1. Legal Obligations of Charter School Trustees May 2004

2. Overview* Key provisions of the Charter School Law Key provisions of the Charter School Law Application of the School Code to charter schools Application of the School Code to charter schools Some thoughts on how to avoid legal problems Some thoughts on how to avoid legal problems * This material is not intended to be, and should not be understood as, legal advice. Please check with your solicitor about issues specific to your school.

3. A. Key Provisions in the Charter School Law Five key areas ranging from trustees’ express statutory authority to school facilities issues Five key areas ranging from trustees’ express statutory authority to school facilities issues These are areas where PDE has noticed problems or seen issues arise These are areas where PDE has noticed problems or seen issues arise They merit your consideration and attention They merit your consideration and attention

4. 1.Corporate Form of Charter Schools Definition of Charter School: “[A]n independent public school established and operated under a charter from the local board of school directors and in which students are enrolled or attend. A charter school must be organized as a public, nonprofit corporation. Charters may not be granted to any for-profit entity.” “[A]n independent public school established and operated under a charter from the local board of school directors and in which students are enrolled or attend. A charter school must be organized as a public, nonprofit corporation. Charters may not be granted to any for-profit entity.”

5. “Public, Nonprofit Corporation” Under section 1714-A(a) of the CSL, a “charter school … is a body corporate.” Under section 1714-A(a) of the CSL, a “charter school … is a body corporate.” That corporation must be registered with the Commonwealth as a nonprofit corporation. That corporation must be registered with the Commonwealth as a nonprofit corporation.

6. “Public, Nonprofit Corporation” A charter school is a public entity: A charter school is a public entity:  It operates primarily with public funds and it may use those funds “for charter school purposes only”;  Its board members are public officials;  It is subject to the Sunshine Act; and  It may sue and be sued “but only to the same extent and upon the same conditions as political subdivisions and local agencies.”

7. Consequences A charter school must be a corporation: A charter school must be a corporation:  It may not be an operating division of another corporation;  It may not be a subsidiary of another corporation. A charter school must operate independently of other corporations with which it is associated. A charter school must operate independently of other corporations with which it is associated.

8. 2. Express Statutory Authority of Charter School Trustees Section 1716-A. Powers of board of trustees. Section 1716-A. Powers of board of trustees.  (a) The board of trustees of a charter school shall have the authority to decide matters related to the operation of the school, including, but not limited to, budgeting, curriculum and operating procedures, subject to the school's charter. The board shall have the authority to employ, discharge and contract with necessary professional and nonprofessional employees subject to the school's charter and the provisions of this article.

9. Section 1716-A (cont’d)  (b) No member of a local board of school directors of a school entity shall serve on the board of trustees of a charter school that is located in the member’s district.  (c) The board of trustees shall comply with the act of July 3, 1986 (P.L. 388, No.84), known as the “Sunshine Act.”

10. Consequences Subsections (b) and (c) are fairly straightforward. Subsections (b) and (c) are fairly straightforward. According to the Pa. Supreme Ct., subsection (a) means that the board must “retain the ultimate authority over the general operation of the school.” Collegium. According to the Pa. Supreme Ct., subsection (a) means that the board must “retain the ultimate authority over the general operation of the school.” Collegium. Once the board is in place, it must control the school—not the applicant or founder, and not a management company. Once the board is in place, it must control the school—not the applicant or founder, and not a management company.

11. Control Over the School Pay particular attention to these areas expressly listed in the statute: Pay particular attention to these areas expressly listed in the statute:  Budgeting  Curriculum  Operating procedures  Employment, discharge, and contracts with employees.

12. 3. Facilities and Construction Two provisions affect charter schools in these areas: Two provisions affect charter schools in these areas:  Section 1722-A permits a charter school to be located in virtually any public or private site, but also prohibits a charter school from constructing a facility with funds received from the state or a local school district.

13. Facilities (cont’d)  Section 1715-A(10) provides that for construction and construction-related projects, charter schools must comply with certain statutes—including some outside the School Code.

14. 4. Retirement System Section 1724-A(c) of the CSL provides: “All employees of a charter school shall be enrolled in the Public School Employees’ Retirement System …” (with exceptions) Section 1724-A(c) of the CSL provides: “All employees of a charter school shall be enrolled in the Public School Employees’ Retirement System …” (with exceptions) It also provides, “The Commonwealth shall make contributions on behalf of charter school employees, and the charter school shall be considered a school district and shall make payments by employers …” It also provides, “The Commonwealth shall make contributions on behalf of charter school employees, and the charter school shall be considered a school district and shall make payments by employers …”

15. Consequences Charter School Trustees, as the employer of the school’s employees, must ensure that Charter School Trustees, as the employer of the school’s employees, must ensure that  employees are enrolled in PSERS;  the school is making timely payments to PSERS on behalf of the employees. PSERS will use a statutory intercept if necessary to ensure such payments are made. PSERS will use a statutory intercept if necessary to ensure such payments are made.

16. 5. Prohibitions on and Disqualification of Trustees No person affiliated with a charter school— including a trustee—may accept a gift from an employee or student as a condition of maintaining employment or enrollment in the school. No person affiliated with a charter school— including a trustee—may accept a gift from an employee or student as a condition of maintaining employment or enrollment in the school. Any trustee who is convicted of “a felony or any crime involving moral turpitude” is disqualified from serving as a trustee. Any trustee who is convicted of “a felony or any crime involving moral turpitude” is disqualified from serving as a trustee. The board should have a clear plan for succession. The board should have a clear plan for succession.

17. B. School Code Provisions General Rules regarding application of the School Code to charter schools General Rules regarding application of the School Code to charter schools Provisions that do apply to charter schools Provisions that do apply to charter schools Areas for special consideration Areas for special consideration

18. 1. General Rules on Application of the School Code to Charters Unless a School Code provision is specifically made applicable to charter schools, charters are exempt from it. See Unless a School Code provision is specifically made applicable to charter schools, charters are exempt from it. See 24 P.S. §1715-A(1). Charter schools are not exempt from laws outside the School Code. Charter schools are not exempt from laws outside the School Code. Charter schools are subject to all statutes and regulations listed in section 1732-A of the CSL. Charter schools are subject to all statutes and regulations listed in section 1732-A of the CSL.

19. 2. Application of Specific School Code Provisions Many sections are listed in section 1732-A of the Charter School Law. Some new ones were added as recently at 2002. Many sections are listed in section 1732-A of the Charter School Law. Some new ones were added as recently at 2002. Other places to look in the CSL are: Other places to look in the CSL are:  Section 1715-A(10) (construction)  Section 1722-A(b) (facilities regulations)  Section 1724-A(b) (Retirement Code)

20. 3. Areas for Special Attention The provisions listed in section 1732-A that are found in articles III, IV, and V of the School Code merit special attention. The provisions listed in section 1732-A that are found in articles III, IV, and V of the School Code merit special attention. Those School Code articles address board members’ responsibilities, issues concerning board meetings and officers, and board duties and powers. Those School Code articles address board members’ responsibilities, issues concerning board meetings and officers, and board duties and powers.

21. C. Suggestions for Avoiding Legal Problems Be knowledgeable about your school and the legal requirements it must meet. Be knowledgeable about your school and the legal requirements it must meet. Be vigilant in carrying out your duties as a trustee. Be vigilant in carrying out your duties as a trustee. Hire a solicitor and develop a cooperative relationship with him or her. Hire a solicitor and develop a cooperative relationship with him or her. If you don’t already have them, try to find community organization partners. If you don’t already have them, try to find community organization partners.

22. 1. Be Knowledgeable Learn as much as you can about your charter school, the Charter School Law, and other legal requirements—including federal requirements like special education and No Child Left Behind—to which the school is subject. Learn as much as you can about your charter school, the Charter School Law, and other legal requirements—including federal requirements like special education and No Child Left Behind—to which the school is subject. A school can be successful only if those who are responsible for running it know what must be done and whether it is being done by the school’s management. A school can be successful only if those who are responsible for running it know what must be done and whether it is being done by the school’s management.

23. 2. Be Vigilant You are running your charter school. You are running your charter school. You must probe, ask questions, and— when necessary—press for answers from those involved in the day-to-day operation of the school. You must probe, ask questions, and— when necessary—press for answers from those involved in the day-to-day operation of the school.

24. 3. Work With a Solicitor No one at PDE is a school solicitor, and we cannot offer legal advice to charter schools. No one at PDE is a school solicitor, and we cannot offer legal advice to charter schools. We are willing to help your solicitor work through some of the issues and problems that arise under the law. We are willing to help your solicitor work through some of the issues and problems that arise under the law. Simply put, there are too many legal issues—and often complex ones—to operate a public charter school without a well-trained attorney as a resource. Simply put, there are too many legal issues—and often complex ones—to operate a public charter school without a well-trained attorney as a resource.

25. 4. Work With Existing Community Organizations As part of the charter application process, applicants are asked to provide information on “the manner in which community groups will be involved in the charter school planning process.” 24 P.S. §1719-A(8). As part of the charter application process, applicants are asked to provide information on “the manner in which community groups will be involved in the charter school planning process.” 24 P.S. §1719-A(8). The 2002 statewide study of charter schools found that charters that were affiliated with existing community organizations had clear advantages in the formation and start-up phases. The 2002 statewide study of charter schools found that charters that were affiliated with existing community organizations had clear advantages in the formation and start-up phases.

26. D. Observations and Conclusions There are many legal requirements that charter schools and their trustees must follow. There are many legal requirements that charter schools and their trustees must follow. The more knowledgeable the trustees, the less likely there are to be problems in the operation of the charter school. The more knowledgeable the trustees, the less likely there are to be problems in the operation of the charter school. A solicitor can be an excellent resource for a charter school’s board of trustees. A solicitor can be an excellent resource for a charter school’s board of trustees.