2004 Legislation
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SENATE BILL NO. 1328 – Charter schools, board, conduct

SENATE BILL NO. 1328

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Bill Status



S1328aa........................................................by EDUCATION
CHARTER SCHOOLS - Amends existing law to provide that the board of
directors of a public charter school is subject to the same rules of
conduct in existing provisions of law as are local public school boards of
trustees and is subject to the same limitations on pecuniary interests.
                                                                        
02/16    Senate intro - 1st rdg - to printing
02/17    Rpt prt - to Educ
02/23    Rpt out - to 14th Ord
03/02    Rpt out amen - to engros
03/03    Rpt engros - 1st rdg - to 2nd rdg as amen
03/04    2nd rdg - to 3rd rdg as amen
03/12    Ret'd to Educ

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-seventh Legislature                 Second Regular Session - 2004
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1328
                                                                        
                                   BY EDUCATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO PUBLIC CHARTER SCHOOLS; AMENDING SECTION 33-5204, IDAHO  CODE,  TO
  3        PROVIDE  THAT THE BOARD OF DIRECTORS OF A PUBLIC CHARTER SCHOOL IS SUBJECT
  4        TO THE SAME RULES OF CONDUCT IN EXISTING PROVISIONS OF LAW  AS  ARE  LOCAL
  5        PUBLIC SCHOOL BOARDS OF TRUSTEES.
                                                                        
  6    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
  7        SECTION  1.  That  Section 33-5204, Idaho Code, be, and the same is hereby
  8    amended to read as follows:
                                                                        
  9        33-5204.  NONPROFIT CORPORATION -- LIABILITY -- INSURANCE. (1)  A  charter
 10    school  shall  be  organized and managed under the Idaho nonprofit corporation
 11    act. The board of directors of a charter school shall be deemed public  agents
 12    authorized by a public school district or the state board of education to con-
 13    trol  the charter school, but shall function independently of any school board
 14    of trustees, except as provided in the charter. A charter school shall be con-
 15    sidered a public school for all purposes  and  shall  comply  with  the  audit
 16    reporting  requirements  of  section 33-701 6., Idaho Code, and shall annually
 17    file financial and statistical reports as required in section 33-701 7., Idaho
 18    Code. For the purposes of section 59-1302(15), Idaho Code,  a  charter  school
 19    created pursuant to this chapter shall be deemed a governmental entity. Pursu-
 20    ant  to  the provisions of section 63-3622O, Idaho Code, sales to or purchases
 21    by a public charter school are exempt from payment of the sales and use tax. A
 22    charter school and the board of directors of a charter school are  subject  to
 23    the provisions of:
 24        (a)  Sections  18-1351 through 18-1362, Idaho Code, on bribery and corrupt
 25        influence;
 26        (b)  Chapter 2, title 59, Idaho Code, on  prohibitions  against  contracts
 27        with officers;
 28        (c)  Chapter 7, title 59, Idaho Code, on ethics in government;
 29        (d)  Cchapter 23, title 67, Idaho Code, on open public meetings; and
 30        (e)  Cchapter 3, title 9, Idaho Code, on disclosure of public records
 31    in  the  same manner that a public school and the board of school trustees are
 32    subject to those provisions.
 33        (2)  A charter school may sue or be sued, purchase, receive, hold and con-
 34    vey real and personal property for school purposes, and borrow money for  such
 35    purposes,  to  the  same  extent and on the same conditions as a public school
 36    district, and its employees, directors and officers shall enjoy the same immu-
 37    nities as employees, directors and officers of  public  school  districts  and
 38    other  public  schools. The approving authority of a charter school shall have
 39    no liability for the acts, omissions, debts or other obligations of a  charter
 40    school,  except  as  may  be  provided  in  an agreement or contract with such
 41    charter school.
 42        (3)  Nothing in this chapter shall prevent the board  of  directors  of  a
 43    charter  school, operating as a nonprofit corporation, from borrowing money to
                                                                        
                                           2
                                                                        
  1    finance the purchase of school building facilities. Subject to the terms of  a
  2    contractual  agreement  between  the  board and a lender, nothing herein shall
  3    prevent the board from using the facility as collateral for the loan.
  4        (4)  Charter schools shall secure insurance  for  liability  and  property
  5    loss.

Amendment


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-seventh Legislature                 Second Regular Session - 2004
                                                                        
                                                                        
                                                     Moved by    McWilliams          
                                                                        
                                                     Seconded by Gannon              
                                                                        
                                                                        
                                       IN THE SENATE
                             SENATE AMENDMENT TO S.B. NO. 1328
                                                                        
  1                               AMENDMENTS TO SECTION 1
  2        On page 1 of the printed bill, in line 9,  following  "INSURANCE"  insert:
  3    "--  LIMITATIONS  ON  PECUNIARY  INTERESTS";  and on page 2, following line 5,
  4    insert:
  5        "(5)  It shall be unlawful for:
  6        (a)  Any director to have pecuniary interest directly or indirectly in any
  7        contract or other transaction pertaining to the maintenance or conduct  of
  8        the chartering authority and charter, or to accept any reward or compensa-
  9        tion  for  services rendered as a director except as may be otherwise pro-
 10        vided in this subsection (5). The board of directors of a  charter  school
 11        may  accept and award contracts involving the charter school to businesses
 12        in which a director or a person related to him by blood or marriage within
 13        the second degree has a direct or indirect  interest,  provided  that  the
 14        procedures  set forth in section 18-1361 or 18-1361A, Idaho Code, are fol-
 15        lowed. The receiving, soliciting or acceptance  of  moneys  of  a  charter
 16        school  for deposit in any bank or trust company, or the lending of moneys
 17        by any bank or trust company to any charter school, shall not be deemed to
 18        be a contract pertaining to the maintenance or conduct of a charter school
 19        and chartering authority within the meaning of this section; nor shall the
 20        payment by any charter school board of directors of  compensation  to  any
 21        bank  or  trust  company  for  services rendered in the transaction of any
 22        banking business with such charter school board of directors be deemed the
 23        payment of any reward or compensation to any officer or  director  of  any
 24        such bank or trust company within the meaning of this section.
 25        (b)  The board of directors of any charter school to enter into or execute
 26        any  contract  with  the  spouse of any member of such board, the terms of
 27        which said contract require, or will require, the payment or  delivery  of
 28        any  charter  school  funds,  moneys or property to such spouse, except as
 29        provided in section 18-1361 or 18-1361A, Idaho Code.
 30        (c)  Any relative of any director or relative of the spouse of a  director
 31        related  by  affinity or consanguinity within the second degree to be con-
 32        sidered for employment in a charter school; such  director  shall  abstain
 33        from voting in the election of such relative, and shall be absent from the
 34        meeting while such employment is being considered and determined.".
                                                                        
 35                                 CORRECTION TO TITLE
 36        On  page 1, in line 5, following "TRUSTEES" insert: "AND IS SUBJECT TO THE
 37    SAME LIMITATIONS ON PECUNIARY INTERESTS".

Engrossed Bill (Original Bill with Amendment(s) Incorporated)


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-seventh Legislature                 Second Regular Session - 2004
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                              SENATE BILL NO. 1328, As Amended
                                                                        
                                   BY EDUCATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO PUBLIC CHARTER SCHOOLS; AMENDING SECTION 33-5204, IDAHO  CODE,  TO
  3        PROVIDE  THAT THE BOARD OF DIRECTORS OF A PUBLIC CHARTER SCHOOL IS SUBJECT
  4        TO THE SAME RULES OF CONDUCT IN EXISTING PROVISIONS OF LAW  AS  ARE  LOCAL
  5        PUBLIC SCHOOL BOARDS OF TRUSTEES AND IS SUBJECT TO THE SAME LIMITATIONS ON
  6        PECUNIARY INTERESTS.
                                                                        
  7    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
  8        SECTION  1.  That  Section 33-5204, Idaho Code, be, and the same is hereby
  9    amended to read as follows:
                                                                        
 10        33-5204.  NONPROFIT CORPORATION -- LIABILITY -- INSURANCE  --  LIMITATIONS
 11    ON  PECUNIARY  INTERESTS.  (1) A charter school shall be organized and managed
 12    under the Idaho nonprofit corporation act. The board of directors of a charter
 13    school shall be deemed public agents authorized by a public school district or
 14    the state board of education to control the charter school, but shall function
 15    independently of any school board of  trustees,  except  as  provided  in  the
 16    charter. A charter school shall be considered a public school for all purposes
 17    and  shall  comply with the audit reporting requirements of section 33-701 6.,
 18    Idaho Code, and shall annually  file  financial  and  statistical  reports  as
 19    required  in  section  33-701  7.,  Idaho  Code.  For  the purposes of section
 20    59-1302(15), Idaho Code, a charter school created  pursuant  to  this  chapter
 21    shall  be  deemed a governmental entity. Pursuant to the provisions of section
 22    63-3622O, Idaho Code, sales to or purchases by a  public  charter  school  are
 23    exempt  from  payment of the sales and use tax. A charter school and the board
 24    of directors of a charter school are subject to the provisions of:
 25        (a)  Sections 18-1351 through 18-1362, Idaho Code, on bribery and  corrupt
 26        influence;
 27        (b)  Chapter  2,  title  59, Idaho Code, on prohibitions against contracts
 28        with officers;
 29        (c)  Chapter 7, title 59, Idaho Code, on ethics in government;
 30        (d)  Cchapter 23, title 67, Idaho Code, on open public meetings; and
 31        (e)  Cchapter 3, title 9, Idaho Code, on disclosure of public records
 32    in the same manner that a public school and the board of school  trustees  are
 33    subject to those provisions.
 34        (2)  A charter school may sue or be sued, purchase, receive, hold and con-
 35    vey  real and personal property for school purposes, and borrow money for such
 36    purposes, to the same extent and on the same conditions  as  a  public  school
 37    district, and its employees, directors and officers shall enjoy the same immu-
 38    nities  as  employees,  directors  and officers of public school districts and
 39    other public schools. The approving authority of a charter school  shall  have
 40    no  liability for the acts, omissions, debts or other obligations of a charter
 41    school, except as may be provided  in  an  agreement  or  contract  with  such
 42    charter school.
 43        (3)  Nothing  in  this  chapter  shall prevent the board of directors of a
                                                                        
                                           2
                                                                        
  1    charter school, operating as a nonprofit corporation, from borrowing money  to
  2    finance  the purchase of school building facilities. Subject to the terms of a
  3    contractual agreement between the board and a  lender,  nothing  herein  shall
  4    prevent the board from using the facility as collateral for the loan.
  5        (4)  Charter  schools  shall  secure  insurance for liability and property
  6    loss.
  7        (5)  It shall be unlawful for:
  8        (a)  Any director to have pecuniary interest directly or indirectly in any
  9        contract or other transaction pertaining to the maintenance or conduct  of
 10        the chartering authority and charter, or to accept any reward or compensa-
 11        tion  for  services rendered as a director except as may be otherwise pro-
 12        vided in this subsection (5). The board of directors of a  charter  school
 13        may  accept and award contracts involving the charter school to businesses
 14        in which a director or a person related to him by blood or marriage within
 15        the second degree has a direct or indirect  interest,  provided  that  the
 16        procedures  set forth in section 18-1361 or 18-1361A, Idaho Code, are fol-
 17        lowed. The receiving, soliciting or acceptance  of  moneys  of  a  charter
 18        school  for deposit in any bank or trust company, or the lending of moneys
 19        by any bank or trust company to any charter school, shall not be deemed to
 20        be a contract pertaining to the maintenance or conduct of a charter school
 21        and chartering authority within the meaning of this section; nor shall the
 22        payment by any charter school board of directors of  compensation  to  any
 23        bank  or  trust  company  for  services rendered in the transaction of any
 24        banking business with such charter school board of directors be deemed the
 25        payment of any reward or compensation to any officer or  director  of  any
 26        such bank or trust company within the meaning of this section.
 27        (b)  The board of directors of any charter school to enter into or execute
 28        any  contract  with  the  spouse of any member of such board, the terms of
 29        which said contract require, or will require, the payment or  delivery  of
 30        any  charter  school  funds,  moneys or property to such spouse, except as
 31        provided in section 18-1361 or 18-1361A, Idaho Code.
 32        (c)  Any relative of any director or relative of the spouse of a  director
 33        related  by  affinity or consanguinity within the second degree to be con-
 34        sidered for employment in a charter school; such  director  shall  abstain
 35        from voting in the election of such relative, and shall be absent from the
 36        meeting while such employment is being considered and determined.

Statement of Purpose / Fiscal Impact



                       STATEMENT OF PURPOSE
                             RS 14023


This legislation aligns charter school directing boards with the
same ethics in government statutes that apply to traditional
public school trustee boards.  Namely, this legislation clarifies
that the Bribery and Corrupt Influences statute, the Code on
Prohibitions Against Contracts with Officers, the Ethics in
Government statute and the open meetings and records laws apply
to boards of directors in the same manner as they apply to
trustee boards.  In making these clarifications nothing will
alter the nature of charter schools as non-profit corporations.
These clarifications will, however, resolve ambiguities that are
present in the existing law.  By eliminating the ambiguities,
directing boards will have guidance on the limitations that have
historically applied to the use of public funds.


                          FISCAL IMPACT

This legislation has no fiscal impact.

Contact
Name: Senator Ron McWilliams
Phone: 332-1346

STATEMENT OF PURPOSE/FISCAL NOTE                        S 1328