Bill Summary – FastDemocracy

CHARTER SCHOOL OVERSIGHT                                                    S.B. 946 (S-1) & 947 (S-1):
                                                                                     SUMMARY OF BILL
                                                                           REPORTED FROM COMMITTEE
Senate Bills 946 and 947 (Substitute S-1 as reported)
Sponsor: Senator Darrin Camilleri (S.B. 946)
         Senator Dayna Polehanki (S.B. 947)
Committee: Education
CONTENT
Senate Bill 946 (S-1) would amend the Revised School Code to require an authorizing body
to perform specific oversight for each public school academy (PSA), urban high school
academy, or school of excellence that it authorized.
Senate Bill 947 (S-1) would amend the Revised School Code to do the following:
-- Beginning one year after the bill’s effective date, require the board of directors of a PSA,
   urban high school academy, school of excellence, or strict discipline academy to ensure
   that the terms of a lease or purchase agreement for real property reflected market
   conditions, as determined by an appraisal.
-- Prohibit the board of directors of a PSA, urban high school academy, school of excellence,
   or strict discipline academy from entering a lease or purchase agreement with the school’s
   educational management organization or any person or entity affiliated with that
   educational management organization.
-- Require a PSA, urban high school academy, school of excellence, or strict discipline
   academy’s authorizing body to review the terms of a lease or purchase agreement and
   notify the Superintendent of Public Instruction or State Board of Education if these
   requirements were not followed.
MCL 380.507 et al. (S.B. 946)
    380.504a et al. (S.B. 947)
BRIEF RATIONALE
Public school academies, schools of excellence, urban high school academies, and strict
discipline academies are referred to as charter schools because they are created by charter
contracts approved by an authorizing body. While traditional public schools are run by
superintendents, many charter schools are operated by private for-profit companies called
educational management organizations; however, charter schools receive State
appropriations. Private companies are not subject to Freedom of Information Act requests
and other disclosure requirements, and some argue that this results in a lack of transparency
surrounding charter school finances that allows educational management organizations to
unduly profit from public funds, such as by charging charter schools excessive rents.
Accordingly, some have suggested that charter schools be prohibited from engaging in certain
real estate transactions and subjected to increased oversight.
PREVIOUS LEGISLATION
(This section does not provide a comprehensive account of previous legislative efforts on this subject matter.)
Senate Bill 946 is similar to Senate Bill 680 of the 2017-2018 Legislative Session and Senate
Bill 933 of the 2021-2022 Legislative Session. Senate Bill 947 is a reintroduction of Senate
Page 1 of 2                                                                                    sb946/947/2324
Bill 681 of the 2017-2018 Legislative Session and Senate Bill 934 of the 2021-2022 Legislative
Session.
                                                                                   Legislative Analyst: Abby Schneider
FISCAL IMPACT
Senate Bill 946 (S-1) would have no fiscal impact on the State and would have a negative
fiscal impact on local governmental entities that are charter school authorizers. Authorizers
would see increased costs to ensure that representatives could attend each meeting of the
board of directors for each PSA it authorized. There also would be administrative costs to
prepare and present the reports required under the bill. If the authorizer needed to hire
additional staff to comply with the requirements, it would see increased costs. The amount of
increased costs would be proportional to the number of PSAs authorized by a given charter
school authorizer.
Senate Bill 947 (S-1) would have no fiscal impact on the State and would have an
indeterminate fiscal impact on affected PSAs. While the provisions of the bill likely would have
some effect on the cost to lease or purchase real property for a given PSA, there is no way to
determine whether the provisions would increase the costs, decrease the costs, or have no
effect.
Date Completed: 11-25-24                                                                      Fiscal Analyst: Ryan Bergan
 SAS\Floors2324\sb946
 This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official
 statement of legislative intent.
Page 2 of 2                       Bill Analysis @ www.senate.michigan.gov/sfa                                       sb946/947/2324
Statutes affected: 
Substitute (S-1): 380.504
Substitute (S-3): 380.504
Senate Introduced Bill: 380.504
As Passed by the Senate: 380.504