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[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2218 Reported in House (RH)]

                                                 Union Calendar No. 117
112th CONGRESS
  1st Session
                                H. R. 2218

                          [Report No. 112-178]

To amend the charter school program under the Elementary and Secondary 
                         Education Act of 1965.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                             June 16, 2011

 Mr. Hunter (for himself and Mr. Kline) introduced the following bill; 
   which was referred to the Committee on Education and the Workforce

                             July 22, 2011

 Additional sponsors: Mr. George Miller of California, Mr. Petri, Mr. 
 McKeon, Mr. Bucshon, Mr. Roe of Tennessee, Mr. Kelly, Mr. Polis, Mr. 
    DesJarlais, Mr. Walberg, Mr. Gowdy, Mr. Rokita, and Mr. Crenshaw

                             July 22, 2011

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]
 [For text of introduced bill, see copy of bill as introduced on June 
                               16, 2011]

_______________________________________________________________________

                                 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 ``Empowering Parents through Quality 
Charter Schools Act''.

SEC. 2. REFERENCES.

    Except as otherwise specifically provided, whenever in this Act a 
section or other provision is amended or repealed, such amendment or 
repeal shall be considered to be made to that section or other 
provision of the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 6301 et seq.).

SEC. 3. PURPOSE.

    Section 5201 (20 U.S.C. 7221) is amended to read as follows:

``SEC. 5201. PURPOSE.

    ``It is the purpose of this subpart to--
            ``(1) provide financial assistance for the planning, 
        program design, and initial implementation of charter schools;
            ``(2) expand the number of high-quality charter schools 
        available to students across the Nation;
            ``(3) evaluate the impact of such schools on student 
        achievement, families, and communities, and share best 
        practices between charter schools and other public schools;
            ``(4) encourage States to provide support to charter 
        schools for facilities financing in an amount more nearly 
        commensurate to the amount the States have typically provided 
        for traditional public schools;
            ``(5) improve student services to increase opportunities 
        for students with disabilities, English language learners, and 
        other traditionally underserved students to attend charter 
        schools and meet challenging State academic achievement 
        standards; and
            ``(6) support efforts to strengthen the charter school 
        authorizing process to improve performance management, 
        including transparency, monitoring, and evaluation of such 
        schools.''.

SEC. 4. PROGRAM AUTHORIZED.

    Section 5202 (20 U.S.C. 7221a) is amended to read as follows:

``SEC. 5202. PROGRAM AUTHORIZED.

    ``(a) In General.--This subpart authorizes the Secretary to carry 
out a charter school program that supports charter schools that serve 
elementary school and secondary school students by--
            ``(1) supporting the startup, replication, and expansion of 
        charter schools;
            ``(2) assisting charter schools in accessing credit to 
        acquire and renovate facilities for school use; and
            ``(3) carrying out national activities to support--
                    ``(A) charter school development;
                    ``(B) the dissemination of best practices of 
                charter schools for all schools; and
                    ``(C) the evaluation of the impact of the program 
                on schools participating in the program.
    ``(b) Funding Allotment.--From the amount made available under 
section 5211 for a fiscal year, the Secretary shall--
            ``(1) reserve 15 percent to support charter school 
        facilities assistance under section 5204;
            ``(2) reserve not more than 5 percent to carry out national 
        activities under section 5205; and
            ``(3) use the remaining amount after the Secretary reserves 
        funds under paragraphs (1) and (2) to carry out section 5203.
    ``(c) Prior Grants and Subgrants.--The recipient of a grant or 
subgrant under this subpart, as such subpart was in effect on the day 
before the date of enactment of the Empowering Parents through Quality 
Charter Schools Act, shall continue to receive funds in accordance with 
the terms and conditions of such grant or subgrant.''.

SEC. 5. GRANTS TO SUPPORT HIGH-QUALITY CHARTER SCHOOLS.

    Section 5203 (20 U.S.C. 7221b) is amended to read as follows:

``SEC. 5203. GRANTS TO SUPPORT HIGH-QUALITY CHARTER SCHOOLS.

    ``(a) In General.--From the amount reserved under section 
5202(b)(3), the Secretary shall award grants to State entities having 
applications approved pursuant to subsection (f) to enable such 
entities to--
            ``(1) award subgrants to eligible applicants for--
                    ``(A) opening new charter schools;
                    ``(B) opening replicable, high-quality charter 
                school models; or
                    ``(C) expanding high-quality charter schools; and
            ``(2) provide technical assistance to eligible applicants 
        and authorized public chartering agencies in carrying out the 
        activities described in paragraph (1) and work with authorized 
        public chartering agencies in the State to improve authorizing 
        quality.
    ``(b) State Uses of Funds.--
            ``(1) In general.--A State entity receiving a grant under 
        this section shall--
                    ``(A) use 90 percent of the grant funds to award 
                subgrants to eligible applicants, in accordance with 
                the quality charter school program described in the 
                entity's application approved pursuant to subsection 
                (f), for the purposes described in subparagraphs (A) 
                through (C) of subsection (a)(1); and
                    ``(B) reserve 10 percent of such funds to carry out 
                the activities described in subsection (a)(2), of which 
                not more than 30 percent may be used for administrative 
                costs which may include technical assistance.
            ``(2) Contracts and grants.--A State entity may use a grant 
        received under this section to carry out the activities 
        described in subparagraphs (A) and (B) of paragraph (1) 
        directly or through grants, contracts, or cooperative 
        agreements.
    ``(c) Program Periods; Peer Review; Diversity of Projects.--
            ``(1) Program periods.--
                    ``(A) Grants.--A grant awarded by the Secretary to 
                a State entity under this section shall be for a period 
                of not more than 5 years.
                    ``(B) Subgrants.--A subgrant awarded by a State 
                entity under this section shall be for a period of not 
                more than 5 years, of which an eligible applicant may 
                use not more than 18 months for planning and program 
                design.
            ``(2) Peer review.--The Secretary, and each State entity 
        receiving a grant under this section, shall use a peer review 
        process to review applications for assistance under this 
        section.
            ``(3) Diversity of projects.--Each State entity receiving a 
        grant under this section shall award subgrants under this 
        section in a manner that, to the extent possible, ensures that 
        such subgrants--
                    ``(A) are distributed throughout different areas, 
                including urban, suburban, and rural areas; and
                    ``(B) will assist charter schools representing a 
                variety of educational approaches.
    ``(d) Limitations.--
            ``(1) Grants.--A State entity may not receive more than 1 
        grant under this section for a 5-year period.
            ``(2) Subgrants.--An eligible applicant may not receive 
        more than 1 subgrant under this section per charter school for 
        a 5-year period.
    ``(e) Applications.--A State entity desiring to receive a grant 
under this section shall submit an application to the Secretary at such 
time and in such manner as the Secretary may require. The application 
shall include the following:
            ``(1) Description of program.--A description of the 
        entity's objectives in running a quality charter school program 
        under this section and how the objectives of the program will 
        be carried out, including a description--
                    ``(A) of how the entity--
                            ``(i) will support both new charter school 
                        startup and the expansion and replication of 
                        high-quality charter school models;
                            ``(ii) will inform eligible charter 
                        schools, developers, and authorized public 
                        chartering agencies of the availability of 
                        funds under the program;
                            ``(iii) will work with eligible applicants 
                        to ensure that the applicants access all 
                        Federal funds that they are eligible to 
                        receive, and help the charter schools supported 
                        by the applicants and the students attending 
                        the charter schools--
                                    ``(I) participate in the Federal 
                                programs in which the schools and 
                                students are eligible to participate; 
                                and
                                    ``(II) receive the commensurate 
                                share of Federal funds the schools and 
                                students are eligible to receive under 
                                such programs;
                            ``(iv) in the case in which the entity is 
                        not a State educational agency--
                                    ``(I) will work with the State 
                                educational agency and the charter 
                                schools in the State to maximize 
                                charter school participation in Federal 
                                and State programs for charter schools; 
                                and
                                    ``(II) will work with the State 
                                educational agency to adequately 
                                operate the entity's program under this 
                                section, where applicable;
                            ``(v) will ensure eligible applicants that 
                        receive a subgrant under the entity's program 
                        are prepared to continue to operate the charter 
                        schools receiving the subgrant funds once the 
                        funds have expired;
                            ``(vi) will support charter schools in 
                        local educational agencies with large numbers 
                        of schools that must comply with the 
                        requirements of section 1116(b);
                            ``(vii) will work with charter schools to 
                        promote inclusion of all students and support 
                        all students once they are enrolled to promote 
                        retention;
                            ``(viii) will work with charter schools on 
                        recruitment practices, including efforts to 
                        engage groups that may otherwise have limited 
                        opportunities to participate in charter 
                        schools;
                            ``(ix) will share best and promising 
                        practices between charter schools and other 
                        public schools;
                            ``(x) will ensure the charter schools they 
                        support can meet the educational needs of their 
                        students, including students with disabilities 
                        and English language learners; and
                            ``(xi) will support efforts to increase 
                        quality initiatives, including meeting the 
                        quality authorizing elements described in 
                        paragraph (2)(E);
                    ``(B) of the extent to which the entity--
                            ``(i) is able to meet and carry out the 
                        priorities listed in subsection (f)(2); and
                            ``(ii) is working to develop or strengthen 
                        a cohesive statewide system to support the 
                        opening of new charter schools and replicable, 
                        high-quality charter school models, and 
                        expanding high-quality charter schools;
                    ``(C) how the entity will carry out the subgrant 
                competition, including--
                            ``(i) a description of the application each 
                        eligible applicant desiring to receive a 
                        subgrant will submit, including--
                                    ``(I) a description of the roles 
                                and responsibilities of eligible 
                                applicants, partner organizations, and 
                                management organizations, including the 
                                administrative and contractual roles 
                                and responsibilities; and
                                    ``(II) a description of the quality 
                                controls agreed to between the eligible 
                                applicant and the authorized public 
                                chartering agency involved, such as a 
                                contract or performance agreement, and 
                                how a school's performance on the 
                                State's academic accountability system 
                                will be a primary factor for renewal; 
                                and
                            ``(ii) a description of how the entity will 
                        review applications; and
                    ``(D) in the case of an entity that partners with 
                an outside organization to carry out the entity's 
                quality charter school program, in whole or in part, of 
                the roles and responsibilities of this partner.
            ``(2) Assurances.--Assurances, including a description of 
        how the assurances will be met, that--
                    ``(A) each charter school receiving funds under the 
                entity's program will have a high degree of autonomy 
                over budget and operations;
                    ``(B) the entity will support charter schools in 
                meeting the educational needs of their students as 
                described in paragraph (1)(A)(x);
                    ``(C) the entity will ensure that the authorized 
                public chartering agency of any charter school that 
                receives funds under the entity's program--
                            ``(i) ensures that the charter school is 
                        meeting the obligations under this Act, part B 
                        of the Individuals with Disabilities Education 
                        Act, title VI of the Civil Rights Act of 1964, 
                        and section 504 of the Rehabilitation Act of 
                        1973; and
                            ``(ii) adequately monitors and helps the 
                        schools in recruiting, enrolling, and meeting 
                        the needs of all students, including students 
                        with disabilities and English language 
                        learners;
                    ``(D) the entity will provide adequate technical 
                assistance to eligible applicants to--
                            ``(i) meet the objectives described in 
                        clauses (vii) and (viii) of paragraph (1)(A) 
                        and paragraph (2)(B); and
                            ``(ii) enroll traditionally underserved 
                        students, including students with disabilities 
                        and English language learners, to promote an 
                        inclusive education environment;
                    ``(E) the entity will promote quality authorizing, 
                such as through providing technical assistance, to 
                support all authorized public chartering agencies in 
                the State to improve the monitoring of their charter 
                schools, including by--
                            ``(i) using annual performance data, which 
                        may include graduation rates and student growth 
                        data, as appropriate, to measure the progress 
                        of their schools toward becoming high-quality 
                        charter schools; and
                            ``(ii) reviewing the schools' independent, 
                        annual audits of financial statements conducted 
                        in accordance with generally accepted 
                        accounting principles, and ensuring any such 
                        audits are publically reported; and
                    ``(F) the entity will work to ensure that charter 
                schools are included with the traditional public school 
                system in decision-making about the public school 
                system in the State.
            ``(3) Requests for waivers.--A request and justification 
        for waivers of any Federal statutory or regulatory provisions 
        that the entity believes are necessary for the successful 
        operation of the charter schools that will receive funds under 
        the entity's program under this section, and a description of 
        any State or local rules, generally applicable to public 
        schools, that will be waived, or otherwise not apply to such 
        schools.
    ``(f) Selection Criteria; Priority.--
            ``(1) Selection criteria.--The Secretary shall award grants 
        to State entities under this section on the basis of the 
        quality of the applications submitted under subsection (e), 
        after taking into consideration--
                    ``(A) the degree of flexibility afforded by the 
                State's public charter school law and how the entity 
                will work to maximize the flexibility provided to 
                charter schools under the law;
                    ``(B) the ambitiousness of the entity's objectives 
                for the quality charter school program carried out 
                under this section;
                    ``(C) the quality of the strategy for assessing 
                achievement of those objectives;
                    ``(D) the likelihood that the eligible applicants 
                receiving subgrants under the program will meet those 
                objectives and improve educational results for 
                students;
                    ``(E) the proposed number of new charter schools to 
                be opened, and the number of high-quality charter 
                schools to be replicated or expanded under the program;
                    ``(F) the entity's plan to--
                            ``(i) adequately monitor the eligible 
                        applicants receiving subgrants under the 
                        entity's program; and
                            ``(ii) work with the authorized public 
                        chartering agencies involved to avoid 
                        duplication of work for the charter schools and 
                        authorized public chartering agencies;
                    ``(G) the entity's plan to provide adequate 
                technical assistance, as described in the entity's 
                application under subsection (e), for the eligible 
                applicants receiving subgrants under the entity's 
                program under this section; and
                    ``(H) the entity's plan to support quality 
                authorizing efforts in the State, consistent with the 
                objectives described in subparagraph (B).
            ``(2) Priority.--In awarding grants under this section, the 
        Secretary shall give priority to State entities to the extent 
        that they meet the following criteria:
                    ``(A) In the case in which a State entity is 
                located in a State that allows an entity other than the 
                State educational agency to be an authorized public 
                chartering agency or a State in which only a local 
                educational agency may be an authorized public 
                chartering agency, the State has an appeals process for 
                the denial of an application for a charter school.
                    ``(B) The State entity is located in a State that 
                does not impose any limitation on the number or 
                percentage of charter schools that may exist or the 
                number or percentage of students that may attend 
                charter schools in the State.
                    ``(C) The State entity is located in a State that 
                ensures equitable financing, as compared to traditional 
                public schools, for charter schools and students in a 
                prompt manner.
                    ``(D) The State entity supports full-, blended-, or 
                hybrid-online charter school models.
                    ``(E) The State entity is located in a State that 
                uses charter schools and best practices from charter 
                schools to help improve struggling schools and local 
                educational agencies.
                    ``(F) The State entity partners with an 
                organization that has a demonstrated record of success 
                in developing management organizations to support the 
                development of charter schools in the State.
                    ``(G) The State entity demonstrates quality 
                policies and practices to support and monitor charter 
                schools through factors, including--
                            ``(i) the proportion of high-quality 
                        charter schools in the State; and
                            ``(ii) the proportion of charter schools 
                        enrolling, at a rate similar to traditional 
                        public schools, traditionally underserved 
                        students, including students with disabilities 
                        and English language learners.
    ``(g) Local Uses of Funds.--An eligible applicant receiving a 
subgrant under this section shall use such funds to open new charter 
schools or replicable, high-quality charter school models, or expand 
existing high-quality charter schools.
    ``(h) Reporting Requirements.--Each State entity receiving a grant 
under this section shall submit to the Secretary, at the end of the 
third year of the 5-year grant period and at the end of such grant 
period, a report on--
            ``(1) the number of students served and, if applicable, how 
        many new students were served during each year of the grant 
        period;
            ``(2) the number of subgrants awarded under this section to 
        carry out each of the following--
                    ``(A) the opening of new charter schools;
                    ``(B) the opening of replicable, high-quality 
                charter school models; and
                    ``(C) the expansion of high-quality charter 
                schools;
            ``(3) the progress the entity made toward meeting the 
        priorities described in subsection (f)(2), as applicable;
            ``(4) how the entity met the objectives of the quality 
        charter school program described in the entity's application 
        under subsection (e);
            ``(5) how the entity complied with, and ensured that 
        eligible applicants complied with, the assurances described in 
        the entity's application; and
            ``(6) how the entity worked with authorized public 
        chartering agencies, including how the agencies worked with the 
        management company or leadership of the schools in which the 
        subgrants were awarded.
    ``(i) State Entity Defined.--For purposes of this section, the term 
`State entity' means--
            ``(1) a State educational agency;
            ``(2) a State charter school board; or
            ``(3) a Governor of a State.''.

SEC. 6. FACILITIES FINANCING ASSISTANCE.

    Section 5204 (20 U.S.C. 7221c) is amended to read as follows:

``SEC. 5204. FACILITIES FINANCING ASSISTANCE.

    ``(a) Grants to Eligible Entities.--
            ``(1) In general.--From the amount reserved under section 
        5202(b)(1), the Secretary shall award not less than 3 grants to 
        eligible entities that have applications approved under 
        subsection (d) to demonstrate innovative methods of assisting 
        charter schools to address the cost of acquiring, constructing, 
        and renovating facilities by enhancing the availability of 
        loans or bond financing.
            ``(2) Eligible entity defined.--For purposes of this 
        section, the term `eligible entity' means--
                    ``(A) a public entity, such as a State or local 
                governmental entity;
                    ``(B) a private nonprofit entity; or
                    ``(C) a consortium of entities described in 
                subparagraphs (A) and (B).
    ``(b) Grantee Selection.--
            ``(1) Evaluation of application.--The Secretary shall 
        evaluate each application submitted under subsection (d), and 
        shall determine whether the application is sufficient to merit 
        approval.
            ``(2) Distribution of grants.--The Secretary shall award at 
        least one grant to an eligible entity described in subsection 
        (a)(2)(A), at least one grant to an eligible entity described 
        in subsection (a)(2)(B), and at least one grant to an eligible 
        entity described in subsection (a)(2)(C), if applications are 
        submitted that permit the Secretary to do so without approving 
        an application that is not of sufficient quality to merit 
        approval.
    ``(c) Grant Characteristics.--Grants under subsection (a) shall be 
of a sufficient size, scope, and quality so as to ensure an effective 
demonstration of an innovative means of enhancing credit for the 
financing of charter school acquisition, construction, or renovation.
    ``(d) Applications.--
            ``(1) In general.--To receive a grant under subsection (a), 
        an eligible entity shall submit to the Secretary an application 
        in such form as the Secretary may reasonably require.
            ``(2) Contents.--An application submitted under paragraph 
        (1) shall contain--
                    ``(A) a statement identifying the activities 
                proposed to be undertaken with funds received under 
                subsection (a), including how the eligible entity will 
                determine which charter schools will receive 
                assistance, and how much and what types of assistance 
                charter schools will receive;
                    ``(B) a description of the involvement of charter 
                schools in the application's development and the design 
                of the proposed activities;
                    ``(C) a description of the eligible entity's 
                expertise in capital market financing;
                    ``(D) a description of how the proposed activities 
                will leverage the maximum amount of private-sector 
                financing capital relative to the amount of government 
                funding used and otherwise enhance credit available to 
                charter schools, including how the entity will offer a 
                combination of rates and terms more favorable than the 
                rates and terms that a charter school could receive 
                without assistance from the entity under this section;
                    ``(E) a description of how the eligible entity 
                possesses sufficient expertise in education to evaluate 
                the likelihood of success of a charter school program 
                for which facilities financing is sought; and
                    ``(F) in the case of an application submitted by a 
                State governmental entity, a description of the actions 
                that the entity has taken, or will take, to ensure that 
                charter schools within the State receive the funding 
                the charter schools need to have adequate facilities.
    ``(e) Charter School Objectives.--An eligible entity receiving a 
grant under this section shall use the funds deposited in the reserve 
account established under subsection (f) to assist one or more charter 
schools to access private sector capital to accomplish one or both of 
the following objectives:
            ``(1) The acquisition (by purchase, lease, donation, or 
        otherwise) of an interest (including an interest held by a 
        third party for the benefit of a charter school) in improved or 
        unimproved real property that is necessary to commence or 
        continue the operation of a charter school.
            ``(2) The construction of new facilities, including 
        predevelopment costs, or the renovation, repair, or alteration 
        of existing facilities, necessary to commence or continue the 
        operation of a charter school.
    ``(f) Reserve Account.--
            ``(1) Use of funds.--To assist charter schools to 
        accomplish the objectives described in subsection (e), an 
        eligible entity receiving a grant under subsection (a) shall, 
        in accordance with State and local law, directly or indirectly, 
        alone or in collaboration with others, deposit the funds 
        received under subsection (a) (other than funds used for 
        administrative costs in accordance with subsection (g)) in a 
        reserve account established and maintained by the eligible 
        entity for this purpose. Amounts deposited in such account 
        shall be used by the eligible entity for one or more of the 
        following purposes:
                    ``(A) Guaranteeing, insuring, and reinsuring bonds, 
                notes, evidences of debt, loans, and interests therein, 
                the proceeds of which are used for an objective 
                described in subsection (e).
                    ``(B) Guaranteeing and insuring leases of personal 
                and real property for an objective described in 
                subsection (e).
                    ``(C) Facilitating financing by identifying 
                potential lending sources, encouraging private lending, 
                and other similar activities that directly promote 
                lending to, or for the benefit of, charter schools.
                    ``(D) Facilitating the issuance of bonds by charter 
                schools, or by other public entities for the benefit of 
                charter schools, by providing technical, 
                administrative, and other appropriate assistance 
                (including the recruitment of bond counsel, 
                underwriters, and potential investors and the 
                consolidation of multiple charter school projects 
                within a single bond issue).
            ``(2) Investment.--Funds received under this section and 
        deposited in the reserve account established under paragraph 
        (1) shall be invested in obligations issued or guaranteed by 
        the United States or a State, or in other similarly low-risk 
        securities.
            ``(3) Reinvestment of earnings.--Any earnings on funds 
        received under subsection (a) shall be deposited in the reserve 
        account established under paragraph (1) and used in accordance 
        with such subsection.
    ``(g) Limitation on Administrative Costs.--An eligible entity may 
use not more than 2.5 percent of the funds received under subsection 
(a) for the administrative costs of carrying out its responsibilities 
under this section (excluding subsection (k)).
    ``(h) Audits and Reports.--
            ``(1) Financial record maintenance and audit.--The 
        financial records of each eligible entity receiving a grant 
        under subsection (a) shall be maintained in accordance with 
        generally accepted accounting principles and shall be subject 
        to an annual audit by an independent public accountant.
            ``(2) Reports.--
                    ``(A) Grantee annual reports.--Each eligible entity 
                receiving a grant under subsection (a) annually shall 
                submit to the Secretary a report of its operations and 
                activities under this section.
                    ``(B) Contents.--Each annual report submitted under 
                subparagraph (A) shall include--
                            ``(i) a copy of the most recent financial 
                        statements, and any accompanying opinion on 
                        such statements, prepared by the independent 
                        public accountant reviewing the financial 
                        records of the eligible entity;
                            ``(ii) a copy of any report made on an 
                        audit of the financial records of the eligible 
                        entity that was conducted under paragraph (1) 
                        during the reporting period;
                            ``(iii) an evaluation by the eligible 
                        entity of the effectiveness of its use of the 
                        Federal funds provided under subsection (a) in 
                        leveraging private funds;
                            ``(iv) a listing and description of the 
                        charter schools served during the reporting 
                        period, including the amount of funds used by 
                        each school, the type of project facilitated by 
                        the grant, and the type of assistance provided 
                        to the charter schools;
                            ``(v) a description of the activities 
                        carried out by the eligible entity to assist 
                        charter schools in meeting the objectives set 
                        forth in subsection (e); and
                            ``(vi) a description of the characteristics 
                        of lenders and other financial institutions 
                        participating in the activities undertaken by 
                        the eligible entity under this section 
                        (excluding subsection (k)) during the reporting 
                        period.
                    ``(C) Secretarial report.--The Secretary shall 
                review the reports submitted under subparagraph (A) and 
                shall provide a comprehensive annual report to Congress 
                on the activities conducted under this section 
                (excluding subsection (k)).
    ``(i) No Full Faith and Credit for Grantee Obligation.--No 
financial obligation of an eligible entity entered into pursuant to 
this section (such as an obligation under a guarantee, bond, note, 
evidence of debt, or loan) shall be an obligation of, or guaranteed in 
any respect by, the United States. The full faith and credit of the 
United States is not pledged to the payment of funds which may be 
required to be paid under any obligation made by an eligible entity 
pursuant to any provision of this section.
    ``(j) Recovery of Funds.--
            ``(1) In general.--The Secretary, in accordance with 
        chapter 37 of title 31, United States Code, shall collect--
                    ``(A) all of the funds in a reserve account 
                established by an eligible entity under subsection 
                (f)(1) if the Secretary determines, not earlier than 2 
                years after the date on which the eligible entity first 
                received funds under this section (excluding subsection 
                (k)), that the eligible entity has failed to make 
                substantial progress in carrying out the purposes 
                described in subsection (f)(1); or
                    ``(B) all or a portion of the funds in a reserve 
                account established by an eligible entity under 
                subsection (f)(1) if the Secretary determines that the 
                eligible entity has permanently ceased to use all or a 
                portion of the funds in such account to accomplish any 
                purpose described in subsection (f)(1).
            ``(2) Exercise of authority.--The Secretary shall not 
        exercise the authority provided in paragraph (1) to collect 
        from any eligible entity any funds that are being properly used 
        to achieve one or more of the purposes described in subsection 
        (f)(1).
            ``(3)  Procedures.--The provisions of sections 451, 452, 
        and 458 of the General Education Provisions Act shall apply to 
        the recovery of funds under paragraph (1).
            ``(4) Construction.--This subsection shall not be construed 
        to impair or affect the authority of the Secretary to recover 
        funds under part D of the General Education Provisions Act.
    ``(k) Per-pupil Facilities Aid Program.--
            ``(1) Definition of per-pupil facilities aid program.--In 
        this subsection, the term `per-pupil facilities aid program' 
        means a program in which a State makes payments, on a per-pupil 
        basis, to charter schools to provide the schools with 
        financing--
                    ``(A) that is dedicated solely for funding charter 
                school facilities; or
                    ``(B) a portion of which is dedicated for funding 
                charter school facilities.
            ``(2) Grants.--
                    ``(A) In general.--From the amount reserved under 
                section 5202(b)(1) remaining after the Secretary makes 
                grants under subsection (a), the Secretary shall make 
                grants, on a competitive basis, to States to pay for 
                the Federal share of the cost of establishing or 
                enhancing, and administering per-pupil facilities aid 
                programs.
                    ``(B) Period.--The Secretary shall award grants 
                under this subsection for periods of not more than 5 
                years.
                    ``(C) Federal share.--The Federal share of the cost 
                described in subparagraph (A) for a per-pupil 
                facilities aid program shall be not more than--
                            ``(i) 90 percent of the cost, for the first 
                        fiscal year for which the program receives 
                        assistance under this subsection;
                            ``(ii) 80 percent in the second such year;
                            ``(iii) 60 percent in the third such year;
                            ``(iv) 40 percent in the fourth such year; 
                        and
                            ``(v) 20 percent in the fifth such year.
                    ``(D) State share.--A State receiving a grant under 
                this subsection may partner with 1 or more 
                organizations to provide up to 50 percent of the State 
                share of the cost of establishing or enhancing, and 
                administering the per-pupil facilities aid program.
                    ``(E) Multiple grants.--A State may receive more 
                than 1 grant under this subsection, so long as the 
                amount of such funds provided to charter schools 
                increases with each successive grant.
            ``(3) Use of funds.--
                    ``(A) In general.--A State that receives a grant 
                under this subsection shall use the funds made 
                available through the grant to establish or enhance, 
                and administer, a per-pupil facilities aid program for 
                charter schools in the State of the applicant.
                    ``(B) Evaluations; technical assistance; 
                dissemination.--From the amount made available to a 
                State through a grant under this subsection for a 
                fiscal year, the State may reserve not more than 5 
                percent to carry out evaluations, to provide technical 
                assistance, and to disseminate information.
                    ``(C) Supplement, not supplant.--Funds made 
                available under this subsection shall be used to 
                supplement, and not supplant, State, and local public 
                funds expended to provide per pupil facilities aid 
                programs, operations financing programs, or other 
                programs, for charter schools.
            ``(4) Requirements.--
                    ``(A) Voluntary participation.--No State may be 
                required to participate in a program carried out under 
                this subsection.
                    ``(B) State law.--
                            ``(i) In general.--To be eligible to 
                        receive a grant under this subsection, a State 
                        shall establish or enhance, and administer, a 
                        per-pupil facilities aid program for charter 
                        schools in the State, that--
                                    ``(I) is specified in State law; 
                                and
                                    ``(II) provides annual financing, 
                                on a per-pupil basis, for charter 
                                school facilities.
                            ``(ii) Special rule.--A State that is 
                        required under State law to provide its charter 
                        schools with access to adequate facility space 
                        may be eligible to receive a grant under this 
                        subsection if the State agrees to use the funds 
                        to develop a per-pupil facilities aid program 
                        consistent with the requirements of this 
                        subsection.
            ``(5) Applications.--To be eligible to receive a grant 
        under this subsection, a State shall submit an application to 
        the Secretary at such time, in such manner, and containing such 
        information as the Secretary may require.''.

SEC. 7. NATIONAL ACTIVITIES.

    Section 5205 (20 U.S.C. 7221d) is amended to read as follows:

``SEC. 5205. NATIONAL ACTIVITIES.

    ``(a) In General.--From the amount reserved under section 
5202(b)(2), the Secretary shall--
            ``(1) use not less than 50 percent of such funds to award 
        grants in accordance with subsection (b); and
            ``(2) use the remainder of such funds to--
                    ``(A) disseminate technical assistance to State 
                entities in awarding subgrants under section 5203;
                    ``(B) disseminate best practices; and
                    ``(C) evaluate the impact of the charter school 
                program, including the impact on student achievement, 
                carried out under this subpart.
    ``(b)  Grants.--
            ``(1) In general.--The Secretary shall make grants, on a 
        competitive basis, to eligible applicants for the purpose of 
        carrying out the activities described in section 5202(a)(1), 
        subparagraphs (A) through (C) of section 5203(a)(1), and 
        section 5203(g).
            ``(2) Terms and conditions.--Except as otherwise provided 
        in this subsection, grants awarded under this subsection shall 
        have the same terms and conditions as grants awarded to State 
        entities under section 5203.
            ``(3) Eligible applicant defined.--For purposes of this 
        subsection, the term `eligible applicant' means an eligible 
        applicant that desires to open a charter school in--
                    ``(A) a State that did not apply for a grant under 
                section 5203;
                    ``(B) a State that did not receive a grant under 
                section 5203; or
                    ``(C) a State that received a grant under section 
                5203 and is in the 4th or 5th year of the grant period 
                for such grant.
    ``(c) Contracts and Grants.--The Secretary may carry out any of the 
activities described in this section directly or through grants, 
contracts, or cooperative agreements.''.

SEC. 8. RECORDS TRANSFER.

    Section 5208 (20 U.S.C. 7221g) is amended--
            (1) by inserting ``as quickly as possible and'' before ``to 
        the extent practicable''; and
            (2) by striking ``section 602'' and inserting ``section 
        602(14)''.

SEC. 9. DEFINITIONS.

    Section 5210 (20 U.S.C. 7221i) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``and'' at the end of subparagraph 
                (K);
                    (B) by striking the period at the end of 
                subparagraph (L) and inserting ``; and''; and
                    (C) by adding at the end, the following:
                    ``(M) may serve prekindergarten or post secondary 
                students.'';
            (2) in paragraph (3)(B), by striking ``under section 
        5203(d)(3)''; and
            (3) by inserting at the end the following:
            ``(5) Expansion of a high-quality charter school.--The term 
        `expansion of a high-quality charter school' means a high-
        quality charter school that either significantly increases its 
        enrollment or adds one or more grades to its school.
            ``(6) High-quality charter school.--The term `high-quality 
        charter school' means a charter school that--
                    ``(A) shows evidence of strong academic results, 
                which may include strong academic growth as determined 
                by a State;
                    ``(B) has no significant issues in the areas of 
                student safety, financial management, or statutory or 
                regulatory compliance;
                    ``(C) has demonstrated success in significantly 
                increasing student academic achievement and attainment 
                for all students served by charter schools; and
                    ``(D) has demonstrated success in increasing 
                student academic achievement for the subgroups of 
                students described in section 1111(b)(2)(C)(v)(II).
            ``(7) Replicable, high-quality charter school model.--The 
        term `replicable, high-quality charter school model' means a 
        high-quality charter school that will open a new campus under 
        an existing charter.''.

SEC. 10. AUTHORIZATION OF APPROPRIATIONS.

    Section 5211 (20 U.S.C. 7221j) is amended to read as follows:

``SEC. 5211. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this subpart 
$300,000,000 for fiscal year 2012 and each of the 5 succeeding fiscal 
years.''.

SEC. 11. CONFORMING AMENDMENTS.

    (a) Repeal.--Subpart 2 of part B of title V (20 U.S.C. 7223 et 
seq.) is repealed.
    (b) Table of Contents.--The table of contents in section 2 is 
amended--
            (1) by striking the item relating to section 5203 and 
        inserting the following:

``Sec. 5203. Grants to support high-quality charter schools.'';
            (2) by striking the item relating to section 5204 and 
        inserting the following:

``Sec. 5204. Facilities Financing Assistance.''; and
            (3) by striking subpart 2 of part B of title V.
                                                 Union Calendar No. 117

112th CONGRESS

  1st Session

                               H. R. 2218

                          [Report No. 112-178]

_______________________________________________________________________

                                 A BILL

To amend the charter school program under the Elementary and Secondary 
                         Education Act of 1965.

_______________________________________________________________________

                             July 22, 2011

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed
```