1Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An
2act relating to the public school system, including certain
3provisions applicable as well to private and parochial
4schools; amending, revising, consolidating and changing the
5laws relating thereto," exempting first class school
6districts from provisions on distress.

7The General Assembly of the Commonwealth of Pennsylvania
8hereby enacts as follows:

9Section 1.  Section 696 of the act of March 10, 1949 (P.L.30,
10No.14), known as the Public School Code of 1949, amended October
1130, 2001 (P.L.828, No.83), June 29, 2002 (P.L.524, No.88) and
12July 12, 2012 (P.L.1142, No.141), is amended to read:

13Section 696.  Distress in School Districts of the First
14Class.--[(a)  Within thirty (30) days of a declaration by the
15Secretary of Education that a school district of the first class
16is distressed under section 691(c), a School Reform Commission
17shall be established consisting of four members initially
18appointed by the Governor and one member initially appointed by
19the mayor of the city coterminous with the school district. The
20School Reform Commission shall be an instrumentality of a school

1district of the first class, exercising the powers of the board
2of school directors. The Governor shall appoint a chairman of
3the School Reform Commission. At least three of the commission
4members, including the member appointed by the mayor, must be
5residents of the school district.  

6(b)  Membership of the School Reform Commission shall be as
7follows:

8(1)  Members appointed pursuant to this section shall serve
9terms as follows:

10(i)  Two of the members appointed by the Governor shall serve
11initial terms of seven (7) years.

12(ii)  One of the members appointed by the Governor shall
13serve an initial term of five (5) years.

14(iii)  One of the members appointed by the Governor shall
15serve an initial term of three (3) years. Upon the expiration of
16the initial term of this member, the mayor shall appoint an
17individual to fill this position.

18(iv)  The member appointed by the mayor shall serve an
19initial term of three (3) years.

20(v)  After the expiration of each initial term:

21(A)  Members appointed by the Governor under subclauses (i)
22and (ii) shall be appointed for a term of five (5) years.

23(B)  Members appointed by the mayor under subclauses (iii)
24and (iv) shall be appointed for a term of four (4) years.

25(2)  Except as authorized in this subsection, no commission 
26member may be removed from office during a term. The Governor 
27may, upon proof by clear and convincing evidence of malfeasance 
28or misfeasance in office, remove a commission member prior to 
29the expiration of the term. Before a commission member is 
30removed, that member must be provided with a written statement 

1of the reasons for removal and an opportunity for a hearing in 
2accordance with 2 Pa.C.S. Ch. 5 Subch. A (relating to practice 
3and procedure of Commonwealth agencies) and Ch. 7 Subch. A 
4(relating to judicial review of Commonwealth agency action).

5(3)  Upon the expiration of term or the occurrence of a
6vacancy in the office of a commission member appointed by the
7Governor, the Governor shall appoint, with the consent of a
8majority of the members elected to the Senate, the successor
9member. Upon the expiration of term or the occurrence of a
10vacancy in the office of a commission member appointed by the
11mayor, the mayor shall appoint the successor member. An
12appointment to fill a vacancy shall be for the balance of the
13unexpired term.

14(4)  A commission member shall hold office until a successor
15has been appointed and qualified.

16(5)  A commission member may serve successive terms.

17(6)  No commission member may, while in the service of the
18School Reform Commission, seek or hold a position as any other
19public official within this Commonwealth or as an officer of a
20political party.

21(7)  Commission members shall be reimbursed for reasonable
22and necessary expenses incurred in the performance of their
23official duties from funds of the school district.(b.1)  Actions
24of the School Reform Commission shall be by a majority vote. A
25majority of the commission members appointed shall constitute a
26quorum.

27(b.2)  Upon the issuance of a declaration by the Secretary of
28Education that a school district of the first class is
29distressed under section 691(c), the Governor shall appoint an
30interim chairman of the School Reform Commission, who shall have

1the full power and authority of the School Reform Commission.
2The interim chairman shall serve for a term not to exceed thirty
3(30) days. The interim chairman may be appointed to the School
4Reform Commission pursuant to this section.

5(c) The School Reform Commission may suspend or dismiss the
6superintendent or any person acting in an equivalent capacity.

7(e)  The following shall apply:

8(1)  The School Reform Commission shall be responsible for
9the operation, management and educational program of the school
10district of the first class. The powers and duties of the board
11of school directors of a school district of the first class
12shall be suspended. All powers and duties granted heretofore to
13the board of school directors of a school district of the first
14class under this act or any other law, including its authority
15to levy taxes and incur debt, shall be vested in the School
16Reform Commission until the Secretary of Education issues a
17declaration under subsection (n).

18(2)  The School Reform Commission may enter into agreements
19necessary to provide for the operation, management and
20educational programs of the school district of the first class.
21The agreements shall include appropriate fiscal and academic
22accountability measures. Academic accountability measures shall
23include:

24(i)  Strategic goals and objectives for improving academic
25performance.

26(ii)  Methods setting forth how the strategic goals and
27objectives are to be achieved and the specific methodology for
28evaluating results.

29(h)  The School Reform Commission shall be responsible for
30financial matters related to the distressed school district of

1the first class and:

2(1)  All taxes authorized to be levied by a school district
3of the first class or for a school district of the first class
4by a city or county of the first class on the date of the
5declaration of distress shall continue to be authorized and
6levied in accordance with this act and shall be transmitted to
7the school district. For the first fiscal year or part thereof
8and every fiscal year thereafter in which the school district is
9declared to be distressed, the amount appropriated or paid by
10the city or county to the school district and the tax authorized
11by the city or county to be levied for the school district or
12dedicated to the school district shall be an amount or tax not
13less than the highest amount paid by the city or county to the
14school district or authorized by the city or county to be levied
15for the school district or dedicated to the school district
16during any of the three full preceding fiscal years. In
17addition, the city of the first class shall provide to the
18school district of the first class all other available local
19non-tax revenue, including grants, subsidies or payments made
20during the prior year.

21(2)  In addition to the moneys collected under paragraph (1),
22the city of the first class shall remit to the school district
23of the first class for each year that the school district is
24declared distressed that portion of all other local tax revenue
25levied for a full fiscal year by a city or county of the first
26class coterminous with a school district of the first class that
27was allocated to the school district prior to the school
28district being declared distressed in accordance with section
29691(c).

30(3)  All taxes collected on behalf of a school district of

1the first class by any person or entity, including a city or
2county of the first class, shall be promptly paid following
3collection to the School Reform Commission for the benefit of
4the school district.

5(4)  In the event the city or county of the first class does
6not meet the financial obligations prescribed in this
7subsection, the Commonwealth may apply to that obligation any
8amounts otherwise due from the Commonwealth to the city or
9county of the first class, including, but not limited to,
10grants, awards and moneys collected by the Commonwealth on
11behalf of the city or county of the first class. Funds withheld
12shall be maintained in a separate account by the State Treasurer
13to be disbursed as determined by the Secretary of Education in
14consultation with the State Treasurer.

15(5)  The School Reform Commission shall adopt a budget.

16(i)  In addition to all powers granted to the superintendent
17by law and a special board of control under section 693 and
18notwithstanding any other law to the contrary, the School Reform
19Commission shall have the following powers:

20(1)  To appoint such persons and other entities as needed to
21conduct fiscal and performance audits and other necessary
22analyses.

23(2)  To enter into agreements with persons or for-profit or
24nonprofit organizations to operate one or more schools. A school
25operated under this clause shall be funded in accordance with
26the terms of the agreement.

27(i)  All applications to operate a charter school in a school
28year after a declaration of distress is issued and all charter
29schools established after a declaration of distress is issued
30shall not be subject to sections 1717-A(b), (c), (d), (e), (f),

1(g), (h) and (i), 1722-A(c) and 1724-A.

2(ii)  The School Reform Commission may suspend or revoke a
3charter pursuant to section 1729-A.

4(3)  To suspend the requirements of this act and regulations
5of the State Board of Education except that the school district
6shall remain subject to those provisions of this act set forth
7in sections 1073, 1073.1, 1076, 1077, 1078, 1080, 1732-A(a), (b)
8and (c), 1714-B and 2104 and regulations under those sections.

9(4)  To employ professional and senior management employes
10who do not hold State certification if the School Reform
11Commission has approved the qualifications of the person at a
12salary established by the commission.

13(5)  To enter into agreements with persons or for-profit or
14nonprofit organizations providing educational or other services
15to or for the school district. Services provided under this
16clause shall be funded in accordance with the terms of the
17agreement.

18(6)  Notwithstanding any other provisions of this act, to
19close or reconstitute a school, including the reassignment,
20suspension or dismissal of professional employes.

21(7)  To suspend professional employes without regard to the
22provisions of section 1125.1.

23(8)  To appoint managers, administrators or for-profit or
24nonprofit organizations to oversee the operations of a school or
25group of schools within the school district.

26(9)  To reallocate resources, amend school procedures,
27develop achievement plans and implement testing or other
28evaluation procedures for educational purposes.

29(10)  To supervise and direct principals, teachers and
30administrators.

1(11)  To negotiate any memoranda of understanding under the
2collective bargaining agreement in existence on the effective
3date of this section.

4(12)  To negotiate a new collective bargaining agreement.

5(13)  To delegate to a person, including an employe of the
6school district or a for-profit or nonprofit organization,
7powers it deems necessary to carry out the purposes of this
8article, subject to the supervision and direction of the School
9Reform Commission.

10(14)  To employ, contract with or assign persons or for-
11profit or nonprofit organizations to review the financial and
12educational programs of school buildings and make
13recommendations to the School Reform Commission regarding
14improvements to the financial or educational programs of school
15buildings.

16(j)  The board of school directors of the distressed school
17district of the first class shall continue in office for the
18remainder of their terms during the time the district is
19operated by the commission unless removed for neglect of duty
20under section 318 by the court of common pleas or unless the
21director is elected to another position not compatible with the
22position of school director or is appointed to a position for
23which there is a requirement that the appointee shall hold no
24elective office. The board of school directors shall perform any
25duties delegated to it by the commission. The establishment of
26the School Reform Commission shall not interfere with the
27regular selection of school directors for the school district of
28the first class.

29(k)  Collective bargaining between employes and the school
30district of the first class shall be conducted in accordance

1with this subsection. For purposes of collective bargaining, as
2used in section 693 and this section: "professional employe"
3shall have the meaning given in section 1101(1), and "teacher"
4shall have the meaning given in section 1202-A.

5(2)  No distressed school district of the first class shall
6be required to engage in collective bargaining negotiations or
7enter into memoranda of understanding or other agreements
8regarding any of the following issues:

9(i)  Contracts with third parties for the provision of goods
10or services, including educational services or the potential
11impact of such contracts on employes.

12(ii)  Decisions related to reductions in force.

13(iii)  Staffing patterns and assignments, class schedules,
14academic calendar, places of instruction, pupil assessment and
15teacher preparation time.

16(iv)  The use, continuation or expansion of programs
17designated by the School Reform Commission as pilot or
18experimental programs.

19(v)  The approval or designation of a school as a charter or
20magnet school.

21(vi)  The use of technology to provide instructional or other
22services.

23(3)  A collective bargaining agreement for professional
24employes entered into after the expiration of the agreement in
25effect on the date of the declaration of distress shall provide
26for the following:

27(i)  A school day for professional employes that is equal to
28or exceeds the State average as determined by the department. An
29extension of the school day resulting from this requirement
30shall be used exclusively for instructional time for students.

1(ii)  The number of instructional days shall be equal to or
2exceed the State average number of instructional days.

3(iii)  The School Reform Commission shall not increase
4compensation for employes solely to fulfill the requirements
5under subparagraphs (i) and (ii).

6(4)  A provision in any contract in effect on the date of the
7declaration of distress under this subsection that is in
8conflict with this subsection shall be discontinued in any new
9or renewed contract.

10(5)  Except as specifically provided in section 693, nothing
11in this subsection shall eliminate, supersede or preempt any
12provision of an existing collective bargaining agreement until
13the expiration of the agreement unless otherwise authorized by
14law.

15(6)  If upon the termination of a collective bargaining
16agreement in effect on the date of the declaration of distress
17under this section a new collective bargaining agreement has not
18been ratified, the School Reform Commission shall establish a
19personnel salary schedule to be used until a new agreement is
20ratified.

21(l)  During the time the school district of the first class 
22is under the direction of the School Reform Commission, all 
23school employes shall be prohibited from engaging in any strike 
24as defined in Article XI-A and section 301 of the act of July 
2523, 1970 (P.L.563, No.195), known as the "Public Employe 
26Relations Act." The Secretary of Education may suspend the 
27certificate of an employe who violates this subsection.

28(n)  The Secretary of Education, only upon the recommendation
29of a majority of the School Reform Commission, may issue a
30declaration to dissolve the School Reform Commission. The

1dissolution declaration shall be issued at least one hundred
2eighty (180) days prior to the end of the current school year
3and shall be effective at the end of that school year. Except as
4otherwise provided in this section, after dissolution the board
5of school directors shall have the powers and duties of the
6School Reform Commission.

7(n.1)  When a declaration has been issued by the Secretary of
8Education under section 691(c) and a School Reform Commission
9has been appointed under this section, section 1705-B shall be
10suspended for school districts of the first class.

11(n.2)  Beginning in 2003, by August 31 of each year, the
12School Reform Commission shall provide a report for the
13preceding school year regarding progress made toward
14improvements in fiscal and academic performance in a school
15district of the first class. The report shall be filed with the
16Governor's Office and with the chairman and minority chairman of
17the Education Committee of the Senate and the chairman and
18minority chairman of the Education Committee of the House of
19Representatives.

20(o)  The provisions of this section are severable. If any
21provision of this section or its application to any person or
22circumstance is held invalid, the invalidity shall not affect
23the remaining provisions or applications.] This subarticle shall 
24not apply to school districts of the first class.

25Section 2.  The school directors under section 403 of the act
26shall implement this act.

27Section 3.  This act shall take effect as follows:

28(1)  The amendment of section 696 of the act shall take
29effect in 180 days.

30(2)  The remainder of this act shall take effect

1immediately.