HOUSE BILL No. 4078

 

January 27, 2005, Introduced by Reps. Palmer and Elsenheimer and referred to the Committee on Education.

 

     A bill to amend 1976 PA 451, entitled

 

"The revised school code,"

 

by amending sections 501, 502, 503, 504, and 507 (MCL 380.501,

 

380.502, 380.503, 380.504, and 380.507), section 501 as amended by

 

2003 PA 179, sections 502 and 507 as amended by 1995 PA 289,

 

section 503 as amended by 2003 PA 299, and section 504 as amended

 

by 1994 PA 416, and by adding section 1320.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 501.  (1) A public school academy 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 section

 


1225 and section 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 public school academy is a body corporate and is a governmental

 

agency. The powers granted to a public school academy 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 any of the following governing

 

boards that issues a contract as provided in this part:

 

     (i) The board of a school district that operates grades K to

 

12.

 

     (ii) An intermediate school board.

 

     (iii) The board of a community college.

 

     (iv) The governing board of a state public university.

 

     (b) "Certificated teacher" means an individual who holds a

 

valid teaching certificate issued by the superintendent of public

 

instruction under section 1531.

 

     (c) "Community college" means a community college organized

 

under the community college act of 1966, 1966 PA 331, MCL 389.1 to

 

389.195, or a federal tribally controlled community college that is

 

recognized under the tribally controlled community college

 

assistance act of 1978, Public Law 95-471, 92 Stat. 1325,  and is

 

determined by the department to meet the requirements for

 

accreditation by a recognized regional accrediting body.

 

     (d) "Contract" means the executive act taken by an authorizing

 

body that evidences the authorization of a public school academy

 


and that establishes, subject to the constitutional powers of the

 

state board and applicable law, the written instrument executed by

 

an authorizing body conferring certain rights, franchises,

 

privileges, and obligations on a public school academy, as provided

 

by this part, and confirming the status of a public school academy

 

as a public school in this state.

 

     (e) "Educational management company" means that term as

 

defined in section 1320.

 

     (f) (e)  "Entity" means a partnership, nonprofit or business

 

corporation, labor organization, or any other association,

 

corporation, trust, or other legal entity.

 

     (g) (f)  "State public university" means a state university

 

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

 

constitution of 1963.

 

     Sec. 502. (1) A public school academy 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 public school academy corporation shall be organized

 

under the nonprofit corporation act,  Act No. 162 of the Public

 

Acts of 1982, being sections 450.2101 to 450.3192 of the Michigan

 

Compiled Laws  1982 PA 162, MCL 450.2101 to 450.3192, except that a

 

public school academy corporation is not required to comply with

 

sections 170 to 177 of  Act No. 327 of the Public Acts of 1931,

 

being sections 450.170 to 450.177 of the Michigan Compiled Laws  

 

1931 PA 327, MCL 450.170 to 450.177. To the extent disqualified

 

under the state or federal constitution, a public school academy

 

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) Any of the following governing boards may act as an

 

authorizing body to issue a contract to organize and operate 1 or

 

more public school academies under this part:

 

     (a) The board of a school district that operates grades K to

 

12. However, the board of a school district shall not issue a

 

contract for a public school academy to operate outside the school

 

district's boundaries, and a public school academy authorized by

 

the board of a school district shall not operate outside that

 

school district's boundaries.

 

     (b) An intermediate school board. However, the board of an

 

intermediate school district shall not issue a contract for a

 

public school academy to operate outside the intermediate school

 

district's boundaries, and a public school academy authorized by

 

the board of an intermediate school district shall not operate

 

outside that intermediate school district's boundaries.

 

     (c) The board of a community college. However, except as

 

otherwise provided in this subdivision,  the board of a community

 

college shall not issue a contract for a public school academy to

 

operate in a school district organized as a school district of the

 

first class, a public school academy authorized by the board of a

 

community college shall not operate in a school district organized

 

as a school district of the first class,  the board of a community

 

college shall not issue a contract for a public school academy to

 

operate outside the boundaries of the community college district  ,  

 

and a public school academy authorized by the board of a community

 


college shall not operate outside the boundaries of the community

 

college district. The board of a community college also may issue a

 

contract for not more than 1 public school academy to operate on

 

the grounds of an active or closed federal military installation

 

located outside the boundaries of the community college district,

 

or may operate a public school academy itself on the grounds of

 

such a federal military installation, if the federal military

 

installation is not located within the boundaries of any community

 

college district and the community college has previously offered

 

courses on the grounds of the federal military installation for at

 

least 10 years.

 

     (d) The governing board of a state public university.  

 

However, the combined total number of contracts for public school

 

academies issued by all state public universities shall not exceed

 

85 through 1996, and, after the initial evaluation under section

 

501a, shall not exceed 100 through 1997, 125 through 1998, or 150

 

thereafter. Further, the total number of contracts issued by any 1

 

state public university shall not exceed 50 through 1996, and

 

thereafter shall not exceed 50% of the maximum combined total

 

number that may be issued under this subdivision.

 

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

 

public school academies, 1 or more persons or an entity may apply

 

to an authorizing body described in subsection (2). The application

 

shall include at least all of the following:

 

     (a) Identification of the applicant for the contract.

 

     (b) Subject to the resolution adopted by the authorizing body

 

under section  503(4)  507(1)(c), a list of the proposed members of

 


the board of directors of the public school academy and a

 

description of the qualifications and method for appointment or

 

election of members of the board of directors.

 

     (c) The proposed articles of incorporation, which shall

 

include at least all of the following:

 

     (i) The name of the proposed public school academy.

 

     (ii) The purposes for the public school academy corporation.

 

This language shall provide that the public school academy is

 

incorporated pursuant to this part and that the public school

 

academy corporation is a governmental entity and political

 

subdivision of this state.

 

     (iii) The name of the authorizing body.

 

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

 

be effective.

 

     (v) Other matters considered expedient to be in the articles

 

of incorporation.

 

     (d) A copy of the proposed bylaws of the public school

 

academy.

 

     (e) Documentation meeting the application requirements of the

 

authorizing body, including at least all of the following:

 

     (i) The governance structure of the public school academy.

 

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

 

academy and the curricula to be offered and methods of pupil

 

assessment to be used by the public school academy. To the extent

 

applicable, the progress of the pupils in the public school academy

 

shall be assessed using at least a Michigan education assessment

 

program (MEAP) test or an assessment instrument developed under

 


section 1279  for a state-endorsed high school diploma or 1279g.

 

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

 

public school academy. The admission policy and criteria shall

 

comply with section 504. This part of the application also shall

 

include a description of how the applicant will provide to the

 

general public adequate notice that a public school academy 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.

 

     (f) Descriptions of staff responsibilities and of the public

 

school academy's governance structure.

 

     (g) For an application to the board of a school district, an

 

intermediate school board, or board of a community college,

 

identification of the local and intermediate school districts in

 

which the public school academy will be located.

 

     (h) An agreement that the public school academy will comply

 

with the provisions of this part and, subject to the provisions of

 

this part, with all other state law applicable to public bodies and

 

with federal law applicable to public bodies or school districts.

 

     (i) For a public school academy authorized by a school

 

district, an assurance that employees of the public school academy

 

will be covered by the collective bargaining agreements that apply

 

to other employees of the school district employed in similar

 

classifications in schools that are not public school academies.

 

     (j) For a contract issued by an intermediate school district

 

after the effective date of this subdivision for a public school

 


academy that is a conversion of an existing program of the

 

intermediate school district, is a substantially similar program to

 

an existing program of the intermediate school district, or is a

 

program or class managed by the intermediate school district, an

 

assurance that employees of the public school academy will be

 

covered by the collective bargaining agreements that apply to other

 

employees of the intermediate school district employed in similar

 

classifications in schools or programs that are not public school

 

academies.

 

     (k)   (j)  A description of and address for the proposed

 

physical plant in which the public school academy will be located.

 

      (4) An authorizing body shall oversee, or shall contract with

 

an intermediate school district, community college, or state public

 

university to oversee, each public school academy operating under a

 

contract issued by the authorizing body. The oversight shall be

 

sufficient to ensure that the authorizing body can certify that the

 

public school academy is in compliance with statute, rules, and the

 

terms of the contract.

 

     (4)   (5)  If the  state board  department finds that an

 

authorizing body is not engaging in appropriate continuing

 

oversight of 1 or more public school academies operating under a

 

contract issued by the authorizing body, the  state board  

 

department may suspend the power of the authorizing body to issue

 

new contracts to organize and operate public school academies. A

 

contract issued by the authorizing body during the suspension is

 

void. A contract issued by the authorizing body before the

 

suspension is not affected by the suspension.

 


     (5)   (6)  An 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 public school academy in an amount that exceeds

 

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

 

the public school academy in the school year in which the fees or

 

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

 

     (a) As set forth in the contract, an authorizing body may use

 

a portion of this fee to provide technical assistance to the public

 

school academy.

 

     (b) An authorizing body shall not use any portion of this fee

 

for any purpose other than considering applications and issuing

 

contracts under this part or for oversight of, technical assistance

 

to, and direct academic support to public school academies.

 

     (c) An authorizing body may provide other services for a

 

public school academy and charge a fee for those services, but

 

shall not require such an arrangement as a condition to issuing the

 

contract authorizing the public school academy.

 

     (6)   (7)  A public school academy shall be presumed to be

 

legally organized if it has exercised the franchises and privileges

 

of a public school academy for at least 2 years.

 

     Sec. 503. (1) An authorizing body is not required to issue a

 

contract to any person or entity. Public school academy contracts

 

shall be issued on a competitive basis taking into consideration

 

the resources available for the proposed public school academy, the

 

population to be served by the proposed public school academy, and

 

the educational goals to be achieved by the proposed public school

 


academy.

 

     (2) If a person or entity applies to the board of a school

 

district for a contract to organize and operate 1 or more public

 

school academies within the boundaries of the school district and

 

the board does not issue the contract, the person or entity may

 

petition the board to place the question of issuing the contract on

 

the ballot to be decided by the school electors of the school

 

district. The petition shall contain all of the information

 

required to be in the contract application under section 502 and

 

shall be signed by a number of school electors of the school

 

district equal to at least 15% of the total number of school

 

electors of that school district. The petition shall be filed with

 

the school district filing official. If the board receives a

 

petition meeting the requirements of this subsection, the board

 

shall have the question of issuing the contract placed on the

 

ballot at its next regular school election held at least 60 days

 

after receiving the petition. If a majority of the school electors

 

of the school district voting on the question vote to issue the

 

contract, the board shall issue the contract.

 

     (3) Within 10 days after issuing a contract for a public

 

school academy, the authorizing body shall submit to the

 

superintendent of public instruction a copy of the contract and of

 

the application under section 502.

 

     (4) An authorizing body shall adopt a resolution establishing

 

the method of selection, length of term, and number of members of

 

the board of directors of each public school academy subject to its

 

jurisdiction.

 


     (3)  (5)  A contract issued to organize and administer a

 

public school academy shall contain at least all of the following:

 

     (a) The educational goals the public school academy is to

 

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

 

the extent applicable, the pupil performance of a public school

 

academy shall be assessed using at least a Michigan education

 

assessment program (MEAP) test or an assessment instrument

 

developed under section 1279 or 1279g.

 

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

 

public school academy's compliance with applicable law and its

 

performance in meeting its targeted educational objectives.

 

     (c) A description of the process for amending the contract

 

during the term of the contract.

 

     (d) All of the matters set forth in the application for the

 

contract.

 

     (e) For a public school academy authorized by a school

 

district, an agreement that employees of the public school academy

 

will be covered by the collective bargaining agreements that apply

 

to employees of the school district employed in similar

 

classifications in schools that are not public school academies.

 

     (f) For a contract issued by an intermediate school board

 

after the effective date of this subdivision for a public school

 

academy that is a conversion of an existing program of the

 

intermediate school district, is a substantially similar program to

 

an existing program of the intermediate school district, or is a

 

program or class managed by the intermediate school district, an

 

assurance that employees of the public school academy will be

 


covered by the collective bargaining agreements that apply to other

 

employees of the intermediate school district employed in similar

 

classifications in schools or programs that are not public school

 

academies.

 

     (g)  (f)  Procedures for revoking the contract and grounds for

 

revoking the contract, including at least the grounds listed in

 

section 507.

 

     (h)  (g)  A description of and address for the proposed

 

physical plant in which the public school academy will be located.

 

     (i)  (h)  Requirements and procedures for financial audits.

 

The financial audits shall be conducted at least annually by a

 

certified public accountant in accordance with generally accepted

 

governmental auditing principles.

 

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

 

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

 

15.330, and with any other conflict of interest law generally

 

applicable to public bodies in this state.

 

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

 

public school academy enters into an agreement with an educational

 

management company for operation or management of the public school

 

academy, the agreement between the board of directors and the

 

educational management company must comply with section 1320.

 

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

 

disapprove any agreement between the board of directors and an

 

educational management company entered into under section 1320

 

before the agreement is final and valid.  An authorizing body may

 

disapprove an agreement described in this subdivision only if the

 


agreement is contrary to the contract or applicable.

 

     (m) A requirement that the board of directors shall

 

demonstrate all of the following to the satisfaction of the

 

authorizing body with regard to its pupil admission process:

 

     (i) That the public school academy has made a reasonable effort

 

to advertise its enrollment openings in a newspaper of general

 

circulation in the intermediate school district in which the public

 

school academy is located.

 

     (ii) That the public school academy has made the following

 

additional efforts to recruit pupils who are eligible for special

 

education programs and 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 within the boundaries of the

 

intermediate school district in which the public school academy is

 

located.

 

     (B) Inclusion in all pupil recruitment materials of a

 

statement that appropriate special education services will be made

 

available to pupils attending the school as required by law.

 

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

 

academy is for a duration of at least 4 weeks.

 

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

 

shall report to the authorizing body the total compensation for

 

each individual employee of the public school academy.

 

     (4)  (6)  A public school academy 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.

 

     (c) 1947 PA 336, MCL 423.201 to 423.217.

 

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

 

     (e) Sections 1134, 1135, 1146, 1153, 1263(3), 1267, and 1274.

 

     (5)  (7)  A public school academy 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 an act or omission in authorizing or oversight of a public

 

school academy 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.

 

     (6)  (8)  A public school academy is exempt from all taxation

 

on its earnings and property. Instruments of conveyance to or from

 

a public school academy are exempt from all taxation including

 

taxes imposed by 1966 PA 134, MCL 207.501 to 207.513. A public

 

school academy may not levy ad valorem property taxes or another

 

tax for any purpose. However, operation of 1 or more public school

 

academies by a school district or intermediate school district does

 

not affect the ability of the school district or intermediate

 

school district to levy ad valorem property taxes or another tax.

 

     (7)  (9)  A public school academy may acquire by purchase,

 

gift, devise, lease, sublease, installment purchase agreement, land

 

contract, option, or by 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 public

 

school academy 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. 504. (1) A public school academy may be located in all or

 

part of an existing public school building. A public school academy

 

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 application required under section 502 and in the

 

contract.

 

     (2) A public school academy shall not charge tuition.  and  

 

Except as otherwise provided in this section, a public school

 

academy 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 public school academy 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 may give enrollment priority as provided in

 

subsection (4).

 


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

 

States citizen, a public school academy shall not enroll a pupil

 

who is not a resident of this state. Enrollment in the public

 

school academy may be open to all individuals who reside in this

 

state who meet the admission policy and shall be open to all pupils

 

who reside within the geographic boundaries, if any, of the

 

authorizing body as described in section 502(2)(a) to (c) who meet

 

the admission policy, except that admission to a public school

 

academy authorized by the board of a community college to operate,

 

or operated by the board of a community college, on the grounds of

 

a federal military installation, as described in section 502(2)(c),

 

shall be open to all pupils who reside in the county in which the

 

federal military installation is located. For a public school

 

academy authorized by a state public university, enrollment shall

 

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

 

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

 

applications to enroll in the public school academy than there are

 

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

 

selection process.  However, a public school academy may give

 

enrollment priority to a sibling of a pupil enrolled in the public

 

school academy.  A public school academy shall allow any pupil who

 

was enrolled in the public school academy in the immediately

 

preceding school year to enroll in the public school academy in the

 

appropriate grade unless the appropriate grade is not offered at

 

that public school academy.

 

     (4) A public school academy may give enrollment priority to 1

 

or more of the following:

 


     (a) A sibling of a pupil enrolled in the public school

 

academy.

 

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

 

school academy or who is on the board of directors of the public

 

academy. As used in this subdivision, "child" includes an adopted

 

child or a legal ward.

 

     (c) If the public school academy is a high school created

 

pursuant to a joint application by 2 or more other public school

 

academies, as described in subsection (6), a pupil who attended and

 

has completed the grade levels offered by 1 of those other public

 

school academies.

 

     (5)   (4) A  Subject to the terms of the contract authorizing

 

the public school academy, a public school academy may include any

 

grade up to grade 12 or any configuration of those grades,

 

including kindergarten and early childhood education, as specified

 

in its contract. If specified in its contract, a public school

 

academy may also operate an adult basic education program, adult

 

high school completion program, or general education development

 

testing preparation program.  The  Authorizing bodies are

 

encouraged to issue contracts for public school academies for

 

students who have dropped out of school or otherwise have failed to

 

complete high school. An authorizing body may approve amendment of

 

a contract with respect to ages of pupils or grades offered.

 

     (6) Two or more public school academies that do not operate

 

grades 9 to 12 may jointly apply for a contract to establish and

 

operate a public school academy for some or all of grades 9 to 12.

 

This subsection does not prohibit a public school academy that does

 


not currently operate grades 9 to 12, or any combination of those

 

grades, from offering some or all of those grades under an existing

 

contract with an authorizing body.

 

     Sec. 507. (1) An authorizing body that issues a contract for a

 

public school academy under this part 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 and of the application for the

 

contract.

 

     (c) Adopt a resolution establishing the method of selection,

 

length of term, and number of members of the board of each public

 

school academy it authorizes.

 

     (d) Oversee the operations of each public school academy

 

operating under a contract issued by the authorizing body. The

 

oversight shall be sufficient to ensure that the authorizing body

 

can certify that the public school academy is in compliance with

 

statute, rules, and the terms of the contract. An authorizing body

 

may enter into an agreement with 1 or more other authorizing bodies

 

to oversee a public school academy operating under a contract

 

issued by the authorizing body.

 

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

 

school academy board of directors accountable for meeting

 

applicable academic performance standards set forth in the contract

 

and for implementing corrective action for a public school academy

 

that does not meet those standards.

 


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

 

academy board of directors operates independently of any

 

educational management company involved in the operation of the

 

public school academy.

 

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

 

by the public school academy 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 public school

 

academy maintains and releases information as necessary to comply

 

with applicable law.

 

     (2)   (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.

 

     (3) 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.

 

     (c) Failure of the public school academy to meet generally

 

accepted public sector accounting principles.

 


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

 

specified in the contract.

 

     (4)   (2)  The decision of an 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 state agency. An authorizing body that does not issue,

 

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

 

     (5) Before an authorizing body revokes a contract under

 

subsection (3), the authorizing body may consider and take

 

corrective measures to avoid revocation. If it is appropriate

 

considering the overall circumstances, an authorizing body may

 

reconstitute the public school academy to improve student

 

educational performance or to avoid interruption of the educational

 

process. An authorizing body may include a reconstituting provision

 

in the contract that identifies these corrective measures,

 

including, but not limited to, appointing a new board of directors

 

or a trustee to take over operation of the public school academy.

 

     (6) If an authorizing body revokes a contract under subsection

 

(3), the authorizing body shall work with a school district or

 

another public school academy, 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 public school academy under this

 

section, 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 school district or

 

public school academy in which the pupils enroll after the

 

revocation pursuant to a methodology established by the department

 

and the center for educational performance and information.

 

     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.

 

     (c) If the governing board is the board of directors of a

 

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

 

board of directors and the educational management company, 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.

 

     (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 to support 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.

 

     (c) If the governing board is the board of directors of a

 

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.

 

     (3) 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.

 

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

 

corporation, labor organization, or any other association,

 


corporation, trust, or other legal entity.