SB-0619, As Passed Senate, May 2, 2012

HOUSE SUBSTITUTE FOR

SENATE BILL NO. 619

A bill to amend 1976 PA 451, entitled

"The revised school code,"

by amending section 552 (MCL 380.552), as amended by 2011 PA 277.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 552. (1) An authorizing body may issue contracts under

this subsection to organize and operate a school of excellence. All

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

authorizing body under this subsection:

(a) The issuance of the contract must be approved by the

superintendent of public instruction. The superintendent of public

instruction shall approve issuance of a contract if he or she

determines that the proposed school of excellence is modeled after

a high-performing school or program.

(b) The first 5 contracts issued by all authorizing bodies

Senate Bill No. 619 (H-3) as amended April 26, 2012

under this subsection shall be for schools of excellence that offer

1 or more of high school grades 9 to 12, or any combination of

those grades, as specified in the contract.

shall not be located in a school district that has a graduation

rate of over 75%, on average, for the most recent 3 school years

for which the data are available, as determined by the department.

(2) ~~A combined total of 2 contracts may be issued by all~~

~~authorizing bodies under this subsection for schools of excellence~~

~~that are cyber schools and that meet all of the following~~

~~additional requirements:~~Subject to the limitations in this

subsection [AND SUBSECTION (14)], an authorizing body may issue contracts

under this

subsection for 1 or more schools of excellence that are cyber

schools. [Until December 31, 2013, the combined total number of contracts

that may be issued by all statewide authorizing bodies under this

subsection for schools of excellence that are cyber schools shall not

exceed 5. Until December 31, 2014, the combined total number of

contracts that may be issued by all statewide authorizing bodies under

this subsection for schools of excellence that are cyber schools shall

not exceed 10. After December 31, 2014, the combined total number of

contracts issued by all statewide authorizing bodies under this

subsection for schools of excellence that are cyber schools shall not

exceed 15.] The board of a school district, an intermediate

school board, [the board of a community college that is not a statewide

authorizing body,] or 2 or more public agencies acting jointly as

described in subsection (6)(e) may not act as the authorizing body

for more than 1 school of excellence that is a cyber school. An

authorizing body shall not issue a contract for a school of

excellence that is a cyber school unless the school of excellence

that is a cyber school meets all of the following requirements:

(a) ~~Are~~ Is available for enrollment to all pupils in this

state. ~~who were previously enrolled in a public school.~~

(b) ~~Offer~~ Offers some configuration of or all of grades K to

12.

cyber school demonstrates experience in ~~serving urban and at-risk~~

~~student populations through an educational model involving a~~

~~significant cyber component.~~delivering a quality education program

that improves pupil academic achievement. In determining whether

this requirement is met, an authorizing body shall refer to the

standards for quality online learning established by the national

association of charter school authorizers or other similar

nationally recognized standards for quality online learning.

~~(d) Has an initial enrollment in the school of excellence that~~

~~is a cyber school that does not exceed 400 pupils.~~

~~(e) In the second and subsequent years of operation under the~~

~~contract, a school of excellence that is a cyber school may expand~~

~~enrollment to exceed 400 pupils by adding 1 pupil for each pupil~~

~~who becomes enrolled in the school of excellence who is identified~~

~~as a dropout in the Michigan student data system maintained by the~~

~~center for educational performance and information. The school of~~

~~excellence that is a cyber school shall annually account for the~~

~~number of pupils it enrolls who are identified as a dropout in the~~

~~Michigan student data system and report that information to the~~

~~department, in a form and manner determined by the superintendent~~

~~of public instruction. The school of excellence shall maintain its~~

Senate Bill No. 619 (H-3) as amended April 26, 2012

~~ratio of pupils who are identified as a dropout. Maximum enrollment~~

~~at a school of excellence that is a cyber school shall not exceed~~

~~1,000 pupils.~~

[(d) The enrollment in the school of excellence that is a cyber

school is limited to not more than 2,500 pupils in membership for the

first school year of operation of the school of excellence that is a

cyber school, not more than 5,000 pupils in membership for the second

school year of operation of the school of excellence that is a cyber

school, and not more than 10,000 pupils in membership for the third and

subsequent school years of operation of the school of excellence that is

a cyber school. As used in this subdivision, "membership" means that term as defined in section 6 of the state school aid act of 1979, MCL 388.1606.

(e) The school of excellence that is a cyber school offers each pupil's family a computer and subsidizes the cost of internet access.]

(3) For a public school academy operating under part 6a that

meets the requirements of subsection (4), with the approval of its

authorizing body, the board of directors of the public school

academy may adopt a resolution choosing to convert the public

school academy to a school of excellence under this part. If the

board of directors of a public school academy that meets the

requirements of subsection (4) is issued a contract as a school of

excellence under this subsection, all the following apply:

(a) The public school academy shall cease to operate as a

public school academy under part 6a and shall operate as a school

of excellence upon the issuance of a contract or at another time as

determined by the authorizing body.

(b) The public school academy shall be considered to be a

school of excellence for all purposes upon the issuance of a

contract or at another time as determined by the authorizing body,

but shall retain its corporate identity.

a school of excellence operating under this part shall not impair

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

indebtedness, or any other agreement entered into by a public

school academy while it was operating under part 6a.

(d) The contract issued to the public school academy under

part 6a shall automatically terminate upon the issuance of a

contract or at another time as determined by the authorizing body.

(4) Subsection (3) applies to a public school academy that is

determined by the department to meet all of the following, as

applicable:

(a) If the public school academy operates only some or all of

grades K to 8, meets at least 1 of the following:

(i) On average over a 3-year period, at least 90% of the pupils

enrolled in the public school academy achieved a score of

proficient or better on the Michigan education assessment program

mathematics and reading tests or successor state assessment

program.

(ii) On average over a 3-year period, at least 70% of the

pupils enrolled in the public school academy achieved a score of

proficient or better on the Michigan education assessment program

mathematics and reading tests or successor state assessment program

and at least 50% of the pupils enrolled in the public school

academy met the income eligibility criteria for the federal free or

reduced-price lunch program, as determined under the Richard B.

Russell national school lunch act, 42 USC 1751 to 1769i, and

reported to the department.

(b) If the public school academy operates grades 9 to 12, at

Senate Bill No. 619 (H-3) as amended April 26, 2012

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 the

school has at least an 80% postsecondary enrollment rate.

(5) A school of excellence 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 school of

excellence shall be organized under the nonprofit corporation act,

1982 PA 162, MCL 450.2101 to 450.3192, except that a school of

excellence 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 school of excellence

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.

(6) Any of the following may act as an authorizing body to

issue a contract to organize and operate 1 or more schools of

excellence under this part:

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

12. However, [except as otherwise provided in this subdivision,]the board

of a school district shall not issue a

contract for a school of excellence to operate outside the school

district's boundaries, and a school of excellence authorized by the

board of a school district shall not operate outside that school

district's boundaries. [If the board of a school district issues a

contract for a school of excellence that is a cyber school, the contract may authorize the school of excellence that is a cyber school to operate outside that school district's boundaries.]

(b) An intermediate school board. However, [except as otherwise

provided in this subdivision,]the board of an

intermediate school district shall not issue a contract for a

school of excellence to operate outside the intermediate school

Senate Bill No. 619 (H-3) as amended April 26, 2012

district's boundaries, and a school of excellence authorized by the

board of an intermediate school district shall not operate outside

that intermediate school district's boundaries. [If the board of an

intermediate school district issues a contract for a school of excellence that is a cyber school, the contract may authorize the school of excellence that is a cyber school to operate outside that intermediate school district's boundaries.]

provided in this subdivision, the] board of a community

college shall not issue a contract for a school of excellence to

operate outside the boundaries of the community college district,

and a school of excellence authorized by the board of a community

college shall not operate outside the boundaries of the community

college district. [If the board of a community college issues a contract

for a school of excellence that is a cyber school, the contract may authorize the school of excellence that is a cyber school to 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 school of excellence 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 school of excellence 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.

(e) Two or more of the public agencies described in

subdivisions (a) to (d) exercising power, privilege, or authority

jointly pursuant to an interlocal agreement under the urban

cooperation act of 1967, 1967 (Ex Sess) PA 7, MCL 124.501 to

124.512.

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

schools of excellence, 1 or more persons or an entity may apply to

an authorizing body described in this section. 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 553(4), a list of the proposed members of the board

of directors of the school of excellence and a description of the

qualifications and method for appointment or election of members of

the board of directors.

include at least all of the following:

(i) The name of the proposed school of excellence.

(ii) The purposes for the school of excellence corporation.

This language shall provide that the school of excellence is

incorporated pursuant to this part and that the school of

excellence is a governmental entity.

(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 school of excellence.

(e) Documentation meeting the application requirements of the

authorizing body, including at least all of the following:

(i) The governance structure of the school of excellence.

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

excellence and the curricula to be offered and methods of pupil

assessment to be used by the school of excellence. The educational

goals shall include demonstrated improved pupil academic

achievement for all groups of pupils. To the extent applicable, the

progress of the pupils in the school of excellence shall be

assessed using at least a Michigan education assessment program

(MEAP) test or the Michigan merit examination under section 1279g,

as applicable.

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

school of excellence. The admission policy and criteria shall

comply with section 556. This part of the application also shall

include a description of how the applicant will provide to the

general public adequate notice that a school of excellence is being

created and adequate information on the admission policy, criteria,

and process.

(iv) Except for a school of excellence that is a cyber school,

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 school

of excellence 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 school district and intermediate school

district in which the school of excellence will be located.

(h) An agreement that the school of excellence 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) A description of and address for the proposed physical

plant in which the school of excellence will be located. An

applicant may request the authorizing body to issue a contract

allowing the board of directors of the school of excellence to

operate the same configuration of age or grade levels at more than

1 site.

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

an intermediate school district, community college, or state public

university to oversee, each school of excellence operating under a

contract issued by the authorizing body. The authorizing body is

responsible for overseeing compliance by the board of directors

with the contract and all applicable law. This subsection does not

relieve any other government entity of its enforcement or

supervisory responsibility.

(9) If the superintendent of public instruction finds that an

authorizing body is not engaging in appropriate continuing

oversight of 1 or more schools of excellence operating under a

contract issued by the authorizing body, the superintendent of

public instruction may suspend the power of the authorizing body to

issue new contracts to organize and operate schools of excellence.

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.

(10) 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 school of excellence in an amount that exceeds a

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

school of excellence in the school year in which the fees or

Senate Bill No. 619 (H-3) as amended April 26, 2012

expenses are charged. The authorizing body may provide other

services for a school of excellence and charge a fee for those

services, but shall not require such an arrangement as a condition

to issuing the contract authorizing the school of excellence.

(11) A school of excellence 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.

(12) A member of the board of directors of a school of

excellence is a public officer and shall, before entering upon the

duties of the office, take the constitutional oath of office for

public officers under section 1 of article XI of the state

constitution of 1963.

(13) A school of excellence that is a cyber school may make

available to other public schools for purchase any of the course

offerings that the cyber school offers to its own pupils.

[(14) If the DEPARTMENT determines that the combined total statewide final audited membership for all pupils in membership in schools of excellence that are cyber schools for the 2012-2013 state fiscal year exceeds a number equal to 1% of the combined total statewide final audited membership for all pupils in membership in public schools for the 2011-2012 state fiscal year, then all of the following apply:

(a) An authorizing body may not issue a new contract for a new school of excellence that is a cyber school to begin operations in the 2013-2014 school year.

(b) A school of excellence that is a cyber school may not enroll any new pupils in the school of excellence that is a cyber school in the 2013-2014 school year.

(15) Beginning July 1, 2013, if the department determines that the combined total statewide final audited membership for all pupils in membership in schools of excellence that are cyber schools for a state fiscal year exceeds a number equal to 2% of the combined total statewide final audited membership for all pupils in membership in public schools for the 2011-2012 state fiscal year, then all of the following apply:

(a) Subject to subdivision (c), an authorizing body may not issue a new contract for a new school of excellence that is a cyber school to begin operations in a school year that begins after that determination is made.

(b) Subject to subdivision (c), a school of excellence that is a cyber school may not enroll any new pupils in the school of excellence that is a cyber school in a school year that begins after that determination is made.

(c) If the department determines that the combined total statewide final audited membership for all pupils in membership in schools of excellence that are cyber schools for a state fiscal year does not exceed a number equal to 2% of the combined total statewide final audited membership for all pupils in membership in public schools for the 2011-

2012 state fiscal year, then subdivisions (a) and (b) do not apply for a school year that begins after that determination is made unless the department makes a new determination that the membership limits under this subsection have been exceeded.

Senate Bill No. 619 (H-3) as amended April 26, 2012

(16) For the purposes of subsections (14) and (15), not later than July 1, 2012, and by not later than July 1 of each year thereafter, the department shall determine the percentage of the combined total statewide final audited membership for all pupils in membership in public schools that are pupils in membership in schools of excellence that are cyber schools for the state fiscal year that includes that July 1.

(17) As used in this section:

(a) "membership" means that term as defined in section 6 of the state school aid act of 1979, MCL 388.1606.

(b) "statewide authorizing body" means the governing board of a state public university or the board of a federal tribally controlled community college that is recognized under the tribally controlled colleges and universities assistance act of 1978, 25 USC 1801 to 1852, and is determined by the department to meet the requirements for accreditation by a recognized regional accrediting body.

(18) not later than October 1, 2012, If a district, an intermediate school district, a public school academy, or the education achievement system offers online learning, the board or board of directors of the district, intermediate school district, or public school ACADEMY, or the education achievement system, shall submit to the department a report that details the per-pupil costs of operating the online learning. The report shall include, on a per-pupil basis, at least all of the following costs:

(a) Textbooks, instructional materials, and supplies, including electronic instructional material.

(b) Computer and other electronic equipment, including Internet and telephone access.

(d) purchased courses and curricula.

(e) Fees associated with oversight and regulation.

(f) Travel costs associated with school activities and testing.

(g) Facilities costs.

(h) Costs associated with special education.

(19) Not later than December 31, 2012, the department shall issue a report to the legislature including the following:

(a) A Review of the data submitted under subsection (14).

(b) a comparison with costs of substantially similar programs in other states and RElevant national research on the costs of online LEARNING.

(C) Any conclusions concerning factors or characteristics of online learning programs that make a difference in the costs of operating the programs.

(20) The board of directors of a school of excellence that is a cyber school, or the board of a school district, intermediate school district, or public school academy that operates an online or other distance learning program, shall submit a monthly report to the department, in the form and manner prescribed by the department, that reports the number of pupils enrolled in the school of excellence that is a cyber school, or in the online or other distance learning program, during the immediately preceding month.

(21) The board of directors of a school of excellence that is a cyber school shall ensure that, when a pupil enrolls in the school of excellence that is a cyber school, the pupil and his or her parent or legal guardian are provided with a parent-student orientation. If the pupil is at least age 18 or is an emancipated minor, the orientation may be provided to just the pupil.]