IB 

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] 

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A BILL 

To amend the charter school program under the Elementary 

and Secondary Education Act of 1965. 

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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. 

4 This Act may be cited as the ‘‘Empowering Parents 

5 through Quality Charter Schools Act’’. 

6 SEC. 2. REFERENCES. 

7 Except as otherwise specifically provided, whenever in 

8 this Act a section or other provision is amended or repealed, 

9 such amendment or repeal shall be considered to be made 

10 to that section or other provision of the Elementary and 

11 Secondary Education Act of 1965 (20 U.S.C. 6301 et seq.). 

12 SEC. 3. PURPOSE. 

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

14 follows: 

15 ‘‘SEC. 5201. PURPOSE. 

16 ‘‘It is the purpose of this subpart to— 

17 ‘‘(1) provide financial assistance for the plan18 ning, program design, and initial implementation of 

19 charter schools; 

20 ‘‘(2) expand the number of high-quality charter 

21 schools available to students across the Nation; 

22 ‘‘(3) evaluate the impact of such schools on stu23 dent achievement, families, and communities, and 

24 share best practices between charter schools and other 

25 public schools; 

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1 ‘‘(4) encourage States to provide support to char2 ter schools for facilities financing in an amount more 

3 nearly commensurate to the amount the States have 

4 typically provided for traditional public schools; 

5 ‘‘(5) improve student services to increase oppor6 tunities for students with disabilities, English lan7 guage learners, and other traditionally underserved 

8 students to attend charter schools and meet chal9 lenging State academic achievement standards; and 

10 ‘‘(6) support efforts to strengthen the charter 

11 school authorizing process to improve performance 

12 management, including transparency, monitoring, 

13 and evaluation of such schools.’’. 

14 SEC. 4. PROGRAM AUTHORIZED. 

15 Section 5202 (20 U.S.C. 7221a) is amended to read 

16 as follows: 

17 ‘‘SEC. 5202. PROGRAM AUTHORIZED. 

18 ‘‘(a) IN GENERAL.—This subpart authorizes the Sec19 retary to carry out a charter school program that supports 

20 charter schools that serve elementary school and secondary 

21 school students by— 

22 ‘‘(1) supporting the startup, replication, and ex23 pansion of charter schools; 

24 ‘‘(2) assisting charter schools in accessing credit 

25 to acquire and renovate facilities for school use; and 

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1 ‘‘(3) carrying out national activities to sup2 port— 

3 ‘‘(A) charter school development; 

4 ‘‘(B) the dissemination of best practices of 

5 charter schools for all schools; and 

6 ‘‘(C) the evaluation of the impact of the pro7 gram on schools participating in the program. 

8 ‘‘(b) FUNDING ALLOTMENT.—From the amount made 

9 available under section 5211 for a fiscal year, the Secretary 

10 shall— 

11 ‘‘(1) reserve 15 percent to support charter school 

12 facilities assistance under section 5204; 

13 ‘‘(2) reserve not more than 5 percent to carry out 

14 national activities under section 5205; and 

15 ‘‘(3) use the remaining amount after the Sec16 retary reserves funds under paragraphs (1) and (2) to 

17 carry out section 5203. 

18 ‘‘(c) PRIOR GRANTS AND SUBGRANTS.—The recipient 

19 of a grant or subgrant under this subpart, as such subpart 

20 was in effect on the day before the date of enactment of 

21 the Empowering Parents through Quality Charter Schools 

22 Act, shall continue to receive funds in accordance with the 

23 terms and conditions of such grant or subgrant.’’. 

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

2 SCHOOLS. 

3 Section 5203 (20 U.S.C. 7221b) is amended to read 

4 as follows: 

5 ‘‘SEC. 5203. GRANTS TO SUPPORT HIGH-QUALITY CHARTER 

6 SCHOOLS. 

7 ‘‘(a) IN GENERAL.—From the amount reserved under 

8 section 5202(b)(3), the Secretary shall award grants to 

9 State entities having applications approved pursuant to 

10 subsection (f) to enable such entities to— 

11 ‘‘(1) award subgrants to eligible applicants for— 

12 ‘‘(A) opening new charter schools; 

13 ‘‘(B) opening replicable, high-quality char14 ter school models; or 

15 ‘‘(C) expanding high-quality charter schools; 

16 and 

17 ‘‘(2) provide technical assistance to eligible ap18 plicants and authorized public chartering agencies in 

19 carrying out the activities described in paragraph (1) 

20 and work with authorized public chartering agencies 

21 in the State to improve authorizing quality. 

22 ‘‘(b) STATE USES OF FUNDS.— 

23 ‘‘(1) IN GENERAL.—A State entity receiving a 

24 grant under this section shall— 

25 ‘‘(A) use 90 percent of the grant funds to 

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1 cordance with the quality charter school program 

2 described in the entity’s application approved 

3 pursuant to subsection (f), for the purposes de4 scribed in subparagraphs (A) through (C) of sub5 section (a)(1); and 

6 ‘‘(B) reserve 10 percent of such funds to 

7 carry out the activities described in subsection 

8 (a)(2), of which not more than 30 percent may 

9 be used for administrative costs which may in10 clude technical assistance. 

11 ‘‘(2) CONTRACTS AND GRANTS.—A State entity 

12 may use a grant received under this section to carry 

13 out the activities described in subparagraphs (A) and 

14 (B) of paragraph (1) directly or through grants, con15 tracts, or cooperative agreements. 

16 ‘‘(c) PROGRAM PERIODS; PEER REVIEW; DIVERSITY

17 OF PROJECTS.— 

18 ‘‘(1) PROGRAM PERIODS.— 

19 ‘‘(A) GRANTS.—A grant awarded by the 

20 Secretary to a State entity under this section 

21 shall be for a period of not more than 5 years. 

22 ‘‘(B) SUBGRANTS.—A subgrant awarded by 

23 a State entity under this section shall be for a 

24 period of not more than 5 years, of which an elimstockstill on DSK4VPTVN1PROD with BILLS

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1 gible applicant may use not more than 18 

2 months for planning and program design. 

3 ‘‘(2) PEER REVIEW.—The Secretary, and each 

4 State entity receiving a grant under this section, shall 

5 use a peer review process to review applications for 

6 assistance under this section. 

7 ‘‘(3) DIVERSITY OF PROJECTS.—Each State enti8 ty receiving a grant under this section shall award 

9 subgrants under this section in a manner that, to the 

10 extent possible, ensures that such subgrants— 

11 ‘‘(A) are distributed throughout different 

12 areas, including urban, suburban, and rural 

13 areas; and 

14 ‘‘(B) will assist charter schools representing 

15 a variety of educational approaches. 

16 ‘‘(d) LIMITATIONS.— 

17 ‘‘(1) GRANTS.—A State entity may not receive 

18 more than 1 grant under this section for a 5-year pe19 riod. 

20 ‘‘(2) SUBGRANTS.—An eligible applicant may 

21 not receive more than 1 subgrant under this section 

22 per charter school for a 5-year period. 

23 ‘‘(e) APPLICATIONS.—A State entity desiring to receive 

24 a grant under this section shall submit an application to 

25 the Secretary at such time and in such manner as the Secmstockstill on DSK4VPTVN1PROD with BILLS

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1 retary may require. The application shall include the fol2 lowing: 

3 ‘‘(1) DESCRIPTION OF PROGRAM.—A description 

4 of the entity’s objectives in running a quality charter 

5 school program under this section and how the objec6 tives of the program will be carried out, including a 

7 description— 

8 ‘‘(A) of how the entity— 

9 ‘‘(i) will support both new charter 

10 school startup and the expansion and rep11 lication of high-quality charter school mod12 els; 

13 ‘‘(ii) will inform eligible charter 

14 schools, developers, and authorized public 

15 chartering agencies of the availability of 

16 funds under the program; 

17 ‘‘(iii) will work with eligible appli18 cants to ensure that the applicants access 

19 all Federal funds that they are eligible to 

20 receive, and help the charter schools sup21 ported by the applicants and the students 

22 attending the charter schools— 

23 ‘‘(I) participate in the Federal 

24 programs in which the schools and stu25 dents are eligible to participate; and 

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1 ‘‘(II) receive the commensurate 

2 share of Federal funds the schools and 

3 students are eligible to receive under 

4 such programs; 

5 ‘‘(iv) in the case in which the entity is 

6 not a State educational agency— 

7 ‘‘(I) will work with the State edu8 cational agency and the charter schools 

9 in the State to maximize charter school 

10 participation in Federal and State 

11 programs for charter schools; and 

12 ‘‘(II) will work with the State 

13 educational agency to adequately oper14 ate the entity’s program under this sec15 tion, where applicable; 

16 ‘‘(v) will ensure eligible applicants that 

17 receive a subgrant under the entity’s pro18 gram are prepared to continue to operate 

19 the charter schools receiving the subgrant 

20 funds once the funds have expired; 

21 ‘‘(vi) will support charter schools in 

22 local educational agencies with large num23 bers of schools that must comply with the 

24 requirements of section 1116(b); 

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1 ‘‘(vii) will work with charter schools to 

2 promote inclusion of all students and sup3 port all students once they are enrolled to 

4 promote retention; 

5 ‘‘(viii) will work with charter schools 

6 on recruitment practices, including efforts 

7 to engage groups that may otherwise have 

8 limited opportunities to participate in 

9 charter schools; 

10 ‘‘(ix) will share best and promising 

11 practices between charter schools and other 

12 public schools; 

13 ‘‘(x) will ensure the charter schools 

14 they support can meet the educational needs 

15 of their students, including students with 

16 disabilities and English language learners; 

17 and 

18 ‘‘(xi) will support efforts to increase 

19 quality initiatives, including meeting the 

20 quality authorizing elements described in 

21 paragraph (2)(E); 

22 ‘‘(B) of the extent to which the entity— 

23 ‘‘(i) is able to meet and carry out the 

24 priorities listed in subsection (f)(2); and 

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1 ‘‘(ii) is working to develop or strength2 en a cohesive statewide system to support 

3 the opening of new charter schools and 

4 replicable, high-quality charter school mod5 els, and expanding high-quality charter 

6 schools; 

7 ‘‘(C) how the entity will carry out the 

8 subgrant competition, including— 

9 ‘‘(i) a description of the application 

10 each eligible applicant desiring to receive a 

11 subgrant will submit, including— 

12 ‘‘(I) a description of the roles and 

13 responsibilities of eligible applicants, 

14 partner organizations, and manage15 ment organizations, including the ad16 ministrative and contractual roles and 

17 responsibilities; and 

18 ‘‘(II) a description of the quality 

19 controls agreed to between the eligible 

20 applicant and the authorized public 

21 chartering agency involved, such as a 

22 contract or performance agreement, 

23 and how a school’s performance on the 

24 State’s academic accountability system 

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1 will be a primary factor for renewal; 

2 and 

3 ‘‘(ii) a description of how the entity 

4 will review applications; and 

5 ‘‘(D) in the case of an entity that partners 

6 with an outside organization to carry out the en7 tity’s quality charter school program, in whole or 

8 in part, of the roles and responsibilities of this 

9 partner. 

10 ‘‘(2) ASSURANCES.—Assurances, including a de11 scription of how the assurances will be met, that— 

12 ‘‘(A) each charter school receiving funds 

13 under the entity’s program will have a high de14 gree of autonomy over budget and operations; 

15 ‘‘(B) the entity will support charter schools 

16 in meeting the educational needs of their stu17 dents as described in paragraph (1)(A)(x); 

18 ‘‘(C) the entity will ensure that the author19 ized public chartering agency of any charter 

20 school that receives funds under the entity’s pro21 gram— 

22 ‘‘(i) ensures that the charter school is 

23 meeting the obligations under this Act, part 

24 B of the Individuals with Disabilities Edu25 cation Act, title VI of the Civil Rights Act 

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1 of 1964, and section 504 of the Rehabilita2 tion Act of 1973; and 

3 ‘‘(ii) adequately monitors and helps the 

4 schools in recruiting, enrolling, and meeting 

5 the needs of all students, including students 

6 with disabilities and English language 

7 learners; 

8 ‘‘(D) the entity will provide adequate tech9 nical assistance to eligible applicants to— 

10 ‘‘(i) meet the objectives described in 

11 clauses (vii) and (viii) of paragraph (1)(A) 

12 and paragraph (2)(B); and 

13 ‘‘(ii) enroll traditionally underserved 

14 students, including students with disabil15 ities and English language learners, to pro16 mote an inclusive education environment; 

17 ‘‘(E) the entity will promote quality author18 izing, such as through providing technical assist19 ance, to support all authorized public chartering 

20 agencies in the State to improve the monitoring 

21 of their charter schools, including by— 

22 ‘‘(i) using annual performance data, 

23 which may include graduation rates and 

24 student growth data, as appropriate, to 

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1 measure the progress of their schools toward 

2 becoming high-quality charter schools; and 

3 ‘‘(ii) reviewing the schools’ inde4 pendent, annual audits of financial state5 ments conducted in accordance with gen6 erally accepted accounting principles, and 

7 ensuring any such audits are publically re8 ported; and 

9 ‘‘(F) the entity will work to ensure that 

10 charter schools are included with the traditional 

11 public school system in decision-making about 

12 the public school system in the State. 

13 ‘‘(3) REQUESTS FOR WAIVERS.—A request and 

14 justification for waivers of any Federal statutory or 

15 regulatory provisions that the entity believes are nec16 essary for the successful operation of the charter 

17 schools that will receive funds under the entity’s pro18 gram under this section, and a description of any 

19 State or local rules, generally applicable to public 

20 schools, that will be waived, or otherwise not apply to 

21 such schools. 

22 ‘‘(f) SELECTION CRITERIA; PRIORITY.— 

23 ‘‘(1) SELECTION CRITERIA.—The Secretary shall 

24 award grants to State entities under this section on 

25 the basis of the quality of the applications submitted 

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1 under subsection (e), after taking into consider2 ation— 

3 ‘‘(A) the degree of flexibility afforded by the 

4 State’s public charter school law and how the en5 tity will work to maximize the flexibility pro6 vided to charter schools under the law; 

7 ‘‘(B) the ambitiousness of the entity’s objec8 tives for the quality charter school program car9 ried out under this section; 

10 ‘‘(C) the quality of the strategy for assessing 

11 achievement of those objectives; 

12 ‘‘(D) the likelihood that the eligible appli13 cants receiving subgrants under the program will 

14 meet those objectives and improve educational re15 sults for students; 

16 ‘‘(E) the proposed number of new charter 

17 schools to be opened, and the number of high18 quality charter schools to be replicated or ex19 panded under the program; 

20 ‘‘(F) the entity’s plan to— 

21 ‘‘(i) adequately monitor the eligible ap22 plicants receiving subgrants under the enti23 ty’s program; and 

24 ‘‘(ii) work with the authorized public 

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1 cation of work for the charter schools and 

2 authorized public chartering agencies; 

3 ‘‘(G) the entity’s plan to provide adequate 

4 technical assistance, as described in the entity’s 

5 application under subsection (e), for the eligible 

6 applicants receiving subgrants under the entity’s 

7 program under this section; and 

8 ‘‘(H) the entity’s plan to support quality 

9 authorizing efforts in the State, consistent with 

10 the objectives described in subparagraph (B). 

11 ‘‘(2) PRIORITY.—In awarding grants under this 

12 section, the Secretary shall give priority to State enti13 ties to the extent that they meet the following criteria: 

14 ‘‘(A) In the case in which a State entity is 

15 located in a State that allows an entity other 

16 than the State educational agency to be an au17 thorized public chartering agency or a State in 

18 which only a local educational agency may be an 

19 authorized public chartering agency, the State 

20 has an appeals process for the denial of an ap21 plication for a charter school. 

22 ‘‘(B) The State entity is located in a State 

23 that does not impose any limitation on the num24 ber or percentage of charter schools that may 

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1 exist or the number or percentage of students 

2 that may attend charter schools in the State. 

3 ‘‘(C) The State entity is located in a State 

4 that ensures equitable financing, as compared to 

5 traditional public schools, for charter schools and 

6 students in a prompt manner. 

7 ‘‘(D) The State entity supports full-, blend8 ed-, or hybrid-online charter school models. 

9 ‘‘(E) The State entity is located in a State 

10 that uses charter schools and best practices from 

11 charter schools to help improve struggling schools 

12 and local educational agencies. 

13 ‘‘(F) The State entity partners with an or14 ganization that has a demonstrated record of 

15 success in developing management organizations 

16 to support the development of charter schools in 

17 the State. 

18 ‘‘(G) The State entity demonstrates quality 

19 policies and practices to support and monitor 

20 charter schools through factors, including— 

21 ‘‘(i) the proportion of high-quality 

22 charter schools in the State; and 

23 ‘‘(ii) the proportion of charter schools 

24 enrolling, at a rate similar to traditional 

25 public schools, traditionally underserved 

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1 students, including students with disabil2 ities and English language learners. 

3 ‘‘(g) LOCAL USES OF FUNDS.—An eligible applicant 

4 receiving a subgrant under this section shall use such funds 

5 to open new charter schools or replicable, high-quality char6 ter school models, or expand existing high-quality charter 

7 schools. 

8 ‘‘(h) REPORTING REQUIREMENTS.—Each State entity 

9 receiving a grant under this section shall submit to the Sec10 retary, at the end of the third year of the 5-year grant pe11 riod and at the end of such grant period, a report on— 

12 ‘‘(1) the number of students served and, if appli13 cable, how many new students were served during 

14 each year of the grant period; 

15 ‘‘(2) the number of subgrants awarded under this 

16 section to carry out each of the following— 

17 ‘‘(A) the opening of new charter schools; 

18 ‘‘(B) the opening of replicable, high-quality 

19 charter school models; and 

20 ‘‘(C) the expansion of high-quality charter 

21 schools; 

22 ‘‘(3) the progress the entity made toward meeting 

23 the priorities described in subsection (f)(2), as appli24 cable; 

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1 ‘‘(4) how the entity met the objectives of the qual2 ity charter school program described in the entity’s 

3 application under subsection (e); 

4 ‘‘(5) how the entity complied with, and ensured 

5 that eligible applicants complied with, the assurances 

6 described in the entity’s application; and 

7 ‘‘(6) how the entity worked with authorized pub8 lic chartering agencies, including how the agencies 

9 worked with the management company or leadership 

10 of the schools in which the subgrants were awarded. 

11 ‘‘(i) STATE ENTITY DEFINED.—For purposes of this 

12 section, the term ‘State entity’ means— 

13 ‘‘(1) a State educational agency; 

14 ‘‘(2) a State charter school board; or 

15 ‘‘(3) a Governor of a State.’’. 

16 SEC. 6. FACILITIES FINANCING ASSISTANCE. 

17 Section 5204 (20 U.S.C. 7221c) is amended to read 

18 as follows: 

19 ‘‘SEC. 5204. FACILITIES FINANCING ASSISTANCE. 

20 ‘‘(a) GRANTS TO ELIGIBLE ENTITIES.— 

21 ‘‘(1) IN GENERAL.—From the amount reserved 

22 under section 5202(b)(1), the Secretary shall award 

23 not less than 3 grants to eligible entities that have ap24 plications approved under subsection (d) to dem25 onstrate innovative methods of assisting charter 

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1 schools to address the cost of acquiring, constructing, 

2 and renovating facilities by enhancing the avail3 ability of loans or bond financing. 

4 ‘‘(2) ELIGIBLE ENTITY DEFINED.—For purposes 

5 of this section, the term ‘eligible entity’ means— 

6 ‘‘(A) a public entity, such as a State or 

7 local governmental entity; 

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

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

10 subparagraphs (A) and (B). 

11 ‘‘(b) GRANTEE SELECTION.— 

12 ‘‘(1) EVALUATION OF APPLICATION.—The Sec13 retary shall evaluate each application submitted 

14 under subsection (d), and shall determine whether the 

15 application is sufficient to merit approval. 

16 ‘‘(2) DISTRIBUTION OF GRANTS.—The Secretary 

17 shall award at least one grant to an eligible entity de18 scribed in subsection (a)(2)(A), at least one grant to 

19 an eligible entity described in subsection (a)(2)(B), 

20 and at least one grant to an eligible entity described 

21 in subsection (a)(2)(C), if applications are submitted 

22 that permit the Secretary to do so without approving 

23 an application that is not of sufficient quality to 

24 merit approval. 

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1 ‘‘(c) GRANT CHARACTERISTICS.—Grants under sub2 section (a) shall be of a sufficient size, scope, and quality 

3 so as to ensure an effective demonstration of an innovative 

4 means of enhancing credit for the financing of charter 

5 school acquisition, construction, or renovation. 

6 ‘‘(d) APPLICATIONS.— 

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

8 subsection (a), an eligible entity shall submit to the 

9 Secretary an application in such form as the Sec10 retary may reasonably require. 

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

12 under paragraph (1) shall contain— 

13 ‘‘(A) a statement identifying the activities 

14 proposed to be undertaken with funds received 

15 under subsection (a), including how the eligible 

16 entity will determine which charter schools will 

17 receive assistance, and how much and what types 

18 of assistance charter schools will receive; 

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

20 charter schools in the application’s development 

21 and the design of the proposed activities; 

22 ‘‘(C) a description of the eligible entity’s ex23 pertise in capital market financing; 

24 ‘‘(D) a description of how the proposed ac25 tivities will leverage the maximum amount of 

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1 private-sector financing capital relative to the 

2 amount of government funding used and other3 wise enhance credit available to charter schools, 

4 including how the entity will offer a combination 

5 of rates and terms more favorable than the rates 

6 and terms that a charter school could receive 

7 without assistance from the entity under this sec8 tion; 

9 ‘‘(E) a description of how the eligible entity 

10 possesses sufficient expertise in education to 

11 evaluate the likelihood of success of a charter 

12 school program for which facilities financing is 

13 sought; and 

14 ‘‘(F) in the case of an application submitted 

15 by a State governmental entity, a description of 

16 the actions that the entity has taken, or will 

17 take, to ensure that charter schools within the 

18 State receive the funding the charter schools need 

19 to have adequate facilities. 

20 ‘‘(e) CHARTER SCHOOL OBJECTIVES.—An eligible en21 tity receiving a grant under this section shall use the funds 

22 deposited in the reserve account established under subsection 

23 (f) to assist one or more charter schools to access private 

24 sector capital to accomplish one or both of the following ob25 jectives: 

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1 ‘‘(1) The acquisition (by purchase, lease, dona2 tion, or otherwise) of an interest (including an inter3 est held by a third party for the benefit of a charter 

4 school) in improved or unimproved real property that 

5 is necessary to commence or continue the operation of 

6 a charter school. 

7 ‘‘(2) The construction of new facilities, including 

8 predevelopment costs, or the renovation, repair, or al9 teration of existing facilities, necessary to commence 

10 or continue the operation of a charter school. 

11 ‘‘(f) RESERVE ACCOUNT.— 

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

13 to accomplish the objectives described in subsection 

14 (e), an eligible entity receiving a grant under sub15 section (a) shall, in accordance with State and local 

16 law, directly or indirectly, alone or in collaboration 

17 with others, deposit the funds received under sub18 section (a) (other than funds used for administrative 

19 costs in accordance with subsection (g)) in a reserve 

20 account established and maintained by the eligible en21 tity for this purpose. Amounts deposited in such ac22 count shall be used by the eligible entity for one or 

23 more of the following purposes: 

24 ‘‘(A) Guaranteeing, insuring, and rein25 suring bonds, notes, evidences of debt, loans, and 

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1 interests therein, the proceeds of which are used 

2 for an objective described in subsection (e). 

3 ‘‘(B) Guaranteeing and insuring leases of 

4 personal and real property for an objective de5 scribed in subsection (e). 

6 ‘‘(C) Facilitating financing by identifying 

7 potential lending sources, encouraging private 

8 lending, and other similar activities that directly 

9 promote lending to, or for the benefit of, charter 

10 schools. 

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

12 charter schools, or by other public entities for the 

13 benefit of charter schools, by providing technical, 

14 administrative, and other appropriate assistance 

15 (including the recruitment of bond counsel, un16 derwriters, and potential investors and the con17 solidation of multiple charter school projects 

18 within a single bond issue). 

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

20 section and deposited in the reserve account estab21 lished under paragraph (1) shall be invested in obli22 gations issued or guaranteed by the United States or 

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

24 ‘‘(3) REINVESTMENT OF EARNINGS.—Any earn25 ings on funds received under subsection (a) shall be 

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1 deposited in the reserve account established under 

2 paragraph (1) and used in accordance with such sub3 section. 

4 ‘‘(g) LIMITATION ON ADMINISTRATIVE COSTS.—An eli5 gible entity may use not more than 2.5 percent of the funds 

6 received under subsection (a) for the administrative costs 

7 of carrying out its responsibilities under this section (ex8 cluding subsection (k)). 

9 ‘‘(h) AUDITS AND REPORTS.— 

10 ‘‘(1) FINANCIAL RECORD MAINTENANCE AND

11 AUDIT.—The financial records of each eligible entity 

12 receiving a grant under subsection (a) shall be main13 tained in accordance with generally accepted account14 ing principles and shall be subject to an annual audit 

15 by an independent public accountant. 

16 ‘‘(2) REPORTS.— 

17 ‘‘(A) GRANTEE ANNUAL REPORTS.—Each el18 igible entity receiving a grant under subsection 

19 (a) annually shall submit to the Secretary a re20 port of its operations and activities under this 

21 section. 

22 ‘‘(B) CONTENTS.—Each annual report sub23 mitted under subparagraph (A) shall include— 

24 ‘‘(i) a copy of the most recent financial 

25 statements, and any accompanying opinion 

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1 on such statements, prepared by the inde2 pendent public accountant reviewing the fi3 nancial records of the eligible entity; 

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

5 audit of the financial records of the eligible 

6 entity that was conducted under paragraph 

7 (1) during the reporting period; 

8 ‘‘(iii) an evaluation by the eligible en9 tity of the effectiveness of its use of the Fed10 eral funds provided under subsection (a) in 

11 leveraging private funds; 

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

13 charter schools served during the reporting 

14 period, including the amount of funds used 

15 by each school, the type of project facilitated 

16 by the grant, and the type of assistance pro17 vided to the charter schools; 

18 ‘‘(v) a description of the activities car19 ried out by the eligible entity to assist char20 ter schools in meeting the objectives set forth 

21 in subsection (e); and 

22 ‘‘(vi) a description of the characteris23 tics of lenders and other financial institu24 tions participating in the activities under25 taken by the eligible entity under this secmstockstill on DSK4VPTVN1PROD with BILLS

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1 tion (excluding subsection (k)) during the 

2 reporting period. 

3 ‘‘(C) SECRETARIAL REPORT.—The Sec4 retary shall review the reports submitted under 

5 subparagraph (A) and shall provide a com6 prehensive annual report to Congress on the ac7 tivities conducted under this section (excluding 

8 subsection (k)). 

9 ‘‘(i) NO FULL FAITH AND CREDIT FOR GRANTEE OB10 LIGATION.—No financial obligation of an eligible entity en11 tered into pursuant to this section (such as an obligation 

12 under a guarantee, bond, note, evidence of debt, or loan) 

13 shall be an obligation of, or guaranteed in any respect by, 

14 the United States. The full faith and credit of the United 

15 States is not pledged to the payment of funds which may 

16 be required to be paid under any obligation made by an 

17 eligible entity pursuant to any provision of this section. 

18 ‘‘(j) RECOVERY OF FUNDS.— 

19 ‘‘(1) IN GENERAL.—The Secretary, in accordance 

20 with chapter 37 of title 31, United States Code, shall 

21 collect— 

22 ‘‘(A) all of the funds in a reserve account es23 tablished by an eligible entity under subsection 

24 (f)(1) if the Secretary determines, not earlier 

25 than 2 years after the date on which the eligible 

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1 entity first received funds under this section (ex2 cluding subsection (k)), that the eligible entity 

3 has failed to make substantial progress in car4 rying out the purposes described in subsection 

5 (f)(1); or 

6 ‘‘(B) all or a portion of the funds in a re7 serve account established by an eligible entity 

8 under subsection (f)(1) if the Secretary deter9 mines that the eligible entity has permanently 

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

11 such account to accomplish any purpose de12 scribed in subsection (f)(1). 

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

14 shall not exercise the authority provided in paragraph 

15 (1) to collect from any eligible entity any funds that 

16 are being properly used to achieve one or more of the 

17 purposes described in subsection (f)(1). 

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

19 451, 452, and 458 of the General Education Provi20 sions Act shall apply to the recovery of funds under 

21 paragraph (1). 

22 ‘‘(4) CONSTRUCTION.—This subsection shall not 

23 be construed to impair or affect the authority of the 

24 Secretary to recover funds under part D of the Gen25 eral Education Provisions Act. 

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1 ‘‘(k) PER-PUPIL FACILITIES AID PROGRAM.— 

2 ‘‘(1) DEFINITION OF PER-PUPIL FACILITIES AID

3 PROGRAM.—In this subsection, the term ‘per-pupil fa4 cilities aid program’ means a program in which a 

5 State makes payments, on a per-pupil basis, to char6 ter schools to provide the schools with financing— 

7 ‘‘(A) that is dedicated solely for funding 

8 charter school facilities; or 

9 ‘‘(B) a portion of which is dedicated for 

10 funding charter school facilities. 

11 ‘‘(2) GRANTS.— 

12 ‘‘(A) IN GENERAL.—From the amount re13 served under section 5202(b)(1) remaining after 

14 the Secretary makes grants under subsection (a), 

15 the Secretary shall make grants, on a competi16 tive basis, to States to pay for the Federal share 

17 of the cost of establishing or enhancing, and ad18 ministering per-pupil facilities aid programs. 

19 ‘‘(B) PERIOD.—The Secretary shall award 

20 grants under this subsection for periods of not 

21 more than 5 years. 

22 ‘‘(C) FEDERAL SHARE.—The Federal share 

23 of the cost described in subparagraph (A) for a 

24 per-pupil facilities aid program shall be not 

25 more than— 

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1 ‘‘(i) 90 percent of the cost, for the first 

2 fiscal year for which the program receives 

3 assistance under this subsection; 

4 ‘‘(ii) 80 percent in the second such 

5 year; 

6 ‘‘(iii) 60 percent in the third such 

7 year; 

8 ‘‘(iv) 40 percent in the fourth such 

9 year; and 

10 ‘‘(v) 20 percent in the fifth such year. 

11 ‘‘(D) STATE SHARE.—A State receiving a 

12 grant under this subsection may partner with 1 

13 or more organizations to provide up to 50 per14 cent of the State share of the cost of establishing 

15 or enhancing, and administering the per-pupil 

16 facilities aid program. 

17 ‘‘(E) MULTIPLE GRANTS.—A State may re18 ceive more than 1 grant under this subsection, so 

19 long as the amount of such funds provided to 

20 charter schools increases with each successive 

21 grant. 

22 ‘‘(3) USE OF FUNDS.— 

23 ‘‘(A) IN GENERAL.—A State that receives a 

24 grant under this subsection shall use the funds 

25 made available through the grant to establish or 

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1 enhance, and administer, a per-pupil facilities 

2 aid program for charter schools in the State of 

3 the applicant. 

4 ‘‘(B) EVALUATIONS; TECHNICAL ASSIST5 ANCE; DISSEMINATION.—From the amount made 

6 available to a State through a grant under this 

7 subsection for a fiscal year, the State may re8 serve not more than 5 percent to carry out eval9 uations, to provide technical assistance, and to 

10 disseminate information. 

11 ‘‘(C) SUPPLEMENT, NOT SUPPLANT.—Funds 

12 made available under this subsection shall be 

13 used to supplement, and not supplant, State, 

14 and local public funds expended to provide per 

15 pupil facilities aid programs, operations financ16 ing programs, or other programs, for charter 

17 schools. 

18 ‘‘(4) REQUIREMENTS.— 

19 ‘‘(A) VOLUNTARY PARTICIPATION.—No State 

20 may be required to participate in a program 

21 carried out under this subsection. 

22 ‘‘(B) STATE LAW.— 

23 ‘‘(i) IN GENERAL.—To be eligible to re24 ceive a grant under this subsection, a State 

25 shall establish or enhance, and administer, 

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1 a per-pupil facilities aid program for char2 ter schools in the State, that— 

3 ‘‘(I) is specified in State law; and 

4 ‘‘(II) provides annual financing, 

5 on a per-pupil basis, for charter school 

6 facilities. 

7 ‘‘(ii) SPECIAL RULE.—A State that is 

8 required under State law to provide its 

9 charter schools with access to adequate facil10 ity space may be eligible to receive a grant 

11 under this subsection if the State agrees to 

12 use the funds to develop a per-pupil facili13 ties aid program consistent with the re14 quirements of this subsection. 

15 ‘‘(5) APPLICATIONS.—To be eligible to receive a 

16 grant under this subsection, a State shall submit an 

17 application to the Secretary at such time, in such 

18 manner, and containing such information as the Sec19 retary may require.’’. 

20 SEC. 7. NATIONAL ACTIVITIES. 

21 Section 5205 (20 U.S.C. 7221d) is amended to read 

22 as follows: 

23 ‘‘SEC. 5205. NATIONAL ACTIVITIES. 

24 ‘‘(a) IN GENERAL.—From the amount reserved under 

25 section 5202(b)(2), the Secretary shall— 

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1 ‘‘(1) use not less than 50 percent of such funds 

2 to award grants in accordance with subsection (b); 

3 and 

4 ‘‘(2) use the remainder of such funds to— 

5 ‘‘(A) disseminate technical assistance to 

6 State entities in awarding subgrants under sec7 tion 5203; 

8 ‘‘(B) disseminate best practices; and 

9 ‘‘(C) evaluate the impact of the charter 

10 school program, including the impact on student 

11 achievement, carried out under this subpart. 

12 ‘‘(b) GRANTS.— 

13 ‘‘(1) IN GENERAL.—The Secretary shall make 

14 grants, on a competitive basis, to eligible applicants 

15 for the purpose of carrying out the activities described 

16 in section 5202(a)(1), subparagraphs (A) through (C) 

17 of section 5203(a)(1), and section 5203(g). 

18 ‘‘(2) TERMS AND CONDITIONS.—Except as other19 wise provided in this subsection, grants awarded 

20 under this subsection shall have the same terms and 

21 conditions as grants awarded to State entities under 

22 section 5203. 

23 ‘‘(3) ELIGIBLE APPLICANT DEFINED.—For pur24 poses of this subsection, the term ‘eligible applicant’ 

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1 means an eligible applicant that desires to open a 

2 charter school in— 

3 ‘‘(A) a State that did not apply for a grant 

4 under section 5203; 

5 ‘‘(B) a State that did not receive a grant 

6 under section 5203; or 

7 ‘‘(C) a State that received a grant under 

8 section 5203 and is in the 4th or 5th year of the 

9 grant period for such grant. 

10 ‘‘(c) CONTRACTS AND GRANTS.—The Secretary may 

11 carry out any of the activities described in this section di12 rectly or through grants, contracts, or cooperative agree13 ments.’’. 

14 SEC. 8. RECORDS TRANSFER. 

15 Section 5208 (20 U.S.C. 7221g) is amended— 

16 (1) by inserting ‘‘as quickly as possible and’’ be17 fore ‘‘to the extent practicable’’; and 

18 (2) by striking ‘‘section 602’’ and inserting ‘‘sec19 tion 602(14)’’. 

20 SEC. 9. DEFINITIONS. 

21 Section 5210 (20 U.S.C. 7221i) is amended— 

22 (1) in paragraph (1)— 

23 (A) by striking ‘‘and’’ at the end of sub24 paragraph (K); 

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1 (B) by striking the period at the end of sub2 paragraph (L) and inserting ‘‘; and’’; and 

3 (C) by adding at the end, the following: 

4 ‘‘(M) may serve prekindergarten or post sec5 ondary students.’’; 

6 (2) in paragraph (3)(B), by striking ‘‘under sec7 tion 5203(d)(3)’’; and 

8 (3) by inserting at the end the following: 

9 ‘‘(5) EXPANSION OF A HIGH-QUALITY CHARTER

10 SCHOOL.—The term ‘expansion of a high-quality 

11 charter school’ means a high-quality charter school 

12 that either significantly increases its enrollment or 

13 adds one or more grades to its school. 

14 ‘‘(6) HIGH-QUALITY CHARTER SCHOOL.—The 

15 term ‘high-quality charter school’ means a charter 

16 school that— 

17 ‘‘(A) shows evidence of strong academic re18 sults, which may include strong academic growth 

19 as determined by a State; 

20 ‘‘(B) has no significant issues in the areas 

21 of student safety, financial management, or stat22 utory or regulatory compliance; 

23 ‘‘(C) has demonstrated success in signifi24 cantly increasing student academic achievement 

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1 and attainment for all students served by charter 

2 schools; and 

3 ‘‘(D) has demonstrated success in increasing 

4 student academic achievement for the subgroups 

5 of students described in section 

6 1111(b)(2)(C)(v)(II). 

7 ‘‘(7) REPLICABLE, HIGH-QUALITY CHARTER

8 SCHOOL MODEL.—The term ‘replicable, high-quality 

9 charter school model’ means a high-quality charter 

10 school that will open a new campus under an existing 

11 charter.’’. 

12 SEC. 10. AUTHORIZATION OF APPROPRIATIONS. 

13 Section 5211 (20 U.S.C. 7221j) is amended to read 

14 as follows: 

15 ‘‘SEC. 5211. AUTHORIZATION OF APPROPRIATIONS. 

16 ‘‘There are authorized to be appropriated to carry out 

17 this subpart $300,000,000 for fiscal year 2012 and each of 

18 the 5 succeeding fiscal years.’’. 

19 SEC. 11. CONFORMING AMENDMENTS. 

20 (a) REPEAL.—Subpart 2 of part B of title V (20 

21 U.S.C. 7223 et seq.) is repealed. 

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

23 section 2 is amended— 

24 (1) by striking the item relating to section 5203 

25 and inserting the following: 

‘‘Sec. 5203. Grants to support high-quality charter schools.’’; 

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1 (2) by striking the item relating to section 5204 

2 and inserting the following: 

‘‘Sec. 5204. Facilities Financing Assistance.’’; and 

3 (3) by striking subpart 2 of part B of title V. 

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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 Comand ordered to be printed mittee of the Whole House on the State of the Union, 

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