| 1 | 1 | | 88R8566 ANG-F |
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| 2 | 2 | | By: Hinojosa H.B. No. 2824 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to requiring an open-enrollment charter school to conduct |
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| 8 | 8 | | an efficiency audit before applying for designation as a charter |
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| 9 | 9 | | district or for the guarantee of certain bonds. |
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| 10 | 10 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 11 | 11 | | SECTION 1. Section 12.135, Education Code, is amended to |
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| 12 | 12 | | read as follows: |
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| 13 | 13 | | Sec. 12.135. DESIGNATION AS CHARTER DISTRICT FOR PURPOSES |
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| 14 | 14 | | OF BOND GUARANTEE. (a) On the application of the charter holder, |
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| 15 | 15 | | the commissioner may grant designation as a charter district to an |
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| 16 | 16 | | open-enrollment charter school that meets financial standards |
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| 17 | 17 | | adopted by the commissioner and that has conducted an efficiency |
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| 18 | 18 | | audit in accordance with Section 12.1351. The financial standards |
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| 19 | 19 | | must require an open-enrollment charter school to have an |
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| 20 | 20 | | investment grade credit rating as specified by Section 45.0541. |
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| 21 | 21 | | (b) Subject to Section 12.1351, a [A] charter district may |
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| 22 | 22 | | apply for bonds issued under Chapter 53 for the open-enrollment |
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| 23 | 23 | | charter school, including refunding and refinanced bonds, to be |
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| 24 | 24 | | guaranteed by the permanent school fund as provided by Chapter 45. |
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| 25 | 25 | | SECTION 2. Subchapter D, Chapter 12, Education Code, is |
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| 26 | 26 | | amended by adding Section 12.1351 to read as follows: |
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| 27 | 27 | | Sec. 12.1351. EFFICIENCY AUDIT. (a) In this section, |
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| 28 | 28 | | "efficiency audit" means an investigation of the operations of an |
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| 29 | 29 | | open-enrollment charter school to examine fiscal management, |
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| 30 | 30 | | efficiency, and utilization of resources. |
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| 31 | 31 | | (b) The governing body of an open-enrollment charter school |
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| 32 | 32 | | must conduct an efficiency audit and hold an open meeting to discuss |
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| 33 | 33 | | the results of the efficiency audit before applying for: |
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| 34 | 34 | | (1) designation as a charter district under Section |
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| 35 | 35 | | 12.135(a); or |
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| 36 | 36 | | (2) a bond to be guaranteed under Section 12.135(b), |
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| 37 | 37 | | if the application is submitted one year or more after the school is |
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| 38 | 38 | | designated as a charter district. |
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| 39 | 39 | | (c) An open-enrollment charter school shall pay the costs |
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| 40 | 40 | | associated with an efficiency audit under this section. |
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| 41 | 41 | | (d) The governing body of an open-enrollment charter school |
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| 42 | 42 | | must select an auditor to conduct an efficiency audit under this |
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| 43 | 43 | | section not later than the last day of the fourth month before the |
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| 44 | 44 | | date on which the school submits an application described by |
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| 45 | 45 | | Subsection (b). |
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| 46 | 46 | | (e) The governing body of the open-enrollment charter |
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| 47 | 47 | | school may select for purposes of Subsection (d) the auditor that |
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| 48 | 48 | | conducts the school's annual audit under Section 44.008 and include |
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| 49 | 49 | | the efficiency audit as part of the school's annual audit. |
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| 50 | 50 | | (f) An auditor selected by the governing body of an |
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| 51 | 51 | | open-enrollment charter school shall: |
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| 52 | 52 | | (1) follow the guidelines established by the |
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| 53 | 53 | | Legislative Budget Board under Section 11.184; |
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| 54 | 54 | | (2) maintain independence from the school; and |
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| 55 | 55 | | (3) complete the efficiency audit not later than the |
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| 56 | 56 | | last day of the third month after the date on which the auditor was |
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| 57 | 57 | | selected. |
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| 58 | 58 | | (g) An open-enrollment charter school shall provide all |
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| 59 | 59 | | documents, records, and personnel requested by the auditor as |
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| 60 | 60 | | needed to conduct the audit in an efficient manner. |
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| 61 | 61 | | (h) Not later than the 30th day before the date the |
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| 62 | 62 | | open-enrollment charter school submits an application described by |
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| 63 | 63 | | Subsection (b), the school shall post the results of the efficiency |
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| 64 | 64 | | audit on the school's Internet website. |
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| 65 | 65 | | SECTION 3. This Act takes effect September 1, 2023. |
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