BILL ANALYSIS Senate Research Center S.B. 605 89R1889 AMF-D By: West Education K-16 3/21/2025 As Filed AUTHOR'S / SPONSOR'S STATEMENT OF INTENT Current Texas law provides that a charter school may expand by amending their charter agreement unless they do not meet general academic and financial criteria. However, due to the way these academic and financial criteria are evaluated, it is possible for a charter holder to be the subject of an enforcement action while still meeting all benchmarks on paper, allowing a potentially flawed operator to expand. For example, IDEA Public Schools, the largest charter holder in Texas with 145 campuses and a state disbursement of $820 million for the 20232024 school year, is currently under conservatorship due to rampant financial mismanagement from 20142021. As a result of separate state and federal investigations, multiple IDEA administrators were fired and criminally investigated, the Department of Education clawed back over $28 million, and the Texas Education Agency (TEA) placed IDEA under a managing conservatorship in February 2024. All told, audits indicate IDEA violated conflict of interest laws, misused almost $100 million of state and federal dollars, and was able to successfully avoid consequences for over eight years, despite a 2018 corrective action plan letter issued by TEA. During this period, they met every academic and financial benchmark established by statute and by rule, with consecutive "A Superior Achievement" ratings on Charter FIRST. S.B. 605 would amend Texas Education Code, Chapter 12, by prohibiting the commissioner of education from approving a charter expansion amendment if a charter holder or a campus under a charter holder is subject to a Chapter 39A action by the commissioner. As proposed, S.B. 605 amends current law relating to the establishment of a new open-enrollment charter school campus by certain charter holders and to the expansion of an open-enrollment charter school. RULEMAKING AUTHORITY This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 12.101(b-4), Education Code, as follows: (b-1) Authorizes a charter holder meeting certain requirements to establish one or more new campuses under an existing charter held by the charter holder under certain circumstances, including if the charter holder and each campus operating under the charter are not currently subject to an action of the commissioner of education (commissioner) under Subchapter A (Interventions and Sanctions for School Districts), Chapter 39A (Accountability Interventions and Sanctions). Makes conforming and nonsubstantive changes. SECTION 2. Amends Section 12.114, Education Code, by adding Subsection (c-1), to prohibit the commissioner from approving a request for approval of an expansion amendment if the charter holder or any campus operating under the charter is currently subject to an action of the commissioner under Subchapter A, Chapter 39A. SECTION 3. Makes application of this Act prospective. SECTION 4. Effective date: September 1, 2025.
BILL ANALYSIS
Senate Research Center S.B. 605
89R1889 AMF-D By: West
Education K-16
3/21/2025
As Filed
Senate Research Center
S.B. 605
89R1889 AMF-D
By: West
Education K-16
3/21/2025
As Filed
AUTHOR'S / SPONSOR'S STATEMENT OF INTENT
Current Texas law provides that a charter school may expand by amending their charter agreement unless they do not meet general academic and financial criteria. However, due to the way these academic and financial criteria are evaluated, it is possible for a charter holder to be the subject of an enforcement action while still meeting all benchmarks on paper, allowing a potentially flawed operator to expand.
For example, IDEA Public Schools, the largest charter holder in Texas with 145 campuses and a state disbursement of $820 million for the 20232024 school year, is currently under conservatorship due to rampant financial mismanagement from 20142021. As a result of separate state and federal investigations, multiple IDEA administrators were fired and criminally investigated, the Department of Education clawed back over $28 million, and the Texas Education Agency (TEA) placed IDEA under a managing conservatorship in February 2024. All told, audits indicate IDEA violated conflict of interest laws, misused almost $100 million of state and federal dollars, and was able to successfully avoid consequences for over eight years, despite a 2018 corrective action plan letter issued by TEA. During this period, they met every academic and financial benchmark established by statute and by rule, with consecutive "A Superior Achievement" ratings on Charter FIRST.
S.B. 605 would amend Texas Education Code, Chapter 12, by prohibiting the commissioner of education from approving a charter expansion amendment if a charter holder or a campus under a charter holder is subject to a Chapter 39A action by the commissioner.
As proposed, S.B. 605 amends current law relating to the establishment of a new open-enrollment charter school campus by certain charter holders and to the expansion of an open-enrollment charter school.
RULEMAKING AUTHORITY
This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 12.101(b-4), Education Code, as follows:
(b-1) Authorizes a charter holder meeting certain requirements to establish one or more new campuses under an existing charter held by the charter holder under certain circumstances, including if the charter holder and each campus operating under the charter are not currently subject to an action of the commissioner of education (commissioner) under Subchapter A (Interventions and Sanctions for School Districts), Chapter 39A (Accountability Interventions and Sanctions). Makes conforming and nonsubstantive changes.
SECTION 2. Amends Section 12.114, Education Code, by adding Subsection (c-1), to prohibit the commissioner from approving a request for approval of an expansion amendment if the charter holder or any campus operating under the charter is currently subject to an action of the commissioner under Subchapter A, Chapter 39A.
SECTION 3. Makes application of this Act prospective.
SECTION 4. Effective date: September 1, 2025.