BILL NUMBER: S7462
SPONSOR: HOYLMAN-SIGAL
 
TITLE OF BILL:
An act to amend the education law and the state finance law, in relation
to charter schools
 
SUMMARY OF SPECIFIC PROVISIONS:
This bill would provide enhanced transparency and accountability of
charter schools in regards to enrollment targets, discipline policies,
management and operation of the charter school, charter reserve funds,
charter facilities rental aid payments, information disseminated to
parents regarding probationary status, and residency dispute issues.
Specifically, the bill would require charters established in conjunction
with non-profits to specify the extent of the entity's participation in
the management and operation of the school. The bill requires charters
to disclose annually information related to the compensation of individ-
uals serving as a charter executive, loans or gifts received over one
thousand dollars, and financial statements related to assets of the
charter, and, if applicable, any of its affiliated corporate/business
entities, valued over one million dollars. It prohibits charters from
compensating any individual who is also an employee of a charter affil-
iate and limits the compensation of charter executives to $199,000 annu-
ally, with limited exceptions. The bill prohibits charters from entering
into agreements with corporate/business entities to operate the school
unless the entity agrees to provide access to various records for audit-
ing purposes. The bill requires charters to have a formal contract with
any corporate/business entity that must be approved by the charter enti-
ty. It also requires charters that request co-location to demonstrate
that the charter does not have the financial capacity to procure
adequate facilities. Charters with assets that have are valued at over
one million dollars would be ineligible to be offered co-located or
private space at the expense of NYC.
The bill limits the time a charter may be offered private space at no
cost to three years. The bill also limits charter facilities rental aid
payments to six years, and provides that in the last three years, a
reduced payment be provided to the charter.
The bill strengthens provisions relating to the enrollment of ELLS,
students with disabilities, and free lunch recipients by requiring char-
ters to retain an equal or greater enrollment of such students compared
to the district's enrollment. The bill also requires that enrollment
targets be continually met and considered a very significant factor for
charter renewal. The bill would also require charter entities to provide
detailed, written findings related to all requirements the charter must
meet when making a determination to approve a charter.
The bill would apply statewide disciplinary laws to charter schools,
requires charters to develop a code of conduct, and requires charters to
submit an annual report of disciplinary measures imposed on students.
The bill applies Articles 8 and 9 of the Labor Law relating to prevail-
ing wage and public works to charter schools. The bill would require
charters to provide parents information annually detailing the process
to file a complaint against the charter. The bill also requires charter
school to notify parents if the charter is placed in probationary
status.
This bill would withhold funding from charters that fail to enroll the
minimum number of students, and continued failure to adhere to reporting
requirements and enrollment targets would be grounds for revocation or
termination of the charter.. The bill establishes clearer guidelines for
disenrollment and residency determinations for charter schools and
addresses intercept is sues when a residency dispute exists. The bill
would provide that the effective date be immediate.
 
JUSTIFICATION:
As of the 2016-17 school year, New York State has 267 operating charter
schools serving approximately 92,000 students. Charter school s are
largely free from state and local regulations, and operate under differ-
ent rules and laws than traditional public schools. Charters are also
unique in that they are allowed to conduct their own fundraising efforts
for private funding in addition to receiving State aid. There is a lack
of transparency in how charters raise and spend their funds, especially
in regards to the charter's top managers and management companies.
Further, charters do not have to disclose information regarding to the
compensation of individuals serving as charter executives, or financial
statements related to assets of the charter. Charters that request
co-location are not required to disclose whether the charter has the
financial capacity to procure adequate facilities on their own.
Charter audits demonstrate why charter management must be held to stric-
ter standards of accountability and transparency-not only on how they
spend taxpayer's money, but also regarding the student populations they
enroll. In 2015-16, traditional public schools outside NYC enrolled
12.6% of ELL students, while charter schools only served 4.2%. Tradi-
tional public schools served 17.4% of students with disabilities, while
charters only served 9%.
Charter schools are not subject to many of the same requirements as
public school districts, and may retain millions of dollars in unre-
stricted reserve funds. Recent audits have shown that charter schools
held $395 million in cash and $451 million in unrestricted net assets at
the close of 2015. Unrestricted net assets, which can be used to fund
programs or pay rent, grew by $93.5 million from 20 13 to 2015. School
districts face many restrictions that charter school do not, such as a
2% tax cap that limits local revenue. Charters have no limit on the
amount of private funding they may fundraise.
Charter schools need to be held to the same high standards the state's
traditional public schools are held to. This bill would provide overall
greater transparency and accountability of charter schools.
 
LEGISLATIVE HISTORY:
S.4466 of 2023-2024 (Hoylman-Sigal): Died in Education
A.4458 of 2023-2024 (Benedetto): Died in Education
S. 4200 of 2021-2022 (Hoylman): Died in Education
A.51354 of 2021-2022 (Benedetto): Died in Education
S.4237 of 2019-2020 (Hoylman): Died in Education
A.8030 of 2019-2020 (Benedetto): Died in Education
 
FISCAL IMPLICATIONS:
Undetermined.
 
EFFECTIVE DATE:
Immediately.

Statutes affected:
S7462: 2851 education law, 2851(1) education law, 2851(2) education law, 2851(4) education law, 2852 education law, 2852(5) education law, 2852(9-a) education law, 2853 education law, 2853(3) education law, 2853(4) education law, 2854 education law, 2854(1) education law, 2855 education law, 2855(1) education law, 2855(3) education law, 2855(4) education law, 2857 education law, 2857(2) education law, 179-q state finance law, 179-q(7) state finance law