Texas

Texas law has the following caps on open-enrollment charter schools: 285 charters beginning September 1, 2018; and 305 charters beginning September 1, 2019. Currently, there are 228 operational charters in the state.
However, it does not have a cap on open-enrollment university charter schools, open-enrollment junior college charter schools, or school district-authorized charter schools. The law allows for detention, correctional, or residential facilities serving juvenile offenders to apply for a charter with the state board of education. It also provides that charters granted for dropout recovery schools are not counted against the cap.

The law allows up to five open-enrollment charters to be granted for schools primarily serving students with disabilities. It provides that these schools are not counted against the larger charter cap.

It is important to note that existing open enrollment charter schools can apply to the Texas Education Agency for expansion. In addition, high-performing charter schools may use an expedited process to add a new campus. If a charter holder submits to the state commissioner of education an application for expedited expansion, the expansion is automatically approved unless, not later than the 60th day after the date the charter holder submits the application, the commissioner provides written notice to the charter holder that charter holder does not meet the requirements for an expedited expansion.

Texas law allows new start-ups and public school conversions.

Texas law allows applicants to apply to either local school boards or the state commissioner of education. The law requires the state commissioner to notify the state board of education of each charter the commissioner proposes to grant and allows the board to overturn the commissioner’s granting of a charter by a majority vote.

While the law does not require the legislature and governor to regularly review the performance of the state commissioner of education as an authorizer, they can do so at any time. In addition, the ability of the state commissioner of education to continue authorizing can be removed by the legislature and governor (the entities that gave it that authority).
Texas law requires the state commissioner of education to select a center for education research authorized by state law to prepare an annual report concerning the performance of open-enrollment charter schools by authorizer compared to campus charters and matched traditional campuses. It provides that the format of the report must enable the public to distinguish and compare the performance of each type of public school by classifying the schools as follows: open-enrollment charters granted by the state board of education; open-enrollment charters granted by the commissioner; charters granted by school districts; and matched traditional campuses.

It also requires the report to include the performance of each public school in each class as measured by the student achievement indicators adopted under state law and student attrition rates. It also requires the report to aggregate and compare the performance of open-enrollment charter schools granted charters by the state board, open-enrollment charter schools granted charters by the commissioner, campuses and programs granted charters by school districts, and matched traditional campuses and rate the aggregate performance of elementary, middle or junior high, and high schools within each class as indicated by the composite rating that would be assigned to the class of elementary, middle or junior high, and high schools if the students attending all schools in that class were cumulatively enrolled in one elementary, middle or junior high, or high school.

The law also requires the report to include an analysis of whether the performance of matched traditional campuses would likely improve if there were consolidation of school districts within the county in which the campuses are located.
The law only requires such an analysis for a county that includes at least seven school districts and at least 10 open-enrollment charter schools.

Texas law requires the state commissioner of education to designate an impartial organization with experience in evaluating school choice programs to conduct an annual evaluation of open-enrollment charter schools. The law requires the evaluation to include consideration of the following items before implementing the charter and after implementing the charter: students' scores on state tests; student attendance; students' grades; incidents involving student discipline; socioeconomic data on students' families; parents' satisfaction with their children's schools; and students' satisfaction with their schools.

The law also requires the evaluation of open-enrollment charter schools to include an evaluation of: the costs of instruction, administration, and transportation incurred by open-enrollment charter schools; the effect of open-enrollment charter schools on school districts and on teachers, students, and parents in those districts; and other issues, as determined by the commissioner.

The law does not require at least a registration process for local school boards to affirm their interest in chartering to the state, does not require a regular review process by an authorizer oversight body of local school board authorizers, and does not require an authorizer oversight body with authority to sanction local school board authorizers, including removal of authorizer right to approve schools.

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.

Texas law contains application elements for all schools and additional application elements specific to conversion schools.
Texas law provides that the state commissioner of education may grant a charter for an open-enrollment charter school to an applicant that is: an eligible entity that proposes to operate the charter school program of a charter operator that operates one or more charter schools in another state and with which the eligible entity is affiliated and, as determined by the commissioner in accordance with commissioner rule, has performed at a level of performance comparable to performance under the highest or second highest performance rating category under state law; or an entity that has operated one or more charter schools established under state law and, as determined by the commissioner in accordance with commissioner rule, has performed in the highest or second highest performance rating category under state law. This law is not applicable to district authorizers.
Texas law has separate elements required for the approval of a charter school expansion amendment by the state commissioner of education. This law is not applicable to district authorizers.

Texas law provides that approval of the commissioner is not required for establishment of a new open-enrollment charter school campus if: a charter holder has an accreditation status of accredited and at least 50 percent of its student population in grades assessed or at least 50 percent of the students in the grades assessed having been enrolled in the school for at least three school years; the charter holder is currently evaluated under the standard accountability procedures for evaluation and received a district rating in the highest or second highest performance rating category for three of the last five years with at least 75 percent of the campuses rated under the charter also receiving a rating in the highest or second highest performance rating category and with no campus with a rating in the lowest performance rating category in the most recent ratings; the charter holder provides written notice to the commissioner of the establishment of any new campus in the time, manner, and form provided by rule of the commissioner; and not later than the 60th day after the date the charter holder provides written notice, the commissioner does not provide written notice to the charter holder of disapproval of a new campus. This law is not applicable to district authorizers.
Texas regulation specifies that the commissioner must adopt an application form for charter schools that includes such items as application requirements and approval criteria. The law provides that the state commissioner of education shall approve or deny an application based on documented evidence collected through the application review process; merit; and other criteria as adopted by the commissioner, which must include criteria relating to the capability of the applicant to carry out the responsibilities provided by the charter and the likelihood that the applicant will operate a school of high quality, criteria relating to improving student performance and encouraging innovative programs, and a statement from any school district whose enrollment is likely to be affected by the open-enrollment charter school including information relating to any financial difficulty that a loss in enrollment may have on the district. This regulation and law are not applicable to district authorizers.

Texas law states that the state board of education may hold a public hearing to determine parental support for an application for a charter school. Texas regulation provides that the state commissioner of education and a state board of education designee conducts an in-person interview with applicants. These laws and regulations are not applicable to district authorizers.

In practice, prior to each application cycle, the Texas Education Agency releases a written application that includes application requirements and approval criteria. The application review process includes review of the written application by a panel of outside reviewers. The Texas Education Agency also reviews the application for legal compliance. If applicants receive a certain minimum score on the application, then the applicant becomes eligible for an in-person interview with the commissioner of education, the Texas Education Agency, and the state board of education members. If an applicant is within five percentage points of the minimum score, the applicant may appeal for an additional external review.

Texas law requires that all charter approval or denial decisions be made in a public meeting. It does not require authorizers to state reasons for denials in writing.

Texas law provides that a district-authorized charter must be in the form and substance of a written contract signed by the president of the board of trustees granting the charter and the principal or equivalent chief operating officer of the school for which the charter is granted.
Texas law provides that a charter for a state-authorized charter school shall be in the form of a written contract signed by the state commissioner of education and the chief operating officer of the school.

Texas law requires that contracts define the roles, powers, and responsibilities for the school but not the authorizer.

Texas law provides that each charter for a state-authorized charter school must, among other things, provide that continuation of the charter is contingent on the status of the charter as determined by state law, specify the academic, operational, and financial performance expectations by which a school operating under the charter will be evaluated (which must include applicable elements of the performance frameworks adopted under state law), specify any basis on which the charter may be revoked, renewal of the charter may be denied, or the charter may be allowed to expire, and specify the standards for evaluation of a school operating under the charter for purposes of charter renewal, denial of renewal, expiration, revocation, or other intervention in accordance with state law. This law does not apply to district authorizers.

The law requires the commissioner to develop and by rule adopt performance frameworks that establish standards by which to measure the performance of an open-enrollment charter school. The law specifies that the performance frameworks shall be based on national best practices that charter school authorizers use in developing and applying standards for charter school performance. The law provides that In evaluating an open-enrollment charter school, the commissioner shall measure school performance against an established set of quality standards developed and adopted by the commissioner. Each year, the law requires the commissioner to evaluate the performance of each open-enrollment charter school based on the applicable performance frameworks adopted. This law does not apply to district authorizers.

The law provides that a charter granted by a local school board expires 10 years from the date the charter is granted unless the specified goals are substantially met as determined by the local school board. The state board of education charter application stipulates a charter will be granted for five years with a possible renewal of 10 years. The state education agency treats the charter application as an administrative rule.

Like school districts, charters are subject to Chapter 39 of the Education Code, which includes assessment of academic skills, performance indicators, accreditation status, and accreditation sanctions. The data collected is made public through reports on the state education agency’s website through the Academic Excellence indicator system.
The Commissioner of Education, through the Texas Education Agency (TEA), monitors charter school student outcome data annually through the Texas Academic Excellence Indicator System (AEIS). The TEA also monitors annually charter school financial stability through the Charter School Financial Rating System of Texas (FIRST), although FIRST ratings are not required of university charter schools. AEIS reports and FIRST ratings are released to the public by TEA. Charter schools are required to distribute their annual campus report cards to parents.

Texas law requires all charters to ensure that an annual audit of financial and programmatic operations is conducted. Further, the law allows the state commissioner and the TEA to audit the records of an open-enrollment charter school, a charter holder, and a management company. It provides that the state commissioner audit must be limited to matters directly related to the management or operation of an open-enrollment charter school, including any financial and administrative records.

Texas law allows a district board of trustees to place on probation or revoke a charter it grants if the board determines that the charter committed a material violation of the charter, failed to satisfy generally accepted accounting standards of fiscal management, or failed to comply with state law or state agency rule. The law requires each district board of trustees that authorizes a charter to adopt a procedure to be used for placing on probation or revoking a charter it grants and providing an opportunity for a hearing to the charter and to parents and guardians of students at the charter.

The law requires the state commissioner of education to take certain actions if an open-enrollment school commits a material violation of the school's charter, fails to satisfy generally accepted accounting standards of fiscal management or fails to comply with the state’s charter school law or another applicable rule or law. The law allows the state commissioner to temporarily withhold funding, suspend the authority of an open-enrollment charter school to operate, or take any other reasonable action the commissioner determines necessary to protect the health, safety, or welfare of students enrolled at the school based on evidence that conditions at the school present a danger to the health, safety, or welfare of the students.

Not later than the third business day after the date the state commissioner acts, he or she must provide the charter holder an opportunity for a hearing. If the state commissioner takes action, the law specifies that the open-enrollment charter school may not receive funding and may not resume operating until a determination is made that the conditions at the school do not present a danger of material harm to the health, safety, or welfare of students.

In addition, the Texas Academic Excellence Indicator System includes a progressive intervention system for charter schools rated Improvement Required for two or more school years. The progressive intervention system begins with a technical assistance team and ends with mandatory closure of the school.

The law requires the state commissioner of education to develop and by rule adopt a procedure for renewal, denial of renewal, or expiration of a charter for an open-enrollment charter school at the end of the term of the charter. It specifies that the procedure must include consideration of the performance under state law of the charter holder and each campus operating under the charter and must include three distinct processes, which must be expedited renewal, discretionary consideration of renewal or denial of renewal, and expiration.Texas law requires schools seeking renewal to apply for it.
Texas law provides that at the end of the term of a charter for an open-enrollment charter school, if a charter holder submits to the commissioner a petition for expedited renewal of the charter, the charter automatically renews unless, not later than the 30th day after the date the charter holder submits the petition, the commissioner provides written notice to the charter holder that expedited renewal of the charter is denied. The law provides that the commissioner may not deny expedited renewal of a charter if: the charter holder has been assigned the highest or second highest performance rating under state law for the three preceding school years; the charter holder has been assigned a financial performance accountability rating under state law, indicating financial performance that is satisfactory or better for the three preceding school years; and no campus operating under the charter has been assigned the lowest performance rating under state law for the three preceding school years or such a campus has been closed.
Texas law provides that at the end of the term of a charter for an open-enrollment charter school, if a charter holder submits to the commissioner a petition for renewal of the charter and the charter does not meet the criteria for expedited renewal or for expiration, the commissioner shall use the discretionary consideration process. The law provides that the commissioner's decision under the discretionary consideration process must take into consideration the results of annual evaluations under the performance frameworks established under state law. The law requires the commissioner to provide a decision to the charter regarding renewal within 60 days of the renewal application.
Texas law provides that at the end of the term of a charter for an open-enrollment charter school, if a charter holder submits to the commissioner a petition for renewal of the charter, the commissioner may not renew the charter and shall allow the charter to expire if: the charter holder has been assigned the lowest performance rating under state law for any three of the five preceding school years; the charter holder has been assigned a financial accountability performance rating under state law indicating financial performance that is lower than satisfactory for any three of the five preceding school years; the charter holder has been assigned any combination of these ratings for any three of the five preceding school years; or any campus operating under the charter has been assigned the lowest performance rating under state law for the three preceding school years and such a campus has not been closed.
Texas law allows a district board of trustees to place on probation or revoke a charter it grants if the board determines that the charter committed a material violation of the charter, failed to satisfy generally accepted accounting standards of fiscal management, or failed to comply with the state’s charter school law or state agency rule.
The law requires the state commissioner to revoke the charter of an open-enrollment charter school or reconstitute the governing body of the charter holder if the commissioner determines that the charter holder committed a material violation of the charter, including failure to satisfy accountability provisions prescribed by the charter, failed to satisfy generally accepted accounting standards of fiscal management, failed to protect the health, safety, or welfare of the students enrolled at the school, failed to comply with applicable state law or rule, failed to satisfy the performance framework standards adopted under state law, or is imminently insolvent as determined by the commissioner in accordance with commissioner rule.

The law requires the commissioner to revoke the charter of an open-enrollment charter school if: the charter holder has been assigned an unacceptable performance rating under state law for the three preceding school years; the charter holder has been assigned a financial accountability performance rating under state law indicating financial performance lower than satisfactory for the three preceding school years; or the charter holder has been assigned any combination of these ratings for the three preceding school years.
Texas law and regulations require the state commissioner of education to ground renewal decisions based on evidence regarding a state-authorized school’s performance over the term of the charter contract. However, these laws and regulations are not applicable to district authorizers.

Texas law and regulations require the state commissioner of education to provide state-authorized charter schools with timely notification of potential revocation or non-renewal (including reasons) and reasonable time to respond. The law requires each district board of trustees that authorizes a charter to adopt a procedure to be used for placing on probation or revoking a charter it grants that must provide an opportunity for a hearing to the charter and to parents and guardians of students at the charter.
Texas law provides that for open-enrollment charter schools, a charter will be granted for five years with a possible renewal of 10 years. This law is not applicable to district authorizers.

Texas law and regulations require the state commissioner of education to provide charter schools with due process for nonrenewal and revocation decisions. In practice, the state education agency does not provide for a due process hearing if the reason for the adverse action is based on a "Chapter 39" violation (i.e., repeated financial and/or academic accountability failures). For Chapter 39 violations, there is a form of due process that is found in the state’s administrative regulations, but that process arguably is not as exacting as the due process afforded for adverse actions that are not Chapter 39 related.
The law requires that the records of an open-enrollment charter school that ceases to operate must be transferred in the manner specified by the commissioner to a custodian designated by the commissioner. It allows the state commissioner to designate any appropriate entity to serve as custodian, including the agency, a regional education service center, or a school district. However, these laws and regulations are not applicable to district authorizers.

Texas law allows all types of educational service providers – or “management services companies”- to operate all or parts of charter schools.
Texas law provides that the state commissioner of education may grant a charter for an open-enrollment charter school to an applicant that is: an eligible entity that proposes to operate the charter school program of a charter operator that operates one or more charter schools in another state and with which the eligible entity is affiliated and, as determined by the commissioner in accordance with commissioner rule, has performed at a level of performance comparable to performance under the highest or second highest performance rating category under state law; or an entity that has operated one or more charter schools established under state law and, as determined by the commissioner in accordance with commissioner rule, has performed in the highest or second highest performance rating category under state law.

Texas law requires a performance contract between the independent public charter school board and the service provider. The law notes that the commissioner may audit the records of a management company regarding matters directly related to the management or operation of an open-enrollment charter school, including any financial and administrative records. The law requires any management company to maintain all records related to the management services separately from any other records of the management company. Texas law requires that management services contracts between a charter school and a management services company must be pre-approved by the Texas Education Agency.

The law provides that school governing boards operate as entities completely independent of an educational service provider.

The law also includes conflict of interest provisions, requires that potential conflicts are disclosed and explained in the application, and applies ongoing disclosure requirements. State law prohibits charter schools from accepting loans from management services companies and prohibits a person with a substantial interest in a management company from serving on a charter school board. The law provides that records of an open-enrollment charter school and records of a charter holder that relate to an open-enrollment charter school are government records for all purposes under state law.

The law notes that a person may not serve as a teacher, librarian, educational aide, administrator, or school counselor for an open-enrollment charter school unless the person has been approved by the agency following a review of the person’s national criminal history record information.

All of the above provisions are applicable to open-enrollment and university charter schools, but not district-authorized charter schools.

Texas law provides requirements for fiscally and legally autonomous schools with independent charter school boards for open-enrollment charter school boards but not for district-authorized charters. District-authorized charter schools are governed and financed by the local school district board of trustees.

Texas law allows charter schools to be open to any student in the state. However, charter schools must designate in their charter applications the geographic area from which potential students will be enrolled. Students who reside in the school’s pre-approved geographic area must be permitted to attend the tuition-free charter school provided that positions are available. Texas law permits charter schools to deny admission to any student who has a documented history of a criminal offense, a juvenile court adjudication, or discipline problems that fall under Chapter 37 of the Education Code.
The law prohibits discrimination in admission policy on the basis of sex, national origin, ethnicity, religion, disability, academic, artistic, or athletic ability, or the district the child would otherwise attend.

The law requires a district-authorized charter to give admission priority on the basis of geographic and residency considerations. The law allows a district-authorized charter to give secondary consideration in its eligibility criteria for admission to a student's age, grade level, or academic credentials in general or in a specific area, as necessary for the type of program offered. It also allows open-enrollment charter schools that specialize in one or more performing arts to require an applicant to audition for admission to the school.

Through administrative rule, charter schools must follow the federal non-regulatory guidance that allows them to provide a lottery exemption to siblings of students enrolled and to children of a school’s founders and employees so long as the total number of students allowed under this exemption constitutes only a small percentage of the school’s total enrollment. Texas law exempts children of municipal employees from the lottery of a municipal open-enrollment charter school so long as it’s a small percentage of the total student population.

Texas law provides on receipt of more acceptable applications for admission than available positions in open-enrollment charters, the school must fill the available positions by lottery or fill the available positions in the order in which applications received before the application deadline were received. The law is not applicable to district-authorized charters.

Texas law provides that district-authorized charters are exempt from the instructional and academic rules and policies of the board of trustees from which the campus or program is specifically exempted in the charter. It also provides that district-authorized charters are subject to federal laws and rules governing public schools and to state laws and rules governing public schools only to the extent the applicability to district-authorized charters is specifically provided.
Texas law provides that district-authorized charters are subject to a provision of state law establishing a criminal offense, and a prohibition, restriction, or requirement, as applicable relating to state laws governing the following: Public Education Information Management System to the extent necessary to monitor compliance as determined by the commissioner, criminal history records, high school graduation, special education programs, bilingual education, prekindergarten programs, extracurricular activities, health and safety, and public school accountability.

Texas law provides that open-enrollment charters are subject to federal laws and rules governing public schools and to state laws in the Education Code only to the extent the applicability to state-authorized charters is specifically provided.

Texas law provides that open-enrollment charters are subject to a provision of state law establishing a criminal offense, and a prohibition, restriction, or requirement, as applicable relating to state laws governing the following: the Public Education Information Management System, criminal history records, reading instruments and accelerated reading instruction programs, satisfactory performance on assessment instruments and to accelerated instruction, high school graduation, special education programs, bilingual education, prekindergarten programs, extracurricular activities, discipline management practices or behavior management techniques, health and safety, public school accountability, the requirement to report an educator's misconduct, and intensive programs of instruction.

Texas law does not require charter school teachers to be certified except in the instances of bilingual/English language learner teachers, special education teachers, and high quality pre-kindergarten programs.

In Texas, it is illegal for public school teachers to engage in collective bargaining. Consequently, neither open-enrollment charter schools nor district-authorized charter schools participate in outside collective bargaining agreements. However, Texas law provides that open-enrollment charter schools are exempt from participation in school district personnel policies, but district-authorized charter schools are not exempt from participation in school district personnel policies.

Texas law and regulations allow an independent public charter school board to oversee multiple schools linked under a single contract with independent fiscal and academic accountability for each school.
Texas law provides that approval of the commissioner is not required for establishment of a new open-enrollment charter school campus if: a charter holder has an accreditation status of accredited and at least 50 percent of its student population in grades assessed or at least 50 percent of the students in the grades assessed having been enrolled in the school for at least three school years; the charter holder is currently evaluated under the standard accountability procedures for evaluation and received a district rating in the highest or second highest performance rating category for three of the last five years with at least 75 percent of the campuses rated under the charter also receiving a rating in the highest or second highest performance rating category and with no campus with a rating in the lowest performance rating category in the most recent ratings; the charter holder provides written notice to the commissioner of the establishment of any new campus in the time, manner, and form provided by rule of the commissioner; and not later than the 60th day after the date the charter holder provides written notice, the commissioner does not provide written notice to the charter holder of disapproval of a new campus.

Texas open enrollment charter schools are eligible to participate in University Interscholastic League extracurricular activities.

Texas law provides that open-enrollment charter schools are required to provide special education services per federal law and are considered their own LEA for special education services. A school district-authorized charter school is part of the LEA that is the school district.
Texas law specifies that open-enrollment charter schools are entitled to funds that are available to school districts from the state agency or the state commissioner in the form of grants or other discretionary funding unless the statute authorizing the funding explicitly provides that open-enrollment charter schools are not entitled to the funding. This law doesn’t apply to district-authorized charters.

The law states that an open-enrollment charter school is entitled to the same level of services provided to school districts by regional education service centers.

Texas law provides a funding formula for calculating the funding for open-enrollment charter schools. This funding formula, however, results in inequitable funding for open enrollment charter schools. The law is silent on funding for district-authorized schools.

Texas law specifies that open-enrollment charter schools are entitled to funds that are available to school districts from the state agency or the state commissioner in the form of grants or other discretionary funding unless the statute authorizing the funding explicitly provides that open-enrollment charter schools are not entitled to the funding. This law doesn’t apply to district-authorized charters.

According to state law, charter schools are eligible for the state transportation allotment.

Legislative changes made in 2021 allow public charter schools to apply for the Jobs & Education for Texans program grants, which funds career and technical training program equipment and expand eligibility for Teacher Incentive Allotment bonuses to public charter schools.
In a national study of charter school funding (Statistical Analysis of Texas Charter School Facilities), Texas charter schools were receiving on average $8,860 per pupil, while traditional public schools would have received $10,499 for those students. As a result, the state's charter schools were receiving $1,639 per pupil - or 15% - less than what the traditional public schools would have received for those students. This analysis reveals continued inequities for operational, categorical, and capital funding (see component #19 for information on capital issues).

From 2018-19, Texas law provides $60 million in annual facilities funds to charter schools that have received at least an acceptable rating within the state’s accountability system. This approximates to $200 per student (based on average daily attendance).
The New Instructional Facilities Allotment, subject to annual appropriations by the state legislature, provides to public school districts and open-enrollment charter schools operational expenses associated with constructing new instructional facilities that meet the requirements of the statute and rules. Reimbursement is for up to $1,000 per student in average daily attendance in the first two years of operation, but generally are prorated due to limited available funds. The program is capped in statute at $100 million per year. $62.13 million was made available for 2019-20.
Texas law requires a local school board that intends to sell, lease, or allow use of an unused or underused district facility to give each open-enrollment charter school located wholly or partly within its boundaries the opportunity to make an offer to purchase, lease, or use the facility, as applicable, in response to any terms established by the local school board, before offering the facility to any other specific entity. The law does not require the local school board to accept an offer made by an open-enrollment charter school.
Texas law provides that a local school district may not require a charter school to pay rent for or to purchase a facility in order for it to use the facility.
Texas law provides that open-enrollment charter schools may access revenue bonds from the Texas Public Finance Authority Charter School Finance Corporation for the acquisition, construction, repair, or renovation of educational facilities.

Texas law allows open-enrollment charter schools that have an investment grade rating and meet certain financial criteria to apply to have their bonds guaranteed by the Permanent School Fund. The amount of the Permanent School Fund guarantee available to charters is limited to the percentage of the number of students enrolled in open-enrollment charters. Such backing would result in charter bonds being backed by the full, faith, and credit of the state, putting charter schools more on par with school districts and allowing most charters to achieve AAA rating.
The Texas Credit Enhancement Program (TCEP) for Texas open-enrollment charter schools was established to provide a guarantee fund for issuing tax exempt revenue bonds to provide financing for the acquisition, construction, repair, or renovation of Texas charter school facilities, including refinancing of facilities debt within federal program guidelines. A consortium of Texas entities was awarded a federal grant to create the guarantee fund. The consortium consists of the Texas Public Finance Authority Charter School Finance Corporation (CSFC), the Texas Charter Schools Association (TCSA), and the Texas Education Agency (TEA).
The law exempts public charter schools from property tax on leased school buildings.

Texas law requires charter schools to participate in the relevant employee retirement systems.

Texas law includes a small number of the model law’s provisions regarding full-time virtual charter schools. It provides that a school district or open-enrollment charter school is eligible to act as a full-time virtual school by providing electronic courses through the state virtual school network. An open-enrollment charter school may serve as a course provider only to a student within its service area, to another student in the state through agreement with the school district in which the student resides, or if the student receives educational services under the supervision of a juvenile probation department, the Texas Juvenile Justice Department, or the Texas Department of Criminal Justice, through an agreement with the applicable agency. The law provides that an open-enrollment charter school may serve grades 3-12 through the Texas Virtual School Network and must be approved by the Commissioner of the Texas Education Agency (TEA).