II 

111TH CONGRESS 

2D SESSION S. 2932 

To amend the public charter school provisions of the Elementary and 

Secondary Education Act of 1965, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 20, 2010 

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

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

A BILL 

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

other purposes. 

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

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

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

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

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Purpose. 

Sec. 3. Program authorized. 

Sec. 4. Applications. 

Sec. 5. Administration. 


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Sec. 6. National activities. 

Sec. 7. Federal formula allocation. 

Sec. 8. Credit enhancement. 

Sec. 9. Definitions. 

Sec. 10. Authorization of appropriations. 

Sec. 11. Reorganization. 

Sec. 12. Conforming amendments. 

1 SEC. 2. PURPOSE. 

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

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

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

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

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

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

12 ‘‘(5) disseminating charter school innovations 

13 throughout public education; and’’; and 

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

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

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

18 and inserting ‘‘provide’’. 

19 SEC. 3. PROGRAM AUTHORIZED. 

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

22 (1) in subsection (a)— 


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

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

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

7 (2) in subsection (b)— 

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

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

11 ‘‘(1) SPECIAL RULE.—If’’; 

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

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

15 ‘‘section’’; and 

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

17 ‘‘(2) RESERVE ACCOUNTS.— 

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

22 indirectly, alone or in collaboration with others, 

23 deposit the funds received under this section in 

24 a reserve account established and maintained 


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

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

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

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

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

10 are invested under chapter 65 of title 31, 

11 United States Code. 

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

13 earnings on funds received under this section 

14 shall be deposited in a reserve account and used 

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

17 (3) in subsection (c)— 

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

19 term occurs and inserting ‘‘section’’; 

20 (B) in paragraph (1)— 

21 (i) by striking ‘‘State educational 

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

23 and 


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1 (ii) by striking ‘‘not more than 3 

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

3 years’’; and 

4 (C) in paragraph (2)— 

5 (i) by striking ‘‘State educational 

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

7 and 

8 (ii) by striking ‘‘not more than 3 

9 years’’ and all that follows through the pe10 riod at the end and inserting ‘‘not more 

11 than 5 years. An eligible applicant may use 

12 a portion of the grant period for planning 

13 and program design.’’; 

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

15 following: 

16 ‘‘(d) CHARTER SCHOOLS WITH MULTIPLE CAM17 PUSES.—The Secretary shall allow an eligible entity to 

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

19 eligible applicant in order to support multiple campuses 

20 of a charter school.’’; 

21 (5) in subsection (e)— 

22 (A) by striking paragraph (1) and insert23 ing the following: 

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

25 this section for fiscal year 2010 or any succeeding 


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1 fiscal year from any funds appropriated under sec2 tion 5212 (other than funds reserved to carry out 

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

4 an eligible entity to the extent that the State in 

5 which the eligible entity proposes to carry out the 

6 activities under the grant meets the criteria de7 scribed in paragraph (2) and one or more of the cri8 teria described in subparagraphs (A) through (H) of 

9 paragraph (3).’’; 

10 (B) in paragraph (3)— 

11 (i) in subparagraph (A)— 

12 (I) by striking ‘‘a State edu13 cational agency’’ and inserting ‘‘an el14 igible entity’’; and 

15 (II) by striking ‘‘subpart’’ and 

16 inserting ‘‘section’’; 

17 (ii) by redesignating subparagraph 

18 (C) as subparagraph (D); 

19 (iii) in subparagraph (B)— 

20 (I) by redesignating clause (ii) as 

21 subparagraph (C), and aligning the 

22 margins of such subparagraph with 

23 the margins of subparagraph (A); 

24 (II) by striking ‘‘The State’’ and 

25 all that follows through ‘‘provides’’ 


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1 and inserting ‘‘The State provides’’; 

2 and 

3 (III) by striking ‘‘law; or’’ and 

4 inserting ‘‘law.’’; 

5 (iv) in subparagraph (C) (as redesig6 nated by clause (iii)(I)), by striking ‘‘in the 

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

8 and inserting ‘‘The State allows’’; 

9 (v) in subparagraph (D) (as redesig10 nated by clause (ii))— 

11 (I) by striking ‘‘school has a’’ 

12 and inserting ‘‘school has— 

13 ‘‘(i) a’’; 

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

15 and inserting ‘‘expenditures; and’’; 

16 and 

17 (III) by adding at the end the 

18 following: 

19 ‘‘(iii) an independent governing board 

20 that enters into a written performance con21 tract with an authorized public chartering 

22 agency.’’; and 

23 (vi) by adding at the end the fol24 lowing: 

25 ‘‘(E) The State— 


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1 ‘‘(i) provides public charter schools 

2 with funding commensurate with the fund3 ing provided to other public schools, in4 cluding capital or facilities aid distributed 

5 through a formula or revenue generated by 

6 bonds; and 

7 ‘‘(ii) ensures that the State and local 

8 educational agencies provide public charter 

9 schools with the Federal, State, and local 

10 funds to which the public charter schools 

11 are entitled in a timely manner. 

12 ‘‘(F) The State makes it a priority to cre13 ate charter schools in local educational agencies 

14 with large numbers of schools designated as in 

15 need of improvement, corrective action, or re16 structuring under paragraph (1), (7), or (8) of 

17 section 1116(b). 

18 ‘‘(G) The State has developed a trans19 parent authorizer accreditation, training, or re20 view process for evaluating the effectiveness and 

21 quality of the State’s authorized public char22 tering agencies, or each authorized public char23 tering agency in the State has implemented 

24 such a process, including— 


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1 ‘‘(i) a process for reviewing and evalu2 ating the performance of the authorized 

3 public chartering agencies in the State in 

4 authorizing or approving public charter 

5 schools, including a process that enables 

6 the authorized public chartering agencies 

7 to respond to any State concerns or defi8 ciencies regarding such authorizing or ap9 proving; and 

10 ‘‘(ii) any other necessary policies to 

11 ensure effective charter school authorizing 

12 in the State that are developed in conjunc13 tion with the State’s charter school com14 munity and in accordance with the prin15 ciples of high quality charter school au16 thorizing, as determined by the State in 

17 consultation with the charter school com18 munity and stakeholders. 

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

20 charter schools that constrains growth and lim21 its parental options in an unreasonable man22 ner.’’; and 

23 (6) in subsection (f)— 


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1 (A) by striking ‘‘subpart to a State edu2 cational agency’’ and inserting ‘‘section to an 

3 eligible entity’’; and 

4 (B) by striking ‘‘in the State’’ and insert5 ing ‘‘in the State where the grant activities will 

6 be carried out’’. 

7 SEC. 4. APPLICATIONS. 

8 Section 5203 of the Elementary and Secondary Edu9 cation Act of 1965 (20 U.S.C. 7221b) is amended— 

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

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

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

13 AGENCIES.—Each State educational agency’’ and in14 serting ‘‘ELIGIBLE ENTITIES.—An eligible entity’’; 

15 (3) in subsection (b)— 

16 (A) in the subsection heading, by striking 

17 ‘‘A STATE EDUCATIONAL AGENCY’’ and insert18 ing ‘‘AN ELIGIBLE ENTITY’’; 

19 (B) in paragraph (1)— 

20 (i) by striking ‘‘State educational 

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

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

23 (ii) by striking ‘‘State educational 

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

25 (C) in paragraph (2)— 


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1 (i) in the matter preceding subpara2 graph (A), by striking ‘‘describe how the 

3 State educational agency—’’ and inserting 

4 ‘‘describe the State’s level of participation 

5 and involvement in the grant, including a 

6 letter from the State describing how the 

7 State—’’; 

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

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

10 State’’ and inserting ‘‘area served by the 

11 grant’’; 

12 (iii) in subparagraph (B)— 

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

14 inserting ‘‘in the area served by the 

15 grant’’; and 

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

17 semicolon; 

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

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

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

21 such areas as budgeting, scheduling, staff22 ing, and instruction to public schools, in23 cluding public charter schools in the 

24 State;’’; and 

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


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

2 management of Federal funds; and 

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

4 authorized public chartering agencies in the 

5 State, including through a transparent author6 izer accreditation, training, and review process 

7 described in subsection (e)(3)(G);’’; 

8 (D) by redesignating paragraph (3) as 

9 paragraph (4); 

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

11 following: 

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

13 will use to award subgrants to eligible applicants to 

14 ensure high-quality charter schools;’’; 

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

16 subparagraph (D))— 

17 (i) in the matter preceding subpara18 graph (A), by striking ‘‘State educational 

19 agency’’ each place the term appears and 

20 inserting ‘‘eligible entity’’; 

21 (ii) in subparagraph (A)— 

22 (I) by redesignating clauses (ii) 

23 and (iii) as clauses (iii) and (iv), re24 spectively; and 


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1 (II) by inserting after clause (i) 

2 the following: 

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

4 using academic assessments to measure 

5 and report student academic progress;’’; 

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

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

8 ‘‘managed, including— 

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

10 and policies, including financial controls 

11 and annual audit requirements; 

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

13 and responsibilities for the charter school’s 

14 governing board, leadership, and manage15 ment team, and any other organizations 

16 critical to the charter school’s operations 

17 or success; 

18 ‘‘(iii) plans for recruiting and devel19 oping the charter school’s leadership and 

20 staff; 

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

22 and teacher employment policies, including 

23 performance evaluation plans; 

24 ‘‘(v) the proposed governing bylaws of 

25 the charter school; and 


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

2 plan, that identifies tasks, timelines, and 

3 responsible parties;’’; 

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

5 ‘‘, including documentation of the parents’ 

6 and community members’ support for the 

7 school’’ before the semicolon; 

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

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

10 assurance from the authorized public char11 tering agency that’’; 

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

13 ‘‘and how such funds will be used for plan14 ning, program design, and the initial im15 plementation of a charter school’’ before 

16 the semicolon at the end; 

17 (vii) in subparagraph (I)(ii), by insert18 ing ‘‘, including through a lottery process 

19 if the number of applicants exceeds the 

20 number of seats available at the charter 

21 school’’ before the semicolon; 

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

23 by striking ‘‘State educational agency’’ 

24 each place the term appears and inserting 

25 ‘‘eligible entity’’; 


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1 (ix) by striking subparagraph (M); 

2 (x) by redesignating subparagraph 

3 (N) as subparagraph (O); 

4 (xi) by inserting after subparagraph 

5 (L) the following: 

6 ‘‘(M) demonstration of support for the 

7 charter school from the State’s charter school 

8 community; 

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

10 governing board of the charter school, including 

11 a board overseeing multi-campus charters, is 

12 encouraged to include individuals with a diver13 sity of skills, including business management, 

14 financial management, real estate finance, and 

15 curriculum and instruction; and’’; and 

16 (xii) in subparagraph (O) (as redesig17 nated by clause (x))— 

18 (I) by striking ‘‘State educational 

19 agency’’ and inserting ‘‘eligible enti20 ty’’; and 

21 (II) by striking the period at the 

22 end and inserting ‘‘; and’’; and 

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

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

25 authorized public chartering agency— 


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1 ‘‘(A) describe such eligible entity’s stra2 tegic goal for chartering schools and progress 

3 towards that goal; and 

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

5 entity will annually file a plan with the State in 

6 which the eligible entity is located that covers 

7 such topics necessary for effective charter 

8 school oversight, including, at a minimum— 

9 ‘‘(i) the academic and financial per10 formance of all operating public charter 

11 schools overseen by the eligible entity, ac12 cording to the performance expectations 

13 for each public charter school set forth in 

14 the school’s contract; 

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

16 public charter school portfolio, identifying 

17 all public charter schools in each of the fol18 lowing categories: approved (but not yet 

19 open), operating, renewed, transferred, re20 voked, not renewed, voluntarily closed, or 

21 never opened; 

22 ‘‘(iii) the authorizing functions pro23 vided by the eligible entity to the public 

24 charter schools the eligible entity oversees, 

25 including the eligible entity’s operating 


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1 costs and expenses detailed in annual au2 dited financial statements that conform 

3 with generally accepted accounting prin4 ciples; and 

5 ‘‘(iv) the services purchased from the 

6 eligible entity by the public charter schools 

7 overseen by the eligible entity, including an 

8 itemized accounting of the actual costs of 

9 these services.’’; and 

10 (4) in subsection (d)— 

11 (A) in paragraph (1)— 

12 (i) by striking ‘‘(A) through (N)’’ and 

13 inserting ‘‘(A) through (O)’’; 

14 (ii) by striking ‘‘and (N)’’ and insert15 ing ‘‘and (O)’’; and 

16 (iii) by striking ‘‘State educational 

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

18 and 

19 (B) in paragraph (2)— 

20 (i) in the matter preceding subpara21 graph (A), by striking ‘‘State educational 

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

23 and 

24 (ii) in paragraph (3)— 


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1 (I) by striking ‘‘State educational 

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

4 (II) by striking ‘‘subgrant if’’ 

5 and all that follows through the period 

6 and inserting ‘‘subgrant.’’. 

7 SEC. 5. ADMINISTRATION. 

8 Section 5204 of the Elementary and Secondary Edu9 cation Act of 1965 (20 U.S.C. 7221c) is amended— 

10 (1) in subsection (a)— 

11 (A) in the subsection heading, by striking 

12 ‘‘STATE EDUCATIONAL AGENCIES’’ and insert13 ing ‘‘ELIGIBLE ENTITIES’’; 

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

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

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

17 by striking ‘‘State educational agencies’’ and in18 serting ‘‘eligible entities’’; 

19 (D) in paragraph (1), by inserting ‘‘, in20 cluding efforts at closing the achievement gap 

21 by meeting the annual objectives described in 

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

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

24 autonomy’’ after ‘‘flexibility’’; 


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

2 after the semicolon; 

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

4 and inserting a period; and 

5 (H) by striking paragraph (7); 

6 (2) in subsection (b)— 

7 (A) by striking ‘‘this subpart’’ and insert8 ing ‘‘section 5202’’; and 

9 (B) by striking paragraph (7); 

10 (3) in subsection (c)— 

11 (A) by striking ‘‘this subpart’’ and insert12 ing ‘‘section 5202’’; and 

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

14 and inserting ‘‘eligible entity’’; 

15 (4) in subsection (d)— 

16 (A) in the matter preceding paragraph 

17 (1)— 

18 (i) by striking ‘‘State educational 

19 agency receiving a grant under this sub20 part’’ and inserting ‘‘eligible entity receiv21 ing a grant under section 5202’’; and 

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

23 inserting ‘‘such section in’’; and 


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

2 non-traditional curricula’’ before the period at 

3 the end; 

4 (5) in subsection (e)— 

5 (A) in the matter preceding subparagraph 

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

7 ‘‘5211(1)’’; and 

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

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

10 (6) in subsection (f)— 

11 (A) in paragraph (1)— 

12 (i) in the paragraph heading, by strik13 ing ‘‘STATE EDUCATIONAL AGENCIES.— 

14 Each State educational agency’’ and in15 serting the following: ‘‘ELIGIBLE ENTI16 TIES.— 

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

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

19 and inserting ‘‘under section 5202’’; 

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

21 campus or expansion of an existing charter 

22 school,’’ after ‘‘charter school’’; 

23 (iv) by striking ‘‘in the State’’ and in24 serting ‘‘in the area to be served by the 

25 grant’’; and 


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1 (v) by striking ‘‘except that’’ and all 

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

3 inserting a period; 

4 (B) by striking paragraph (6); 

5 (C) by redesignating paragraphs (2) 

6 through (5) as paragraphs (4) through (7), re7 spectively; 

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

9 following: 

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

11 awarding subgrants under this section, an eligible 

12 entity shall ensure that— 

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

14 awarded to eligible applicants described in sec15 tion 5211(3)(A); and 

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

17 practicable, to a mix of such eligible applicants. 

18 ‘‘(3) AMOUNT OF SUBGRANTS.—An eligible en19 tity may vary the amount of a subgrant under this 

20 section based upon a variety of factors, including— 

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

22 start-up charter school or a conversion charter 

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


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1 ‘‘(B) whether the eligible applicant is cre2 ating a charter school under a new charter or 

3 an existing charter.’’; 

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

5 subparagraph (C))— 

6 (i) by striking ‘‘a State educational 

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

8 and 

9 (ii) by striking ‘‘, or to disseminate in10 formation about the charter school and 

11 successful practices in the charter school,’’; 

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

13 subparagraph (C))— 

14 (i) in the matter preceding subpara15 graph (A), by striking ‘‘this subpart’’ and 

16 inserting ‘‘section 5202’’; 

17 (ii) in subparagraph (A)(ii), by strik18 ing ‘‘and’’ after the semicolon; 

19 (iii) in subparagraph (B)(iv), by strik20 ing the period and inserting ‘‘; and’’; and 

21 (iv) by adding at the end the fol22 lowing: 

23 ‘‘(C) providing assistance, through activi24 ties described in section 5205(b)(4), in imple25 menting charter school innovations and dissemiVerDate Nov 24 2008 04:07 Jan 21, 2010 Jkt 089200 PO 00000 Frm 00022 Fmt 6652 Sfmt 6201 E:\BILLS\S2932.IS S2932

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1 nating information regarding such innova2 tions.’’; 

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

4 by subparagraph (C))— 

5 (i) in the subparagraph heading, by 

6 striking ‘‘STATE EDUCATIONAL AGENCY’’ 

7 and inserting ‘‘ELIGIBLE ENTITY’’; 

8 (ii) by striking ‘‘State educational 

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

10 (iii) by striking ‘‘pursuant to this sub11 part’’ and inserting ‘‘pursuant to section 

12 5202’’; 

13 (iv) by striking ‘‘this subpart’’ and in14 serting ‘‘such section’’; and 

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

16 ‘‘An eligible entity may use a portion of 

17 the reserved funds to improve the charter 

18 school authorizing policies and practices of 

19 the area served by the eligible entity, which 

20 may include the approval, monitoring, and 

21 renewal of charter schools.’’; and 

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

23 subparagraph (C))— 

24 (i) by striking ‘‘State educational 

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


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1 (ii) by striking ‘‘this subpart’’ and in2 serting ‘‘section 5202’’; 

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

4 ‘‘20’’; and 

5 (iv) by striking ‘‘the State educational 

6 agency’’ and all that follows through 

7 ‘‘sources.’’ and inserting ‘‘the eligible enti8 ty, for expenses necessary to plan, begin 

9 operations, and subsequently operate a 

10 public charter school.’’; and 

11 (7) by striking subsection (g). 

12 SEC. 6. NATIONAL ACTIVITIES. 

13 Section 5205 of the Elementary and Secondary Edu14 cation Act of 1965 (20 U.S.C. 7221d) is amended— 

15 (1) in subsection (a)— 

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

17 ‘‘schools’’ each place the term occurs and in18 serting ‘‘schools, authorized public chartering 

19 agencies, and charter support organizations’’; 

20 and 

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

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

23 schools on how to meet the requirements of part B 

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


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

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

3 (3) by inserting after subsection (a) the fol4 lowing: 

5 ‘‘(b) NATIONAL DISSEMINATION.— 

6 ‘‘(1) IN GENERAL.—To carry out this sub7 section, the Secretary shall reserve for each fiscal 

8 year not more than $8,000,000 of the amount ap9 propriated to carry out this subpart. 

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

11 under this subsection, an entity shall— 

12 ‘‘(A) be— 

13 ‘‘(i) a charter school; 

14 ‘‘(ii) an eligible applicant; 

15 ‘‘(iii) an eligible entity; or 

16 ‘‘(iv) a consortium of entities de17 scribed in clauses (i), (ii), and (iii); and 

18 ‘‘(B) submit an application to the Sec19 retary at such time, in such manner, and con20 taining such information as the Secretary may 

21 require. 

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

23 grants under this subsection on the basis of— 

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


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1 ‘‘(B) the capacity of the applicant to exe2 cute the application; and 

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

4 the application. 

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

6 this subsection shall use funds received under the 

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

8 and in other States in adopting charter school inno9 vations, or to disseminate information about charter 

10 school innovations, through activities such as— 

11 ‘‘(A) assisting other entities with the plan12 ning and start-up of one or more new public 

13 schools, including charter schools; 

14 ‘‘(B) developing partnerships designed to 

15 improve student academic achievement; 

16 ‘‘(C) developing curriculum materials, as17 sessments, and other materials that promote in18 creased student achievement and are based on 

19 successful practices at charter schools; 

20 ‘‘(D) conducting evaluations and devel21 oping materials that document successful prac22 tices at charter schools and that are designed to 

23 improve student performance in other schools; 

24 and 


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1 ‘‘(E) training, regarding the innovative 

2 practices developed at the original site, for per3 sonnel of— 

4 ‘‘(i) local educational agencies that 

5 are adopting innovations or successful 

6 practices used at charter schools; 

7 ‘‘(ii) authorized public chartering 

8 agencies; or 

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

10 and 

11 (4) in subsection (c) (as redesignated by para12 graph (2))— 

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

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

15 and inserting ‘‘section 5212’’; 

16 (B) by redesignating paragraphs (5) and 

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

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

19 following: 

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

21 public charter schools with access to existing ade22 quate facility space may apply for a grant under this 

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

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1 gram consistent with the program described in this 

2 subsection during the grant period.’’; and 

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

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

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

6 SEC. 7. FEDERAL FORMULA ALLOCATION. 

7 Section 5206 of the Elementary and Secondary Edu8 cation Act of 1965 (20 U.S.C. 7221e) is amended— 

9 (1) by striking the section heading and insert10 ing the following: 

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

12 and 

13 (2) in subsection (a), by inserting ‘‘or is in op14 eration’’ after ‘‘actually opens’’. 

15 SEC. 8. CREDIT ENHANCEMENT. 

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

17 Secondary Education Act of 1965 (as amended by this 

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

19 (1) by redesignating sections 5207 through 

20 5211 as sections 5208 through 5212, respectively; 

21 and 

22 (2) by inserting after section 5206 the fol23 lowing: 


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

2 FACILITIES PROGRAMS. 

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

4 provide grants to eligible entities to permit the eligible en5 tities to demonstrate innovative credit enhancement initia6 tives that assist charter schools to address the cost of ac7 quiring, constructing, and renovating facilities. 

8 ‘‘(b) GRANTS TO ELIGIBLE ENTITIES.—After reserv9 ing any funds as necessary for grant evaluation or admin10 istration consistent with any applicable provisions (includ11 ing section 9601(a) of this Act and section 402(b)(1) of 

12 the Department of Education Organization Act), the Sec13 retary shall use the amounts available to carry out this 

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

15 grants to eligible entities that have applications approved 

16 under this section to demonstrate innovative methods of 

17 assisting charter schools to address the cost of acquiring, 

18 constructing, and renovating facilities by enhancing the 

19 availability of loans or bond financing for charter schools. 

20 ‘‘(c) GRANTEE SELECTION.— 

21 ‘‘(1) EVALUATION OF APPLICATION.—The Sec22 retary shall evaluate each application submitted 

23 under subsection (e), and shall determine whether 

24 the application is sufficient to merit approval. 

25 ‘‘(2) DISTRIBUTION OF GRANTS.— 


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1 ‘‘(A) IN GENERAL.—Subject to subpara2 graph (B) and paragraph (3), the Secretary 

3 shall award— 

4 ‘‘(i) not less than 1 grant to an eligi5 ble entity described in section 5211(6)(A); 

6 ‘‘(ii) not less than 1 grant to an eligi7 ble entity described in section 5211(6)(B); 

8 and 

9 ‘‘(iii) not less than 1 grant to an eligi10 ble entity described in section 5211(6)(C). 

11 ‘‘(B) EXCEPTION.—Subparagraph (A) 

12 shall only apply if applications are submitted 

13 that permit the Secretary to do so without ap14 proving an application that is not of sufficient 

15 quality to merit approval. 

16 ‘‘(3) SPECIAL RULE.—In the event the Sec17 retary determines that the funds made available 

18 under this section are insufficient to permit the Sec19 retary to award not less than 3 grants in accordance 

20 with this section, the 3-grant minimum under para21 graph (2) shall not apply, and the Secretary may de22 termine the appropriate number of grants to be 

23 awarded in accordance with subsection (d). 

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

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


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1 as to ensure an effective demonstration of an innovative 

2 means of enhancing credit for the financing of charter 

3 school acquisition, construction, or renovation. 

4 ‘‘(e) APPLICATIONS.— 

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

6 this section, an eligible entity shall submit to the 

7 Secretary an application in such form as the Sec8 retary may reasonably require. 

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

10 under paragraph (1) shall contain— 

11 ‘‘(A) a statement identifying the activities 

12 proposed to be undertaken with funds received 

13 under this section, including how the eligible 

14 entity will determine which charter schools will 

15 receive assistance, and how much and what 

16 types of assistance charter schools will receive; 

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

18 charter schools in the application’s development 

19 and the design of the proposed activities; 

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

21 expertise in capital market financing; 

22 ‘‘(D) a description of how the proposed ac23 tivities will leverage the maximum amount of 

24 private-sector financing capital relative to the 

25 amount of Federal and State funds used and 


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1 otherwise enhance credit available to charter 

2 schools, including how the applicant will offer a 

3 combination of rates and terms more favorable 

4 than rates and terms that a charter school 

5 could receive without assistance under this sec6 tion; 

7 ‘‘(E) a description of how the eligible enti8 ty possesses sufficient expertise in education to 

9 evaluate the likelihood of success of a charter 

10 school program for which facilities financing is 

11 sought; 

12 ‘‘(F) in the case of an application sub13 mitted by an eligible entity that is a State gov14 ernmental entity, a description of the actions 

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

16 that charter schools within the State receive the 

17 funding needed to have adequate facilities; and 

18 ‘‘(G) such other information as the Sec19 retary may reasonably require. 

20 ‘‘(f) 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 sub23 section (g)(1) to assist 1 or more charter schools to access 

24 private sector capital in order to accomplish one or more 

25 of the following objectives: 


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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 

5 that is necessary to commence or continue the oper6 ation of a charter school. 

7 ‘‘(2) The construction (including 

8 predevelopment costs in a case where construction or 

9 renovation cannot proceed as a result of 

10 predevelopment findings) of new facilities, or the 

11 renovation, repair, or alteration of existing facilities, 

12 necessary to commence or continue the operation of 

13 a charter school. 

14 ‘‘(g) RESERVE ACCOUNT.— 

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

16 to accomplish the objectives described in subsection 

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

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

19 directly or indirectly, alone or in collaboration with 

20 others, deposit the funds received under this section 

21 (other than funds used for administrative costs in 

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

23 established and maintained by the eligible entity for 

24 this purpose. Amounts deposited in such account 


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

2 of the following purposes: 

3 ‘‘(A) Guaranteeing, insuring, and rein4 suring bonds, notes, evidences of debt, loans, 

5 and interests therein, the proceeds of which are 

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

7 ‘‘(B) Guaranteeing and insuring leases of 

8 personal and real property for an objective de9 scribed in subsection (f). 

10 ‘‘(C) Facilitating financing by identifying 

11 potential lending sources, encouraging private 

12 lending, and other similar activities that di13 rectly promote lending to, or for the benefit of, 

14 charter schools. 

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

16 charter schools, or by other public entities for 

17 the benefit of charter schools, by providing 

18 technical, administrative, and other appropriate 

19 assistance (including the recruitment of bond 

20 counsel, underwriters, and potential investors 

21 and the consolidation of multiple charter school 

22 projects within a single bond issue). 

23 ‘‘(E) Making limited loans to charter 

24 schools, under such terms and conditions as the 

25 Secretary may prescribe. 


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

2 section and deposited in the reserve account estab3 lished under paragraph (1) shall be invested in obli4 gations issued or guaranteed by the United States or 

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

6 ‘‘(3) REINVESTMENT OF EARNINGS.—Any earn7 ings on funds received under this section shall be de8 posited in the reserve account established under 

9 paragraph (1) and used in accordance with such 

10 paragraph. 

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

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

13 funds received for any fiscal year under this section for 

14 the administrative costs of carrying out its responsibilities 

15 under this section. 

16 ‘‘(i) AUDITS AND REPORTS.— 

17 ‘‘(1) FINANCIAL RECORD MAINTENANCE AND

18 AUDIT.—The financial records of each eligible entity 

19 receiving a grant under this section shall be main20 tained in accordance with generally accepted ac21 counting principles and shall be subject to an annual 

22 audit by an independent public accountant. 

23 ‘‘(2) REPORTS.— 

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

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1 tion annually shall submit to the Secretary a re2 port of the eligible entity’s operations and ac3 tivities under this section. 

4 ‘‘(B) CONTENTS.—Each annual report 

5 submitted under subparagraph (A) shall in6 clude— 

7 ‘‘(i) a copy of the most recent finan8 cial statements, and any accompanying 

9 opinion on such statements, prepared by 

10 the independent public accountant review11 ing the financial records of the eligible en12 tity; 

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

14 audit of the financial records of the eligible 

15 entity that was conducted under paragraph 

16 (1) during the reporting period; 

17 ‘‘(iii) an evaluation by the eligible en18 tity of the effectiveness of its use of the 

19 Federal funds provided under this section 

20 in leveraging private funds; 

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

22 charter schools served during the reporting 

23 period; 

24 ‘‘(v) a description of the activities car25 ried out by the eligible entity to assist 


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1 charter schools in meeting the objectives 

2 set forth in subsection (f); and 

3 ‘‘(vi) a description of the characteris4 tics of lenders and other financial institu5 tions participating in the activities under6 taken by the eligible entity under this sec7 tion during the reporting period. 

8 ‘‘(C) SECRETARIAL REPORT.—The Sec9 retary shall review the reports submitted under 

10 paragraph (2)(A) and shall provide a com11 prehensive annual report to Congress on the ac12 tivities conducted under this section. 

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

14 OBLIGATIONS.—No financial obligation of an eligible enti15 ty entered into pursuant to this section (such as an obliga16 tion under a guarantee, bond, note, evidence of debt, or 

17 loan) shall be an obligation of, or guaranteed in any re18 spect by, the United States. The full faith and credit of 

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

20 which may be required to be paid under any obligation 

21 made by an eligible entity pursuant to any provision of 

22 this section. 

23 ‘‘(k) RECOVERY OF FUNDS.— 


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1 ‘‘(1) IN GENERAL.—The Secretary, in accord2 ance with chapter 37 of title 31, United States 

3 Code, shall collect— 

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

5 established by an eligible entity under sub6 section (g)(1) if the Secretary determines, not 

7 earlier than 2 years after the date on which the 

8 eligible entity first received funds under this 

9 section, that the eligible entity has failed to 

10 make substantial progress in carrying out the 

11 purposes described in this section; or 

12 ‘‘(B) all or a portion of the funds in a re13 serve account established by an eligible entity 

14 under subsection (g)(1) if the Secretary deter15 mines that the eligible entity has permanently 

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

17 such account to accomplish any purpose de18 scribed in this section. 

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

20 shall not exercise the authority provided in para21 graph (1) to collect from any eligible entity any 

22 funds that are being properly used to achieve one or 

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

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

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1 sions Act shall apply to the recovery of funds under 

2 paragraph (1). 

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

4 shall be construed to impair or affect the authority 

5 of the Secretary to recover funds under part D of 

6 the General Education Provisions Act. 

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

8 Secretary shall reserve for each fiscal year not less than 

9 5 percent and not more than 15 percent of the amount 

10 appropriated under section 5212.’’. 

11 SEC. 9. DEFINITIONS. 

12 Section 5211 of the Elementary and Secondary Edu13 cation Act of 1965 (as redesignated by section 8(1)) (20 

14 U.S.C. 7221i) is amended— 

15 (1) in paragraph (1)— 

16 (A) by striking subparagraph (L); 

17 (B) by redesignating subparagraphs (D) 

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

19 respectively; 

20 (C) by inserting after subparagraph (B) 

21 the following: 

22 ‘‘(C) has an independent governing board 

23 that enters into a performance-based agreement 

24 that encompasses one or more campuses with 

25 an authorized public chartering agency in the 


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1 State, which agreement shall include a descrip2 tion of— 

3 ‘‘(i) how student performance will be 

4 measured in each charter school pursuant 

5 to the State assessments that are required 

6 of other schools and any other assessments 

7 or evaluations mutually agreeable to the 

8 authorized public chartering agency and 

9 the charter school; and 

10 ‘‘(ii) criteria for renewal or revocation 

11 of the charter;’’; 

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

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

14 or secondary education, or both’’ and inserting 

15 ‘‘prekindergarten, elementary, or secondary 

16 education, or adult education if permitted by 

17 State charter law, or any combination of such 

18 types of education’’; 

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

20 by subparagraph (B))— 

21 (i) by striking ‘‘school to’’ and insert22 ing ‘‘school— 

23 ‘‘(i) to’’; 

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

25 and inserting ‘‘children; 


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1 ‘‘(ii) that’’; and 

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

3 inserting ‘‘accommodated; and 

4 ‘‘(iii) that does not give admissions 

5 preference to any student on the basis of 

6 prior academic achievement;’’; 

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

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

9 the semicolon; and 

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

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

12 inserting a period; 

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

14 following: 

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

16 applicant’ means— 

17 ‘‘(A) a developer that has applied to an au18 thorized public chartering agency to operate a 

19 charter school and provided adequate and time20 ly notice to that authority under section 

21 5203(d)(3); or 

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

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

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

25 term ‘charter support organization’ means a public 


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1 or private nonprofit organization that provides as2 sistance to a developer of a charter school during the 

3 planning, program design, and initial implementa4 tion of a charter school. 

5 ‘‘(6) ELIGIBLE ENTITY.—The term ‘eligible en6 tity’ means— 

7 ‘‘(A) a public entity, such as a State edu8 cational agency or other State or local govern9 mental entity; 

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

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

12 subparagraph (A) or (B).’’; and 

13 (4) by redesignating paragraphs (1) through 

14 (6) as paragraphs (2), (4), (5), (1), (3), and (6), re15 spectively. 

16 SEC. 10. AUTHORIZATION OF APPROPRIATIONS. 

17 Section 5212 of the Elementary and Secondary Edu18 cation Act of 1965 (as redesignated by section 8(1)) (20 

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

20 ‘‘SEC. 5212. AUTHORIZATION OF APPROPRIATIONS. 

21 ‘‘(a) IN GENERAL.—There are authorized to be ap22 propriated to carry out this subpart $650,000,000 for fis23 cal year 2010 and such sums as may be necessary for each 

24 of the 5 succeeding fiscal years. 


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

2 subpart for any fiscal year, the Secretary shall consider 

3 the relative need between the programs under section 

4 5202, section 5205(c), and section 5211 and the quality 

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

6 SEC. 11. REORGANIZATION. 

7 Part B of title V of the Elementary and Secondary 

8 Education Act of 1965 (20 U.S.C. 7221 et seq.) is amend9 ed— 

10 (1) by striking subpart 2; and 

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

12 SEC. 12. CONFORMING AMENDMENTS. 

13 (a) CONFORMING AMENDMENT.—Section 5247(1) of 

14 the Elementary and Secondary Education Act of 1965 (20 

15 U.S.C. 7225f(1)) is amended by striking ‘‘5210’’ and in16 serting ‘‘5211’’. 

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

18 the Elementary and Secondary Education Act of 1965 is 

19 amended— 

20 (1) by striking the items relating to sections 

21 5206 through 5211 and inserting the following: 

‘‘Sec. 5206. Federal formula allocation. 

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

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

‘‘Sec. 5209. Records transfer. 

‘‘Sec. 5210. Paperwork reduction. 

‘‘Sec. 5211. Definitions. 

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


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

2 of part B of title V; 

3 (3) by striking the items relating to sections 

4 5221 through 5231; and 

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

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

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

Æ 


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