Education, Administration

Rule R277-480

Charter Schools School Building Subaccount

Notice of Proposed Rule

(Amendment)

DAR File No.: 34818
Filed: 05/16/2011 06:39:21 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rule is amended to provide changes consistent with H.B. 83, 2011 General Session, which separated the Charter School Building Subaccount from the School Building Subaccount and created a new Charter School Revolving Account to assist charter schools with loans for building construction and renovation needs. (DAR NOTE: H.B. 83 (2011) was effective 03/16/2011.)

Summary of the rule or change:

The amendments include changing the name of the account and citations throughout the rule to make the rule consistent with state law, changing definitions, and changing procedures specifically for the Charter School Revolving Account Committee.

State statutory or constitutional authorization for this rule:

• Subsection 53A-1a-522(2)(b)
• Subsection 53A-1-401(3)
• Art X, Sec 3

Anticipated cost or savings to:

the state budget:

There are no anticipated costs or savings to the state budget. The name of the account and the location of the account in law have been changed, but the standards and procedures have not changed. The state charter school staff will continue to administer the program as before.

local governments:

There are no anticipated costs or savings to local government. The name of the account and the location of the account in law have been changed, but the standards and procedures have not changed. Public charter schools will continue to use the account as before.

small businesses:

There are no anticipated costs or savings to small businesses. This rule applies to public education and does not affect businesses.

persons other than small businesses, businesses, or local governmental entities:

There are no anticipated costs or savings to persons other than small businesses, businesses, or local government entities. This rule applies to charter schools and not to individuals.

Compliance costs for affected persons:

There are no compliance costs for affected persons. The name of the account and the location of the account in law have changed, but the standards and procedures have not changed.

Comments by the department head on the fiscal impact the rule may have on businesses:

I have reviewed this rule and I see no fiscal impact on businesses.

Larry K. Shumway, State Superintendent

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Education
Administration
250 E 500 S
SALT LAKE CITY, UT 84111-3272

Direct questions regarding this rule to:

• Carol Lear at the above address, by phone at 801-538-7835, by FAX at 801-538-7768, or by Internet E-mail at carol.lear@schools.utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

07/01/2011

This rule may become effective on:

07/08/2011

Authorized by:

Carol Lear, Director, School Law and Legislation

R277. Education, Administration.

R277-480. Charter School[s School Building Subaccount]Revolving Account.

R277-480-1. Definitions.

A. "Board" means the Utah State Board of Education.

B. "Charter schools" means schools acknowledged as charter schools by local boards of education under Section 53A-1a-515[ or], by the Board under Section 53A-1a-505 , and by boards of trustees of higher education institutions under Section 53A-1a-501.3.

[ C. "Subaccount" means the Charter School Building Subaccount consisting of funds provided under 53A-21-401(5)(b)

] C. "Charter School Revolving Account" means a restricted account created within the Uniform School fund to provide assistance to charter schools to:

(1) meet school building construction and renovation needs; and

(2) pay for expenses related to the start up of a new charter school or the expansion of an existing charter schools.

D. "[Subaccount]Charter School Revolving Account Committee" means the committee established by the [Superintendent]Board under Section [53A-21-401(6)]53A-1a-522(6).

E. "Superintendent" means the State Superintendent of Public Instruction as designated under 53A-1-301.

F. "USOE" means the Utah State Office of Education.

 

R277-480-2. Authority and Purpose.

A. This rule is authorized under Utah Constitution Article X, Section 3 which vests general control and supervision over public education in the Board, Section [53A-21-401(6)]53A-1a-522(2)(b) which requires the Board to [establish or reauthorize a Subaccount Committee by July 15 annually]administer the Charter School Revolving Account, and Section 53A-1-401(3) which allows the Board to adopt rules in accordance with its responsibilities.

B. The purpose of this rule is to establish procedures for administering the Charter School Revolving Account to determin[ing]e membership of the Charter School [Building Subaccount]Revolving Account Committee, and to determin[ing]e loan amounts and loan repayment conditions.

 

R277-480-3. Charter School [Building Subaccount]Revolving Account Committee.

A. The Board shall establish [or reauthorize a Subaccount]a Charter School Revolving Account Committee consistent with [53A-21-401(6) by July 15 annually]Section 53A-1a-522(6).

[( a)] B. The State Charter School Board shall submit a list of at least three nominees per vacancy who meet the requirements of Section 53A-[21-401]1a-522(6)(b) for appointment by the Board consistent with timelines established by the Board.

[ (b) Subaccount Committee members shall be appointed by the Board for terms that do not exceed three years.

(2) For appointment prior to June 1, 2010, the Superintendent, under the direction of the Board, shall designate which Subaccount Committee members shall be reappointed and which members shall serve continuing one, two or three year terms in order to stagger the terms of Subaccount Committee members.

] [(1)]C. [The Superintendent, on behalf of t]The Board[, may] shall annually accept nominations of individuals provided by the State Charter School Board who meet the qualifications of 53A-[21-401]1a-522(6)(b).

D. The Board may only select Charter School Revolving Account Committee members who satisfy conditions of Section 53A-1a-502(6).

[(3)]E. [Subaccount]Charter School Revolving Account Committee members appointed by the Board after May 1, 2010 shall [serve]be appointed for two year terms.

[(4)]F. The USOE Charter School Director or designee shall be a non-voting [Subaccount]Charter School Revolving Account Committee member.

 

R277-480-4. Charter School Revolving Account Application and Conditions.

[B]A. The [Subaccount]Charter School Revolving Account Committee shall develop and the USOE shall make available a loan application that includes criteria designated under Section[s 53A-21-401(6)(c) and (8)] 53A-1a-522.

[C]B. The [Subaccount]Charter School Revolving Account Committee shall include other criteria or information from loan applicants that the committee or the Board determines to be necessary and helpful , including considerations of Section 53A-1a-522(5), in making final recommendations to the Superintendent, the State Charter School Board and the Board.

[E]C. Applications for loans shall be accepted on an ongoing basis, subject to eligibility criteria and availability of fund[ing]s.

(1) To apply for a loan, a charter school shall submit the information requested on the Board's most current loan application form together with the requested supporting documentation.

(2) The application shall include a resolution from the governing board of the charter school that the governing board, at a minimum:

(a) agrees to enter into the loan as provided in the application materials;

(b) agrees to the interest established by the [Subaccount]Charter School Revolving Account Committee and repayment schedule of the loan designated by the [Subaccount]Charter School Revolving Account Committee and the Board;

(c) agrees that loan funds shall only be used consistent with the purposes of Section [53A-21-401(5)(c)]53A-1a-522 and the purpose of the approved charter;

(d) agrees to any and all inspections, audits or financial reviews ordered by the [Subaccount]Charter School Revolving Account Committee or the Board; and

[ (e) agrees to any and all inspections or reviews ordered by the Subaccount Committee or the Board;

] ([f]e) understands that repayment, including interest, shall be deducted automatically from the charter school's monthly fund transfers, as appropriate.

D. The [Subaccount]Charter School Revolving Account Committee shall establish terms and conditions for loan repayment, consistent with Section [53A-21-401(6)(c) and Section 53A-21-401(8)]53A-1a-522. Terms [may]shall include:

(1) A tiered schedule of loan fund distribution:

(a) 50 percent (up to $150,000) disbursed no more than 12 months prior to August 15 in the school's first year of operations;

(b) 25 percent (up to $75,000) disbursed no more than six months prior to August 15 in the school's first year of operation;

(c) the balance of loan funds disbursed no more than three months prior to August 15 in the school's first year of operations.

(2) The loan amount to a charter school board awarded under Section [53A-21-401(7)]53A-1a-522 shall not exceed:

(a) $1,000 per pupil based on prior year October 1 enrollment count for operational schools; or

(b) $1,000 per pupil based on approved enrollment capacity of the first year of operation for pre-operational schools; or

(c) $300,000 of the total of all current loan awards by the Board to a charter school board.

 

R277-480-5. Charter School Revolving Account Committee Recommendations and Board Approval.

[F]A. The [Subaccount]Charter School Revolving Account Committee shall [not] make recommendations to [the Superintendent,] the State Charter School Board [or]and the Board [until the committee receives]only upon receipt of complete and satisfactory information from the applicant and [the Subaccount Committee has reached a majority recommendation]upon a majority recommendation from the Charter School Revolving Account Committee.

[G]B. The submission of intentionally false, incomplete or inaccurate information from a loan applicant [shall]may result in immediate cancellation of any previous loan(s), the requirement for immediate repayment of any funds received, denial of subsequent applications for a 12 month period from the date of the initial application, and possible Board revocation of a charter.

[H]C. The [Superintendent, in consultation with USOE]Board staff and State Charter Board staff[,] shall review recommendations from the [Subaccount]Charter School Revolving Account Committee[ and make final recommendations to the Board].

[I]D. [The Superintendent shall submit f]Final recommendations from the [Subaccount]Charter School Revolving Account Committee shall be submitted to the Board no more than 60 days after submission of all information and materials from the loan applicant to the [Subaccount]Charter School Revolving Account Committee.

[J]E. The Board may request additional information from loan applicants or a reconsideration of a recommendation by the [Subaccount]Charter School Revolving Account Committee.

[K]F. The Board's approval or denial of loan applications constitutes the final administrative action in the charter school building revolving loan process.

 

KEY: charter schools, [building subaccount]revolving account

Date of Enactment or Last Substantive Amendment: [August 9, 2010]2011

Authorizing, and Implemented or Interpreted Law: Art X, Sec 3; [53A-21-401(6)]53A-1a-522(2)(b); 53A-1-401(3)