HB-4787, As Passed House, June 25, 2009

SUBSTITUTE FOR

HOUSE BILL NO. 4787

A bill to amend 1976 PA 451, entitled

"The revised school code,"

by amending sections 5, 507, and 1701a (MCL 380.5, 380.507, and

380.1701a), section 5 as amended by 2005 PA 61, section 507 as

amended by 1995 PA 289, and section 1701a as amended by 2008 PA 1,

and by adding sections 1280c and 1320 and part 6d.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 5. (1) "Local act school district" or "special act school

district" means a district governed by a special or local act or

chapter of a local act. "Local school district" and "local school

district board" as used in article 3 include a local act school

district and a local act school district board.

(2) "Membership" means the number of full-time equivalent

pupils in a public school as determined by the number of pupils

registered for attendance plus pupils received by transfer and

minus pupils lost as defined by rules promulgated by the state

board.

(3) "Michigan election law" means the Michigan election law,

1954 PA 116, MCL 168.1 to 168.992.

(4) "Nonpublic school" means a private, denominational, or

parochial school.

(5) "Objectives" means measurable pupil academic skills and

knowledge.

(6) "Public school" means a public elementary or secondary

educational entity or agency that is established under this act,

has as its primary mission the teaching and learning of academic

and vocational-technical skills and knowledge, and is operated by a

school district, local act school district, special act school

district, intermediate school district, public school academy

corporation, strict discipline academy corporation, urban high

school academy corporation, turnaround school corporation, the

state school reform/redesign school district created under section

1280c, or by the department or state board. Public school also

includes a laboratory school or other elementary or secondary

school that is controlled and operated by a state public university

described in section 4, 5, or 6 of article VIII of the state

constitution of 1963.

(7) "Public school academy" means a public school academy

established under part 6a and, except as used in part 6a, also

includes an urban high school academy established under part 6c, a

turnaround school established under part 6d, and a strict

discipline academy established under sections 1311b to 1311l.

(8) "Pupil membership count day" of a school district means

that term as defined in section 6 of the state school aid act of

1979, MCL 388.1606.

(9) "Regular school election" or "regular election" means the

election held in a school district, local act school district, or

intermediate school district to elect a school board member in the

regular course of the terms of that office and held on the school

district's regular election date as determined under section 642 or

642a of the Michigan election law, MCL 168.642 and 168.642a.

(10) "Reorganized intermediate school district" means an

intermediate school district formed by consolidation or annexation

of 2 or more intermediate school districts under sections 701 and

702.

(11) "Rule" means a rule promulgated under the administrative

procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.

Sec. 507. (1) The authorizing body for a public school academy

is the fiscal agent for the public school academy. A state school

aid payment for a public school academy shall be paid to the

authorizing body that is the fiscal agent for that public school

academy, which shall then forward the payment to the public school

academy. An authorizing body has the responsibility to oversee a

public school academy's compliance with the contract and all

applicable law. A contract issued under this part may be revoked by

the authorizing body that issued the contract if the authorizing

body determines that 1 or more of the following has occurred:

(a) Failure of the public school academy to abide by and meet

the educational goals set forth in the contract.

(b) Failure of the public school academy to comply with all

applicable law.

accepted public sector accounting principles.

(d) The existence of 1 or more other grounds for revocation as

specified in the contract.

(2) If an authorizing body receives notice from the

superintendent of public instruction that a public school academy

that it authorized has been designated by the superintendent of

public instruction as a failing public school under section 1280c,

the authorizing body may revoke the public school academy's

contract and the public school academy may be closed.

(3) ~~(2) The~~ Except as provided in subsection (2), the decision

of an authorizing body to revoke a contract under this section is

solely within the discretion of the authorizing body, is final, and

is not subject to review by a court or any state agency.

(4) An authorizing body that revokes a contract under this

section is not liable for that action to the public school academy,

public school academy corporation, a pupil of the public school

academy, the parent or guardian of a pupil of the public school

academy, or any other person.

PART 6D

TURNAROUND SCHOOLS

Sec. 531. (1) A turnaround school is a public school under

section 2 of article VIII of the state constitution of 1963, is a

school district for the purposes of section 11 of article IX of the

state constitution of 1963 and for the purposes of sections 1225

and 1351a, and is subject to the leadership and general supervision

of the state board over all public education under section 3 of

article VIII of the state constitution of 1963. A turnaround school

is a body corporate and is a governmental agency. The powers

granted to a turnaround school under this part constitute the

performance of essential public purposes and governmental functions

of this state.

(2) As used in this part:

(a) "Authorizing body" means the state reform/redesign school

district created under section 1280c.

(b) "Contract" means the executive act taken by the

authorizing body that evidences the authorization of a turnaround

school and that establishes, subject to the constitutional powers

of the state board and applicable law, the written instrument

executed by the authorizing body conferring certain rights,

franchises, privileges, and obligations on a turnaround school, as

provided by this part, and confirming the status of a turnaround

school as a public school in this state.

enters into an agreement with the governing board of a public

school to provide comprehensive educational, administrative,

management, or instructional services or staff to the public

school.

(d) "Entity" means that term as defined in part 6a.

(e) "Failing public school" means a school that is determined

by the department to meet the criteria under section 1280c(3) and

is designated by the superintendent of public instruction as a

failing public school under section 1280c(3).

(f) "Qualified entity" means an entity that is determined by

the superintendent of public instruction to meet either of the

following:

(i) Meets both of the following:

(A) Has been issued and is currently a party to a contract to

organize and operate at least 1 public school academy under part

6a.

(B) The high-performing school review team created under

section 1280c has determined that it operates high-performing

schools.

(ii) Meets both of the following:

(A) Is an entity that operates a school in another state that

is similar to a public school in this state or that provides

comprehensive educational, administrative, management, or

instructional services or staff for a school in another state that

is similar to a public school in this state.

(B) The high-performing school review team created under

section 1280c has determined that it operates, or provides services

or staff for, high-performing schools.

Sec. 532. (1) A turnaround school shall be organized and

administered under the direction of a board of directors in

accordance with this part and with bylaws adopted by the board of

directors. A turnaround school corporation shall be organized under

the nonprofit corporation act, 1982 PA 162, MCL 450.2101 to

450.3192, except that a turnaround school corporation is not

required to comply with sections 170 to 177 of 1931 PA 327, MCL

450.170 to 450.177. To the extent disqualified under the state or

federal constitution, a turnaround school shall not be organized by

a church or other religious organization and shall not have any

organizational or contractual affiliation with or constitute a

church or other religious organization.

(2) The authorizing body may issue a contract for the

organization and operation of a turnaround school under this part.

All of the following apply to the issuance of a contract by the

authorizing body:

(a) The authorizing body shall not issue more than 1

turnaround school contract for each failing public school.

(b) In the contract, the authorizing body shall identify the

failing public school that corresponds to the turnaround school.

by the authorizing body on a competitive basis as described in

section 533(1) after receiving and evaluating applications from

qualified entities. The authorizing body may solicit applications

from qualified entities.

(3) A contract issued under this part shall be issued for an

initial term of 5 years. If at the end of the 5-year period the

turnaround school is determined by the department to meet all of

the following, the authorizing body may renew the contract for

subsequent 5-year terms:

(a) At least 80% of the school's pupils graduate from high

school or are determined by the department to be on track to

graduate from high school, the school has at least 80% average

attendance, and, if the school is a high school, the school's

pupils have an average score of at least 18 on the college entrance

examination component of the Michigan merit examination.

(b) Is meeting the other educational goals set forth in the

contract.

(4) To obtain a contract to organize and operate 1 or more

turnaround schools, a qualified entity may apply to the authorizing

body, as described in subsection (2). The contract shall be issued

to a turnaround school corporation designated by the qualified

entity applying for the contract. The application shall include at

least all of the following:

(a) Name of the qualified entity applying for the contract.

(b) Subject to the action of the authorizing body under

section 538(1)(c), a list of the proposed members of the board of

directors of the turnaround school and a description of the

qualifications and method for appointment or election of members of

the board of directors. The board of directors shall include

representation from the local community.

include at least all of the following:

(i) The name of the proposed turnaround school to which the

contract will be issued.

(ii) The purposes for the turnaround school corporation. This

language shall provide that the turnaround school is incorporated

pursuant to this part and that the turnaround school corporation is

a governmental entity and political subdivision of this state.

(iii) The proposed time when the articles of incorporation will

be effective.

(iv) Other matters considered desirable to be in the articles

of incorporation.

(d) A copy of the proposed bylaws of the turnaround school.

(e) Documentation meeting the application requirements of the

authorizing body, including at least all of the following:

(i) The governance structure of the turnaround school.

(ii) A copy of the educational goals of the turnaround school

and the curricula to be offered and methods of pupil assessment to

be used by the turnaround school. To the extent applicable, the

progress of the pupils in the turnaround school shall be assessed

using at least a Michigan education assessment program (MEAP) test

or the Michigan merit examination developed under section 1279g, as

applicable. The educational goals shall include that, by the last

year of the contract, at least 80% of the school's pupils will

graduate from high school or be determined by the department to be

on track to graduate from high school, the school will have at

least 80% average attendance, and, if the school is a high school,

the school's pupils will have an average score of at least 18 on

the college entrance examination component of the Michigan merit

examination.

(iii) The admission policy and criteria to be maintained by the

turnaround school. The admission policy and criteria shall comply

with section 534. This part of the application also shall include a

description of how the applicant will provide to the general public

adequate notice that a turnaround school is being created and

adequate information on the admission policy, criteria, and

process.

(iv) The school calendar and school day schedule.

(v) The age or grade range of pupils to be enrolled. The grade

range shall include at least all of the same grade levels offered

by the failing public school that is identified under subsection

(2) as corresponding to the turnaround school.

(f) Descriptions of staff responsibilities and of the

turnaround school's governance structure.

(g) A description of and address for the proposed building or

buildings in which the turnaround school will be located, and a

financial commitment by the qualified entity applying for the

contract to construct or renovate the building or buildings that

will be occupied by the turnaround school that is issued the

contract. A turnaround school must be located within the attendance

area of the failing public school that corresponds to the

turnaround school, as established by the school district that

operated the failing public school, and within the same school

district as that failing public school is located.

(5) The authorizing body shall not charge a fee, or require

reimbursement of expenses, for considering an application for a

contract, for issuing a contract, or for providing oversight of a

contract for a turnaround school in an amount that exceeds a

combined total of 3% of the total state school aid received by the

turnaround school in the school year in which the fees or expenses

are charged. All of the following apply to this fee:

(a) The authorizing body may use this fee only for the

following purposes:

(i) Considering applications and issuing or administering

contracts.

(ii) Compliance monitoring and oversight of turnaround schools.

(iii) Training for turnaround school applicants, administrators,

and boards of directors.

(iv) Technical assistance to turnaround schools.

(v) Academic support to turnaround schools or to pupils or

graduates of turnaround schools.

(vi) Evaluation of turnaround school performance.

(vii) Training of teachers, including supervision of teacher

interns.

(viii) Other purposes that assist the turnaround school or

traditional public schools in achieving improved academic

performance.

(b) The authorizing body may provide other services for a

turnaround school and charge a fee for those services, but shall

not require such an arrangement as a condition to issuing the

contract authorizing the turnaround school.

(6) A turnaround school shall be presumed to be legally

organized if it has exercised the franchises and privileges of a

turnaround school for at least 2 years.

Sec. 533. (1) The authorizing body is not required to issue a

contract to any entity. Turnaround school contracts shall be issued

on a competitive basis taking into consideration the resources

available for the proposed turnaround school, the population to be

served by the proposed turnaround school, and the educational goals

to be achieved by the proposed turnaround school. However, the

state school reform/redesign officer may solicit applications from

qualified entities. In evaluating if an applicant is qualified, the

authorizing body shall examine the proposed performance standards,

proposed academic program, financial viability of the applicant,

and the ability of the proposed board of directors to meet the

contract goals and objectives. The authorizing body shall not issue

a contract unless the contract requires the turnaround school to

enter into an agreement for operation of the school by an

established educational management organization approved by the

department.

(2) A contract issued to organize and administer a turnaround

school shall contain at least all of the following:

(a) The educational goals the turnaround school is to achieve

and the methods by which it will be held accountable. To the extent

applicable, the pupil performance of a turnaround school shall be

assessed using at least a Michigan education assessment program

(MEAP) test or the Michigan merit examination developed under

section 1279g, as applicable. The educational goals shall include

that, by the last year of the contract, at least 80% of the

school's pupils will graduate from high school or be determined by

the department to be on track to graduate from high school, the

school will have at least 80% average attendance, and, if the

school is a high school, the school's pupils will have an average

score of at least 18 on the college entrance examination component

of the Michigan merit examination.

(b) A description of the method to be used to monitor the

turnaround school's compliance with applicable law and its

performance in meeting its targeted educational objectives.

during the term of the contract. The authorizing body may approve

amendment of the contract with respect to any provision contained

in the contract except for the location of the building or

buildings to be operated by the turnaround school.

(d) A certification, signed by an authorized member of the

turnaround school board of directors, that the turnaround school

will comply with the contract and all applicable law.

(e) Procedures for revoking the contract and grounds for

revoking the contract. The grounds shall include, but are not

limited to, the failure to meet the requirements for renewal of a

contract under section 532(3)(a) to (c) within 5 years.

(f) A description of and address for the proposed building or

buildings in which the turnaround school will be located. A

turnaround school must be located within the attendance area of the

failing public school that corresponds to the turnaround school, as

established by the school district that operated the failing public

school.

(g) Requirements and procedures for financial audits. The

financial audits shall be conducted at least annually by an

independent certified public accountant in accordance with

generally accepted governmental auditing principles.

(h) A requirement that the board of directors shall ensure

compliance with the requirements of 1968 PA 317, MCL 15.321 to

15.330.

(i) A requirement that the board of directors shall prohibit

specifically identified family relationships between members of the

board of directors, individuals who have an ownership interest in

or who are officers or employees of an educational management

company involved in the operation of the turnaround school, and

employees of the turnaround school. The contract shall identify the

specific prohibited relationships consistent with applicable law.

(j) A requirement that the board of directors of the

turnaround school shall make information concerning its operation

and management available to the public and to the authorizing body

in the same manner as is required by state law for school

districts.

(k) A requirement that the board of directors of the

turnaround school shall collect, maintain, and make available to

the public and the authorizing body, in accordance with applicable

law and the contract, at least all of the following information

concerning the operation and management of the turnaround school:

(i) A copy of the contract issued by the authorizing body for

the turnaround school.

(ii) A list of currently serving members of the board of

directors of the turnaround school, including name, address, and

term of office; copies of policies approved by the board of

directors; board meeting agendas and minutes; copy of the budget

approved by the board of directors and of any amendments to the

budget; and copies of bills paid for amounts of $10,000.00 or more

as they were submitted to the board of directors.

(iii) Quarterly financial reports submitted to the authorizing

body.

(iv) A current list of teachers working at the turnaround

school that includes their individual salaries; copies of the

teaching certificates or permits of current teaching staff; and

evidence of compliance with the criminal background and records

checks and unprofessional conduct check required under sections

1230, 1230a, and 1230b for all teachers and administrators working

at the turnaround school.

(v) Curriculum documents and materials given to the

authorizing body.

(vi) Proof of insurance as required by the contract.

(vii) Copies of facility leases or deeds, or both, and of any

equipment leases.

(viii) Copies of any management contracts or services contracts

approved by the board of directors.

(ix) All health and safety reports and certificates, including

those relating to fire safety, environmental matters, asbestos

inspection, boiler inspection, and food service.

(x) Any management letters issued as part of the annual

financial audit under subdivision (g).

(xi) Any other information specifically required under this

act.

(l) A requirement that the authorizing body must review and may

disapprove any agreement between the board of directors and an

educational management organization before the agreement is final

and valid.

(m) A requirement that the board of directors shall

demonstrate all of the following to the satisfaction of the

House Bill No. 4787 (H-5) as amended June 25, 2009

authorizing body with regard to its pupil admission process:

(i) That the turnaround school has made a reasonable effort to

advertise its enrollment openings[.

]

(ii) That the turnaround school has made the following

additional efforts to recruit pupils who are eligible for special

education programs and services or English as a second language

services to apply for admission:

(A) Reasonable efforts to advertise all enrollment openings to

organizations and media that regularly serve and advocate for

individuals with disabilities or children with limited English-

speaking ability within the boundaries of the intermediate school

district in which the turnaround school is located.

(B) Inclusion in all pupil recruitment materials of a

statement that appropriate special education services and English

as a second language services will be made available to pupils

attending the school as required by law.

(iii) That the open enrollment period for the turnaround school

is for a duration of at least 2 weeks and that the enrollment times

include some evening and weekend times.

(n) A requirement that the board of directors shall prohibit

any individual from being employed by the turnaround school in more

than 1 full-time position and simultaneously being compensated at a

full-time rate for each of those positions.

(o) A requirement that, if requested, the board of directors

shall report to the authorizing body the total compensation for

each individual working at the turnaround school.

(3) A turnaround school shall comply with all applicable law,

including all of the following:

(a) The open meetings act, 1976 PA 267, MCL 15.261 to 15.275.

(b) The freedom of information act, 1976 PA 442, MCL 15.231 to

15.246.

(d) 1965 PA 166, MCL 408.551 to 408.558.

(e) 1978 PA 566, MCL 15.181 to 15.185.

(f) 1968 PA 317, MCL 15.321 to 15.330.

(g) The uniform budgeting and accounting act, 1968 PA 2, MCL

141.421 to 141.440a.

(h) The revised municipal finance act, 2001 PA 34, MCL

141.2101 to 141.2821.

(i) The federal no child left behind act of 2001, Public Law

107-110.

(j) Sections 1134, 1135, 1146, 1153, 1263, 1267, 1274, and

1280.

(4) A turnaround school and its incorporators, board members,

officers, employees, and volunteers have governmental immunity as

provided in section 7 of 1964 PA 170, MCL 691.1407. An authorizing

body and its board members, officers, and employees are immune from

civil liability, both personally and professionally, for any acts

or omissions in authorizing or oversight of a turnaround school if

the authorizing body or the person acted or reasonably believed he

or she acted within the authorizing body's or the person's scope of

authority.

(5) A turnaround school is exempt from all taxation on its

earnings and property. Instruments of conveyance to or from a

turnaround school are exempt from all taxation, including taxes

imposed by 1966 PA 134, MCL 207.501 to 207.513. A turnaround school

may not levy ad valorem property taxes or any other tax for any

purpose.

(6) A turnaround school may acquire by purchase, gift, devise,

lease, sublease, installment purchase agreement, land contract,

option, or any other means, hold, and own in its own name buildings

and other property for school purposes, and interests therein, and

other real and personal property, including, but not limited to,

interests in property subject to mortgages, security interests, or

other liens, necessary or convenient to fulfill its purposes. For

the purposes of condemnation, a turnaround school may proceed under

the uniform condemnation procedures act, 1980 PA 87, MCL 213.51 to

213.75, excluding sections 6 to 9 of that act, MCL 213.56 to

213.59, or other applicable statutes, but only with the express,

written permission of the authorizing body in each instance of

condemnation and only after just compensation has been determined

and paid.

Sec. 533a. (1) An agreement, mortgage, loan, or other

instrument of indebtedness entered into by a turnaround school and

a third party does not constitute an obligation, either general,

special, or moral, of this state or the authorizing body. The full

faith and credit or the taxing power of this state or any agency of

this state, or the full faith and credit of the authorizing body,

may not be pledged for the payment of any turnaround school bond,

note, agreement, mortgage, loan, or other instrument of

indebtedness.

(2) This part does not impose any liability on this state or

on the authorizing body for any debt incurred by a turnaround

school.

Sec. 534. (1) A turnaround school may be located in all or

part of an existing public school building. A turnaround school

shall not operate at a site other than the single site requested

for the configuration of grades that will use the site, as

specified in the contract. A turnaround school shall not relocate

to a different location than the site or sites specified in the

contract. A turnaround school must be located within the attendance

area of the failing public school that is identified under section

532(2) as corresponding to the turnaround school, as established by

the school district that operated the failing public school.

(2) A turnaround school shall not charge tuition. Except as

otherwise provided in this section, a turnaround school shall not

discriminate in its pupil admissions policies or practices on the

basis of intellectual or athletic ability, measures of achievement

or aptitude, status as a handicapped person, or any other basis

that would be illegal if used by a school district. However, a

turnaround school may limit admission to pupils who are within a

particular range of age or grade level or on any other basis that

would be legal if used by a school district and shall comply with

subsections (3) and (4).

(3) Except for a foreign exchange student who is not a United

States citizen, a turnaround school shall not enroll a pupil who is

not a resident of this state. Enrollment in a turnaround school

shall be open to all pupils who reside in this state who meet the

admission policy. Subject to subsection (4), if there are more

applications to enroll in the turnaround school than there are

spaces available, pupils shall be selected to attend using a random

selection process. A turnaround school shall allow any pupil who

was enrolled in the turnaround school in the immediately preceding

school year to enroll in the turnaround school in the appropriate

grade unless the appropriate grade is not offered at that

turnaround school.

(4) A turnaround school shall allow a child who was previously

enrolled in the failing public school that is identified under

section 532(2) as corresponding to the turnaround school to enroll

in the turnaround school. A turnaround school also may give

enrollment priority to 1 or more of the following:

(a) A sibling of a pupil enrolled in the turnaround school.

(b) A child of a person who is employed by or at the

turnaround school or who is on the board of directors of the

turnaround school. As used in this subdivision, "child" includes an

adopted child or a legal ward.

(5) A turnaround school shall include at least all of the same

grade levels offered by the failing public school that is

identified under section 532(2) as corresponding to the turnaround

school. A turnaround school also may include other grades or any

configuration of those grades, including kindergarten and early

childhood education, as specified in its contract.

Sec. 535. In addition to other powers set forth in this part,

a turnaround school may take action to carry out the purposes for

which it was incorporated under this part, including, but not

limited to, all of the following:

(a) To sue and be sued in its name.

(b) Subject to section 533a, to acquire, hold, and own in its

own name real and personal property, or interests in real or

personal property, for educational purposes by purchase, gift,

grant, devise, bequest, lease, sublease, installment purchase

agreement, land contract, option, or condemnation, and subject to

mortgages, security interests, or other liens; and to sell or

convey the property as the interests of the turnaround school

require.

purposes.

(d) To enter into binding legal agreements with persons or

entities as necessary for the operation, management, financing, and

maintenance of the turnaround school.

(e) To incur temporary debt in accordance with section 1225.

(f) To solicit and accept any grants or gifts for educational

purposes and to establish or permit to be established on its behalf

1 or more nonprofit corporations the purpose of which is to assist

the turnaround school in the furtherance of its public purposes.

(g) To borrow money and issue bonds in accordance with section

1351a and in accordance with part VI of the revised municipal

finance act, 2001 PA 34, MCL 141.2601 to 141.2613, except that the

borrowing of money and issuance of bonds by a turnaround school are

not subject to section 1351a(4) or section 1351(2) to (4). Bonds

issued under this section shall be full faith and credit

obligations of the turnaround school, pledging the general funds or

any other money available for such a purpose. Bonds issued under

this section are subject to the revised municipal finance act, 2001

PA 34, MCL 141.2101 to 141.2821.

Sec. 536. (1) Except as otherwise provided by law, a

turnaround school shall assign to teach only an individual holding

a valid Michigan teaching certificate.

(2) A turnaround school may develop and implement new teaching

techniques or methods or significant revisions to known teaching

techniques or methods and shall report those to the authorizing

body and state board to be made available to the public. A

turnaround school may use any instructional technique or delivery

method that may be used by a school district.

Sec. 537. A turnaround school, with the approval of the

authorizing body, may employ or contract with personnel, or enter

into a contract with another party to furnish teachers or other

personnel, as necessary for the operation of the turnaround school,

prescribe their duties, and fix their compensation.

Sec. 537a. If the board of directors of a turnaround school

provides medical, optical, or dental benefits to employees and

their dependents, the board of directors shall provide those

benefits in accordance with the public employees health benefit

act, 2007 PA 106, MCL 124.71 to 124.85, and shall comply with that

act.

Sec. 538. (1) If the authorizing body issues a contract for a

turnaround school under this part, the authorizing body shall do

all of the following:

(a) Ensure that the contract and the application for the

contract comply with the requirements of this part.

(b) Within 10 days after issuing the contract, submit to the

department a copy of the contract.

number of members of the board of directors of each turnaround

school that it authorizes. The authorizing body shall ensure that

the board of directors includes representation from the local

community.

(d) Oversee the operations of each turnaround school operating

under a contract issued by the authorizing body. The oversight

shall be sufficient to ensure that the turnaround school is in

compliance with the terms of the contract and with applicable law.

(e) Develop and implement a process for holding a turnaround

school board of directors accountable for meeting applicable

academic performance standards set forth in the contract and for

implementing corrective action for a turnaround school that does

not meet those standards.

(f) Take necessary measures to ensure that a turnaround school

board of directors operates independently of any educational

management company involved in the operations of the turnaround

school.

(g) Oversee and ensure that the pupil admission process used

by the turnaround school is operated in a fair and open manner and

is in compliance with the contract and this part.

(h) Ensure that the board of directors of the turnaround

school maintains and releases information as necessary to comply

with applicable law.

(2) The authorizing body may enter into an agreement with 1 or

more authorizing bodies, as defined under part 6a, to carry out any

function of the authorizing body under subsection (1)(a) to (h).

(3) The authorizing body for a turnaround school is the fiscal

agent for the turnaround school. A state school aid payment for a

turnaround school shall be paid to the authorizing body as the

fiscal agent for that turnaround school, and the authorizing body

shall then forward the payment to the turnaround school. Within 30

days after a contract is submitted to the department by the

authorizing body under subsection (1), the department shall issue a

district code to the turnaround school for which the contract was

issued. If the department does not issue a district code within 30

days after a contract is filed, the state treasurer shall assign a

temporary district code in order for the turnaround school to

receive funding under the state school aid act of 1979.

(4) A contract issued under this part may be revoked by the

authorizing body if the authorizing body determines that 1 or more

of the following have occurred:

(a) Failure of the turnaround school to abide by and meet the

educational goals set forth in the contract.

(b) Failure of the turnaround school to comply with all

applicable law.

accepted public sector accounting principles.

(d) The existence of 1 or more other grounds for revocation as

specified in the contract.

(5) The decision of the authorizing body to issue, reissue, or

reconstitute a contract under this part, or to revoke a contract

under this section, is solely within the discretion of the

authorizing body, is final, and is not subject to review by a court

or any other state agency. If the authorizing body does not issue,

reissue, or reconstitute a contract under this part, or revokes a

contract under this section, the authorizing body is not liable for

that action to the turnaround school, the turnaround school

corporation, a pupil of the turnaround school, the parent or

guardian of a pupil of the turnaround school, or any other person.

(6) Before the authorizing body revokes a contract, the

authorizing body may consider and take corrective measures to avoid

revocation. The authorizing body may reconstitute the turnaround

school in a final attempt to improve student educational

performance or to avoid interruption of the educational process.

The authorizing body may include a reconstituting provision in the

contract that identifies these corrective measures, including, but

not limited to, removing 1 or more members of the board of

directors, withdrawing approval to contract under section 535 for

an agreement described in section 1320, or appointing a new board

of directors or a trustee to take over operation of the turnaround

school.

(7) If the authorizing body revokes a contract, the

authorizing body shall work with a school district or another

public school, or with a combination of these entities, to ensure a

smooth transition for the affected pupils. If the revocation occurs

during the school year, the authorizing body, as the fiscal agent

for the turnaround school under this part, shall return any school

aid funds received by the authorizing body that are attributable to

the affected pupils to the state treasurer for deposit into the

state school aid fund. The state treasurer shall distribute funds

to the public school in which the pupils enroll after the

revocation pursuant to a methodology established by the department

and the center for educational performance and information.

(8) Not more than 10 days after a turnaround school's contract

terminates or is revoked, the authorizing body shall notify the

superintendent of public instruction in writing of the name of the

turnaround school whose contract has terminated or been revoked and

the date of contract termination or revocation.

(9) If a turnaround school's contract terminates or is

revoked, title to all real and personal property, interest in real

or personal property, and other assets owned by the turnaround

school shall revert to the state. This property shall be

distributed in accordance with the following:

(a) Within 30 days following the termination or revocation,

the board of directors of a turnaround school shall hold a public

meeting to adopt a plan of distribution of assets and to approve

the dissolution of the turnaround school corporation, all in

accordance with chapter 8 of the nonprofit corporation act, 1982 PA

162, MCL 450.2801 to 450.2864.

(b) The turnaround school shall file a certificate of

dissolution with the department of energy, labor, and economic

growth within 10 business days following board approval.

dissolution under subdivision (b), the turnaround school board of

directors shall provide a copy of the board of directors' plan of

distribution of assets to the state treasurer for approval. Within

30 days, the state treasurer, or his or her designee, shall review

and approve the board of directors' plan of distribution of assets.

If the proposed plan of distribution of assets is not approved

within 30 days, the state treasurer, or his or her designee, shall

provide the board of directors with an acceptable plan of

distribution of assets.

(d) The state treasurer, or his or her designee, shall monitor

the turnaround school's winding up of the dissolved corporation in

accordance with the plan of distribution of assets approved or

provided under subdivision (c).

(e) As part of the plan of distribution of assets, the

turnaround school board of directors shall designate the director

of the department of management and budget, or his or her designee,

to dispose of all real property of the turnaround school

corporation in accordance with the directives developed for

disposition of surplus land and facilities under section 251 of the

management and budget act, 1984 PA 431, MCL 18.1251.

(f) If the board of directors of a turnaround school fails to

take any necessary action under this section, the state treasurer,

or his or her designee, may suspend the turnaround school board of

directors and appoint a trustee to carry out the board's plan of

distribution of assets. Upon appointment, the trustee shall have

all the rights, powers, and privileges under law that the

turnaround school board of directors had before being suspended.

(g) Following the sale of the real or personal property or

interests in the real or personal property, and after payment of

any turnaround school debt secured by the property or interest in

property, whether real or personal, the turnaround school board of

directors, or a trustee appointed under this section, shall forward

any remaining money to the state treasurer. Following receipt, the

state treasurer, or his or her designee, shall deposit this

remaining money in the state school aid fund.

Sec. 539. The authorizing body and turnaround school may

include provisions in the contract that permit the qualified entity

that applied for the contract to do any of the following:

(a) Participate in the recruiting, interviewing, and

nominating process for members of the turnaround school board of

directors.

(b) Conduct an independent educational review, on a periodic

basis, to determine whether the turnaround school is successful in

implementing the educational goals set forth in the contract.

school board of directors and any educational management company

contracted to operate the turnaround school.

(d) Make recommendations to the authorizing body and

turnaround school on how to improve the turnaround school's

operation.

Sec. 1280c. (1) The superintendent of public instruction shall

hire a state school reform/redesign officer to carry out the

functions under this section and as otherwise prescribed by law.

The state school reform/redesign officer shall be chosen solely on

the basis of his or her competence and experience in educational

reform and redesign. The state school reform/redesign officer is

exempt from civil service. The state school reform/redesign officer

is responsible directly to the superintendent of public instruction

to ensure that the purposes of this section are carried out and

accordingly should be a position within the department that is

exempt from the classified state civil service. The department

shall request that the civil service commission establish the

position of state school reform/redesign officer as a position that

is exempt from the classified state civil service.

(2) The state school reform/redesign school district is

created. The state school reform/redesign school district is a

school district for the purposes of section 11 of article IX of the

state constitution of 1963 and for receiving state school aid under

the state school aid act of 1979 and is subject to the leadership

and general supervision of the state board over all public

education under section 3 of article VIII of the state constitution

of 1963. The state school reform/redesign school district is a body

corporate and is a governmental agency. All of the following apply

to the state school reform/redesign school district:

(a) The state school reform/redesign school district shall

consist of schools that are placed in the state school

reform/redesign school district as described under subsections (7)

and (8).

(b) The state school reform/redesign officer shall act as the

superintendent of the state school reform/redesign school district.

With respect to schools placed in the state school reform/redesign

school district, the state school reform/redesign officer has all

of the powers and duties described in subsections (7) and (8) and

all provisions of this act that would otherwise apply to the school

board that previously operated a school placed in the state school

reform/redesign school district apply to the state school

reform/redesign officer with respect to that school, except those

relating to taxation or borrowing; subject to subsections (7) and

(8), the state school reform/redesign officer may exercise all the

powers and duties otherwise vested by law in the school board that

previously operated a school placed in the state school

reform/redesign school district and in its officers, except those

relating to taxation or borrowing, and may exercise all additional

powers and duties provided under this section; and, subject to

subsections (7) and (8), the state school reform/redesign officer

accedes to all the rights, duties, and obligations of the school

board with respect to that school. These powers, rights, duties,

and obligations include, but are not limited to, all of the

following:

(i) Authority over the expenditure of all funds attributable to

pupils at that school, including that portion of proceeds from

bonded indebtedness and other funds dedicated to capital projects

that would otherwise be apportioned to that school by the school

board that previously operated the school according to the terms of

the bond issue or financing documents.

(ii) Subject to subsection (8), rights and obligations under

collective bargaining agreements and employment contracts entered

into by the school board for employees at the school.

(iii) Rights to prosecute and defend litigation.

(iv) Rights and obligations under statute, rule, and common

law.

(v) Authority to delegate any of the state school

reform/redesign officer's powers and duties to 1 or more designees,

with proper supervision by the state school reform/redesign

officer.

(vi) Power to terminate any contract or portion of a contract

entered into by the school board that applies to that school.

However, this subsection does not allow any termination or

diminishment of obligations to pay debt service on legally

authorized bonds and does not allow a collective bargaining

agreement to be affected except as provided under subsections (6)

and (8). A contract terminated by the state school reform/redesign

officer under this subsection is void.

(3) Beginning after the 2008-2009 school year, if the

department determines that a public school has been unaccredited

for 4 consecutive years or has failed to achieve the federal pupil

performance standard for all pupils for academic performance for 4

or more consecutive years and that the percentage of all pupils

enrolled in the public school who scored at least "proficient" on

the most recent Michigan education assessment program assessments

or Michigan merit examination, as applicable, for which results are

available was less than the designated percentage, as defined in

subsection (14), in both mathematics and English language arts,

then the superintendent of public instruction may issue an order

designating the public school as a failing public school and

placing the public school under the control and supervision of the

state school reform/redesign officer. If the superintendent of

public instruction decides to issue an order designating a public

school as a failing public school, he or she shall issue that order

within 15 days after it is determined that the public school meets

the criteria under this subsection. If the superintendent of public

instruction decides not to issue such an order for a public school

that is determined to meet the criteria under this subsection, he

or she shall work with the public school and its governing board to

ensure that they are continuing all ongoing restructuring and

reform efforts and to ensure that they are regularly reporting to

the superintendent of public instruction.

(4) Within 15 days after an order is issued under subsection

(3), the state school reform/redesign officer shall appoint a

review team to conduct an evaluation of the failing public school.

The review team shall consist of at least a teacher, a support

staff member, a parent, a school administrator, a school board

member, a member of the local community, and a designee of the

superintendent of public instruction. A member of the review team,

other than the designee of the superintendent of public

instruction, serves at the pleasure of the state school

reform/redesign officer and may be removed and replaced by the

state school reform/redesign officer. The evaluation shall focus on

issues at both the school district level and school building level

and shall cover, at a minimum, standards and expectations,

curriculum, instruction, time on task, learning environment,

prevalence of transient pupils, parental involvement, community

involvement, staff development, planning and assessment, and

governance and leadership. Within 30 days after being appointed,

the review team shall submit a report to the state school

reform/redesign officer based on its evaluation that identifies the

reasons for the failing public school's failures and contains

recommendations on the measures that the state school

reform/redesign officer should take under this section with regard

to the failing public school. The board of a school district or

board of directors of a public school academy shall cooperate fully

with a review team appointed under this subsection.

(5) If a public school is designated as a failing public

school by the superintendent of public instruction under subsection

(3), then all of the following apply:

(a) If the public school is a public school academy, the

superintendent of public instruction shall notify the public school

academy's authorizing body that the school has been designated as a

failing public school. The superintendent of public instruction

then may order the public school academy's authorizing body to

revoke the public school academy's contract, and the public school

academy may be closed. If the superintendent of public instruction

does not order revocation of the contract, the state school

reform/redesign officer shall proceed with a memorandum of

understanding for the public school academy under subsection (6) or

shall place the public school academy into the state school

reform/redesign school district created under subsection (2) and

take action as described in subsection (7).

(b) If the failing public school is not a public school

academy, then all of the following apply to the school:

(i) The state school reform/redesign officer shall confer with

the school board that operates the school along with collective

bargaining representatives of all of the bargaining units at the

school to attempt to enter into a memorandum of understanding

described in subsection (6) with the school board. If the parties

are unable to agree to a memorandum of understanding by the next

January 31 after the public school is designated as a failing

public school, then the state school reform/redesign officer shall

impose a memorandum of understanding on the parties and proceed

under subsection (6) based on the imposed memorandum of

understanding.

(ii) The state school reform/redesign officer shall place the

failing public school into the state school reform/redesign school

district created under subsection (2) and shall take action as

described in subsection (7) if any of the following occur:

(A) If the school has operated for at least 2 full school

years under a memorandum of understanding described in subsection

(6) and has failed to meet the requirements for continuing to

operate under a memorandum of understanding. The requirements for

continuing to operate under a memorandum of understanding shall be

contained in the memorandum of understanding, and shall include at

least a requirement that the department determines either that the

percentage of all pupils enrolled in the school who scored at least

"proficient" on the most recent Michigan education assessment

program assessments or Michigan merit examination, as applicable,

for which results are available was at least 30% in either

mathematics or English language arts or that the percentage of all

pupils below the proficient achievement level used for the federal

pupil performance standard decreased by at least 10% from the

preceding year. Scores labeled "provisionally proficient" are

considered as proficient for these purposes.

(B) If the superintendent of public instruction determines

that the school board has failed to comply with the memorandum of

understanding.

(6) If the state school reform/redesign officer enters into a

memorandum of understanding with the school board or board of

directors that operates the failing public school, the memorandum

of understanding shall provide for at least all of the following:

(a) General oversight and supervision of the failing public

school by the state school reform/redesign officer.

(b) The requirements for continuing to operate under the

memorandum of understanding, as described in subsection

(5)(b)(ii)(A).

school by the school board or board of directors, but only after

modification of school district or public school academy policies

and renegotiation of applicable collective bargaining agreements to

provide for any of the following that are determined by the state

school reform/redesign officer to be necessary to achieve the

educational goals established by the state school reform/redesign

officer:

(i) That any contractual or other seniority system that would

otherwise be applicable shall not apply at the public school. This

subparagraph does not allow unilateral changes in pay scales or

benefits.

(ii) That any contractual or other work rules the state school

reform/redesign officer determines to be impediments to achieving

satisfactory pupil performance shall not apply at the public

school. This subparagraph does not allow unilateral changes in pay

scales or benefits.

(iii) That the state school reform/redesign officer shall direct

the expenditure of all funds attributable to pupils at the public

school and the principal or other school leader designated by the

state school reform/redesign officer shall have full autonomy and

control over curriculum and discretionary spending at the public

school.

(d) That, for the purposes of collective bargaining under 1947

PA 336, MCL 423.201 to 423.217, the state school reform/redesign

officer is a joint employer of the employees at the public school

along with the board of the school district, or board of directors

of the public school academy, that operates the public school.

(e) That, except as otherwise provided by law, an individual

may be employed to teach at the school only if he or she holds a

valid Michigan teaching certificate.

(7) If the state school reform/redesign officer places the

public school in the state school reform/redesign school district,

the state school reform/redesign officer shall do 1 of the

following, as determined by the state school reform/redesign

officer:

(a) Assume autonomous control and oversight of the public

school through a performance contract with a qualified person or

entity to manage the school. If the state school reform/redesign

officer takes this action, the state school reform/redesign school

district shall publish a request for proposals for qualified

persons or entities to enter into a performance contract with the

state school reform/redesign school district to manage the school.

The state school reform/redesign school district shall select a

qualified person or entity and enter into a performance contract

with the qualified person or entity to manage the school as a

redesigned public school. A performance contract shall contain at

least all of the following:

(i) The educational goals the redesigned public school is to

achieve and the methods by which it will be held accountable. To

the extent applicable, the pupil performance of a redesigned public

school shall be assessed using at least a Michigan education

assessment program (MEAP) test or the Michigan merit examination,

as applicable. At a minimum, the educational goals shall include

that at least 80% of the school's pupils graduate from high school

or are determined by the department to be on track to graduate from

high school, the school has at least 80% average attendance, and,

if the school is a high school, the school's pupils have an average

score of at least 18 on the college entrance examination component

of the Michigan merit examination.

(ii) A description of the method to be used to monitor the

redesigned public school's compliance with applicable law and its

performance in meeting its targeted educational objectives.

(iii) A description of the process for amending the performance

contract during the term of the contract.

(iv) Procedures for revoking the performance contract and

grounds for revoking the performance contract. The grounds shall

include, but are not limited to, the failure to meet the

educational goals of the redesigned public school.

(v) A provision that requires the qualified person or entity

to provide to the state school reform/redesign school district the

same information that an educational management company is required

to provide to a governing board under section 1320(2).

(b) Authorize a turnaround school under part 6d. If the state

school reform/redesign officer takes this action, the state school

reform/redesign officer shall solicit applications from qualified

entities, as defined in part 6d, for organizing a turnaround school

under part 6d to correspond to the failing public school and the

state school reform/redesign school district shall issue a contract

to a qualified entity under part 6d authorizing a turnaround school

under part 6d that corresponds to the failing public school. If the

state school reform/redesign school district issues a contract for

a turnaround school under part 6d that corresponds to a failing

public school, the superintendent of public instruction shall then

issue an order closing the failing public school.

(8) All of the following apply to management of a redesigned

public school by a qualified person or entity pursuant to a

performance contract under subsection (7)(a):

(a) The school district or public school academy that

previously operated the failing public school remains the employer

House Bill No. 4787 (H-5) as amended June 25, 2009

of all staff employed at the school, but for the purposes of

collective bargaining under 1947 PA 336, MCL 423.201 to 423.217,

the state school reform/redesign school district is a joint

employer of those employees along with the board of the school

district, or board of directors of the public school academy, that

previously operated the failing public school.

(b) The qualified person or entity managing the school or a

school leader designated by the qualified person or entity may

remove a staff member from a job assignment at the school in

accordance with any applicable collective bargaining agreement [that

applies to that school, after any modification of the collective bargaining agreement under this section,] and

direct that he or she be assigned elsewhere. However, this

subdivision applies only to assignment at that school and does not

allow a staff member to be terminated from his or her employment

with the school district or public school academy that previously

operated the school.

qualified person or entity may hire and assign employees to work at

the school. An employee who works at the school at the time it is

designated as a failing school by the state school reform/redesign

officer must reapply and be rehired for assignment at the school.

However, this subdivision applies only to assignment at that school

and does not allow a staff member to be terminated from his or her

employment with the school district or public school academy that

previously operated the school.

(d) With the approval of the state school reform/redesign

school district, contractual or other work rules that would

otherwise be applicable shall not apply at the school. This

subdivision does not allow unilateral changes in pay scales or

benefits.

(e) With the approval of the state school reform/redesign

school district, any contractual or other seniority system that

would otherwise be applicable shall not apply at the school. This

subdivision does not allow unilateral changes in pay scales or

benefits.

(f) The principal or other school leader designated by the

qualified person or entity shall have full autonomy and control

over curriculum and discretionary spending at the school.

(g) The qualified person or entity managing the school shall

assign to teach at the school only an individual holding a valid

Michigan teaching certificate.

(h) The school board or board of directors that operated the

public school before it was designated as a failing public school

shall ensure that all of its school officials and employees

cooperate with the state school reform/redesign officer and with

the qualified person or entity managing the public school under a

performance contract under subsection (7) as requested by the state

school reform/redesign officer and the qualified person or entity.

(i) The public school is part of the school reform/redesign

school district for management of the public school, but, for

purposes of calculating state school aid under the state school aid

act of 1979, is considered part of the school district or public

school academy that operated the public school before it was

designated as a failing public school.

(j) The state school reform/redesign officer shall establish a

school advisory council for the school consisting of parents and

community leaders and shall meet with the school advisory council

periodically to receive their input. The state school

reform/redesign officer may also include on the advisory council 1

or more pupils; representatives of local community organizations

that offer health, social, or educational services; or

representatives of local workforce development boards or

postsecondary institutions that serve the local community.

(9) The state school reform/redesign officer shall do 1 of the

following:

(a) Create a high-performing school review team that evaluates

public school academies in this state and similar public schools in

other states to identify persons or entities that operate high-

performing public schools. The high-performing school review team

shall consist of at least teachers, school administrators, and

other educational experts. In identifying high-performing public

schools, the high-performing school review team shall take into

account the past academic performance of pupils at the school, past

grade offerings at the school, and the demographics of pupils at

the school.

(b) Contract with an entity to perform the functions under

subdivision (a).

(10) The state school reform/redesign officer shall use the

evaluations of the high-performing school review team or the

contracting entity under subsection (9) when soliciting proposals

from qualified persons or entities for the purposes of subsection

(7) or soliciting qualified entities, as defined in part 6d, to

operate turnaround schools for the purposes of part 6d.

(11) At least annually, the department shall publish a watch

list of public schools that are in danger of meeting the criteria

under subsection (3). If a public school is included on the list,

the department shall notify the board or board of directors that

operates the public school and the collective bargaining

representatives of all collective bargaining units with members who

work at the school. The board or board of directors shall notify

employees and parent organizations at the school that the school

has been placed on this watch list and shall publish a notice to

this effect on its website. The department shall include a public

school on this watch list if the department determines that a

public school has failed to achieve the federal pupil performance

standard for 3 or more consecutive years and that the percentage of

all pupils enrolled in the public school who scored at least

"proficient" on the most recent Michigan education assessment

program assessments or Michigan merit examination, as applicable,

for which results are available was less than 45% in both

mathematics and English language arts, and may include other public

schools if the department determines that there are other reasons

why they are in danger of meeting the criteria under subsection

(3).

(12) For the purposes of this section, the state school

reform/redesign officer is encouraged to consider taking measures

to increase the number of qualified school counselors serving a

failing public school to ensure that there is at least 1 qualified

school counselor for every 250 pupils.

(13) If the superintendent of public instruction determines

that the resources available to the department and to the state

school reform/redesign school district are insufficient to address

all of the public schools in this state that meet the criteria

under subsection (3), the superintendent of public instruction

shall prioritize his or her efforts by addressing the lowest-

performing public schools first and addressing others as resources

become available.

(14) At least quarterly, the state school reform/redesign

officer shall submit a report to the standing committees of the

senate and house of representatives having jurisdiction over

education legislation on the progress being made in improving pupil

proficiency due to the measures under this section.

(15) As used in this section:

(a) "Achieved the federal pupil performance standard" means

that the department has determined that the school has achieved

adequate yearly progress under the no child left behind act of

2001, Public Law 107-110, or has met a successor federal standard

that the superintendent of public instruction has identified as

being a standard established by the federal government that is

based on pupil performance and is required to be met in order to

receive full federal funding.

(b) "Designated percentage" means 30% for 2009-2010, 33% for

2010-2011, 36% for 2011-2012, 39% for 2012-2013, 42% for 2013-2014,

and 45% for 2014-2015 and thereafter.

means that the department has determined that the school has failed

to achieve adequate yearly progress under the no child left behind

act of 2001, Public Law 107-110, or has failed to meet a successor

federal standard that the superintendent of public instruction has

identified as being a standard established by the federal

government that is based on pupil performance and is required to be

met in order to receive full federal funding.

Sec. 1320. (1) Beginning with contracts described in this

section that are entered into after the effective date of this

section, if the governing board of a public school enters into a

contract with an educational management company to carry out the

operations of a public school under this act, the governing board

shall ensure all of the following:

(a) That the governing board has conducted sufficient due

diligence to conclude that the educational management company has

sufficient educational expertise and management experience to

provide the agreed services.

(b) That the governing board will obtain independent legal

counsel in all negotiations with the educational management

company.

public school academy, that, pursuant to the contract between the

board of directors and the educational management company or

educational management organization, the educational management

company will provide to the board of directors all financial and

other information required to comply with the requirements

concerning reporting that are contained in the contract between the

board of directors and its authorizing body under section 503 or

533, as applicable.

(2) Beginning with contracts described in this section that

are entered into after the effective date of this section, if the

governing board of a public school enters into a contract with an

educational management company to carry out the operations of a

public school under this act, the contract between the governing

board and the educational management company shall contain at least

all of the following provisions:

(a) A provision requiring the educational management company

to provide to the governing board information regarding any

teachers, administrators, and support staff employed by the

educational management company and assigned to work at the public

school, including at least all of the following personal

information:

(i) Name.

(ii) Education, including highest degree attained.

(iii) Salary.

(iv) Copy of teaching certificate or other required permit or

credential, if required for the position.

(v) Description of relevant experience.

(vi) Employment record.

(b) A provision requiring the educational management company

to provide to the governing board information regarding the

business operations of the public school, including at least all of

the following:

(i) Financial records and information concerning the operation

of the school, including, but not limited to, budgets and detailed

records of funds received from this state and other entities,

expenditure of those funds, investment of those funds, carryover,

and contractual arrangements or agreements entered into by the

educational management company as an agent of the governing board.

(ii) Financial records and information concerning leases to

which the governing board is a party, including, but not limited

to, leases for equipment, physical facility space, or institutional

and educational materials.

(iii) Financial records and information concerning mortgages and

loans to which the governing board is a party.

public school academy, a provision requiring the educational

management company to make information available to the board of

directors concerning the operation and management of the public

school academy, including at least all of the information necessary

to comply with the requirements concerning reporting that are

contained in the contract between the board of directors and its

authorizing body under section 503 or 533, as applicable.

(3) This section does not apply to a contract to furnish

substitute teachers entered into under section 1236a.

(4) As used in this section:

(a) "Educational management company" means an entity that

enters into an agreement with the governing board of a public

school to provide comprehensive educational, administrative,

management, or instructional services or staff to the public

school. Educational management company includes an educational

management organization as that term is defined and used in part 6d

or a qualified person or entity with whom the state school

reform/redesign officer enters into a performance contract under

section 1280c.

(b) "Entity" means a partnership, nonprofit or business

corporation, labor organization, or any other association,

corporation, trust, or other legal entity.

Sec. 1701a. For the purposes of ensuring that a student with a

disability enrolled in a public school academy ~~created under part~~

~~6a or 6b~~ is provided with special education programs and services,

the public school academy is considered to be a local school

district under this article.

Enacting section 1. This amendatory act does not take effect

unless all of the following bills of the 95th Legislature are

enacted into law:

(a) House Bill No. 4788.

(b) House Bill No. 4789.