Charter School Accountability Act of 2015

To improve certain provisions relating to charter schools. 1. Short title This Act may be cited as the Charter School Accountability Act of 2015 2. General provisions Title V of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7201 et seq. (1) by striking the title heading and inserting Empowering Parents and Expanding Opportunity Through Innovation (2) by striking part A; (3) by striking subparts 2 and 3 of part B; (4) by redesignating parts B and C as parts A and B, respectively; (5) in part A, as redesignated by paragraph (4), by striking Subpart 1—Charter School Programs (6) by redesignating sections 5201 through 5211 as sections 5101 through 5111, respectively; (7) by redesignating sections 5301 through 5307 as sections 5201 through 5207, respectively; (8) by striking sections 5308 and 5310; and (9) by redesignating sections 5309 and 5311 as sections 5208 and 5209, respectively. 3. Public charter schools Part A of title V of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7221 et seq. 5101. Purpose It is the purpose of this part to— (1) provide authorization and support for public charter schools providing elementary or secondary education as a means to test and learn from innovations aimed at improving the education of all students and strengthening public education; (2) evaluate the impact of such schools on student achievement, families, and communities, and share best practices among charter schools and other public schools; (3) expand opportunities for children with disabilities, students who are English learners, and other traditionally underserved students to attend charter schools and meet the challenging State academic standards under section 1111(b)(1); and (4) support efforts to strengthen the charter school authorizing process to improve performance management, including transparency, monitoring, including financial audits, and evaluation of such schools. 5102. Program authorized (a) In general The Secretary may award grants to eligible State educational agencies having applications approved pursuant to section 5103(f) to enable such agencies to conduct a charter school grant program in accordance with this part, by— (1) supporting the startup of charter schools that are evaluated by the charter school authorizer for quality and local impact; (2) supporting the replication and expansion of high-quality charter schools; (3) assisting charter schools in accessing credit to acquire and renovate facilities for school use; and (4) carrying out national activities to support— (A) the dissemination of best and promising practices between and among magnet, traditional district, and charter schools; (B) the evaluation of the impacts of the charter school program under this part on educational quality and equity for students, and the overall strength of public education in local communities; and (C) stronger charter school authorizing. (b) Funding allotment From the amount made available under section 5113 for a fiscal year, the Secretary shall— (1) reserve 12.5 percent to support charter school facilities assistance under section 5104; (2) reserve not more than 25 percent to carry out sections 5103A and 5105; and (3) use the remaining amount after the reservations under paragraphs (1) and (2) to carry out section 5103. (c) Prior grants and subgrants The recipient of a grant or subgrant under this part (as such part was in effect on the day before the date of enactment of the Charter School Accountability Act of 2015) shall continue to receive funds in accordance with the terms and conditions of such grant or subgrant. 5103. Grants to support high-quality charter schools (a) Program authorized From the amount available under section 5102(b)(3), the Secretary shall award, on a competitive basis, grants to eligible State educational agencies having applications approved under subsection (f) to enable such eligible State educational agencies to— (1) award subgrants to eligible applicants to enable such eligible applicants to— (A) support the startup of charter schools that are thoroughly vetted by the authorizer for quality and local impact; (B) replicate or expand high-quality charter schools, which may include— (i) supporting the acquisition, expansion, or preparation of a charter school building to meet increasing enrollment needs, including financing the development of a new building and ensuring that a school building complies with applicable statutes and regulations; (ii) paying costs associated with hiring additional teachers to serve additional students; (iii) providing transportation to students to and from the charter school; (iv) providing instructional materials, implementing teacher and principal or other school leader professional development programs, and hiring additional nonteaching staff; (v) supporting any necessary activities that assist the charter school in carrying out this section; and (vi) providing early childhood education programs for children, including direct support to, and coordination with, school or community based early childhood education programs; or (C) in the case of the closure or dissolution of a charter school, transfer students and student records to another school in the school district in which the charter school is located; and (2) provide technical assistance to eligible applicants and charter school authorizers in carrying out the activities described in paragraph (1), and work with charter school authorizers in the State to improve authorizing quality, including developing capacity for and conducting fiscal oversight and auditing of charter schools. (b) Eligible State educational agency defined For purposes of this section, the term eligible State educational agencies (1) State law authorizing the creation of charter schools The State must have a law in force that authorizes the creation and operation of charter schools. (2) Fiduciary duties and conflict of interest rules The State must have legally binding rules establishing fiduciary duties for officers, directors, managers, and employees of charter schools and prohibitions against conflicts of interest among officers, directors, managers, and employees of charter schools, education management organizations, and related entities. Specifically, the State must have legally binding rules— (A) providing that charter school officers, directors, managers, and employees occupy positions of trust when they handle the money or property of the charter school; (B) prohibiting charter school officers, directors, managers, and employees from dealing with the charter school as an adverse party or acting on behalf of an adverse party in any matter connected with the duties of such officer, director, manager, or employee; (C) prohibiting charter school officers, directors, managers, and employees from holding or acquiring any pecuniary or personal interest that conflicts with the interests of the charter school; (D) prohibiting education management organizations from entering into any transaction with a related party, including— (i) any related entity formed for the purpose of managing or providing support to a charter school or group of related charter schools; (ii) any direct or indirect wholly owned subsidiary of any such entity, if the transaction benefits the education management organization, the related party, or both; or (iii) any other related party; and (E) providing civil remedies and criminal penalties, as applicable, that will apply to a breach of fiduciary duties and prohibited actions described in this paragraph in the same manner that such remedies or penalties apply to a breach of fiduciary duties or an action similar to a prohibited action under this paragraph in the case of officers, directors, managers, and employees of an entity that is not a charter school. (3) Public removal of charter school governing board members The State charter school law shall ensure that a State agency or charter school authorizer has the authority to remove a member of a charter school’s governing board if the member has violated the member's fiduciary responsibilities or the applicable conflict of interest rules. (4) Independent financial audit requirements with public disclosure The State must require that all charter schools, and all education management organizations that enter into management services contracts with charter schools— (A) conduct annual, independent audits of their financial statements and submit these required audit reports to the eligible State educational agency; and (B) make the required audit reports, including any management letters, publicly available via disclosure by the eligible State educational agency. (5) Charter school access to books and records of education management organizations The State must require that a charter school’s governing board have access to all the books and records— (A) of any education management organization with which the board has contracted to manage the school; and (B) that are applicable to that charter school. (6) Open meetings and open records requirements for charter schools The State must provide that charter schools are covered by the State’s open meetings and open records laws to the same extent that public schools and school boards are covered by such laws. (7) Charter school authorizer authority The State must have policies in force that provide charter school authorizers with the authority to— (A) inspect and obtain copies of any books and records of the charter schools they authorize, including all contracts entered into by the charter schools; and (B) conduct a review or audit of educational performance and financial operations of the charter schools they authorize. (8) Charter school authorizer accountability The State must have policies holding charter school authorizers responsible for monitoring the educational performance and financial operations of all charter schools that the charter school authorizer has authorized. Such policies must include all of the following: (A) Performance standards for charter school authorizers. (B) A standardized and public charter school authorizer performance reporting system that discloses, for each authorizer in each school year— (i) the number of applications received; (ii) the number of applications approved; (iii) the name, location, and status of each authorized school; and (iv) all charter school closures, decisions to deny renewal of charters, or decisions to cancel charters, including reasons for the closures, nonrenewal decisions, or cancellation decisions. (C) The provision of technical assistance to help authorizers meet performance standards. (D) Authority on the part of an agency or instrumentality of the State to suspend or revoke an authorizer’s ability to authorize charter schools on the basis of poor performance, and policies relating to that authority, including— (i) published criteria for such suspensions or revocations based on the educational or financial performance of the schools that are authorized by the charter school authorizer; and (ii) a protocol or policy for reassigning authorizer responsibilities for each such school to another appropriate authorizer and assisting with the necessary transition (except in the case of a State that has only one charter school authorizer). (E) A policy regarding how charter schools are monitored and held accountable for— (i) meeting the requirements described in section 5110(1); and (ii) providing equitable access and effectively serving the needs of all students, including students with disabilities and English learners. (F) A policy regarding how the charter school authorizer will ensure that the local educational agency that serves a charter school that such charter school authorizer has authorized will comply with subsections (a)(5) and (e)(1)(B) of section 613 of the Individuals with Disabilities Education Act. (9) For-profit charter schools The State must have laws in effect that require for-profit charter schools to— (A) ensure that the charter school's educational responsibilities take primacy over other purposes, such as generating financial returns for investors, contributing to a related or parent organization, or supporting external interests; and (B) include board members who have no significant administrative position and no ownership interest in the charter school or a related party, as described in 5103(b)(2)(D). (10) Districtwide multi-year school plan The State must require local educational agencies, charter school authorizers, and charter schools to jointly develop and regularly update a districtwide multi-year school plan, which shall be coordinated by the charter school authorizer. (11) Impact statement The State must require that before any new charter school application is approved, the local educational agency that serves the charter school or is in the geographic area of the charter school, in accordance with the districtwide multi-year school plan, shall— (A) prepare an impact statement— (i) assessing the proposed charter school’s impact on the districtwide multi-year school plan; and (ii) identifying the role that the charter school intends to fill within the local educational agency; (B) make such impact statement available to community members prior to the hearing described in subparagraph (C); and (C) hold a community input hearing prior to the determination about the approval or disapproval of a pending charter school application. (12) Impact report The State educational agency must prepare, and publish on the State educational agency website, an annual assessment of the impact of charter schools on local educational agencies in the State, including— (A) a review of the flow of funding between sectors, student enrollment trends, and educational outcomes; (B) identification of noteworthy innovative or promising practices carried out by charter schools in the State; and (C) documentation of efforts that lead to two-way cross sector sharing of promising practices. (13) Charter school disclosures (A) In General Subject to subparagraph (B), the State must require each charter school to publicly disclose, on the school's website, the following: (i) The school's charter documents. (ii) Any performance agreements in effect between the charter school and the charter school's authorizer. (iii) A description of the schools’ program, including courses and programs offered. (iv) Whether or not transportation services are provided, and any fees for transportation. (v) Whether or not meals and snacks are served at school and whether or not free or reduced-price meals are available (and, if so, to which students). (vi) Annual student attrition rates by grade level. (vii) Student behavior or discipline codes, policies, and processes, including parent appeal options. (viii) Annual teacher attrition rates. (ix) The amounts of nonpublic funding sources, including the duration of philanthropic funding commitments. (x) The names of legal title holders of land and buildings that the charter school utilizes, along with a description of any public subsidies used directly or indirectly to purchase or lease charter school property. (xi) Fees related to incidentals of attendance, and whether any of those fees are waived for certain students (such as for students who are eligible to receive a free or reduced price lunch). (xii) Information related to financial and in-kind contributions of support, which shall be— (I) the amount and duration of any Federal, State, local, and private financial and in-kind contributions of support, and how such funding and in-kind contributions are spent or used; (II) the information required to be submitted to the Office for Civil Rights for the Civil Rights Data Collection; or (III) in the case of an organization described in section 501(c)(3) of the Internal Revenue Code that is exempt from taxation under section 501(a) of that Code, the information required to be submitted on any return to be filed under section 6033 of that Code. (B) Personally identifiable information Notwithstanding the requirements under subparagraph (A), a charter school shall not provide any information under this paragraph that would reveal personally identifiable information about an individual. (c) Eligible State educational agency uses of funds (1) In general An eligible State educational agency receiving a grant under this section shall— (A) use not less than 90 percent of the grant funds to award subgrants to eligible applicants, in accordance with the quality charter school program described in the eligible State educational agency’s application pursuant to subsection (f), for the purposes described in subsection (a)(1); (B) reserve not less than 5 percent of such funds to carry out the activities described in subsection (a)(2); (C) reserve not more than 3 percent of such funds for administrative costs, which may include the administrative costs of providing technical assistance; and (D) reserve not less than 2 percent of such funds for the oversight of charter school use of Federal, State, and local public funds and private funds, including the investigation of fraud, waste, mismanagement and misconduct and ensuring compliance with paragraphs (2), (4), and (13) of subsection (b), which may be used by— (i) the State for oversight of each charter school in the State; (ii) local educational agencies for oversight of public charter schools served by the local educational agency; and (iii) charter school authorizers for— (I) oversight of each charter school that is authorized by such authorizer; and (II) coordination of the districtwide multi-year school plan, as described in subsection (b)(10). (2) Rules of construction Nothing in this part shall prohibit the Secretary from awarding grants to eligible State educational agencies, or eligible State educational agencies from awarding subgrants to eligible applicants, that use a weighted lottery, or an equivalent lottery mechanism, to give better chances for school admission to all or a subset of educationally disadvantaged students if— (A) the use of a weighted lottery in favor of such students is not prohibited by State law; and (B) such weighted lottery is not used for the purpose of creating schools exclusively to serve a particular subset of students. (d) Program periods; peer review; distribution of subgrants; waivers (1) Program periods (A) Grants A grant awarded by the Secretary to an eligible State educational agency under this section shall be for a period of not more than 3 years, and may be renewed by the Secretary for one additional 2-year period. (B) Subgrants A subgrant awarded by an eligible State educational agency under this section— (i) shall be for a period of not more than 3 years, of which an eligible applicant may use not more than 18 months for planning and program design; and (ii) may be renewed by the eligible State educational agency for one additional 2-year period. (2) Peer review The Secretary, and each eligible State educational agency awarding subgrants under this section, shall use a peer-review process to review applications for assistance under this section. (3) Distribution of subgrants Each eligible State educational agency awarding subgrants under this section shall award subgrants in a manner that, to the extent practicable and applicable, ensures that such subgrants— (A) prioritize eligible applicants that plan to serve a significant number of students from low-income families; (B) are distributed throughout different areas, including urban, suburban, and rural areas; and (C) will assist charter schools representing a variety of educational approaches. (4) Waivers The Secretary may waive any statutory or regulatory requirement over which the Secretary exercises administrative authority under this Act with respect to charter schools supported under this part, except any such requirement relating to the elements of a charter school, if— (A) the waiver is requested in an approved application; and (B) the Secretary determines that granting such waiver will promote the purposes of this part. (e) Limitations (1) Grants An eligible State educational agency may not receive more than 1 grant under this section at a time. (2) Subgrants An eligible applicant may not receive more than 1 subgrant under this section for each individual charter school for each grant period or renewal period, unless the eligible applicant demonstrates to the eligible State educational agency that such individual charter school has demonstrated a strong track record of positive results over the course of the grant period regarding the elements described in subparagraphs (A) and (D) of section 5110(8). (f) Applications (1) In General An eligible State educational agency 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. (2) Contents The application shall, in addition to citing the applicable policies necessary to satisfy the grant eligibility criteria set forth in subsection (b), provide a description of the eligible State educational agency’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 of the following: (A) How the eligible State educational agency will— (i) support the opening of new charter schools and, if applicable, the replication or expansion of high-quality charter schools, and the proposed number of charter schools to be opened, replicated, or expanded under the eligible State educational agency’s program; (ii) inform eligible charter schools, developers, and charter school authorizers of the availability of funds under the program; (iii) work with eligible applicants to ensure that the eligible applicants access all Federal funds that such applicants are eligible to receive, and help the charter schools supported by the applicants and the students attending those charter schools— (I) participate in the Federal programs in which the schools and students are eligible to participate; and (II) receive the commensurate share of Federal funds the schools and students are eligible to receive under such programs; (iv) ensure each eligible applicant that receives a subgrant under the eligible State educational agency’s program— (I) is opening or expanding schools that meet the definition of a charter school under section 5110; and (II) is prepared to continue to operate such charter schools once the subgrant funds under this section are no longer available; (v) support charter schools in local educational agencies with schools that have been identified by the State under section 1116(b); (vi) work with charter schools to promote inclusion of all students and support all students upon enrollment in order to promote retention of students in the school; (vii) work with charter schools on recruitment practices, including efforts to engage groups that may otherwise have limited opportunities to attend charter schools; (viii) promote the sharing of best and promising practices among and across their charter, magnet, and traditional school sectors; (ix) ensure that charter schools receiving funds under the eligible State educational agency’s program meet the educational needs of their students, including students with disabilities and students who are English learners; (x) support efforts to increase charter school quality initiatives, including meeting quality authorizing elements in this part; (xi) hold charter schools within such eligible State educational agency’s jurisdiction accountable if such schools do not meet the objectives specified in the performance contract described in section 5110(1), including by closing unsuccessful schools; and (xii) ensure that local educational agencies within such eligible State educational agency's jurisdiction comply with subsections (a)(5) and (e)(1)(B) of section 613 of the Individuals with Disabilities Education Act. (B) The eligible State educational agency’s authorizer accountability policies and operations, and plans pursuant to section 5103(b)(8). (C) How the eligible State educational agency will ensure that each eligible applicant will solicit and consider input from parents and other members of the community on the implementation and operation of each charter school that will receive funds under the eligible State educational agency’s program. (D) How the eligible State educational agency will allow for an impartial appeals process for a denial by a charter school authorizer of a developer’s application for a charter school. (E) How the eligible State educational agency will award subgrants, on a competitive basis, to eligible applicants, on the basis of applications that include— (i) the name and address of the public charter school and its mission, purpose, and any specialized innovation of the charter school; (ii) a description of the roles and responsibilities of eligible applicants, and of any education management organizations or other organizations with which the eligible applicant will partner to open charter schools, including the administrative and contractual roles and responsibilities of such partners; (iii) the proposed governance structure of the school, developed with public input and including, at a minimum, a list of members of the governing board with each member’s qualifications, terms, and full financial disclosure of any potential conflicts of interest, including relationships with education management organizations, vendors, or other business dealings with the school or other charter schools; (iv) for a traditional public school applying to convert to a charter school, demonstrated support of two-thirds of the families of children attending the school and two-thirds of the school staff for the conversion; (v) any contract between the charter school and an education management organization; (vi) student recruitment, admission, and retention policies and practices, including a description of how the school provides equitable access and effectively serves the needs of all students, including students with disabilities and English learners, and implements outreach and recruitment practices that include the families of all students; (vii) the ages and grades of students and an estimate of the total enrollment of the school to be served by the charter school; (viii) the number of staff and school leadership positions, including full-time and part-time employees, and qualifications of employees; (ix) a description of the educational program, methodology, and services to be offered to students, including students who are English learners and students with disabilities; (x) information about the school’s daily hours of operation and number of days in the school year; (xi) a description of how the school will engage parents as partners in the education of their children; (xii) a description of transportation services provided to and from school for students; (xiii) a statement that the school will not discriminate on the basis of race, national origin, gender, sexual orientation and gender identity, ethnicity, disability, academic achievement, or home language and that the school will comply with Federal and State civil rights laws applicable to other publicly funded elementary and secondary schools; (xiv) evidence of adequate community support for and interest in the charter school sufficient to allow the school to reach its anticipated enrollment, and an assessment of the projected programmatic and fiscal impact of the school on other public and nonpublic schools in the area; (xv) a description of the health and food services to be provided to students attending the school, including whether the school participates in any free or reduced price lunch programs; (xvi) methods and strategies for serving students with disabilities, students who are English learners, and students who are homeless, including compliance with all applicable Federal laws; (xvii) a description of the procedures to be followed in the case of the closure or dissolution of the charter school, including— (I) provisions for the transfer of students and student records to the school district in which the charter school is located, which transfer activities may be carried out using funds under this part; (II) the amount of funds that will be held in escrow annually to fund closure or dissolution related costs; and (III) unless State law requires otherwise, procedures for the disposition of the charter school’s assets to the local educational agency that serves the charter school or is in the geographic area of the charter school; (xviii) the hiring and personnel policies and procedures of the school; (xix) a description of the manner by which employees of the charter school will be covered by the State teachers’ retirement system, the public employees’ retirement system, or other pension or retirement plan as well as compensation, health, and other benefits provided to the school’s employees; (xx) for the purposes of a traditional public school that seeks to convert to a public charter school, how the charter school will comply with the same public sector labor relations laws and regulations as required of traditional public schools, including collective bargaining rights of the employees of the charter school, as applicable under State law; (xxi) a statement that the public charter school will conduct or arrange for the performance of annual independent financial audits and submit the audits to the eligible State educational agency; (xxii) a 3-year plan to sustain the maintenance, operation, and fiscal stability of the school; (xxiii) a statement that the school will maintain a public online site with information as required in this section, and as otherwise provided in Federal, State, and local requirements applicable to other public schools, and a statement that the public charter school will participate in an independent evaluation, and any other evaluations or assessments, in the time and manner determined by the eligible State educational agency; and (xxiv) a description of the quality controls agreed to between the eligible applicant and the authorizer, such as a contract or a performance agreement or financial audits to ensure adequate fiscal oversight. (F) In the case of an eligible State educational agency that partners with an outside organization to carry out the entity’s quality charter school program, in whole or in part, a description of the roles and responsibilities of the partner. (G) How the eligible State educational agency will help the charter schools receiving funds under the eligible State educational agency’s program address the transportation needs of the schools’ students. (3) Assurances The application shall, in addition to the information described in paragraph (2), include assurances that the eligible State educational agency will ensure that the charter school authorizer of any charter school that receives funds under the eligible State educational agency’s program— (A) ensures that the charter school under the authority of such agency is meeting the requirements of this Act, part B of the Individuals with Disabilities Education Act, title VI of the Civil Rights Act of 1964, and section 504 of the Rehabilitation Act of 1973; (B) adequately monitors and provides adequate technical assistance to each charter school under the authority of such agency in recruiting, enrolling, retaining, and meeting the needs of all students, including children with disabilities and students who are English learners; and (C) ensures that each such charter school solicits and considers input from parents and other members of the community on the implementation and operation of the school. (g) Parent information and rights (1) As a condition for eligibility for funding under this part, eligible State educational agencies shall— (A) ensure that each charter school in the State provides the information described in paragraph (2) to the parents of the students who attend the charter school in a manner that is— (i) concise; (ii) presented in an understandable and uniform format and, to the extent practicable, in a language that parents can understand; and (iii) widely accessible to the public; and (B) make such information available on a single webpage of the State educational agency's website. (2) Such information shall include, at a minimum, each of the following: (A) Information about the charter school's mission, educational programs, and services. (B) The charter application and the approved charter document for the school, as well as any performance or other agreements in effect between the charter school and its authorizer. (C) Rules and policies regarding student behavior and student disciplinary policies and practices, including suspension and expulsion policies. (D) Information about the provision of meals and snacks, including— (i) the number and type of meals and snacks served each day; (ii) whether such meals and snacks are fully or partially subsidized; and (iii) information about student eligibility for free and reduced price lunch programs. (E) Information about transportation to and from the school, including any transportation that is free or subsidized to students and the eligibility requirements for free or subsidized transportation. (F) Recruitment and admission policies and practices used at each charter school site. (G) Information about the school’s daily, weekly, and school year schedule, including hours of operation and number of days in the school year. (H) The number of years that the public charter school has operated. (I) The maximum number of students in each classroom by grade. (J) Staff qualifications (including school leadership) and languages spoken by staff. (K) Fees related to incidentals of attendance (other than tuition), and whether any of those fees are waived for certain students (such as for students who are eligible to receive a free or reduced price lunch). (L) Data on attendance and the number of suspensions and expulsions by school year, in total and disaggregated by each of the categories of students described in section 1111(b)(2)(C)(v). (M) Annual student attrition rates by grade level. (N) Annual teacher attrition rates and numbers, disaggregated by grade level and teaching subject matter, years of experience, and credential. (O) Procedures for parents, students, and school employees to appeal school decisions and the procedures and processes for such appeals. (P) Other information that would assist a parent in making a decision to enroll a child in the public charter school. (3) Notwithstanding the requirements under paragraph (2), a charter school shall not provide any information under this subsection that would reveal personally identifiable information about an individual. (h) Selection criteria; priority The Secretary shall award grants to eligible State educational agencies under this section on the basis of— (1) the quality of the applications submitted; (2) the performance record of the charter sector in the applicant State, including in the areas of promoting high student achievement and growth, identification and use of instructional and other educational program innovations to strengthen public education, financial management, student safety, and compliance with applicable policies; and (3) the eligible State educational agency’s plan to solicit and consider input from parents and other members of the community on the implementation and operation of the charter schools in the State. (i) State evaluation and report (1) In General Beginning not later than 2 years after the date of enactment of the Charter School Accountability Act of 2015, each eligible State educational agency receiving a grant under this section shall enter into a contract for an independent evaluation of the charter schools in the State, which shall be carried out on an annual basis. The State educational agency may use grant funds under this section to pay the cost of the independent evaluation and related reporting. (2) Submission to the Secretary; Public availability Each such independent evaluation shall be submitted to the Secretary and shall also be made publicly available on the website of the agency. (3) Contents The independent evaluation described in paragraph (1) shall include an evaluation of the following: (A) An assessment of the cumulative impact of charter schools on local educational agencies within the State, including on the flows of funding between sectors, student enrollment trends, staffing, and educational outcomes, along with recommendations for any changes to laws, regulations, or policies to address identified problems. (B) A compilation of profiles of public charter schools and other charter schools in the State relating to demographic information on student enrollment and retention. (C) Staff and leadership qualifications, demographic information and retention information regarding staff, and academic and nonacademic programs provided, in charter schools in the State. (D) The academic achievement of students in each public charter school in the State, as compared to students enrolled in other public charter schools within the same local educational agency and as compared to other students enrolled in all public schools in the local educational agency, accounting for differences in student populations served, programs and services provided, and public and nonpublic funding available in the schools students are attending. (E) Adequacy of funding and resource distribution among public charter schools and noncharter public schools in the State, accounting for differences in student populations served and programs and services provided. (F) Recommendations for any changes to laws, regulations, or policies that would facilitate improvement of student outcomes in public charter schools in the State. (G) Recommendations for improvements in equity, transparency, and accountability of public charter schools in the State to the public and the parents and staff at such public charter schools. (H) Identification of best and promising practices within the sectors of public schools, private schools, and charter schools, in the State and the extent to which these are being shared to improve educational outcomes as a whole, barriers to effective sharing, and recommendations for how to reduce such barriers, in the State. (I) How the eligible State educational agency has worked with charter schools receiving funds under the State educational agency’s program to foster community involvement in the planning for and opening of such schools. 5103A. Grants for the replication and expansion of high-quality charter schools (a) In General From amounts reserved under section 5102(b)(2), the Secretary shall make grants, on a competitive basis, to eligible entities having applications approved under this section to enable such eligible entities to replicate a high-quality charter school or expand a high-quality charter school. (b) Eligible entity defined For purposes of this section, the term eligible entity (1) (A) is a charter management organization that, at the time of the application, operates or manages one or more high-quality charter schools; or (B) is a nonprofit organization that oversees and coordinates the activities of a group of such charter management organizations; and (2) (A) operates in a State that meets the requirements of section 5103(b); or (B) if the entity does not operate in such a State, the Secretary has certified that the eligible entity has policies and controls in place that are in compliance with section 5103(b) and the Secretary has determined that awarding a grant under this section to the entity will promote the purposes of this part. (c) Application requirements An eligible 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) Each item that is required for an application as described in clauses (i) through (xxiv) of section 5103(f)(2)(E), except that the term eligible entity eligible applicant (2) A description of the eligible entity's objectives for implementing a high-quality charter school program with funding under this section, including a description of the proposed number of high-quality charter schools to be replicated or expanded with funding under this section. (3) A description of the educational program that the eligible entity will implement in the charter schools that the eligible entity proposes to replicate or expand, including information on how the program will enable all students to meet the challenging State academic standards under section 1111(b)(1), the grade levels or ages of students that will be served, and the instructional practices that will be used. (4) A multi-year financial and operating model for the eligible entity, including a description of how the operation of the charter schools to be replicated or expanded will be sustained after the grant under this section has ended. (5) A description of how the eligible entity will inform all students in the community, including children with disabilities, students who are English learners, and other educationally disadvantaged students, about the charter schools to be replicated or expanded with funding under this section. (6) For each charter school currently operated or managed by the eligible entity— (A) student assessment results for all students and for each category of students described in section 1111(b)(2)(C)(v); and (B) attendance and student retention rates for the most recently completed school year and, if applicable, the most recent available 4-year adjusted cohort graduate rate and extended-year adjusted cohort graduation rate (as such rates were calculated on the day before enactment of the Charter School Accountability Act of 2015). (7) Information on any significant compliance issues encountered, within the last 3 years, by any school operated or managed by the eligible entity, including in the areas of student safety and financial management. (8) An assurance that the eligibly entity will comply with the requirements of— (A) section 5103(f)(3); and (B) section 5103(g). (d) Selection criteria The Secretary shall select eligible entities to receive grants under this section, on the basis of the quality of— (1) the selection criteria described in section 5103(h); (2) the eligible entity’s financial and operating model, including the quality of the eligible entity’s plan for sustaining the operation of the charter schools to be replicated or expanded after the grant under this section has ended; (3) a determination that the eligible entity has not operated or managed a significant proportion of charter schools that— (A) have been closed; (B) have had a school charter revoked due to problems with statutory or regulatory compliance; or (C) have had the school’s affiliation with the eligible entity revoked; and (4) a determination that the eligible entity has not experienced significant problems with statutory or regulatory compliance that could lead to the revocation of a school’s charter. (e) Priority In awarding grants under this section, the Secretary shall give priority to eligible entities that operate or manage charter schools that, in the aggregate, serve students at least 60 percent of whom are eligible for a free or reduced price lunch under the Richard B. Russell National School Lunch Act. (f) Terms and conditions Except as otherwise provided in this section, grants awarded under this section shall have the same terms and conditions as grants awarded to eligible State educational agencies under section 5103. 5104. Facilities financing assistance (a) Grants to eligible entities (1) In general From the amount reserved under section 5102(b)(1), the Secretary shall use not less than 50 percent to award not less than 3 grants, on a competitive basis, to eligible entities that have the highest-quality applications approved under subsection (d) to demonstrate innovative methods of helping 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 the purposes of this section, the term eligible entity (A) a public entity, such as a State or local governmental entity; (B) a private nonprofit entity; or (C) a consortium of entities described in subparagraphs (A) and (B). (b) Grantee selection The Secretary shall evaluate each application submitted under subsection (d), and shall determine whether the application is sufficient to merit approval. (c) Grant characteristics Grants under subsection (a) shall be of a sufficient size, scope, and quality so as to ensure an effective demonstration of an innovative means of enhancing credit for the financing of charter school acquisition, construction, or renovation. (d) Applications (1) In general An eligible entity desiring to receive a grant under this section shall submit an application to the Secretary 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 that the eligible entity proposes to carry out 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 that 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 more of the following objectives: (1) The acquisition (by purchase, lease, donation, or otherwise) of an interest (including an interest held by a third party for the benefit of a charter school) in improved or unimproved real property that is necessary to commence or continue the operation of a charter school. (2) The construction of new facilities, including predevelopment costs, or the renovation, repair, or alteration of existing facilities, necessary to commence or continue the operation of a charter school. (3) The predevelopment costs required to assess sites for purposes of paragraph (1) or (2) and which are necessary to commence or continue the operation of a charter school. (f) Reserve account (1) Use of funds To assist charter schools in accomplishing the objectives described in subsection (e), an eligible entity receiving a grant under subsection (a) shall, in accordance with State and local law, directly or indirectly, alone or in collaboration with others, deposit the funds received under subsection (a) (other than funds used for administrative costs in accordance with subsection (g)) in a reserve account established and maintained by the eligible entity for this purpose. Amounts deposited in such account shall be used by the eligible entity for one or more of the following purposes: (A) Guaranteeing, insuring, and reinsuring bonds, notes, evidences of debt, loans, and interests therein, the proceeds of which are used for an objective described in subsection (e). (B) Guaranteeing and insuring leases of personal and real property for an objective described in such subsection. (C) Facilitating financing by identifying potential lending sources, encouraging private lending, and other similar activities that directly promote lending to, or for the benefit of, charter schools. (D) Facilitating the issuance of bonds by charter schools, or by other public entities for the benefit of charter schools, by providing technical, administrative, and other appropriate assistance (including the recruitment of bond counsel, underwriters, and potential investors and the consolidation of multiple charter school projects within a single bond issue). (2) Investment Funds received under this section and deposited in the reserve account established under paragraph (1) shall be invested in obligations issued or guaranteed by the United States or a State, or in other similarly low-risk securities. (3) Reinvestment of earnings Any earnings on funds received under subsection (a) shall be deposited in the reserve account established under paragraph (1) and used in accordance with this subsection. (g) Limitation on administrative costs An eligible entity may use not more than 2.5 percent of the funds received under subsection (a) for the administrative costs of carrying out its responsibilities under this section (excluding subsection (k)). (h) Audits and reports (1) Financial record maintenance and audit The financial records of each eligible entity receiving a grant under subsection (a) shall be maintained in accordance with generally accepted accounting principles and shall be subject to an annual audit by an independent public accountant. (2) Reports (A) Grantee annual reports Each eligible entity receiving a grant under subsection (a) annually shall submit to the Secretary a report of the entity’s operations and activities under this section. (B) Contents Each annual report submitted under subparagraph (A) shall include— (i) a copy of the most recent financial statements, and any accompanying opinion on such statements, prepared by the independent public accountant reviewing the financial records of the eligible entity; (ii) a copy of any report made on an audit of the financial records of the eligible entity that was conducted under paragraph (1) during the reporting period; (iii) an evaluation by the eligible entity of the effectiveness of its use of the Federal funds provided under subsection (a) in leveraging private funds; (iv) a listing and description of the charter schools served during the reporting period, including the amount of funds used by each school, the type of project facilitated by the grant, and the type of assistance provided to the charter schools; (v) a description of the activities carried out by the eligible entity to assist charter schools in meeting the objectives set forth in subsection (e); and (vi) a description of the characteristics of lenders and other financial institutions participating in the activities carried out 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 (A) all of the funds in a reserve account established by an eligible entity under subsection (f)(1) if the Secretary determines, not earlier than 2 years after the date on which the eligible entity first received funds under this section (excluding subsection (k)), that the eligible entity has failed to make substantial progress in carrying out the purposes described in subsection (f)(1); or (B) all or a portion of the funds in a reserve account established by an eligible entity under subsection (f)(1) if the Secretary determines that the eligible entity has permanently ceased to use all or a portion of the funds in such account to accomplish any purpose described in such subsection. (2) Exercise of authority The Secretary shall not exercise the authority provided in paragraph (1) to collect from any eligible entity any funds that are being properly used to achieve one or more of the purposes described in subsection (f)(1). (3) Procedures The provisions of sections 451, 452, and 458 of the General Education Provisions Act shall apply to the recovery of funds under paragraph (1). (4) Construction This subsection shall not be construed to impair or affect the authority of the Secretary to recover funds under part D of the General Education Provisions Act. (k) Per-Pupil facilities aid program (1) Definition of per-pupil facilities aid program In this subsection, the term per-pupil facilities aid program (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 5102(b)(1) and remaining after the Secretary makes grants under subsection (a), the Secretary shall make grants, on a competitive basis, to States to pay for the Federal share of the cost of establishing or enhancing, and administering, per-pupil facilities aid programs. (B) Period The Secretary shall award grants under this subsection for periods of not more than 5 years. (C) Federal share The Federal share of the cost described in subparagraph (A) for a per-pupil facilities aid program shall be not more than— (i) 90 percent of the cost, for the first fiscal year for which the program receives assistance under this subsection; (ii) 80 percent for the second such year; (iii) 60 percent for the third such year; (iv) 40 percent for the fourth such year; and (v) 20 percent for the fifth such year. (D) State share A State receiving a grant under this subsection may partner with 1 or more organizations, and such organizations may provide not more than 50 percent of the State share of the cost of establishing or enhancing, and administering, the per-pupil facilities aid program. (E) Multiple grants A State may receive more than 1 grant under this subsection, so long as the amount of such grant funds provided to charter schools increases with each successive grant. (3) Use of funds (A) In general A State that receives a grant under this subsection shall use the funds made available through the grant to establish or enhance, and administer, a per-pupil facilities aid program for charter schools in the State 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. 5105. National activities (a) In general From amounts reserved under section 5102(b)(2) the Secretary shall use such funds to— (1) disseminate technical assistance to eligible State educational agencies in awarding grants under section 5103; (2) disseminate best and promising practices regarding charter schools; (3) evaluate the impact of the charter school program carried out under this part on all students in charter and traditional public schools and on local communities and the overall strength and performance of their public schools; and (4) award grants, on a competitive basis, for the purpose of carrying out the activities described in section 5103(1)(b), to eligible applicants that desire to open a charter school, replicate a high-quality charter school, or expand a high-quality charter school in— (A) a State that did not apply for a grant under section 5103; or (B) a State that did not receive a grant under section 5103. (b) Report by the Secretary Not later than 6 months after the date of enactment of the Charter School Accountability Act of 2015, the Secretary shall prepare and submit to the Committee on Health, Education, Labor, and Pensions of the Senate, the Committee on Education and the Workforce of the House of Representatives, and the relevant appropriations committees of Congress, and to the public via the Department's website, a report— (1) responding to the March 9, 2010, final management information report of the Office of the Inspector General of the Department of Education, which expressed concern about findings of inadequate oversight by local educational agencies and charter school authorizers to ensure Federal funds are properly used and accounted for; (2) responding to the September 2012 report of the Office of the Inspector General of the Department of Education entitled ‘‘The Office of Innovation and Improvement’s Oversight and Monitoring of the Charter Schools Program’s Planning and Implementation Grants Final Audit Report’’ finding that none of the 3 States whose charter schools programs that Office investigated adequately monitored the public charter schools that the States funded; and (3) describing actions the Department has taken to address the concerns described in such memorandum and final audit report. . 4. Formula allocation Section 5106 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7221e (c) New or significantly expanding charter schools For purposes of implementing the hold-harmless protections in sections 1122(c) and 1125A(g)(3) for a newly opened or significantly expanded charter school under subsection (a), a State educational agency shall calculate a hold-harmless base for the prior year that, as applicable, reflects the new or significantly expanded enrollment of the charter school. . 5. Records Transfer Section 5108 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7221g as quickly as possible and to the extent practicable 6. Paperwork Reduction Section 5109 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7221f authorized public chartering agency shall ensure that implementation of this subpart charter school authorizer shall ensure that implementation of this part 7. Definitions; Transition; Caps; Authorization of approporations Title V of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7201 et seq. 20 U.S.C. 7221i 5110. Definitions (1) Charter school The term charter school (A) is afforded autonomy to test innovative educational approaches, consistent with the provisions of this Act, which local educational agencies consider promising; (B) complies with the data collection, reporting, auditing, and disclosure provisions of this Act as well as those applicable to other public schools through other Federal, State, and local laws, regulations and policies; (C) admits students on the basis of a lottery, if more students apply for admission than can be accommodated; (D) in the case of a school that has an affiliated charter school (such as a school that is part of the same network of schools), automatically enrolls students who are enrolled in the immediate prior grade level of the affiliated charter school and, for any additional student openings or student openings created through regular attrition in student enrollment in the affiliated charter school and the enrolling school, admits students on the basis of a lottery as described in subparagraph (C); (E) complies with the Age Discrimination Act of 1975 ( 42 U.S.C. 6101 et seq. 42 U.S.C. 2000d et seq. 20 U.S.C. 1681 et seq. 29 U.S.C. 794 42 U.S.C. 12101 et seq. 20 U.S.C. 1232g Family Educational Rights and Privacy Act of 1974 20 U.S.C. 1411 et seq. (F) meets all applicable Federal, State, and local health and safety requirements; (G) operates in accordance with State law; (H) has a written performance contract with a charter school authorizer that includes— (i) a description of how student performance will be measured on the basis of— (I) State assessments that are required of other public schools; and (II) any other assessments that are mutually agreeable to the charter school authorizer and the charter school; (ii) a requirement that student academic achievement and growth, for the students enrolled at the school as a whole and for each of the categories of students described in section 1111(b)(2)(C)(v) (except in a case in which the number of students in a group is insufficient to yield statistically reliable information or the results would reveal personally identifiable information about an individual student) will be used as a primary factor in decisions about the renewal or revocation of the charter, in addition to other criteria, as appropriate; (iii) the student academic achievement and growth and student retention goals, and, in the case of a high school, graduation rate goals for the students enrolled at the school as a whole and for each of the categories of students described in section 1111(b)(2)(C)(v) (except in a case in which the number of students in a group is insufficient to yield statistically reliable information or the results would reveal personally identifiable information about an individual student), and any other goals to be achieved by the end of the contract period; and (iv) the obligations and responsibilities of the charter school and the charter school authorizer; (I) does not charge tuition; (J) is nonsectarian in its programs, admissions policies, employment practices, and all other operations, and is not affiliated with a sectarian school or religious institution; (K) is created by a developer as a public school, or is adapted by a developer from an existing public school, and is operated under public supervision and direction; (L) operates in pursuit of a specific set of educational objectives determined by the school's developer and agreed to by the charter school authorizer; (M) provides 1 or more programs of elementary education, secondary education, or both, including early childhood education, and may also provide adult education, in accordance with State law; and (N) is governed by a separate and independent board that exercises authority over 1 or more schools, including authority in the areas of governance, personnel, budget, schedule, and instructional program. (2) Charter management organization The term charter management organization (3) Charter school authorizer The term charter school authorizer (A) develop and update regularly a districtwide multi-year school plan; (B) monitor and assist charter schools in complying with applicable requirements, including data collection and public disclosure requirements and participation in the development of the districtwide multi-year school plan; (C) establish criteria and processes that the charter school authorizer will use in monitoring the performance of each charter school authorized by the charter school authorizer, including interventions and any actions leading up to the revocation of a school’s charter if the charter school authorizer finds that such a revocation is necessary to protect the public interest; (D) review the application and hold meaningful public hearings to gather input from the public and parents on applications to establish a charter school or convert another school to a public charter school; (E) provide a statement on the impact of the charter school within the local educational agency; and (F) in the case of a State with a cap on the number of public charter schools in the State— (i) review and render a decision within 120 days of receipt of the application for a charter school (whether a new school or a conversion); and (ii) submit to the State educational agency the charter school authorizer's recommendation regarding approval of charter school applicants, in order to allow the State educational agency to conduct an expedited review to determine if the approval described in clause (i) will violate the cap on the number of public charter schools in operation in the State. (4) Developer The term developer (5) Districtwide multi-year school plan The term districtwide multi-year school plan (A) is developed and regularly updated, with meaningful public input from across the local educational agency; and (B) takes into consideration projected demographic changes, criteria for new school openings or closings, and equitable geographic distribution of schools and students to ensure that all students have access to schools in their communities and a range of specialized programs. (6) Education management organization The term education management organization (7) Eligible applicant The term eligible applicant (A) applied to a charter school authorizer to operate a charter school; and (B) provided adequate and timely notice to that charter school authorizer. (8) High-quality charter school The term high-quality charter school (A) shows evidence of strong academic results, which may include strong student academic growth, as determined by a State; (B) has no significant issues in the areas of student safety, financial management, or statutory or regulatory compliance; (C) has demonstrated success in significantly increasing student academic achievement, including— (i) graduation rates, where applicable, for all students served by the charter school; and (ii) graduation rates, where applicable, for each of the categories of students described in section 1111(b)(2)(C)(v), except that such demonstration is not required in a case in which the number of students in a group is insufficient to yield statistically reliable information or the results would reveal personally identifiable information about an individual student; (D) has demonstrated community involvement during the development and operation of the school; and (E) has had 3 successful consecutive annual audits that have not indicated fiscal difficulties, as determined by typical accounting standards. 5111. Transition arrangements No new Federal grants under this part shall be awarded for a period of one year following the date of enactment of the Charter School Accountability Act of 2015, at which time the definition of eligible State educational agency under this part shall take effect. 5112. Caps In awarding grants under this part, the Secretary may neither disadvantage nor advantage eligible State educational agency applicants based on whether the State— (1) has a cap on the number of charter schools in the State; or (2) expresses an intention to adopt such State charter school caps. 5113. Authorization of appropriations There are authorized to be appropriated to carry out this part such sums as may be necessary for fiscal years 2016 and for each of the 5 succeeding fiscal years. .

Summary: Charter School Accountability Act of 2015 This bill amends the Elementary and Secondary Education Act of 1965 to replace the charter school grant program, through which states receive formula-based grants, with a competitive grant program. The Department of Education (ED) shall award grants to: (1) support the start up of charter schools that have been thoroughly vetted for quality and local impact, and (2) replicate or expand high-quality charter schools. To be eligible to receive grant funding, a state must: have legally binding rules related to fiduciary duties and conflicts of interest of charter school officers, directors, managers, and employees; require all charter schools to annually conduct and publicly disclose independent audits; provide that charter schools are covered by the state's open meetings and open records laws to the same extent as public schools are covered by those laws; have policies in effect that hold charter school authorizers accountable for monitoring a charter school's educational performance and financial operations; and require a charter school to make certain public disclosures related to its operation and funding. The bill also revises the per-pupil facilities aid program, through which ED makes competitive matching grants to states to provide per-pupil financing to charter schools for facility acquisition, construction, and renovation. Specifically, a state may: (1) partner with one or more organizations to provide up to half of the state share of program funding, and (2) receive more than one program grant under specified circumstances. ED must conduct specified national activities, including awarding competitive grants directly to charter school developers in states that have not applied for or received charter school grants.