective de20 scribed in subsection (f). 

21 ‘‘(C) Facilitating financing by identifying 

22 potential lending sources, encouraging private 

23 lending, and other similar activities that di24 rectly promote lending to, or for the benefit of, 

25 charter schools. 


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1 ‘‘(D) Facilitating the issuance of bonds by 

2 charter schools, or by other public entities for 

3 the benefit of charter schools, by providing 

4 technical, administrative, and other appropriate 

5 assistance (including the recruitment of bond 

6 counsel, underwriters, and potential investors 

7 and the consolidation of multiple charter school 

8 projects within a single bond issue). 

9 ‘‘(E) Making limited loans to charter 

10 schools, under such terms and conditions as the 

11 Secretary may prescribe. 

12 ‘‘(2) INVESTMENT.—Funds received under this 

13 section and deposited in the reserve account estab14 lished under paragraph (1) shall be invested in obli15 gations issued or guaranteed by the United States or 

16 a State, or in other similarly low-risk securities. 

17 ‘‘(3) REINVESTMENT OF EARNINGS.—Any earn18 ings on funds received under this section shall be de19 posited in the reserve account established under 

20 paragraph (1) and used in accordance with such 

21 paragraph. 

22 ‘‘(h) LIMITATION ON ADMINISTRATIVE COSTS.—An 

23 eligible entity may use not more than 2 percent of the 

24 funds received for any fiscal year under this section for 


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1 the administrative costs of carrying out its responsibilities 

2 under this section. 

3 ‘‘(i) AUDITS AND REPORTS.— 

4 ‘‘(1) FINANCIAL RECORD MAINTENANCE AND

5 AUDIT.—The financial records of each eligible entity 

6 receiving a grant under this section shall be main7 tained in accordance with generally accepted ac8 counting principles and shall be subject to an annual 

9 audit by an independent public accountant. 

10 ‘‘(2) REPORTS.— 

11 ‘‘(A) GRANTEE ANNUAL REPORTS.—Each 

12 eligible entity receiving a grant under this sec13 tion annually shall submit to the Secretary a re14 port of the eligible entity’s operations and ac15 tivities under this section. 

16 ‘‘(B) CONTENTS.—Each annual report 

17 submitted under subparagraph (A) shall in18 clude— 

19 ‘‘(i) a copy of the most recent finan20 cial statements, and any accompanying 

21 opinion on such statements, prepared by 

22 the independent public accountant review23 ing the financial records of the eligible en24 tity; 


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1 ‘‘(ii) a copy of any report made on an 

2 audit of the financial records of the eligible 

3 entity that was conducted under paragraph 

4 (1) during the reporting period; 

5 ‘‘(iii) an evaluation by the eligible en6 tity of the effectiveness of its use of the 

7 Federal funds provided under this section 

8 in leveraging private funds; 

9 ‘‘(iv) a listing and description of the 

10 charter schools served during the reporting 

11 period; 

12 ‘‘(v) a description of the activities car13 ried out by the eligible entity to assist 

14 charter schools in meeting the objectives 

15 set forth in subsection (f); and 

16 ‘‘(vi) a description of the characteris17 tics of lenders and other financial institu18 tions participating in the activities under19 taken by the eligible entity under this sec20 tion during the reporting period. 

21 ‘‘(C) SECRETARIAL REPORT.—The Sec22 retary shall review the reports submitted under 

23 paragraph (2)(A) and shall provide a com24 prehensive annual report to Congress on the ac25 tivities conducted under this section. 


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1 ‘‘(j) NO FULL FAITH AND CREDIT FOR GRANTEE

2 OBLIGATIONS.—No financial obligation of an eligible enti3 ty entered into pursuant to this section (such as an obliga4 tion under a guarantee, bond, note, evidence of debt, or 

5 loan) shall be an obligation of, or guaranteed in any re6 spect by, the United States. The full faith and credit of 

7 the United States is not pledged to the payment of funds 

8 which may be required to be paid under any obligation 

9 made by an eligible entity pursuant to any provision of 

10 this section. 

11 ‘‘(k) RECOVERY OF FUNDS.— 

12 ‘‘(1) IN GENERAL.—The Secretary, in accord13 ance with chapter 37 of title 31, United States 

14 Code, shall collect— 

15 ‘‘(A) all of the funds in a reserve account 

16 established by an eligible entity under sub17 section (g)(1) if the Secretary determines, not 

18 earlier than 2 years after the date on which the 

19 eligible entity first received funds under this 

20 section, that the eligible entity has failed to 

21 make substantial progress in carrying out the 

22 purposes described in this section; or 

23 ‘‘(B) all or a portion of the funds in a re24 serve account established by an eligible entity 

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1 mines that the eligible entity has permanently 

2 ceased to use all or a portion of the funds in 

3 such account to accomplish any purpose de4 scribed in this section. 

5 ‘‘(2) EXERCISE OF AUTHORITY.—The Secretary 

6 shall not exercise the authority provided in para7 graph (1) to collect from any eligible entity any 

8 funds that are being properly used to achieve one or 

9 more of the objectives described in subsection (f). 

10 ‘‘(3) PROCEDURES.—The provisions of sections 

11 451, 452, and 458 of the General Education Provi12 sions Act shall apply to the recovery of funds under 

13 paragraph (1). 

14 ‘‘(4) CONSTRUCTION.—Nothing in this section 

15 shall be construed to impair or affect the authority 

16 of the Secretary to recover funds under part D of 

17 the General Education Provisions Act. 

18 ‘‘(l) RESERVATION.—To carry out this section, the 

19 Secretary shall reserve for each fiscal year not less than 

20 5 percent and not more than 15 percent of the amount 

21 appropriated under section 5212.’’. 

22 SEC. 9. DEFINITIONS. 

23 Section 5211 of the Elementary and Secondary Edu24 cation Act of 1965 (as redesignated by section 8(1)) (20 

25 U.S.C. 7221i) is amended— 


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1 (1) in paragraph (1)— 

2 (A) by striking subparagraph (L); 

3 (B) by redesignating subparagraphs (D) 

4 through (K) as subparagraphs (E) through (L), 

5 respectively; 

6 (C) by inserting after subparagraph (C) 

7 the following: 

8 ‘‘(D) has an independent governing board 

9 that enters into a performance-based agreement 

10 that encompasses one or more campuses with 

11 an authorized public chartering agency in the 

12 State, which agreement shall include a descrip13 tion of— 

14 ‘‘(i) how student performance will be 

15 measured in each charter school pursuant 

16 to the State assessments that are required 

17 of other schools and any other assessments 

18 or evaluations mutually agreeable to the 

19 authorized public chartering agency and 

20 the charter school; and 

21 ‘‘(ii) criteria for renewal or revocation 

22 of the charter;’’; 

23 (D) in subparagraph (E) (as redesignated 

24 by subparagraph (B)), by striking ‘‘elementary 

25 or secondary education, or both’’ and inserting 


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1 ‘‘prekindergarten, elementary, or secondary 

2 education, or adult education if permitted by 

3 State charter law, or any combination of such 

4 types of education’’; 

5 (E) in subparagraph (I) (as redesignated 

6 by subparagraph (B))— 

7 (i) by striking ‘‘school to’’ and insert8 ing ‘‘school— 

9 ‘‘(i) to’’; 

10 (ii) by striking ‘‘children, and that’’ 

11 and inserting ‘‘children; 

12 ‘‘(ii) that’’; and 

13 (iii) by striking ‘‘accommodated;’’ and 

14 inserting ‘‘accommodated; and 

15 ‘‘(iii) that does not give admissions 

16 preference to any student on the basis of 

17 prior academic achievement;’’; 

18 (F) in subparagraph (K) (as redesignated 

19 by subparagraph (B)), by inserting ‘‘and’’ after 

20 the semicolon; and 

21 (G) in subparagraph (L) (as redesignated 

22 by subparagraph (B)), by striking ‘‘; and’’ and 

23 inserting a period; 

24 (2) by striking paragraph (3) and inserting the 

25 following: 


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1 ‘‘(3) ELIGIBLE APPLICANT.—The term ‘eligible 

2 applicant’ means— 

3 ‘‘(A) a developer that has applied to an au4 thorized public chartering agency to operate a 

5 charter school and provided adequate and time6 ly notice to that authority under section 

7 5203(d)(3); or 

8 ‘‘(B) a charter support organization.’’; 

9 (3) by adding at the end the following: 

10 ‘‘(5) CHARTER SUPPORT ORGANIZATION.—The 

11 term ‘charter support organization’ means a public 

12 or private nonprofit organization that provides as13 sistance to a developer of a charter school during the 

14 planning, program design, and initial implementa15 tion of a charter school. 

16 ‘‘(6) ELIGIBLE ENTITY.—The term ‘eligible en17 tity’ means— 

18 ‘‘(A) a public entity, such as a State edu19 cational agency or other State or local govern20 mental entity; 

21 ‘‘(B) a private nonprofit entity; or 

22 ‘‘(C) a consortium of entities described in 

23 subparagraph (A) or (B).’’; and 


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1 (4) by redesignating paragraphs (1) through 

2 (6) as paragraphs (2), (4), (5), (1), (3), and (6), re3 spectively. 

4 SEC. 10. AUTHORIZATION OF APPROPRIATIONS. 

5 Section 5212 of the Elementary and Secondary Edu6 cation Act of 1965 (as redesignated by section 8(1)) (20 

7 U.S.C. 7221j) is amended to read as follows: 

8 ‘‘SEC. 5212. AUTHORIZATION OF APPROPRIATIONS. 

9 ‘‘(a) IN GENERAL.—There are authorized to be ap10 propriated to carry out this subpart $650,000,000 for fis11 cal year 2015 and such sums as may be necessary for each 

12 of the 5 succeeding fiscal years. 

13 ‘‘(b) ALLOCATION.—In allocating funds under this 

14 subpart for any fiscal year, the Secretary shall consider 

15 the relative need between the programs under section 

16 5202, section 5205(c), and section 5207 and the quality 

17 of the applications submitted under such sections.’’. 

18 SEC. 11. REORGANIZATION. 

19 Part B of title V of the Elementary and Secondary 

20 Education Act of 1965 (20 U.S.C. 7221 et seq.) is amend21 ed— 

22 (1) by striking subpart 2; and 

23 (2) by redesignating subpart 3 as subpart 2. 


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1 SEC. 12. CONFORMING AMENDMENTS. 

2 (a) CONFORMING AMENDMENT.—The Elementary 

3 and Secondary Education Act of 1965 (20 U.S.C. 6301 

4 et seq.) is amended— 

5 (1) in section 2102(2), by striking ‘‘5210’’ and 

6 inserting ‘‘5211’’; and 

7 (2) in section 5247(1), by striking ‘‘5210’’ and 

8 inserting ‘‘5211’’. 

9 (b) TABLE OF CONTENTS.—The table of contents in 

10 section 2 of the Elementary and Secondary Education Act 

11 of 1965 is amended— 

12 (1) by striking the items relating to sections 

13 5206 through 5211 and inserting the following: 

‘‘Sec. 5206. Federal formula allocation. 

‘‘Sec. 5207. Credit enhancement for charter school facilities programs. 

‘‘Sec. 5208. Solicitation of input from charter school operators. 

‘‘Sec. 5209. Records transfer. 

‘‘Sec. 5210. Paperwork reduction. 

‘‘Sec. 5211. Definitions. 

‘‘Sec. 5212. Authorization of appropriations.’’; 

14 (2) by striking the item relating to subpart 2 

15 of part B of title V; 

16 (3) by striking the items relating to sections 

17 5221 through 5231; and 

18 (4) by striking the item relating to subpart 3 

19 of part B of title V and inserting the following: 

‘‘SUBPART 2—VOLUNTARY PUBLIC SCHOOL CHOICE PROGRAMS’’. 

Æ 


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