By: Bettencourt S.B. No. 1365
(In the Senate - Filed March 10, 2021; March 18, 2021, read
first time and referred to Committee on Education; April 26, 2021,
reported adversely, with favorable Committee Substitute by the
following vote: Yeas 7, Nays 2, two present not voting;
April 26, 2021, sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR S.B. No. 1365 By: Bettencourt
A BILL TO BE ENTITLED
AN ACT
relating to public school organization, accountability, and fiscal
management.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. STATE AND LOCAL ORGANIZATION AND GOVERNANCE
SECTION 1.01. Section 7.055, Education Code, is amended by
adding Subsection (d) to read as follows:
(d) Notwithstanding any other law, the commissioner's power
to delegate ministerial and executive functions under Subsection
(b)(5) is a valid delegation of authority.
SECTION 1.02. Section 11.151(b), Education Code, is amended
to read as follows:
(b) Except as provided by Sections 39A.201 and 39A.202, the
[The] trustees as a body corporate have the exclusive power and duty
to govern and oversee the management of the public schools of the
district. All powers and duties not specifically delegated by
statute to the agency or to the State Board of Education are
reserved for the trustees, and the agency may not substitute its
judgment for the lawful exercise of those powers and duties by the
trustees.
SECTION 1.03. Section 11.1511(a), Education Code, is
amended to read as follows:
(a) In addition to powers and duties under Section 11.151 or
other law, the board of trustees of an independent school district
has the powers and duties provided by Subsection (b), except as
otherwise provided by Sections 39A.201 and 39A.202.
ARTICLE 2. PUBLIC SCHOOL SYSTEM ACCOUNTABILITY
SECTION 2.01. Chapter 5, Education Code, is amended by
adding Section 5.003 to read as follows:
Sec. 5.003. FINAL AND UNAPPEALABLE. In this title, if an
order, decision, or determination is described as final and
unappealable, an interlocutory or intermediate order, decision, or
determination made or reached before the final order, decision, or
determination may be appealed only if specifically authorized by
this code or a rule adopted under this code.
SECTION 2.02. Sections 39.057 and 39.058, Education Code,
are transferred to Subchapter A, Chapter 39, Education Code,
redesignated as Sections 39.003 and 39.004, Education Code, and
amended to read as follows:
Sec. 39.003 [39.057]. SPECIAL [ACCREDITATION]
INVESTIGATIONS. (a) The commissioner may authorize special
[accreditation] investigations to be conducted:
(1) to determine if an academic program offered by a
school district is providing students the quality education to
which students are entitled under Title 1 and this title, including
an investigation regarding:
(A) the proportion of students in each
demographic group participating in the program;
(B) whether an excessive number of students are
participating in a particular program or are being exempted from
state requirements; or
(C) whether all students have equitable access to
the program, including advanced learning options [when excessive
numbers of absences of students eligible to be tested on state
assessment instruments are determined];
(2) [when excessive numbers of allowable exemptions
from the required state assessment instruments are determined;
[(3)] in response to complaints submitted to the
agency with respect to alleged violations of civil rights or other
requirements imposed on the state by federal law or court order;
(3) regarding a [(4) in response to established
compliance reviews of the] district's financial accounting
practices and fiscal management;
(4) to determine whether a district is complying with
state and federal [program] requirements;
(5) when extraordinary numbers of student placements
in disciplinary alternative education programs, other than
placements under Sections 37.006 and 37.007, are determined;
(6) in response to an allegation involving a conflict
between members of the board of trustees or between the board and
the district administration if it appears that the conflict
involves a violation of a role or duty of the board members or the
administration clearly defined by this code;
(7) regarding educational [when excessive numbers of
students in special education] programs provided under [Subchapter
A,] Chapter 29[, are assessed through assessment instruments
developed or adopted under Section 39.023(b)];
(8) in response to an allegation regarding or an
analysis using a statistical method result indicating a possible
violation of an assessment instrument security procedure
established under Section 39.0301, including for the purpose of
investigating or auditing a school district under that section;
(9) [when a significant pattern of decreased academic
performance has developed as a result of the promotion in the
preceding two school years of students who did not perform
satisfactorily as determined by the commissioner under Section
39.0241(a) on assessment instruments administered under Section
39.023(a), (c), or (l);
[(10) when excessive numbers of students eligible to
enroll fail to complete an Algebra II course or any other advanced
course as determined by the commissioner;
[(11)] when resource allocation practices as
evaluated under Section 39.0821 indicate a potential for
significant improvement in resource allocation;
(10) regarding [(12) when a disproportionate number of
students of a particular demographic group is graduating with a
particular endorsement under Section 28.025(c-1);
[(13) when an excessive number of students is
graduating with a particular endorsement under Section
28.025(c-1);
[(14) in response to a complaint submitted to the
agency with respect to] alleged inaccurate data [that is] reported:
(A) through the Public Education Information
Management System (PEIMS);
(B) [or] through other reports required by state
or federal law or rule or court order and that is used by the agency
to make a determination relating to public school accountability,
including accreditation, under this chapter; or
(C) to the agency, including a material
misrepresentation made in the course of a special investigation
under this section;
(11) [(15)] when a school district for any reason
fails to produce, at the request of the agency, evidence or an
investigation report, including an investigation report relating
to an educator who is under investigation by the State Board for
Educator Certification;
(12) regarding whether an improper use of public funds
has occurred; or
(13) [(16)] as the commissioner otherwise determines
necessary.
(b) If the agency's findings in an investigation under
Subsection (a)(6) indicate that the board of trustees has observed
a lawfully adopted policy that does not otherwise violate a law or
rule, the agency may not substitute its judgment for that of the
board.
(c) The commissioner may authorize special [accreditation]
investigations to be conducted in response to repeated complaints
submitted to the agency concerning imposition of excessive
paperwork requirements on classroom teachers.
(d) Based on the results of a special [accreditation]
investigation, the commissioner may:
(1) take any [appropriate] action under Chapter 39A,
regardless of any requirements applicable to the action that are
provided by that chapter;
(2) lower the school district's accreditation status
or a district's or campus's accountability rating; or
(3) take action under both Subdivisions (1) and (2).
(e) At any time before issuing a report with the agency's
final findings, the commissioner may defer taking an action under
Subsection (d) until:
(1) a person who is a third party, selected by the
commissioner, has reviewed programs or other subjects of an
investigation under this section and submitted a report identifying
problems and proposing solutions;
(2) a district completes a corrective action plan
developed by the commissioner; or
(3) the completion of actions under both Subdivisions
(1) and (2).
(f) Based on the results of an action taken under Subsection
(e), the commissioner may decline to take the deferred action under
Subsection (d).
(g) Section 39A.301 applies to an action taken under
Subsection (d)(1) in the same manner as that section applies to an
action taken under Chapter 39A [Regardless of whether the
commissioner lowers the school district's accreditation status or a
district's or campus's performance rating under Subsection (d), the
commissioner may take action under Section 39A.002 or 39A.051 if
the commissioner determines that the action is necessary to improve
any area of a district's or campus's performance, including the
district's financial accounting practices].
Sec. 39.004 [39.058]. CONDUCT OF SPECIAL [ACCREDITATION]
INVESTIGATIONS. (a) The agency shall adopt written procedures for
conducting special [accreditation] investigations [under this
subchapter], including procedures that allow the agency to obtain
information from district employees in a manner that prevents a
district or campus from screening the information. The agency
shall make the procedures available on the agency Internet website.
Agency staff must be trained in the procedures and must follow the
procedures in conducting the special [accreditation]
investigation.
(a-1) If the agency determines that it is necessary to
protect the welfare of the witness, the agency may classify the
identity of a witness as confidential and not subject to disclosure
to the district or under Chapter 552, Government Code.
(b) After completing a special [accreditation]
investigation, the agency shall present preliminary findings to any
person or entity the agency finds has violated a law, rule, or
policy. Before issuing a report with its final findings, the agency
must provide a person or entity the agency finds has violated a law,
rule, or policy an opportunity for an informal review by the
commissioner or the commissioner's designee [a designated hearing
examiner].
(c) An informal review under this section is not a contested
case for purposes of Chapter 2001, Government Code.
SECTION 2.03. Section 39.054, Education Code, is amended by
amending Subsections (a) and (b-1) and adding Subsections (a-4) and
(a-5) to read as follows:
(a) Except as provided by Subsection (a-4), the [The]
commissioner shall adopt rules to evaluate school district and
campus performance and assign each district and campus an overall
performance rating of A, B, C, D, or F. In addition to the overall
performance rating, the commissioner shall assign each district and
campus a separate domain performance rating of A, B, C, D, or F for
each domain under Section 39.053(c). An overall or domain
performance rating of A reflects exemplary performance. An overall
or domain performance rating of B reflects recognized performance.
An overall or domain performance rating of C reflects acceptable
performance. An overall or domain performance rating of D reflects
performance that needs improvement. An overall or domain
performance rating of F reflects unacceptable performance. A
district may not receive an overall or domain performance rating of
A if the district includes any campus with a corresponding overall
or domain performance rating of D or F. If a school district has
been approved under Section 39.0544 to assign campus performance
ratings and the commissioner has not assigned a campus an overall
performance rating of D or F, the commissioner shall assign the
campus an overall performance rating based on the school district
assigned performance rating under Section 39.0544. A reference in
law to an acceptable rating or acceptable performance includes an
overall or domain performance rating of A, B, C, or D or performance
that is exemplary, recognized, or acceptable performance or
performance that needs improvement.
(a-4) Notwithstanding any other law, the commissioner may
assign a school district or campus an overall performance rating of
"Not Rated" if the commissioner determines that the assignment of a
performance rating of A, B, C, D, or F would be inappropriate
because:
(1) the district or campus is located in an area that
is subject to a declaration of a state of disaster under Chapter
418, Government Code, and due to the disaster, performance
indicators for the district or school are difficult to measure or
evaluate and would not accurately reflect quality of learning and
achievement for the district or campus; or
(2) the district or campus has experienced breaches or
other failures in data integrity to the extent that accurate
analysis of data regarding performance indicators is not possible.
(a-5) Notwithstanding any other law, an overall performance
rating of "Not Rated" is not included in calculating consecutive
school years and is not considered a break in consecutive school
years for purposes of Chapter 39A.
(b-1) Consideration of the effectiveness of district
programs under Section 39.052(b)(2)(B) or (C):
(1) must:
(A) be based on data collected through the Public
Education Information Management System (PEIMS) for purposes of
accountability under this chapter; and
(B) include the results of assessments required
under Section 39.023; and
(2) may be based on the results of a special
[accreditation] investigation conducted under Section 39.003
[39.057].
SECTION 2.04. Section 39A.003, Education Code, is amended
by adding Subsection (d) to read as follows:
(d) A conservator or management team may exercise the powers
and duties defined by the commissioner under Subsection (a) or
described by Subsection (c) regardless of whether the conservator
or management team was appointed to oversee the operations of a
school district in its entirety or the operations of a certain
campus within the district.
SECTION 2.05. Sections 39A.006(a) and (b), Education Code,
are amended to read as follows:
(a) This section applies:
(1) regardless of whether a school district has
satisfied the accreditation criteria; and
(2) to a conservator or management team appointed
under any provision of this title, regardless of the scope or any
changes to the scope of the conservator's or team's oversight.
(b) If for two consecutive school years, including the
current school year, a school district has had a conservator or
management team assigned to the district or a district campus for
any reason under this title, the commissioner may appoint a board of
managers to exercise the powers and duties of the board of trustees
of the district.
SECTION 2.06. Section 39A.102, Education Code, is amended
by amending Subsection (b) and adding Subsection (b-1) to read as
follows:
(b) Subject to Subsection (b-1), the [The] commissioner may
appoint a monitor, conservator, management team, or board of
managers to the school district to ensure and oversee
district-level support to low-performing campuses and the
implementation of the updated targeted improvement plan.
(b-1) The commissioner shall appoint a conservator to a
school district under Subsection (b) unless and until:
(1) each campus in the district for which a campus
turnaround plan has been ordered under Section 39A.101 receives an
acceptable performance rating for the school year; or
(2) the commissioner determines a conservator is not
necessary.
SECTION 2.07. The heading to Section 39A.110, Education
Code, is amended to read as follows:
Sec. 39A.110. MODIFICATION OF [CHANGE IN] CAMPUS TURNAROUND
PLAN [PERFORMANCE RATING].
SECTION 2.08. Section 39A.110, Education Code, is amended
by adding Subsection (c) to read as follows:
(c) The commissioner may authorize modification of an
approved campus turnaround plan if the commissioner determines that
due to a change in circumstances occurring after the plan's
approval under Section 39A.107, a modification of the plan is
necessary to achieve the plan's objectives.
SECTION 2.09. Section 39A.111, Education Code, is amended
to read as follows:
Sec. 39A.111. CONTINUED UNACCEPTABLE PERFORMANCE RATING.
If a campus is considered to have an unacceptable performance
rating for five [three] consecutive school years [after the campus
is ordered to submit a campus turnaround plan under Section
39A.101], the commissioner, subject to Section 39A.112, shall
order:
(1) appointment of a board of managers to govern the
school district as provided by Section 39A.202; or
(2) closure of the campus.
SECTION 2.10. Subchapter C, Chapter 39A, Education Code, is
amended by adding Section 39A.117 to read as follows:
Sec. 39A.117. APPOINTMENT OF CONSERVATOR AND BOARD OF
MANAGERS FOR CERTAIN DISTRICTS OR SCHOOLS. (a) This section
applies to a school district or open-enrollment charter school for
which a board of managers has not assumed control of the district or
school and includes a campus that:
(1) has not received an acceptable performance rating
since the 2010-2011 school year;
(2) has received more than five unacceptable
performance ratings since the 2010-2011 school year; and
(3) has not been closed by the commissioner.
(b) Notwithstanding any other law, the commissioner shall
appoint:
(1) a conservator to oversee the operations of a
school district or open-enrollment charter school described by
Subsection (a); and
(2) a board of managers to exercise the powers and
duties of the board of trustees or governing body of a district or
school described by Subsection (a).
(c) On the effective date of the appointment made under
Subsection (b)(1), the board of trustees or governing body of a
school district or open-enrollment charter school described by
Subsection (a) may no longer exercise the powers and duties of the
board or body under Chapter 11 or 12.
(d) Once appointed under Subsection (b), the conservator
and board of managers shall be subject to the provisions of this
chapter.
(e) This section expires September 1, 2024.
SECTION 2.11. Section 39A.201(a), Education Code, is
amended to read as follows:
(a) Notwithstanding Section 11.151(b) or 11.1511(a) or any
other provision of this code, a [A] board of managers may exercise
all of the powers and duties assigned to a board of trustees of a
school district by law, rule, or regulation.
SECTION 2.12. Section 39A.202(a), Education Code, is
amended to read as follows:
(a) Notwithstanding Section 11.151(b) or 11.1511(a) or any
other provision of this code, if [If] the commissioner appoints a
board of managers to govern a school district:
(1) the powers of the board of trustees of the district
are suspended for the period of the appointment; and
(2) the commissioner shall appoint a district
superintendent.
SECTION 2.13. Section 39A.301, Education Code, is amended
to read as follows:
Sec. 39A.301. REVIEW OF SANCTIONS BY STATE OFFICE OF
ADMINISTRATIVE HEARINGS. (a) A school district or open-enrollment
charter school must appeal under this section if the district or
school [that] intends to challenge a decision by the commissioner
under Section 39.003 or this chapter to:
(1) close the district or a district campus or the
charter school;
(2) [or to] pursue alternative management of a
district campus or the charter school; or
(3) appoint a board of managers to the district or
school under Section 39A.202 [must appeal the decision under this
section].
(b) A challenge under this section to a decision by the
commissioner described by Subsection (a) is subject to review by
the State Office of Administrative Hearings. Notwithstanding
[under this section is under the substantial evidence rule as
provided by Subchapter G,] Chapter 2001, Government Code:
(1) the[. The] commissioner shall adopt procedural
rules for a challenge under this section;
(2) [.
[(c) Notwithstanding other law:
[(1)] the State Office of Administrative Hearings shall
conduct an expedited review of a challenge under this section;
(3) the administrative law judge shall uphold a
decision by the commissioner described by Subsection (a) unless the
judge finds the decision is arbitrary and capricious or clearly
erroneous;
(4) in reviewing any discretionary decisions made by
the commissioner, the administrative law judge may not substitute
the judge's judgment for that of the commissioner;
(5) [(2)] the administrative law judge shall issue a
final order not later than the 30th day after the date on which the
hearing is finally closed;
(6) [(3)] the decision of the administrative law judge
is final and may not be appealed; and
(7) [(4)] the decision of the administrative law judge
may set an effective date for an action under this section.
SECTION 2.14. Section 39A.116, Education Code, is
transferred to Subchapter Z, Chapter 39A, Education Code,
redesignated as Section 39A.906, Education Code, and amended to
read as follows:
Sec. 39A.906 [39A.116]. COMMISSIONER AUTHORITY. A
decision by the commissioner under Chapter 39 or this chapter
[subchapter] is final and may not be appealed, except as provided by
Section 39A.301.
SECTION 2.15. (a) Sections 39.003 and 39.004, Education
Code, as redesignated and amended by this Act, apply to a special
investigation authorized or initiated before, on, or after the
effective date of this Act.
(b) Section 39.054, Education Code, as amended by this Act,
applies to an overall performance rating of "Not Rated" assigned
before, on, or after the effective date of this Act.
(c) Section 39A.006, Education Code, as amended by this Act,
applies to a conservator or management team assigned to a school
district before, on, or after the effective date of this Act.
(d) Section 39A.111, Education Code, as amended by this Act,
applies to a school campus that has been assigned an unacceptable
performance rating before, on, or after the effective date of this
Act.
(e) Section 39A.906, Education Code, as redesignated and
amended by this Act, applies to a decision made by the commissioner
of education before, on, or after the effective date of this Act.
ARTICLE 3. PUBLIC SCHOOL FISCAL MANAGEMENT
SECTION 3.01. Section 44.052(c), Education Code, is amended
to read as follows:
(c) A trustee of a school district who votes to approve any
expenditure of school funds in violation of a provision of this
code, for a purpose for which those funds may not be spent, or in
excess of the item or items appropriated in the adopted budget or a
supplementary or amended budget commits an offense. An offense
under this subsection is a Class C misdemeanor.
SECTION 3.02. Section 45.105, Education Code, is amended by
amending Subsection (c) and adding Subsection (c-1) to read as
follows:
(c) Local school funds from district taxes, tuition fees of
students not entitled to a free education, other local sources, and
state funds not designated for a specific purpose may be used for
the purposes listed for state and county available funds and for
purchasing appliances and supplies, paying insurance premiums,
paying janitors and other employees, buying school sites, buying,
building, repairing, and renting school buildings, including
acquiring school buildings and sites by leasing through annual
payments with an ultimate option to purchase, and, except as
provided by Subsection (c-1), for other purposes necessary in the
conduct of the public schools determined by the board of trustees.
The accounts and vouchers for county districts must be approved by
the county superintendent. If the state available school fund in
any municipality or district is sufficient to maintain the schools
in any year for at least eight months and leave a surplus, the
surplus may be spent for the purposes listed in this subsection.
(c-1) Funds described by Subsection (c) may not be used to
initiate or maintain any action or proceeding against the state or
an agency or officer of the state arising out of a decision, order,
or determination that is final and unappealable under a provision
of this code, except that funds may be used for an action or
proceeding that is specifically authorized by a provision of this
code or a rule adopted under this code and that results in a final
and unappealable decision, order, or determination.
SECTION 3.03. Section 48.201, Education Code, is amended to
read as follows:
Sec. 48.201. PURPOSE. The purpose of the tier two component
of the Foundation School Program is to provide each school district
with the opportunity to provide the basic program and to supplement
that program at a level of its own choice. An allotment under this
subchapter may be used for any legal purpose other than:
(1) capital outlay or debt service; or
(2) a purpose prohibited by Section 45.105(c-1) or
another provision of this code.
SECTION 3.04. Section 39A.203, Education Code, is repealed.
SECTION 3.05. Section 44.052(c), Education Code, as amended
by this Act, applies only to an offense committed on or after the
effective date of this Act. An offense committed before the
effective date of this Act is governed by the law in effect when the
offense was committed, and the former law is continued in effect for
that purpose. For purposes of this section, an offense was
committed before the effective date of this Act if any element of
the offense occurred before that date.
ARTICLE 4. CONFORMING AMENDMENTS
SECTION 4.01. Section 7.028(a), Education Code, is amended
to read as follows:
(a) Except as provided by Section 21.006(k), 22.093(l),
22.096, 28.006, 29.001(5), 29.010(a), 38.003, or 39.003 [39.057],
the agency may monitor compliance with requirements applicable to a
process or program provided by a school district, campus, program,
or school granted charters under Chapter 12, including the process
described by Subchapter F, Chapter 11, or a program described by
Subchapter B, C, D, E, F, H, or I, Chapter 29, or Subchapter A,
Chapter 37, only as necessary to ensure:
(1) compliance with federal law and regulations;
(2) financial accountability, including compliance
with grant requirements;
(3) data integrity for purposes of:
(A) the Public Education Information Management
System (PEIMS); and
(B) accountability under Chapters 39 and 39A; and
(4) qualification for funding under Chapter 48.
SECTION 4.02. Section 12.1162(a), Education Code, is
amended to read as follows:
(a) The commissioner shall take any of the actions described
by Subsection (b) or by Section 39A.001, 39A.002, 39A.004, 39A.005,
or 39A.007, to the extent the commissioner determines necessary, if
an open-enrollment charter school, as determined by a report issued
under Section 39.004(b) [39.058(b)]:
(1) commits a material violation of the school's
charter;
(2) fails to satisfy generally accepted accounting
standards of fiscal management; or
(3) fails to comply with this subchapter or another
applicable rule or law.
SECTION 4.03. Section 39.0302(a), Education Code, is
amended to read as follows:
(a) During an agency investigation or audit of a school
district under Section 39.0301(e) or (f), a special [an
accreditation] investigation under Section 39.003(a)(8)
[39.057(a)(8)] or (10) [(14)], a compliance review under Section
21.006(k), 22.093(l), or 22.096, or an investigation by the State
Board for Educator Certification of an educator for an alleged
violation of an assessment instrument security procedure
established under Section 39.0301(a), the commissioner may issue a
subpoena to compel the attendance of a relevant witness or the
production, for inspection or copying, of relevant evidence that is
located in this state.
SECTION 4.04. Section 39.056(h), Education Code, is amended
to read as follows:
(h) The commissioner may at any time convert a monitoring
review to a special [accreditation] investigation under Section
39.003 [39.057], provided the commissioner promptly notifies the
school district of the conversion.
SECTION 4.05. Section 39A.001, Education Code, is amended
to read as follows:
Sec. 39A.001. GROUNDS FOR COMMISSIONER ACTION. The
commissioner shall take any of the actions authorized by this
subchapter to the extent the commissioner determines necessary if:
(1) a school district does not satisfy:
(A) the accreditation criteria under Section
39.052;
(B) the academic performance standards under
Section 39.053 or 39.054; or
(C) any financial accountability standard as
determined by commissioner rule; or
(2) the commissioner considers the action to be
appropriate on the basis of a special [accreditation] investigation
under Section 39.003 [39.057].
SECTION 4.06. Section 39A.256(a), Education Code, is
amended to read as follows:
(a) A board of managers appointed for an open-enrollment
charter school or a campus of an open-enrollment charter school
under this chapter or Chapter 12 has the powers and duties
prescribed by Section 39A.201(b), if applicable, and Sections
39A.201(a), 39A.202, [39A.203,] and 39A.206(b).
ARTICLE 5. EFFECTIVE DATE
SECTION 5.01. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, this Act takes effect September 1, 2021.
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