5. Adequate Authorizer Funding

To cover costs for overseeing and authorizing public charter schools in accordance with this act, Alabama law allows a local school board serving as an authorizer to charge a portion of annual per student state allocations received by each public charter school it authorizes based on the following schedule:
* If the local school board has oversight over one to three, inclusive, public charter schools: Three percent of annual per student state allocations.
* If the local school board has oversight over four to five, inclusive, public charter schools: Two percent of annual per student state allocations.
* If the local school board has oversight over six to 10, inclusive, public charter schools: One percent of annual per student state allocations.

The law does not provide adequate and guaranteed funding for the Alabama Public Charter School Commission.

The law provides that a public charter school authorized by a local school system may choose to purchase services, such as transportation-related or lunchroom-related services, from its authorizer. In such event, the public charter school and authorizer shall execute an annual service contract, separate from the charter contract, stating the mutual agreement of the parties concerning any service fees to be charged to the public charter school. A public charter school authorized by the commission may not purchase services from the commission, but consistent with this section, may purchase services from the local school system where the public charter school is located.

With the exception of charges for oversight services, the law provides that a public charter school may not be required to purchase services from its authorizer as a condition of charter approval or of a charter contract, nor may any such condition be implied.

Alaska law allows school districts to retain up to four percent of a charter school’s program budget to cover the district’s administrative costs. The law requires a local school board to provide a charter school with a report itemizing the administrative costs retained by the local school board.

While the law does not provide adequate and guaranteed funding to authorizers, the ASBCS receives a small annual appropriation to cover the expenses of the board, staffing, and external contracts for various oversight functions. State law allows the ASBCS to accept gifts or grants. Also, state department of education staff or other state employees complete some oversight functions.
State law allows authorizers to charge a new charter application processing fee to any applicant, which must fully cover the cost of application review and any needed technical assistance. It also allows authorizers to approve policies that allow a portion of the fee to be returned to the applicant whose charter is approved. The law allows the ASBCS to charge a processing fee to any charter school that amends its contract to participate in the Arizona Online Instruction program.
Arizona law provides that authorizers, as public entities, are held accountable for reporting their expenditures.

Except for the new charter application processing fee, Arizona law provides that authorizers may not charge any fees to schools they sponsor unless they have provided services for the school, and any such fees must represent full value of those services. On request, the value of such services must be demonstrated to the state department of education.

Arkansas law includes a small number of the model law's provisions for adequate authorizer funding. State law requires all state agency expenditures, including those by the state department of education (the state’s authorizer), to be publicly reported on a state website.

California law allows authorizers to charge each charter school up to 1% in revenues for the actual costs of oversight or up to 3% of revenues if the authorizer is providing a substantially rent-free facility to the school.
The statutory language permitting authorizers to charge “actual costs not to exceed” the specified percentage implies public accountability for authorizer expenditures, but it is not practiced in any consistent, structured way.

California law permits a charter school to separately purchase services from its authorizer, indicating that such fees are to be separate from the oversight fee.

The law does not explicitly prohibit an authorizer from requiring a school to purchase services. In practice, however, such a requirement could not be a condition for charter approval, as a school’s refusal to purchase services would not be cause for denial.

For district-chartered schools, Colorado law provides that district authorizers may retain the actual cost of each charter school’s per-pupil share of central administrative costs for services actually provided to the charter school, up to 15% of per-pupil funding for districts with 500 or fewer students and up to 5% of per-pupil funding for all other districts. For institute-chartered schools, the law provides that the institute may retain 3% of per-pupil funding (while the state department of education may retain up to 2% of per-pupil funding for its relevant administrative costs). Within 90 days after the end of each fiscal year, the law requires each authorizer to provide to each charter school it oversees an itemized accounting of all its central administrative overhead costs.

The law requires a separate contract for services purchased by a charter school from its authorizer.

The law prohibits the state charter institute from requiring charter schools to purchase services from the institute. The law similarly provides that a district-chartered school may purchase services at its discretion from the district.

Connecticut law does not include any of the model law's provisions for adequate authorizer funding.

Delaware law does not include any of the model law's provisions for adequate authorizer funding.

The law includes a small number of the model law's provisions regarding adequate authorizer funding. The law entitles the authorizer to charge each charter school up to one percent (1%) of its annual school budget as an oversight fee.

Florida law allows an authorizer to withhold up to 5 percent for:
* Enrollment of up to and including 250 students in a charter school.
* Enrollment of up to and including 500 students within a charter school system which meets all of the following: Includes conversion charter schools and nonconversion charter schools; Has all of its schools located in the same county; Has a total enrollment exceeding the total enrollment of at least one school district in this state; Has the same governing board for all of its schools; Does not contract with a for-profit service provider for management of school operations.
* Enrollment of up to and including 250 students in a virtual charter school.

It allows authorizers to withhold up to 2 percent for enrollment of up to and including 250 students in a high-performing charter school.

It allows authorizers to withhold up to 2 percent for enrollment of up to and including 250 students in an exceptional student education center that meets the requirements of the rules adopted by the State Board of Education.
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Florida law provides that if goods and services are made available to a charter school through a contract with an authorizer, then these services must be provided at a rate no greater than actual cost, unless mutually agreed upon by the charter school and the authorizer in a separate contract. If disputes arise over contracted services or contractual matters, the law allows appeals to an administrative law judge appointed by the Division of Administrative Hearings.
The law does not allow authorizers to charge any additional fees or surcharges for administrative and educational services beyond five percent. Statute also states that an authorizer may not charge a fee for reviewing applications and cannot base its consideration or approval of an application upon the promise of future payment of any kind.
The law requires authorizers to annually provide to the state department of education the total amount of funding withheld in administrative fees from charter schools for the prior fiscal year.

Georgia law establishes that authorizers may withhold up to 3% of state and local charter school funding for administrative costs.
State rule provides that all authorizers that withhold funds from charter schools have to annually report on the use of such funds to the state department of education.

Georgia law allows for state authorized charter schools to contract with local boards of education for administrative or transportation services. It does not contain a similar provision pertaining to district-authorized charter schools or a similar provision allowing such contracting with non-district authorizers.

Georgia guidelines provide that each authorizer that provides oversight of a charter school shall include in its annual report a written confirmation that it has not in the preceding year required a commercial contract with any public charter school board under its oversight.

The law provides that the state public charter school commission shall operate with dedicated resources and staff qualified to execute the day-to-day responsibilities of the commission pursuant to this chapter. The law states that the legislature shall make an appropriation to the commission separate from, and in addition to, any appropriation made to charter. The law also allows the commission to assess fees on non-state entities and individuals to help offset its operating costs. However, statute is silent on any financial support for other potential authorizers. Statute provides clear requirements to publicly report authorizer expenditures, to have separate contracts for any purchased services, and to prohibit authorizers from requiring any specific services purchases from them.

Idaho law includes a small number of the model law's provisions regarding adequate authorizer funding.
The law requires each public charter school to pay an authorizer fee to its authorized chartering entity to defray the actual documented cost of monitoring, evaluation and oversight, which, in the case of public charter schools authorized by the public charter school commission, shall include each school's proportional fee share of all moneys appropriated to the public charter school commission, plus 15%. The law allows each public charter school's board of directors to direct up to 10% of the calculated fee to pay membership fees to an organization or association that provides technical assistance, training and advocacy for Idaho public charter schools.

Unless the authorized chartering entity declines payment, such fee shall not exceed the greater of:
(a) all state funds distributed to public schools on a support unit basis for the prior fiscal year, divided by the statewide number of public school students in average daily attendance in the first reporting period in the prior fiscal year; or the lesser of the result of the calculation in (a) multiplied by 4 or 1.5% of the result of the calculation in (a) multiplied by the public charter school's average daily attendance in the first reporting period in the current fiscal year.

Illinois law allows the state board of education to charge up to 3% of the revenues provided to its approved schools. It does not contain a similar provision for school district authorizers.
The law requires the state board of education’s periodic report on charter schools to detail the authorizing functions that authorizers provided to their charter schools, including operating costs and expenses as detailed in annual audited financial statements.

Indiana law allows all authorizers except local school boards to withhold up to 3% of a school’s funding as an administrative fee.
The law provides that an authorizer's administrative fee may not include any costs incurred in delivering services that a charter school may purchase at its discretion from the authorizer. It provides that the authorizer shall use this funding exclusively for fulfilling authorizing obligations.?

The law provides that a charter school may not be required to purchase services from its authorizer as a condition of charter approval or of executing a charter contract, nor may any such condition be implied.?

The law allows a charter school to choose to purchase services from its authorizer. In that event, the law requires the charter school and the authorizer to execute an annual service contract, separate from the charter contract, stating the parties' mutual agreement concerning the services to be provided by the authorizer and any service fees to be charged to the charter school. The law states that an authorizer may not charge more than market rates for services provided to a charter school.?

According to the law, not later than 90 days after the end of each fiscal year, each authorizer shall provide to each charter school it authorizes an itemized accounting of the actual costs of services purchased by the charter school from the authorizer. The law states that any difference between the amount initially charged to the charter school and the actual cost shall be reconciled and paid to the owed party. If either party disputes the itemized accounting, any charges included in the accounting, or charges to either party, the law allows either party to request a review by the state department of education and requires the requesting party to pay the costs of the review.

Iowa law does not include any of the model law's provisions for adequate authorizer funding.

Kansas law does not include any of the model law's provisions for adequate authorizer funding.

Louisiana law allows authorizers to annually charge each charter school it authorizes a fee in an amount equal to two percent of per-pupil funding for administrative overhead costs incurred by the chartering authority for considering the charter application and any amendment thereto, providing monitoring and oversight of the school, collecting and analyzing data of the school, and reporting on school performance.

At least thirty days prior to the beginning of each fiscal year, Louisiana law requires each authorizer to provide each charter school with a projected budget detailing anticipated administrative overhead costs and planned uses for fees charged for such costs. By not later than ninety days following the end of each fiscal year, the law requires the authorizer to provide each charter school an itemized accounting of all administrative overhead costs. Additionally, by not later than ninety days following the end of each fiscal year, the law requires the authorizer to provide each charter school an itemized accounting of the actual cost of each purchased service provided to the charter school.
Louisiana law allows a charter school to contract with its authorizer for the direct purchase of specific services in addition to those included in administrative overhead costs. The law requires the authorizer to provide such services at the actual costs incurred by the authorizer and requires the amount paid by a charter school for such purchased services to be in accordance with a written agreement entered into for this purpose. It provides that such agreement must be negotiated and executed prior to the beginning of each school year and that absent such an agreement the authorizer has no authority to withhold from the charter school any funds relative to providing such services. The law also allows transportation costs to be acquired via contract at below cost if both parties agree.
Louisiana law allows an authorizer to provide other services for a charter school and charge the actual cost of providing such services, but provides that no such arrangement must be required as a condition for authorizing the charter school.

Maine law allows authorizers to charge up to 3% of the per pupil allocations sent to the schools they authorize to cover the costs for an authorizer to oversee its public charter schools. Statute requires authorizers to report to the state commissioner of education the total amount of funds collected from each public charter school the authorizer authorized and the costs incurred by the authorizer to oversee each public charter school.
Statute provides that charter schools may not be required to purchase services from its authorizer, but may choose to do so. The law provides that schools and authorizers must execute an annual service contract, separate from the charter contract, stating the terms of the services.

Maryland law does not include any of the model law's provisions for adequate authorizer funding.

Massachusetts law includes a small number of the model law's provisions for adequate authorizer funding. State ethics laws preclude a charter school from being required to purchase services from the state department of education. Because the authorizer resides within the state department of education, its funding is contained within the overall funding of the department. The funding levels for the authorizer are steady or shrinking while the number of schools continues to grow.

Via an assessed fee, Michigan law allows authorizers to receive up to 3% of the total state school aid to be received by their charter schools.
Michigan law provides that as public entities, all public fund expenditures for authorizers are a matter of public record. However, the law does not require specific separate reporting of authorizer fee expenditures.

Statute allows authorizers to charge a fee for other services, but states they cannot require such arrangements as a condition to issuing a contract to a school.

Minnesota law allows authorizers to charge a fee. It provides that the fee that an authorizer may annually assess is the greater of: the basic formula allowance for that year; or the lesser of: the maximum fee factor times the basic formula allowance for that year; or the fee factor times the basic formula allowance for that year times the charter school's adjusted pupil units for that year. The fee factor equals .015. The maximum fee factor equals 4.0.For the preoperational planning period, after a school is chartered, the law allows an authorizer to assess a charter school a fee equal to the basic formula allowance.

Minnesota law requires authorizers to annually submit a statement of income and expenditures related to authorizing activities to the state commissioner and its charter schools.

Statute states that the granting or renewal of a charter by an authorizer cannot be contingent on the school being required to contract, lease, or purchase services from the authorizer. It also provides that any potential contract, lease, or purchase of service by a charter school from an authorizer must be disclosed to the state commissioner, accepted through an open bidding process, and be a separate contract from the charter contract. There are also further requirements in law if the contract is for management or financial services.

To cover the costs of overseeing charter schools in accordance with this act, the law provides that the state authorizer shall receive 3% of annual per-pupil allocations received by a charter school from state and local funds for each charter school it authorizes.
While the law does not require the state authorizer to publicly report detailed authorizer expenditures, it does require the Joint Legislative Committee on Performance Evaluation and Expenditure Review to prepare an annual report assessing the sufficiency of funding for charter schools, the efficacy of the state formula for authorizer funding, and any suggested changes in state law or policy necessary to strengthen the state's charter schools.

To defray the expenses associated with authorizing, Missouri law requires the state department of education to retain and provide to the authorizer one and five-tenths percent of the amount of state and local funding allocated to the charter school.
Regulations require authorizers to submit an annual report how they are spending their authorizing fees.
The law allows charter schools to enter into contracts with districts for the provision of services, but it silent about allowing charters to enter into contracts with non-district authorizers for the provision of services.

Nevada law provides that authorizers receive a fee not to exceed 2% of the total amount of money apportioned to charter schools, except that charter schools meeting the requirements of law may request their sponsor to lower the amount to not less than 1%.
Upon completion of a school quarter, the law allows an authorizer to request reimbursement from a charter school for the administrative costs associated with authorization during that school year, including an itemized list of those costs.

Statute requires a separate contract for any services purchased from an authorizer by a charter school board, excluding those services covered by the sponsorship fee. The law also provides a prohibition on authorizers requiring schools to purchase any services from them.

New Hampshire law does not include any of the model law's provisions for adequate authorizer funding.

New Jersey law does not include any of the model law's provisions for adequate authorizer funding.

New Mexico law allows authorizers to withhold and use two percent of the school-generated program cost for its administrative support of a charter school. The law requires authorizers to annually provide a detailed description of how they are expending the dollars that they are withholding from charter schools.
New Mexico law allows a charter school to contract with a school district, a university or college, the state, another political subdivision of the state, the federal government or one of its agencies, a tribal government, or any other third party for the use of a facility, its operation and maintenance, and the provision of any service or activity that the charter school is required to perform in order to carry out the educational program described in its charter.

New York law does not include any of the model law’s provisions for adequate authorizer funding. SUNY’s authorizing activities are funded through an appropriation in the New York State Budget each year. The State Education Department and local school district boards fund their authorizing work from their general budgets.

North Carolina provides funding for the Office of Charter Schools at the North Carolina Department of Public Instruction, which serves as authorizing staff to the state board and others. The law also requires the state board of education to establish reasonable fees of no less than $500 for initial and renewal charter applications. The current application fee is $1,000.
The state law provides that a charter school is not required to enter into any other contract.

Ohio law allows authorizers to take up to 3% of each charter school's per pupil funding and requires authorizers to publicly report detailed authorizer expenditures. Ohio law prohibits authorizers from selling any goods or services to any charter school it authorizes, except that it allows school districts and state universities to sell goods or services at no profit. Ohio rules prohibit authorizers from requiring schools to purchase services from them.

Oklahoma law includes a small number of the model law's provisions for adequate authorizer funding.
Oklahoma law permits an authorizer to withhold up to 5% of a school's state aid allocation for administrative purposes.

Oregon law includes a small number of the model law's provisions regarding adequate authorizer funding. Oregon law allows authorizers to retain a significant portion of charter school per-pupil funding, typically 20% for K-8 schools and 5% for high schools. The law does not mandate that these retained funds be spent on oversight.

Pennsylvania law does not include any of the model law's provisions for adequate authorizer funding.

Rhode Island law does not include any of the model law's provisions for adequate authorizer funding.

South Carolina law includes a small number of the model law’s provisions for adequate authorizer funding.
South Carolina law provides that the South Carolina Public Charter School District may retain no more than two percent of the total state appropriations for each charter school it authorizes to cover the costs for overseeing its charter schools. The law provides that this fee does not include costs incurred in delivering services that a charter school may purchase at its discretion from the District. These provisions don’t apply to local school board and higher education authorizers.

South Carolina law requires that all services centrally or otherwise provided by an authorizer including, but not limited to, food services, custodial services, maintenance, curriculum, media services, libraries, and warehousing are subject to negotiation between a charter school and the authorizer and must be outlined in the school’s charter contract. The model law calls for such services to be included in a contract separate from the school’s charter contract.

Tennessee law authorizers to receive an annual authorizer fee that is the lesser of 3% of the annual per student state and local allocations or $35,000 per school. The authorizer must only use the authorizer fee for fulfilling authorizing obligations and must submit an annual report to the state department of education regarding the fee amount and actual usage. Any fee collected in excess of obligation costs must be refunded to the school.
Tennessee law allows LEAs to charge applicants an application fee in an amount approved by the local board of education, not to exceed $2,500 per application.

The law prohibits authorizers from charging any other fees beyond the authorizer and application fees, unless there is an annual service contract for any agreed upon services from the authorizer.

Texas law includes a small number of the model law's provisions for adequate authorizer funding. As a state agency, the Texas Education Agency must report its expenditures, which includes its expenses related to authorizing. While not included in the charter school law, the state provides funds, via the state appropriations process, to the state board of education and state commissioner of education in support of their functions, including those relating to charter schools. In addition, the state board of education and the state commissioner of education is publicly accountable for the state funds used to exercise all of their functions, including those relating to charter schools.

Utah funds its state charter board through an annual legislative appropriation each year. The amount varies but is generally considered adequate for the board’s basic work. The law does not provide for funding for local school board authorizers, but permits higher education institutions to charge up to 3% of the revenue the charter school receives from the state in the current fiscal year in the first two years that a charter school is in operation as an annual oversight fee. Beginning with the third year that a charter school is in operation, an annual oversight fee may not exceed the product of 1% of the revenue a charter school receives from the state in the current fiscal year.
Utah law requires all state agencies, including the state charter board, higher education institutions, and school districts, to publicly report their expenditures.

Utah law specifies that the state charter board may provide services to its charter schools at the discretion of the charter school and that a district-authorized school may contract with the district for services, but the law does not address higher education authorizers and does not clearly prohibit authorizers from requiring schools to purchase services from them.

Virginia law provides that a public charter school may negotiate and contract with a school division, the governing body of a public institution of higher education, or any third party for the use of a school building and grounds, the operation and maintenance thereof, and the provision of any service, activity, or undertaking which the public charter school is required to perform in order to carry out the educational program described in its charter contract. It also provides that any services for which a public charter school contracts with a school division shall not exceed the division's costs to provide such services.
Virginia law also provides that funding and service agreements between local school boards and public charter schools must not provide a financial incentive or constitute a financial disincentive to the establishment of a public charter school, including any regional public charter school.

Statute requires the state board of education to establish a statewide formula for an authorizer oversight fee, which is to be calculated as a percentage of the state operating funding provided to charters. It provides that this amount may not be more than 4% and that it may involve a sliding scale that takes into consideration such factors as the number of schools per authorizer and the number of years that an authorizer has been operating. The law requires authorizers to separately account for such fees and report them annually to the state board of education.
Statute allows authorizers to provide separately contracted, fee-based services in addition to their oversight responsibilities, but such fees cannot cost more than market rates and cannot be required as a condition of being approved.

According to West Virginia law, to cover authorizer costs for overseeing public charter schools, the state board of education shall establish a statewide formula for authorizer oversight funding, which shall apply uniformly to every authorizer in the state and shall not exceed one percent of each public charter school’s per-student funding in a single school year.
According to West Virginia law, a charter school may negotiate and contract with its authorizer or any third party for the use, operation, and maintenance of a building and grounds, liability insurance, and the provision of any service, activity, or undertaking that the public charter school is required to perform in order to carry out the educational program described in its charter contract. Any services for which a public charter school contracts with a school district shall be provided by the district at cost and shall be negotiated as a separate agreement after final charter contract negotiations.

Wisconsin law includes a small number of the model law's provisions for adequate authorizer funding. The law includes a requirement for authorizers to publicly report the operating costs incurred (detailed in an audited financial statement prepared in accordance with generally accepted accounting principles) and the services they provided to the charter schools under contract with them and an itemized accounting of the cost of the services.

Wyoming law does not include any of the model law's provisions for adequate authorizer funding.