Trial Engrossment of Amendment A01634 to House Bill 1422 P.N. 1704, Regular Session 2023-2024

A01634

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

1422

Session of

2023

INTRODUCED BY CIRESI, MADDEN, ISAACSON, SMITH-WADE-EL,

SCHLOSSBERG, HANBIDGE, WEBSTER, GUENST, SANCHEZ, D. WILLIAMS,

HOHENSTEIN, HADDOCK, PROBST, HOWARD, DELLOSO, ADAMS, HILL-

EVANS, KAZEEM, MALAGARI, PIELLI, SALISBURY, BURNS,

SHUSTERMAN, OTTEN, VITALI, RABB, FRIEL, CURRY, KENYATTA,

STURLA, BOROWSKI AND O'MARA, JUNE 22, 2023

REFERRED TO COMMITTEE ON EDUCATION, JUNE 22, 2023

AN ACT

Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An

act relating to the public school system, including certain

provisions applicable as well to private and parochial

schools; amending, revising, consolidating and changing the

laws relating thereto," in preliminary provisions, providing

for advertising and sponsorships; in charter schools, further

providing for definitions and for funding for charter

schools, providing for funding for cyber charter schools,

for, providing for cyber charter school requirements, for

powers and composition of board of trustees and for

educational management service providers, further providing

for powers and duties of department and for assessment and

evaluation, providing for annual reports and public reporting

and for fund balance limits, further providing for cyber

charter school requirements and prohibitions and for school

district and intermediate unit responsibilities, providing

for access to other schools' facilities, further providing

for establishment of cyber charter school, providing for

renewals, for charter amendments and for causes for

nonrenewal, revocation or termination, further providing for

State Charter School Appeal Board review, for cyber charter

school application and for enrollment and notification,

providing for enrollment parameters and for enrollee wellness

checks and further providing for applicability of other

provisions of this act and of other acts and regulations.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The act of March 10, 1949 (P.L.30, No.14), known

as the Public School Code of 1949, is amended by adding a

section to read:

Section 130. Advertising and Sponsorships.--(a) A paid

media advertisement by a public school entity that refers to the

cost of tuition, technology, transportation or other expenses

shall not advertise those expenses as free, and any reference to

tuition, technology, transportation or other expenses must

indicate that the cost is covered by taxpayer dollars.

(b) A public school entity shall be prohibited from paying

for or utilizing any other form of consideration to sponsor a

public event.

shall report to the department of education the entity's total

expenditures for paid media advertisements and sponsorships of

public events for the 2022-2023 school year. The department

shall compile the results of the reporting and make the results

available on the department's publicly accessible Internet

website by December 1, 2024.

(d) For purposes of this section, the following words and

phrases shall have the following meanings:

"Paid media advertisement." The term includes a television,

radio, newspaper, magazine or movie theater advertisement,

billboard, bus poster or Internet-based or other commercial

method that may promote enrollment in a public school entity.

"Public event." An activity, event or gathering that members

of the public may attend, has been publicly announced or

publicized in advance, and for which an admission fee or cost

may be required. The term includes concerts, performances,

sporting events, fairs, festivals, parades, performances and

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other exhibitions.

"Public school entity." A public school district, charter

school entity as defined in section 1703-A, intermediate unit or

area career and technical school.

Section 2. Section 1703-A introductory paragraph and the

definitions of "appeal board," "chief executive officer" and

"school district of residence" of the act are amended and the

section is amended by adding definitions to read:

Section 1703-A. Definitions.--[As used in this article,] The

following words and phrases when used in this article shall have

the meanings given to them in this section unless the context

clearly indicates otherwise:

"Administrator" shall include the chief administrator of a

charter school entity and all other employes of a charter school

entity who by virtue of their positions exercise management or

operational oversight responsibilities.

* * *

"Appeal board" shall mean the State Charter School Appeal

Board established [by this article] under section 1721-A.

* * *

"Charter school entity" shall mean a charter school, regional

charter school, cyber charter school or multiple charter school

organization.

"Charter school foundation" shall mean a nonprofit

organization qualified as Federally tax exempt under section

501(c)(3) of the Internal Revenue Code of 1986 (Public Law 99-

514, 26 U.S.C. § 501(c)(3)), that provides funding or resources

or otherwise serves to support a charter school entity .

"Chief [executive officer] administrator" shall mean an

individual appointed by the board of trustees to oversee and

A01634 - 3 -

manage the operation of [the] a charter school entity, but who

shall not be deemed a professional staff member under this

article.

* * *

"Compensation" shall include money or other remuneration

received from a charter school entity.

* * *

"Educational management service provider" shall mean a

nonprofit or for-profit charter management organization,

education management organization, school design provider,

business manager or any other entity or individual that enters

into a contract or agreement with a charter school entity to

provide instructional, curricular or educational design,

administrative or business services, comprehensive management or

personnel functions or to implement the charter. The term shall

include the subsidiaries or subcontractors of an individual or

entity. The term shall not include a charter school foundation.

"Eligible applicant" shall mean a student who is seeking to

enter a grade level offered by the charter school entity and

meets the requirements of 22 Pa. Code §§ 11.12 (relating to

school age), 11.13 (relating to compulsory school age), 11.14

(relating to admission to kindergarten when provided), 11.15

(relating to admission of beginners), 11.16 (relating to early

admission of beginners) and 12.1 (relating to free education and

attendance) and student residency requirements.

"Emergency" shall mean a manmade or natural disaster. The

term includes a fire, flood, environmental hazard, damage to a

school building or other circumstance that impacts or could

impact the health or safety of students or staff or renders all

or part of a charter school facility unfit for use or

A01634 - 4 -

occupation.

"Family member" shall mean a parent, stepparent, child,

stepchild, spouse, domestic partner, brother, sister,

stepbrother, stepsister, grandparent, grandchild, parent-in-law,

brother-in-law, sister-in-law, aunt, uncle, or first cousin.

* * *

"Multiple charter school organization" shall mean a public,

nonprofit corporation under the oversight of a single board of

trustees and a chief administrator that operates two (2) or more

charter schools under section 1729.1-A.

"Nonrelated" shall mean an individual who is not a family

member.

"Public hearing" shall mean a meeting held pursuant to 65

Pa.C.S. Ch. 7 (relating to open meetings) where the contemplated

action is considered and opportunities for the public to comment

on the contemplated action are provided during the meeting.

* * *

"School district of residence" shall mean the school district

in this Commonwealth in which [the parents or guardians of a

child reside.] a child resides as determined under section 1302

and 22 Pa. Code § 11.11(a)(1) (relating to entitlement of

resident children to attend public schools).

* * *

Section 3. Section 1725-A(a) introductory paragraph of the

act is amended to read:

Section 1725-A. Funding for Charter Schools.--(a) [Funding]

Except as provided in section 1725.1-A, funding for a charter

school shall be provided in the following manner:

* * * (Reserved).

Section 4. The act is amended by adding sections to read:

A01634 - 5 -

Section 1725.1-A. Funding for Cyber Charter Schools.--(a)

Notwithstanding section 1725-A(a)(2) and (3), per-student

funding amounts for students attending a cyber charter school

shall be calculated in accordance with this section.

(b) A cyber charter school may not charge tuition for a

student attending a cyber charter school. Beginning in the 2024-

2025 school year, a cyber charter school shall be paid by a

student's school district of residence using the Statewide Cyber

Charter School Tuition Rate.

for non-special education students, a cyber charter school shall

receive for each student enrolled eight thousand dollars

($8,000). This amount shall be the Statewide Cyber Charter

School Tuition Rate.

(d) Beginning in the 2027-2028 school year and every three

(3) years thereafter, the Statewide Cyber Charter School Tuition

Rate shall be adjusted by the average annual property tax rate

increase for all school districts for the most recent three (3)

years. The department shall develop guidelines for determining

the average annual property tax rate increase.

(e) On or before April 30, 2027, and by April 30 of each

third year thereafter, the department shall calculate and post

on its publicly accessible Internet website the Statewide Cyber

Charter School Tuition Rate payable by a student's school

district of residence under subsection (d) for the next school

year.

(f) For special education students, a cyber charter school

shall receive the Statewide Cyber Charter School Tuition Rate

adjusted as follows:

(1) For each special education student enrolled in the cyber

A01634 - 6 -

charter school, multiply the Statewide Cyber Charter School

Tuition Rate by one and sixty-four hundredths (1.64).

(2) If the cyber charter school determines that the annual

expenditure for providing special education specific services

and programs to an enrolled student is likely to meet or exceed

the amount specified under section 1372(8) for Category 2, the

cyber charter school may apply to the department for an increase

in the Statewide Cyber Charter School Tuition Rate for the

student.

(3) If the department determines that the annual expenditure

for providing special education specific services and programs

to an enrolled student is likely to meet or exceed the amount

specified in section 1372(8) for Category 2, the department

shall direct the school district to pay the Statewide Cyber

Charter School Tuition Rate for the student adjusted as follows:

(i) for each special education student enrolled in the cyber

charter school for which the annual expenditure is in Category

2, multiply the Statewide Cyber Charter School Tuition Rate by

three and eight hundredths (3.08); or

(ii) for each special education student enrolled in the

cyber charter school for which the annual expenditure is in

Category 3, multiply the Statewide Cyber Charter School Tuition

Rate by six and thirty-four hundredths (6.34). For purposes of

this subparagraph, Category 3 shall include students in

Categories 3A and 3B under section 1372(8).

(g) The per-student amounts required under subsection (f)

shall be calculated by the department and posted on its publicly

accessible Internet website and shall be paid by the school

district of residence of each student.

(h) In accordance with guidelines developed by the

A01634 - 7 -

department, to be eligible to receive funding for special

education students under subsection (f)(2) and (3), the cyber

charter school shall provide the department with appropriate

documentation on the likely annual expenditure for providing an

education to the student.

(i) The weights provided under subsection (f) shall be

updated whenever the weights under section 2509.5(bbb)(2) for

the respective categories are adjusted for school districts.

(j) The calculation made under subsection (f) may not result

in a payment that exceeds the maximum amount within the

category's dollar range and the calculation under subsection (f)

(3)(ii) may not result in a payment that exceeds the actual

annual expenditure of providing an education to the student. If

the actual annual expenditure of providing special education

specific services and programs to a student in Category 3 is

less than the amount the cyber charter school received for the

student, the cyber charter school shall return to the school

district of residence any overage the cyber charter school

received for the student no later than August 1 of each year.

Section 1740-A. Cyber Charter School Requirements.

(a) General rule.--Cyber charter schools shall be required

to comply with the following provisions:

(1) Except as otherwise provided in this article, a

cyber charter school is exempt from statutory requirements

established in this act, from regulations of the State board

and the standards of the secretary not specifically

applicable to cyber charter schools. Cyber charter schools

are not exempt from statutes applicable to public schools

other than this act.

(2) A cyber charter school shall be accountable to the

A01634 - 8 -

parents, guardians, families, the public, the department and

the Commonwealth, with the delineation of that accountability

reflected in the charter. Strategies for meaningful parent,

guardian, family and community involvement shall be developed

and implemented by each cyber charter school.

(3) A cyber charter school shall not unlawfully

discriminate in admissions, hiring or operation.

(4) A cyber charter school shall be nonsectarian in all

operations.

(5) (i) Subject to subparagraph (ii), a cyber charter

school shall not provide any religious instruction, nor

shall it display religious objects and symbols on the

premises of the cyber charter school.

(ii) It shall not be a violation of this paragraph

for a cyber charter school to utilize a sectarian

facility:

(A) if the cyber charter school provides for

discrete separate entrances to buildings utilized for

school purposes only;

(B) if the religious objects and symbols within

the portions of the facility utilized by the cyber

charter school are covered or removed; or

or its common areas contain religious symbols and

objects.

(6) A cyber charter school shall not advocate unlawful

behavior.

(7) A cyber charter school shall participate in the

Pennsylvania State Assessment System as provided for in 22

Pa. Code Ch. 4 (relating to academic standards and

A01634 - 9 -

assessment), or subsequent regulations promulgated to replace

22 Pa. Code Ch. 4, in the same manner as school districts.

(8) At the elementary level, a cyber charter school

shall provide a minimum of 180 days of instruction or 900

hours per year of instruction. At the secondary level, a

cyber charter school shall provide a minimum of 990 hours per

year of instruction.

(9) Boards of trustees and contractors of cyber charter

schools shall be subject to the following statutory

requirements governing construction projects and

construction-related work:

(i) The following provisions of this act:

(A) Sections 751 and 751.1.

(B) Sections 756 and 757 insofar as they are

consistent with the act of December 20, 1967

(P.L.869, No.385), known as the Public Works

Contractors' Bond Law of 1967.

(ii) Section 1 of the act of May 1, 1913 (P.L.155,

No.104), entitled "An act regulating the letting of

certain contracts for the erection, construction, and

alteration of public buildings."

(iii) The act of August 11, 1961 (P.L.987, No.442),

known as the Pennsylvania Prevailing Wage Act.

(iv) The Public Works Contractors' Bond Law of 1967.

(v) The act of March 3, 1978 (P.L.6, No.3), known as

the Steel Products Procurement Act.

(10) Trustees of a cyber charter school shall be public

officials for the purposes of 65 Pa.C.S. Ch. 11 (relating

to ethics standards and financial disclosure), and each

trustee shall file a statement of financial interests for

A01634 - 10 -

the preceding calendar year with the secretary of the

board of trustees of the cyber charter school, the State

Ethics Commission and the department not later than May 1

of each year that members hold the position and of the

year after a member leaves the position. In the event

that the trustee was appointed or selected after May 1,

the trustee shall file a statement of financial interests

in accordance with this clause within 30 days of

appointment or selection. All members of the board of

trustees of a cyber charter school shall take the oath of

office as required under section 321 before entering upon

the duties of their office.

(b) Employees.--

(1) An administrator for a cyber charter school shall be

an employee of the cyber charter school and shall not receive

compensation from another charter school entity, from an

educational management service provider, from a charter

school foundation or from a company that provides management

or other services to another charter school entity.

(2) An administrator for a cyber charter school shall be

a public employee under 65 Pa.C.S. Ch. 11 and shall file a

statement of financial interest for the preceding calendar

year with the secretary of the board of trustees of the cyber

charter school not later than May 1 of each year that the

person holds the position and of the year after the person

leaves the position. In the event that the administrator was

appointed after May 1, the administrator shall file a

statement of financial interest in accordance with this

clause within 30 days of appointment.

(3) An administrator of a cyber charter school or family

A01634 - 11 -

member of an administrator may not serve as a voting member

of the board of trustees of the cyber charter school that

employs the administrator or of a charter school foundation

that supports the cyber charter school.

(4) An administrator of a cyber charter school may not

participate in the selection, award or administration of a

contract if the administrator has a conflict of interest as

the term is defined in 65 Pa.C.S. § 1102 (relating to

definitions). A contract made in violation of this paragraph

shall be voidable by the board of trustees of the cyber

charter school.

(5) An administrator shall be immediately dismissed upon

conviction or upon a plea of guilty or nolo contendere for an

offense graded as a felony, an infamous crime, an offense

pertaining to fraud, theft or mismanagement of public funds

or any crime involving moral turpitude.

(6) Charter school entities shall use the revised rating

system specified in Article XI Subarticle (c.1) to evaluate

employees serving as principals or school leaders, classroom

teachers and nonteaching professional employees.

Section 1740.1-A. Powers and Composition of Board of Trustees.

(a) General rule.--The board of trustees of a cyber charter

school shall have the authority to decide matters related to the

operation of the school, including, but not limited to,

budgeting, curriculum and operating procedures, subject to the

school's charter. The board shall have the authority to employ,

discharge and contract with necessary professional and

nonprofessional employees subject to the school's charter and

the provisions of this article.

(b) Prohibition.--No member of a local board of school

A01634 - 12 -

directors of a school entity shall serve on the board of

trustees of a cyber charter school.

65 Pa.C.S. Ch. 7 (relating to open meetings).

(d) Board .--

(1) An individual shall be prohibited from serving as a

voting member of the board of trustees of a cyber charter

school under any of the following conditions:

(i) If the individual or a family member of the

individual is employed by or receives compensation from

the cyber charter school.

(ii) If the individual is employed by either:

(A) the board of trustees or directors of a

charter school foundation that supports the cyber

charter school; or

(B) the board of trustees or directors of an

educational management service provider that

contracts with the cyber charter school.

(iii) The individual serves as a voting member of

the board of trustees of another charter school entity.

(2) A member of the board of trustees of a cyber charter

school may not participate in the selection, award or

administration of any contract if the member has a conflict

of interest as the term is defined in 65 Pa.C.S. § 1102

(relating to definitions).

(3) A member of the board of trustees of a cyber charter

school who in the discharge of the member's official duties

would be required to vote on a matter that would result in a

conflict of interest must abstain from voting and follow the

procedures required under 65 Pa.C.S. § 1103(j) (relating to

A01634 - 13 -

restricted activities).

(4) A member of the board of trustees of a cyber charter

school or family member of a member of a board of trustees of

a cyber charter school shall not, directly or through any

other individual, entity, partnership or corporation in which

the member holds stock or has a financial interest or other

organization, provide a loan, forbearance or forgiveness of a

loan or other debt, service or product or lease property to

the cyber charter school.

(5) A member of the board of trustees of a cyber charter

school who violates the provisions of this subsection commits

a violation of 65 Pa.C.S. § 1103(a) and shall be subject to

the penalties imposed under the jurisdiction of the State

Ethics Commission.

(6) A contract made in violation of this subsection

shall be voidable by a court of competent jurisdiction.

(e) Compensation.--A member of the board of trustees of a

cyber charter school shall not be compensated for duties on the

board of trustees, except that the cyber charter school may

reimburse the members for reasonable expenses incurred in the

performance of their duties. A report detailing the reasons for

and amounts of reimbursements paid to each member of the board

of trustees shall be made available upon request of any person,

including in response to a request under the act of February 14,

2008 (P.L.6, No.3), known as the Right-to-Know Law.

(f) Action .--

(1) A majority of the voting members of the board of

trustees shall constitute a quorum. If less than a majority

is present at any meeting, no business may be transacted at

the meeting but the members present may adjourn to some

A01634 - 14 -

stated time.

(2) The affirmative vote of a majority of all the voting

members of the board of trustees, duly recorded, showing how

each member voted, shall be required in order to take

official action.

(g) Composition.--

(1) The board of trustees of a cyber charter school

shall consist of a minimum of seven nonrelated voting

members. If a cyber charter school has fewer than seven

members serving on its board of trustees on the effective

date of this subsection, the cyber charter school shall,

within 60 days, appoint or select additional members to the

board of trustees to meet the minimum requirements of this

section.

(2) Within one year of the effective date of this

subsection, the board of trustees shall include at least one

parent or guardian of a student enrolled in the cyber charter

school. The trustee appointed under this paragraph shall be

eligible to serve only so long as they have at least one

child enrolled in the cyber charter school. This subparagraph

shall not apply to a cyber charter school that serves

primarily adjudicated youth.

(3) A member of the board of trustees of a cyber charter

school shall be automatically disqualified and immediately

removed from the board of trustees upon conviction or upon a

plea of guilty or nolo contendere for an offense graded as a

felony, an infamous crime, an offense pertaining to fraud,

theft or mismanagement of public funds, any offense

pertaining to the member's official capacity as a member of

the board of trustees, an offense listed in section 111(e) or

A01634 - 15 -

any crime involving moral turpitude. A member of the board of

trustees may also be removed from the board of trustees for

violation of applicable laws, regulations and terms of the

charter as well as any standards for board of trustees'

performance established by the board of trustees.

(4) In case any vacancy shall occur in any board of

trustees by reason of death, resignation or otherwise, the

vacancy shall be filled within 60 days following the vacancy.

Section 1740.2-A. Educational Management Service Providers.

(a) General rule.--An educational management service

provider that provides a service to a cyber charter school:

(1) Is a local agency for the purpose of the act of

February 14, 2008 (P.L.6, No.3), known as the Right-to-Know

Law.

(2) Shall maintain a publicly accessible Internet

website detailing the salaries and other compensation and

titles of its employees, officers and directors.

(b) Employees.--Employees of an educational management

service provider that provides a service to a cyber charter

school are public employees for the purpose of 65 Pa.C.S. Ch. 11

(relating to ethics standards and financial disclosure).

Section 5. Sections 1741-A and 1742-A of the act are amended

to read:

Section 1741-A. Powers and duties of department.

(a) Powers and duties.--The department shall have all powers

necessary to:

(1) Receive, review and act on applications for the

creation of a cyber charter school [and have] including, but

not limited to, the power to request further information from

applicants, obtain input from interested persons or entities

A01634 - 16 -

and hold public hearings regarding applications. At least one

public hearing shall be held prior to granting or denying an

application.

(2) [Renew] Receive, review and act on applications to

amend and renew the charter of a cyber charter school. [and

renew the charter of a charter school approved under section

1717-A or 1718-A which provides instruction through the

Internet or other electronic means. Upon renewal of a charter

of a charter school approved under section 1717-A or 1718-A,

the charter school shall qualify as a cyber charter school

under this subdivision and shall be subject to the provisions

of this subdivision.]

(3) Revoke or deny renewal of a cyber charter school's

charter under the provisions of section [1729-A] 1745.3-A.

[(i) Notwithstanding the provisions of section 1729-

A(i), when the department has revoked or denied renewal

of a charter, the cyber charter school shall be

dissolved. After the disposition of the liabilities and

obligations of the cyber charter school, any remaining

assets of the cyber charter school shall be given over to

the intermediate unit in which the cyber charter school's

administrative office was located for distribution to the

school districts in which the students enrolled in the

cyber charter school reside at the time of dissolution.

(ii) Notwithstanding any laws to the contrary, the

department may, after notice and hearing, take immediate

action to revoke a charter if:

(A) a material component of the student's

education as required under this subdivision is not

being provided; or

A01634 - 17 -

(B) the cyber charter school has failed to

maintain the financial ability to provide services as

required under this subdivision.]

(4) Execute charters after approval.

[(5) Develop forms, including the notification form

under section 1748-A(b), necessary to carry out the

provisions of this subdivision.]

(b) Hearings.--[Hearings] Public hearings conducted by the

department shall be conducted under 65 Pa.C.S. Ch. 7 (relating

to open meetings).

subject to the act of [June 21, 1957 (P.L.390, No.212), referred

to as the Right-to-Know Law.] February 14, 2008 (P.L.6, No.3),

known as the Right-to-Know Law.

(d) Form.--

(1) The department shall develop a standard enrollment

form in both paper and electronic formats that shall be used

by all eligible applicants to apply to a cyber charter

school. The standard enrollment form shall only request

information necessary to allow the cyber charter school to

identify the student, grade level and residency, including:

(i) The student's name, address of residence,

resident school district, telephone number, age, birth

date, current grade level and the grade level in which

the student is being enrolled. The cyber charter school

shall be required to verify the student's residency

within the school district of residence.

(ii) The name, address of residence and telephone

number or e-mail address of the student's parent or

guardian.

A01634 - 18 -

(iii) The date and grade the student will be

enrolled.

(iv) A space for the cyber charter school to include

the name of the cyber charter school and the name,

telephone number and email address of a contact person at

the cyber charter school.

(v) The signature of the parent or guardian and an

authorized representative of the cyber charter school.

(2) The standard enrollment form shall be made

physically available at each cyber charter school location,

in a form that complies with Federal and State law, and

posted on the publicly accessible Internet website of the

cyber charter school. A cyber charter school may accept the

enrollment form via paper or electronic means.

(3) A cyber charter school shall not require or request

information beyond the contents of the standard enrollment

form developed by the department.

(4) Nothing in this subsection shall be construed to

prohibit a cyber charter school from requesting the

submission of additional records and information that public

schools are entitled to receive after a student is accepted

for admission to, and has indicated an intent to enroll in,

the cyber charter school.

[Section 1742-A. Assessment and evaluation.

The department shall:

(1) Annually assess whether each cyber charter school is

meeting the goals of its charter and is in compliance with

the provisions of the charter and conduct a comprehensive

review prior to granting a five-year renewal of the charter.

(2) Annually review each cyber charter school's

A01634 - 19 -

performance on the Pennsylvania System of School Assessment

test, standardized tests and other performance indicators to

ensure compliance with 22 Pa. Code Ch. 4 (relating to

academic standards and assessment) or subsequent regulations

promulgated to replace 22 Pa. Code Ch. 4.

(3) Have ongoing access to all records, instructional

materials and student and staff records of each cyber charter

school and to every cyber charter school facility to ensure

the cyber charter school is in compliance with its charter

and this subdivision.]

Section 6. The act is amended by adding sections to read:

Section 1742.1-A. Annual Reports and Public Reporting.

(a) Department duties.--The department shall:

(1) Annually assess and evaluate whether each cyber

charter school is meeting the goals of its charter. This may

include, but not be limited to, a review of academic

performance, financial management, audit results, governance

and operation, and compliance with state and federal laws and

regulations.

(2) Conduct a comprehensive review prior to granting a

renewal of the charter. This may include, but not be limited

to, a review of academic performance, financial management,

audit results, governance and operation, and compliance with

state and federal laws and regulations.

(3) Have ongoing access to the records, systems and

facilities of the cyber charter school and any related

charter school foundation or educational management service

provider to facilitate the annual and comprehensive reviews

required in this subsection and to ensure that the cyber

charter school is in compliance with its charter and this

A01634 - 20 -

article and that requirements for testing, civil rights and

student health and safety are being met.

(b) Report.--In order to facilitate the department's review

under subsection (a), each cyber charter school shall submit an

annual report no later than August 1 of each year to the

department and all local boards of school directors that have a

student enrolled in the cyber charter school in the form

prescribed by the department. A copy of the annual report

submitted under this subsection, including all exhibits and

attachments to the report, shall also be maintained at each

facility of the cyber charter school and be made available for

public inspection and copying, and shall be posted on the cyber

charter school's publicly accessible Internet website.

with the requirements of the Family Educational Rights and

Privacy Act of 1974 (Public Law 90-247, 20 U.S.C. § 1232g) and

associated regulations in all public reporting.

(d) Annual audit.--A cyber charter school shall form an

independent audit committee of its board of trustees members,

which shall review at the close of each fiscal year a complete

certified audit of the operations of the cyber charter school.

The audit shall be conducted by a qualified independent

certified public accountant. The audit shall be presented at a

public meeting of the board of trustees. The audit shall be

conducted under generally accepted audit standards of the

Governmental Accounting Standards Board and shall at a minimum

include the following:

(1) An enrollment audit to verify the accuracy of

student enrollment, including the enrollment, withdrawal and

residency of students and the reporting of the enrollment

A01634 - 21 -

information to the department and the school district of

residence.

(2) Full review of expense reimbursements for board of

trustees members and administrators, including sampling of

all reimbursements.

(3) Review of internal controls, including review of

receipts and disbursements.

(4) Review of annual Federal and State tax filings,

including the Internal Revenue Service Form 990, Return of

Organization Exempt from Income Tax and all related schedules

and appendices for the cyber charter school, the educational

management service provider and the charter school

foundation, if applicable.

(5) Review of the financial statements of any charter

school foundation.

(6) Review of the selection and acceptance process of

all contracts publicly bid pursuant to sections 751 and

807.1.

(7) Review of all board policies and procedures with

regard to internal controls, codes of ethics, conflicts of

interest, whistle-blower protections; complaints from

parents, guardians or the public; compliance with 65 Pa.C.S.

Ch. 7 (relating to open meetings); finances; budgeting;

audits; public bidding; and bonding.

(e) Audit.--A cyber charter school may be subject to an

annual audit by the Auditor General, the department, or any

other entity granted authority to audit cyber charter schools in

addition to any other audits required by Federal or State law or

this act.

(f) Budget .--

A01634 - 22 -

(1) A cyber charter school shall annually, not later

than June 30 of each year, adopt and provide the department

and any school district which has a student enrolled with a

copy of the annual budget on a form prepared by the

department, which shall require that the cyber charter school

provide no more information than that provided by school

districts pursuant to section 687.

(2) The cyber charter school shall print or otherwise

make available for public inspection a copy of the proposed

annual budget to all persons at least 20 days prior to the

date set for the adoption of the final budget. A copy of the

annual budget shall also be posted on the cyber charter

school's publicly accessible Internet website.

(3) On the date of adoption of the proposed budget

required under this subsection, the president or chair of the

cyber charter school's board of trustees shall certify to the

department that the proposed budget has been prepared,

presented and made available for public inspection using the

uniform form prepared and furnished by the department. The

certification shall be in a form and manner as required by

the department. Final action shall not be taken on a proposed

budget that has not been prepared, presented and made

available for public inspection using the uniform form

prepared and furnished by the department.

(4) The annual budget adopted and submitted under this

subsection shall not exceed the amount of funds available to

the cyber charter school.

(g) Accessibility.--Notwithstanding any other provision of

law, a cyber charter school and an affiliated charter school

foundation shall make copies of the following available upon

A01634 - 23 -

request and on the cyber charter school's or charter school

foundation's publicly accessible Internet website, if one is

maintained:

(1) Annual budgets for the cyber charter school, as

provided for in subsection (f), and charter school foundation

for the most recent five school years, as available. A

charter school foundation shall include in its annual budget

the salaries of all employees of the charter school

foundation.

(2) Annual Federal and State tax filings, including

Internal Revenue Service Form 990, Return of Organization

Exempt from Income Tax and all related schedules and

appendices for the cyber charter school and charter school

foundation for the previous five school years.

(3) Certified audits under subsection (d) and any

Federal and State audits provided under subsection (e) for

the cyber charter school and charter school foundation for

the previous five school years, as available.

(4) Annual reports filed by the cyber charter school

under subsection (b) for the previous five school years, as

available.

Section 1742.2-A. Fund Balance Limits.

(a) Limitation.--For the 2024-2025 school year and each

school year thereafter a cyber charter school shall not

accumulate an unassigned fund balance greater than 10% of its

total budgeted expenditures.

(b) Refund.--Any unassigned fund balance in place on June

30, 2024, and on June 30 of each year thereafter in excess of

the fund balance limit established in subsection (a) shall be

refunded on a pro rata basis within 90 days to all school

A01634 - 24 -

districts that paid tuition to the cyber charter school in the

prior school year, based upon the number of students for whom

each school district paid tuition to the cyber charter school

multiplied by the Statewide Cyber Charter School Tuition Rate

under section 1725.1-A.

each year thereafter, each cyber charter school shall provide

the department and all school districts that paid tuition to the

cyber charter school in the prior school year with information

certifying compliance with this section. The information shall

be provided in a form and manner prescribed by the department

and shall include information on the cyber charter school's

estimated ending unassigned fund balance expressed as a dollar

amount and as a percentage of the cyber charter school's total

budgeted expenditures for that school year.

(d) Prohibition.--Unassigned funds of the cyber charter

school in excess of the unassigned fund balance limit may not be

used to pay bonuses to an administrator, a board of trustees

member, an employee, a staff member or a contractor and may not

be transferred to a charter school foundation. If a cyber

charter school uses funds in excess of the unassigned fund

balance limit to pay bonuses to an administrator, a board of

trustees member, an employee, a staff member or a contractor or

transfers the funds to a charter school foundation, the value of

the bonus payment or fund transfer shall be refunded on a pro

rata basis to all school districts that paid tuition to the

cyber charter school in the prior school year, based upon the

number of students for whom each school district paid tuition to

the cyber charter school multiplied by the Statewide Cyber

Charter School Tuition Rate under section 1725.1-A 1725-A .

A01634 - 25 -

(e) Definition.--As used in this section, the term

"unassigned fund balance" shall mean that portion of the fund

balance of a cyber charter school that is appropriable for

expenditure or not legally or otherwise segregated for a

specific or tentative future use, projected for the close of the

school year for which a cyber charter school's budget was

adopted and held in the General Fund accounts of the cyber

charter school.

Section 7. Sections 1743-A and 1744-A of the act are amended

to read:

Section 1743-A. Cyber charter school requirements and

prohibitions.

(a) Special financial requirements prohibited.--A cyber

charter school shall not:

(1) provide discounts to a school district or waive

payments under section [1725-A] 1725.1-A for any student;

(2) [except as provided for in subsection (e),] provide

payments or reimbursements to parents or guardians for the

purchase of instructional materials[; or], for educational or

field trips or for any other reason not expressly provided

for in subsection (e);

(3) offer or provide parents or guardians or students

cash, gifts or other incentives having more than a de minimus

value for enrolling in, attending or considering enrollment

or attendance in the school; or

(4) except as compensation for the provision of specific

services, enter into agreements to provide funds to a school

entity.

(b) Enrollment.--A cyber charter school shall report to the

department an increase or a decrease of 30% or more in its

A01634 - 26 -

anticipated enrollment set forth in the application under

section [1747-A(11)] 1747-A(3).

available upon request, either in writing or electronically, to

each student's school district of residence the following:

(1) A copy of the charter.

(2) A copy of the cyber charter school application.

(3) A copy of all annual reports prepared by the cyber

charter school under this article.

(4) A list of all students from that school district

enrolled in the cyber charter school.

(5) Information required under section 1725.1-A.

(d) Parent or guardian.--Upon request and prior to the

student's first day in a cyber charter school, the cyber charter

school shall, either in writing or electronically, provide to

the parent or guardian of a student the following:

(1) A current list and brief description of the courses

of instruction the student will receive. The list shall be

updated annually for each grade level in which the student is

enrolled.

(2) A description of the lessons and activities to be

offered both online and offline.

(3) The manner in which attendance will be reported and

work will be authenticated.

(4) A list of all standardized tests the student will be

required to take during the school year and the place where

the test will be administered, if available.

(5) The meetings to be held during the school year

between a parent or guardian and a teacher and among other

school officials or parents or guardians and the manner in

A01634 - 27 -

which the parent or guardian will be notified of the time and

place for the meeting.

(6) The address of the cyber charter school and the

name, telephone number and e-mail address of the school

administrator and other school personnel.

(7) A list of any extracurricular activities provided by

the cyber charter school.

(8) The names of the student's teachers, if available,

and the manner in which each teacher can be contacted by the

student or the parent or guardian.

(9) A list of all services that will be provided to the

student by the cyber charter school.

(10) Copies of policies relating to computer security

and privacy, truancy, absences, discipline and withdrawal or

expulsion of students.

(11) Information on:

(i) The cyber charter school's professional staff,

including the number of staff personnel, their education

level and experience.

(ii) The cyber charter school's performance on the

PSSA and other standardized test scores.

(iii) The cyber charter school's graduation rate, if

applicable.

(iv) The cyber charter school's designation as a

Comprehensive Support and Improvement school, Targeted

Support and Improvement School or an Additional Targeted

Support and Improvement School under the Every Student

Succeeds Act (Public Law 114-95, 129 Stat.1802) or an

equivalent building level designation under its successor

Federal statute along with a description of the

A01634 - 28 -

designation, if applicable.

(12) Information regarding the proper usage of equipment

and materials and the process for returning equipment and

materials supplied to the students by the cyber charter

school. A parent or guardian shall acknowledge, either in

writing or electronically, the receipt of this information.

(13) A description of the school calendar, including,

but not limited to, the time frame that will constitute a

school year and a school week, holidays and term breaks.

(e) Students.--For each student enrolled, a cyber charter

school shall:

(1) provide all instructional materials, which may

include electronic or digital books in place of paper books;

(2) provide all equipment, including, but not limited

to, a computer, computer monitor and printer, provided that a

parent or guardian of an enrolled child may elect not to

receive a computer monitor and printer; and

(3) provide or reimburse for [all] technology and

services necessary for the [on-line] online delivery of the

curriculum and instruction. The department shall establish a

maximum allowable reimbursement rate for the technology and

services required under this paragraph.

(e.1) The Commonwealth and school district of residence

shall not be liable for any reimbursement owed to students,

parents or guardians by a cyber charter school under [paragraph

(3)] subsection (e)(3).

[(f) Annual report.--A cyber charter school shall submit an

annual report no later than August 1 of each year to the

department in the form prescribed by the department.

(g) Records and facilities.--A cyber charter school shall

A01634 - 29 -

provide the department with ongoing access to all records and

facilities necessary for the department to assess the cyber

charter school in accordance with the provisions of this

subdivision.]

(h) Offices and facilities.--A cyber charter school shall

maintain an administrative office within this Commonwealth where

all student records shall be maintained at all times and shall

provide the department with the addresses of all offices and

facilities of the cyber charter school, the ownership thereof

and any lease arrangements. The administrative office of the

cyber charter school shall be considered as the principal place

of business for service of process for any action brought

against the cyber charter school or cyber charter school staff

members. The cyber charter school shall notify the department of

any changes in this information within [ten] 10 days of the

change.

(i) Applicable law.--Any action taken against the cyber

charter school, its successors or assigns or its employees,

including any cyber charter school staff member as defined in

the act of December 12, 1973 (P.L.397, No.141), known as the

Professional Educator Discipline Act, shall be governed by the

laws of this Commonwealth. If the department initiates an

investigation or pursues an action pursuant to the Professional