15-185

15-185. Charter schools; financing; civil
penalty; transportation; definitions

(L10, 7SS, Ch. 8, sec. 1 and L10, Ch. 17, sec. 2, Ch. 306, sec. 1, Ch. 332, sec. 4 &
Ch. 333, sec. 2)

A. Financial provisions for a charter school that is sponsored by a school district
governing board are as follows:

1. The charter school shall be included in the district's budget and financial
assistance calculations pursuant to paragraph 3 of this subsection and chapter 9 of this
title, except for chapter 9, article 4 of this title. The charter of the charter school
shall include a description of the methods of funding the charter school by the school
district. The school district shall send a copy of the charter and application, including
a description of how the school district plans to fund the school, to the state board of
education before the start of the first fiscal year of operation of the charter school.
The charter or application shall include an estimate of the student count for the charter
school for its first fiscal year of operation. This estimate shall be computed pursuant
to the requirements of paragraph 3 of this subsection.

2. A school district is not financially responsible for any charter school that is
sponsored by the state board of education, the state board for charter schools, a
university under the jurisdiction of the Arizona board of regents, a community college
district or a group of community college districts.

3. A school district that sponsors a charter school may:

(a) Increase its student count as provided in subsection B, paragraph 2 of this
section during the first year of the charter school's operation to include those charter
school pupils who were not previously enrolled in the school district. A charter school
sponsored by a school district governing board is eligible for the assistance prescribed
in subsection B, paragraph 4 of this section. The soft capital allocation as provided in
section 15-962 for the school district sponsoring the charter school shall be increased
by the amount of the additional assistance. The school district shall include the full
amount of the additional assistance in the funding provided to the charter school.

(b) Compute separate weighted student counts pursuant to section 15-943, paragraph
2, subdivision (a) for its noncharter school versus charter school pupils in order to
maintain eligibility for small school district support level weights authorized in
section 15-943, paragraph 1 for its noncharter school pupils only. The portion of a
district's student count that is attributable to charter school pupils is not eligible
for small school district support level weights.

4. If a school district uses the provisions of paragraph 3 of this subsection, the
school district is not eligible to include those pupils in its student count for the
purposes of computing an increase in its revenue control limit and district support level
as provided in section 15-948.

5. A school district that sponsors a charter school is not eligible to include the
charter school pupils in its student count for the purpose of computing an increase in
its capital outlay revenue limit as provided in section 15-961, subsection C, except that
if the charter school was previously a school in the district, the district may include
in its student count any charter school pupils who were enrolled in the school district
in the prior year.

6. A school district that sponsors a charter school is not eligible to include the
charter school pupils in its student count for the purpose of computing the revenue
control limit which is used to determine the maximum budget increase as provided in
chapter 4, article 4 of this title unless the charter school is located within the
boundaries of the school district.

7. If a school district converts one or more of its district public schools to a
charter school and receives assistance as prescribed in subsection B, paragraph 4 of this
section, and subsequently converts the charter school back to a district public school,
the school district shall repay the state the total additional assistance received for
the charter school for all years that the charter school was in operation. The repayment
shall be in one lump sum and shall be reduced from the school district's current year
equalization assistance. The school district's general budget limit shall be reduced by
the same lump sum amount in the current year.

B. Financial provisions for a charter school that is sponsored by the state board
of education, the state board for charter schools, a university, a community college
district or a group of community college districts are as follows:

1. The charter school shall calculate a base support level as prescribed in section
15-943, except that section 15-941 does not apply to these charter schools.

2. Notwithstanding paragraph 1 of this subsection, the student count shall be
determined initially using an estimated student count based on actual registration of
pupils before the beginning of the school year. After the first one hundred days or two
hundred days in session, as applicable, the charter school shall revise the student count
to be equal to the actual average daily membership, as defined in section 15-901, or the
adjusted average daily membership, as prescribed in section 15-902, of the charter
school. A charter school that provides two hundred days of instruction may use section
15-902.02 for the purposes of this section. Before the one hundredth day or two
hundredth day in session, as applicable, the state board of education, the state board
for charter schools, the sponsoring university, the sponsoring community college district
or the sponsoring group of community college districts may require a charter school to
report periodically regarding pupil enrollment and attendance, and the department of
education may revise its computation of equalization assistance based on the report. A
charter school shall revise its student count, base support level and additional
assistance before May 15. A charter school that overestimated its student count shall
revise its budget before May 15. A charter school that underestimated its student count
may revise its budget before May 15.

3. A charter school may utilize section 15-855 for the purposes of this section.
The charter school and the department of education shall prescribe procedures for
determining average daily attendance and average daily membership.

4. Equalization assistance for the charter school shall be determined by adding the
amount of the base support level and additional assistance. The amount of the additional
assistance is one thousand six hundred seven dollars fifty cents per student count in
kindergarten programs and grades one through eight and one thousand eight hundred
seventy-three dollars fifty-two cents per student count in grades nine through twelve.

5. The state board of education shall apportion state aid from the appropriations
made for such purposes to the state treasurer for disbursement to the charter schools in
each county in an amount as determined by this paragraph. The apportionments shall be
made as prescribed in section 15-973, subsection B.

6. The charter school shall not charge tuition for pupils who reside in this state,
levy taxes or issue bonds. A charter school may admit pupils who are not residents of
this state and shall charge tuition for those pupils in the same manner prescribed in
section 15-823.

7. Not later than noon on the day preceding each apportionment date established by
paragraph 5 of this subsection, the superintendent of public instruction shall furnish to
the state treasurer an abstract of the apportionment and shall certify the apportionment
to the department of administration, which shall draw its warrant in favor of the charter
schools for the amount apportioned.

C. If a pupil is enrolled in both a charter school and a public school that is not
a charter school, the sum of the daily membership, which includes enrollment as
prescribed in section 15-901, subsection A, paragraph 2, subdivisions (a) and (b) and
daily attendance as prescribed in section 15-901, subsection A, paragraph 6, for that
pupil in the school district and the charter school shall not exceed 1.0, except that if
the pupil is enrolled in both a charter school and a joint technical education district
and resides within the boundaries of a school district participating in the joint
technical education district, the sum of the average daily membership for that pupil in
the charter school and the joint technical education district shall not exceed 1.25. If a
pupil is enrolled in both a charter school and a public school that is not a charter
school, the department of education shall direct the average daily membership to the
school with the most recent enrollment date. Upon validation of actual enrollment in both
a charter school and a public school that is not a charter school and if the sum of the
daily membership or daily attendance for that pupil is greater than 1.0, the sum shall be
reduced to 1.0 and shall be apportioned between the public school and the charter school
based on the percentage of total time that the pupil is enrolled or in attendance in the
public school and the charter school, except that if the pupil is enrolled in both a
charter school and a joint technical education district and resides within the boundaries
of a school district participating in the joint technical education district, the sum of
the average daily membership for that pupil in the charter school and the joint technical
education district shall be reduced to 1.25 and shall be apportioned between the charter
school and the joint technical education district based on the percentage of total time
that the pupil is enrolled or in attendance in the charter school and the joint technical
education district. The uniform system of financial records shall include guidelines for
the apportionment of the pupil enrollment and attendance as provided in this section.

D. Charter schools are allowed to accept grants and gifts to supplement their state
funding, but it is not the intent of the charter school law to require taxpayers to pay
twice to educate the same pupils. The base support level for a charter school or for a
school district sponsoring a charter school shall be reduced by an amount equal to the
total amount of monies received by a charter school from a federal or state agency if the
federal or state monies are intended for the basic maintenance and operations of the
school. The superintendent of public instruction shall estimate the amount of the
reduction for the budget year and shall revise the reduction to reflect the actual amount
before May 15 of the current year. If the reduction results in a negative amount, the
negative amount shall be used in computing all budget limits and equalization assistance,
except that:

1. Equalization assistance shall not be less than zero.

2. For a charter school sponsored by the state board of education, the state board
for charter schools, a university, a community college district or a group of community
college districts, the total of the base support level and the additional assistance
shall not be less than zero.

3. For a charter school sponsored by a school district, the base support level for
the school district shall not be reduced by more than the amount that the charter school
increased the district's base support level, capital outlay revenue limit and soft
capital allocation.

E. If a charter school was a district public school in the prior year and is now
being operated for or by the same school district and sponsored by the state board of
education, the state board for charter schools, a university, a community college
district, a group of community college districts or a school district governing board,
the reduction in subsection D of this section applies. The reduction to the base support
level of the charter school or the sponsoring district of the charter school shall equal
the sum of the base support level and the additional assistance received in the current
year for those pupils who were enrolled in the traditional public school in the prior
year and are now enrolled in the charter school in the current year.

F. Equalization assistance for charter schools shall be provided as a single amount
based on average daily membership without categorical distinctions between maintenance
and operations or capital.

G. At the request of a charter school, the county school superintendent of the
county where the charter school is located may provide the same educational services to
the charter school as prescribed in section 15-308, subsection A. The county school
superintendent may charge a fee to recover costs for providing educational services to
charter schools.

H. If the sponsor of the charter school determines at a public meeting that the
charter school is not in compliance with federal law, with the laws of this state or with
its charter, the sponsor of a charter school may submit a request to the department of
education to withhold up to ten per cent of the monthly apportionment of state aid that
would otherwise be due the charter school. The department of education shall adjust the
charter school's apportionment accordingly. The sponsor shall provide written notice to
the charter school at least seventy-two hours before the meeting and shall allow the
charter school to respond to the allegations of noncompliance at the meeting before the
sponsor makes a final determination to notify the department of education of
noncompliance. The charter school shall submit a corrective action plan to the sponsor on
a date specified by the sponsor at the meeting. The corrective action plan shall be
designed to correct deficiencies at the charter school and to ensure that the charter
school promptly returns to compliance. When the sponsor determines that the charter
school is in compliance, the department of education shall restore the full amount of
state aid payments to the charter school.

I. In addition to the withholding of state aid payments pursuant to subsection H of
this section, the sponsor of a charter school may impose a civil penalty of one thousand
dollars per occurrence if a charter school fails to comply with the fingerprinting
requirements prescribed in section 15-183, subsection C or section 15-512. The sponsor
of a charter school shall not impose a civil penalty if it is the first time that a
charter school is out of compliance with the fingerprinting requirements and if the
charter school provides proof within forty-eight hours of written notification that an
application for the appropriate fingerprint check has been received by the department of
public safety. The sponsor of the charter school shall obtain proof that the charter
school has been notified, and the notification shall identify the date of the deadline
and shall be signed by both parties. The sponsor of a charter school shall automatically
impose a civil penalty of one thousand dollars per occurrence if the sponsor determines
that the charter school subsequently violates the fingerprinting requirements. Civil
penalties pursuant to this subsection shall be assessed by requesting the department of
education to reduce the amount of state aid that the charter school would otherwise
receive by an amount equal to the civil penalty. The amount of state aid withheld shall
revert to the state general fund at the end of the fiscal year.

J. A charter school may receive and spend monies distributed by the department of
education pursuant to section 42-5029, subsection E and section 37-521, subsection B.

K. If a school district transports or contracts to transport pupils to the Arizona
state schools for the deaf and the blind during any fiscal year, the school district may
transport or contract with a charter school to transport sensory impaired pupils during
that same fiscal year to a charter school if requested by the parent of the pupil and if
the distance from the pupil's place of actual residence within the school district to the
charter school is less than the distance from the pupil's place of actual residence
within the school district to the campus of the Arizona state schools for the deaf and
the blind.

L. Notwithstanding any other law, a university under the jurisdiction of the
Arizona board of regents, a community college district or a group of community college
districts shall not include any student in the student count of the university, community
college district or group of community college districts for state funding purposes if
that student is enrolled in and attending a charter school sponsored by the university,
community college district or group of community college districts.

M. The governing body of a charter school shall transmit a copy of its proposed
budget or the summary of the proposed budget and a notice of the public hearing to the
department of education for posting on the department of education's website no later
than ten days before the hearing and meeting. If the charter school maintains a website,
the charter school governing body shall post on its website a copy of its proposed budget
or the summary of the proposed budget and a notice of the public hearing.

N. The governing body of a charter school may contract with the private
organization that is approved by the state board of education pursuant to section
15-792.02 to provide approved board examination systems for the charter school.

O. For the purposes of this section:

1. "Monies intended for the basic maintenance and operations of the school" means
monies intended to provide support for the educational program of the school, except that
it does not include supplemental assistance for a specific purpose or title VIII of the
elementary and secondary education act of 1965 monies. The auditor general shall
determine which federal or state monies meet the definition in this paragraph.

2. "Operated for or by the same school district" means the charter school is either
governed by the same district governing board or operated by the district in the same
manner as other traditional schools in the district or is operated by an independent
party that has a contract with the school district. The auditor general and the
department of education shall determine which charter schools meet the definition in this
subsection.