within the network of the eligible ap-
plicant; 
‘‘(II) demonstrates success in serv-
ing students who are educationally dis-
advantaged; 
‘‘(III) does not have a significant 
proportion of charter schools that have 
been closed, had their charter revoked 
for compliance issues, or had their af-
filiation with such eligible applicant 
revoked; 
‘‘(IV) has sufficient procedures in 
effect to ensure timely closure of low- 
performing or financially-mismanaged 
charter schools and clear plans and 
procedures in effect for the students in 
such schools to attend other high-qual-
ity schools; and 
‘‘(V) 
demonstrates 
success 
in 
working with schools identified for im-
provement by the State. 
‘‘(4) ELIGIBLE APPLICANT DEFINED.—For pur-
poses of this subsection, the term ‘eligible applicant’ 
means an eligible applicant (as defined in section 
5210) that— 
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‘‘(A) desires to open a charter school in— 
‘‘(i) a State that did not apply for a 
grant under section 5203; or 
‘‘(ii) a State that did not receive a 
grant under section 5203; or 
‘‘(B) is a charter management organization. 
‘‘(c) CONTRACTS AND GRANTS.—The Secretary may 
carry out any of the activities described in this section di-
rectly or through grants, contracts, or cooperative agree-
ments.’’. 
SEC. 8. RECORDS TRANSFER. 
Section 5208 (20 U.S.C. 7221g) is amended— 
(1) by inserting ‘‘as quickly as possible and’’ be-
fore ‘‘to the extent practicable’’; and 
(2) by striking ‘‘section 602’’ and inserting ‘‘sec-
tion 602(14)’’. 
SEC. 9. DEFINITIONS. 
Section 5210 (20 U.S.C. 7221i) is amended— 
(1) by amending paragraph (1) to read as fol-
lows: 
‘‘(1) CHARTER
SCHOOL.—The term ‘charter 
school’ means a public school that— 
‘‘(A) in accordance with a specific State 
statute authorizing the granting of charters to 
schools, is exempt from significant State or local 
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rules that inhibit the flexible operation and man-
agement of public schools, but not from any rules 
relating to the other requirements of this para-
graph; 
‘‘(B) is created by a developer as a public 
school, or is adapted by a developer from an ex-
isting public school, and is operated under pub-
lic supervision and direction; 
‘‘(C) operates in pursuit of a specific set of 
educational objectives determined by the school’s 
developer and agreed to by the authorized public 
chartering agency; 
‘‘(D) provides a program of elementary or 
secondary education, or both; 
‘‘(E) is nonsectarian in its programs, ad-
missions policies, employment practices, and all 
other operations, and is not affiliated with a sec-
tarian school or religious institution; 
‘‘(F) does not charge tuition; 
‘‘(G) complies with the Age Discrimination 
Act of 1975, title VI of the Civil Rights Act of 
1964, title IX of the Education Amendments of 
1972, section 504 of the Rehabilitation Act of 
1973, part B of the Individuals with Disabilities 
Education Act, the Americans with Disabilities 
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Act of 1990 (42 U.S.C. 12101 et seq.), and sec-
tion 444 of the General Education Provisions 
Act (20 U.S.C. 1232(g)) (commonly known as 
the ‘Family Education Rights and Privacy Act 
of 1974’); 
‘‘(H) is a school to which parents choose to 
send their children, and admits students on the 
basis of a lottery if more students apply for ad-
mission than can be accommodated, except that 
in cases in which students who are enrolled in 
a charter school affiliated (such as by sharing a 
network) with another charter school, those stu-
dents may be automatically enrolled in the next 
grade level at such other charter school, so long 
as a lottery is used to fill seats created through 
regular attrition in student enrollment; 
‘‘(I) agrees to comply with the same Federal 
and State audit requirements as do other elemen-
tary schools and secondary schools in the State, 
unless such State audit requirements are waived 
by the State; 
‘‘(J) meets all applicable Federal, State, 
and local health and safety requirements; 
‘‘(K) operates in accordance with State law; 
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‘‘(L) has a written performance contract 
with the authorized public chartering agency in 
the State that includes a description of how stu-
dent performance will be measured in charter 
schools pursuant to State assessments that are 
required of other schools and pursuant to any 
other assessments mutually agreeable to the au-
thorized public chartering agency and the char-
ter school; and 
‘‘(M) may serve prekindergarten or postsec-
ondary students.’’; 
(2) by redesignating paragraphs (2) through (4) 
as paragraphs (4) through (6), respectively; 
(3) by inserting after paragraph (1), the fol-
lowing: 
‘‘(2) CHARTER MANAGEMENT ORGANIZATION.— 
The term ‘charter management organization’ means a 
not-for-profit organization that manages a network of 
charter schools linked by centralized support, oper-
ations, and oversight. 
‘‘(3) CHARTER
SCHOOL
SUPPORT
ORGANIZA-
TION.—The term ‘charter school support organization’ 
means a nonprofit, nongovernmental entity that is 
not an authorized public chartering agency, which 
provides on a statewide basis— 
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