Bill Summary for S 522 (2019-2020)

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Summary date: 

Apr 5 2019

Bill Information:

View NCGA Bill Details2019-2020 Session
Senate Bill 522 (Public) Filed Tuesday, April 2, 2019
Intro. by Tillman.

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Bill summary

Part I

Amends GS 115C-218.100(b), concerning dissolution of a charter school, which mandates that net assets of the school purchased with public funds to be deemed the property of the local school administrative unit in which the school is located. Creates an exception, and deems capital-sourced assets the property of the county or counties providing the funding, or divided between the counties in proportion to the funds provided. Defines capital-sourced assets.

Amends GS 115C-218.105 to authorize counties to provide funds to charter schools by direct appropriation under GS 153A-458, as enacted, with use limited to three described purposes, including the acquisition of real property; the acquisition, construction, renovation or replacement of buildings and other structures; and the acquisition or replacement of furniture and furnishings. Provides parameters for the funds to be evidenced by promissory note and secured by deed of trust, which can be released upon the school's repayment of the capital funds provided.

Amends GS 153A-149 to add the provision of capital funds for charter schools to the authorized purposes for which a county can levy property taxes.

Enacts GS 153A-458 to authorize counties to appropriate funds and lease real property to charter schools, provided the use of funds is limited to the purposes set out in GS 115C-218.105(b1), as enacted.

Applies beginning with the 2019-20 fiscal year.

Part II

Amends Section 5.3 of SL 2017-57, as amended, which creates the Needs-Based Public School Capital Fund (Fund) to be used to award grants to counties designated as a development tier one area or a development tier two area under GS 143B-437.08. Authorizes a qualified county, defined as a county designated as a development tier one area, to use a grant awarded from the Fund for building capital needs for an approved charter school. Specifies that building capital needs for an approved charter school can include the acquisition or improvement of a property by the charter school. Establishing grant funds to be matched by the qualified county using grant funds for a charter school at a 1:1 ratio, and caps an award to a qualified county at $3 million. Adds additional requirements for qualified counties using grant funds for charter schools, requiring the  mandated agreement between the county and the Department of Public Instruction (DPI) to include provisions stating that: (1) the property being acquired or improved by grant funds is owned by the nonprofit organization which holds the charter, and amounts provided by the county are evidenced by promissory note and secured by deed of trust, with the effects as described, which can be released upon repayment of funds provided; (2) the property cannot be conveyed without approval of the State Board of Education (State Board); and (3) acknowledgement that upon dissolution, all capital-sourced assets are deemed property of the county under GS 115C-218.100(b), as amended.

Applies to grant fund applications submitted on or after July 1, 2019.

Part III

Enacts GS 115C-218.37 to designate the Superintendent of DPI as an applicable elective representative who can approve the issuance of private activity bonds to finance or refinance a charter school facility, after public hearing and following reasonable public notice, in accordance with applicable state and federal law. Charges the Superintendent with determining procedures for the public hearings and provides that the hearings are to be conducted by the Superintendent or his or her designee. Defines charter school facility and applicable elected representative. 

Part IV

Amends GS 115C-218.6, to allow the State Board to renew a charter for less than the standard 10 year period, if the percent of students who scored at or above proficient for all end-of-grade and end-of-course tests taken in the previous school year is at least five percentage points lower than in the local school administrative unit in which the charter school is located (previously, if the charter school's student academic outcomes for the preceding three years have not been comparable to those of students in the local school administrative unit in which the charter school is located). Maintains the remaining situations in which the renewal period can be less than the standard period.

Part V

Amends GS 115C-218.1 to require charter applications to include a nationwide criminal background check for each member of the board of directors of the proposed charter to ensure no member has a conviction of a crime listed in GS 115C-332 or a substantially similar crime in another state. Requires the check to include a social-security number trace and any known aliases. Also requires charter applications to include a certification of each board member certifying whether the board member has been convicted of any felony or misdemeanor, and if so, include the year of the charge, the charge, and the disposition of the charge. 

Part VI

Enacts GS 115C-218.45 regarding permissible enrollment priority by a charter school. Adds priority for children of permanent employees of a charter partner, up to 50% of the school's total enrollment. Requires a separate lottery if applications from these children exceeds 50% total enrollment. Defines charter partner to mean any legal entity authorized to transact business in the state under specified GS Chapters that has, individually or as a consortium, made one or more specified donations to the charter school valued at at least $50,000, including land on which the school is built, the school building or the space the school occupies, or major renovations to the existing school building or other capital improvements, as detailed. For every year of such enrollment priority, requires the charter partner to enter into a memorandum with the charter school to specify the duration of priority and the support the charter partner will provide, such as internships, tutoring, and career counseling. Prohibits this enrollment priority from displacing students enrolled at the time the charter application or material revision providing for the new priority is approved by the State Board.

Further amends GS 115C-218.1 to require charter applications to include whether the charter intends to provide enrollment priority to children of employees of a charter partner, and if so, to identify that charter partner.

Amends GS 115C-218.7 to deem adoption of enrollment priority for children of employees of a charter partner as a material revision of the charter.

Amends GS 115C-218.15, regarding charter school operation. Establishing that persons affiliated with a charter partner are eligible for membership on the board of directors of a charter school that provides enrollment priority to the children of employees of the charter partner, subject to the existing requirements of subsection (b), and provided that such persons do not constitute a majority of the board, and if the charter partner is leasing the building or space to the school, the lease must provide that the building or space is available without cost and the term of lease is no less than the duration of the charter.

Applies beginning with the 2019-20 school year.

Part VII

Makes the following additional changes to Article 14A, Charter Schools, of GS Chapter 115C.

Amends GS 115C-218. Defines the term Higher Education Institution Authorizer (HEI Authorizer) to mean the board of trustees of a community college under the jurisdiction of the State Board of Community Colleges or the board of trustees of a constituent institution of the UNC System designated as participating in the NC Promise Tuition Plan pursuant to GS 116-143.11.

Enacts GS 115C-218.4 to permit an applicant for a charter school to submit an application that meet the requirements of GS 115C-218.1 to a HEI Authorizer. Requires such an application to include how the HEI Authorizer is to be involved in the planning, operation, or evaluation of the charter school. Requires the HEI Authorizer to timely notify and give the applicant at least five business days to correct issues in the initial application. Authorizes the HEI Authorizer to authorize a charter school if it finds: (1) the application requirements are met under the Article and rules of the State Board; (2) the applicant has the ability to operate the school and would be likely to operate the school in an educationally and economically sound manner; and (3) authorizing the application would achieve one or more purposes set out in GS 115C-218.

Requires the HEI Authorizer to make a final decision by August 15 in the year immediately preceding the year in which the charter school proposes to begin operation. Requires approved charters to enter into a written agreement with the HEI Authorizer with terms and conditions incorporated from the application and any additional terms and conditions imposed by the HEI Authorizer. Permits State funds available to the HEI Authorizer to be used to support the charter school so long as the written agreement contains provisions ensuring the return of any assets to the HEI Authorizer to the extent they were purchased with State funds upon dissolution.

Requires the State Board to approve the charter school for a period not to exceed 10 years upon receipt of the application and written agreement filed by the HEI Authorizer and upon recommendation of the Superintendent. Subjects charter schools approved in this manner to the same requirements of a charter school approved pursuant to GS 115C-218.5. Establishes that termination, nonrenewable, or assumption of a charter school authorized by an HEI Authorizer cannot be initiated by the State Board until the State Board has consisted with the HEI Authorizer pursuant to GS 115C-218.95(b), as enacted. 

Makes conforming changes throughout the Article to provide for the authority of the HEI Authorizer and charters to be approved by the HEI Authorizer. Specifies that the Charter School Advisory Board cannot review applications submitted to the HEI Authorizer. 

Amends GS 115C-218.3 to specify the State Board can include in its rules for fast-track replication of a high-quality charter school currently operating in the State, a charter school authorized by an HEI Authorizer and approved by the State Board. Makes conforming  changes.

Amends GS 115C-218.6 to provide that the HEI Authorizer can request charter renewal.

Amends GS 115C-218.7 to require a HEI Authorizer to submit a material revision of the provisions of a charter pursuant to GS 115C-218.4 consistent with the provisions of the statute for State Board approval.

Amends GS 115C-218.20 and GS 115C-218.90 to extend civil and criminal immunity under the statutes to HEI Authorizers.

Enacts GS 115C-218.95 to prohibit the State Board from initiating the termination, nonrenewal, to assumption of a charter school authorized by an HEI Authorizer until the State Board has consulted with the HEI Authorizer. Permits the State Board, the HEI Authorizer and the charter school to enter into an agreement to provide an opportunity to address concerns that could lead to such decisions.

Amend GS 115C-533 to allow the State Board to offer a system of property insurance to any charter school approved pursuant to GS 115C-218.4, as enacted.

Makes conforming changes to GS 14-33, GS 14-458, GS 20-84, GS 105-228.90, GS 135-5.3, GS 136-18, and GS 160A-307.1.


Amends Section 8.35 of SL 2014-100, as amended, to remove the maximum enrollment cap of 2,592 students for virtual charter schools participating in the Virtual Charter School Pilot. Instead, allows enrollment to increase annually by 20% for each participating school. Makes conforming changes. Applies beginning with the 2019-20 school year.