House File 2198 - Introduced HOUSE FILE 2198 BY WILLS A BILL FOR An Act relating to persistently lowest-achieving schools 1 by authorizing parents or guardians to petition for the 2 closure of an attendance center, for implementation of an 3 education voucher program, or for establishment of a charter 4 school, establishing an education voucher fund, making 5 appropriations, and providing penalties. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 TLSB 5164YH (4) 86 md/sc

H.F. 2198 Section 1. Section 256.7, Code 2016, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 33. Adopt rules relating to applications 3 for an education voucher pursuant to section 256E.4, including 4 application processing timelines and information required to be 5 submitted by a parent or guardian. 6 Sec. 2. NEW SECTION . 256E.1 Definitions. 7 1. “Attendance center” means a public school building 8 that contains classrooms used for instructional purposes for 9 elementary, middle, or secondary school students. 10 2. “School board” means a board of directors regularly 11 elected by the registered voters of a school district. 12 3. “State board” means the state board of education. 13 Sec. 3. NEW SECTION . 256E.2 Alternatives for persistently 14 lowest-achieving schools —— parent petition. 15 1. If an attendance center is identified by the department 16 of education as a persistently lowest-achieving school within 17 the meaning of section 256.9, subsection 61, the parents or 18 guardians of students enrolled at the attendance center may 19 submit a petition to the school board to either close the 20 attendance center pursuant to section 256E.3 or authorize 21 education vouchers for students of the attendance center under 22 section 256E.4. 23 2. A valid petition under this section must state whether 24 the petition is requesting the closure of an attendance center 25 pursuant to section 256E.3 or the authorization of education 26 vouchers under section 256E.4, and must contain the signatures 27 of at least fifty percent of the parents or guardians whose 28 children are enrolled at the attendance center. A valid 29 petition under this section must be received by the school 30 board not later than December 1 of the school year preceding 31 the school year during which the requested action will be 32 implemented. A petition received after that deadline will be 33 considered a petition for the next applicable school year. 34 3. Unless rulemaking is authorized for another state 35 -1- LSB 5164YH (4) 86 md/sc 1/ 10

H.F. 2198 agency, the state board shall, after consulting with the 1 department of education and the department of management, adopt 2 rules to implement and administer this chapter. 3 Sec. 4. NEW SECTION . 256E.3 Closure of attendance center —— 4 reallocation of students. 5 1. If a valid petition for closure of an attendance center 6 is received by a school board under section 256E.2, the school 7 board shall formulate and implement a plan for the closure 8 of the attendance center and a plan for the reallocation of 9 students currently enrolled at the attendance center and those 10 students who would, but for the closure, be enrolled at the 11 attendance center during the next school year. 12 2. The plan for the reallocation of students to other 13 attendance centers in the school district shall include 14 objective criteria and standards and criteria for prioritizing 15 requests that do not have an adverse impact on the plan. 16 3. a. If other attendance centers in the school district 17 have insufficient classroom space to accommodate the students 18 from the closing attendance center, the school board shall 19 instead implement the education voucher program under section 20 256E.4. 21 b. Every school district shall adopt a policy that defines 22 the term “insufficient classroom space” for each attendance 23 center in that district. 24 Sec. 5. NEW SECTION . 256E.4 Education voucher program. 25 1. a. If a valid petition authorizing education vouchers 26 is received by a school board under section 256E.2, or if 27 section 256E.3, subsection 3, is applicable, students eligible 28 to enroll in kindergarten through grade twelve and who are 29 enrolled at the attendance center at the time the applicable 30 petition is filed are eligible to receive education vouchers. 31 b. Education vouchers shall be made available to parents 32 and guardians in the manner authorized under subsection 33 4, paragraph “c” , for the payment of qualified educational 34 expenses as provided in this section. 35 -2- LSB 5164YH (4) 86 md/sc 2/ 10

H.F. 2198 2. a. (1) By January 31 preceding the school year for 1 which the education voucher is requested, the parent or 2 guardian of the student requesting to receive an education 3 voucher shall submit an application to the department of 4 education, on application forms developed by the department, 5 indicating that the parent or guardian intends to enroll the 6 student in a nonpublic school. 7 (2) In addition to other information deemed appropriate 8 by the department of education, the application shall require 9 certification from the nonpublic school of the student’s 10 enrollment for the following school year. 11 b. By March 1 preceding the school year for which the 12 education voucher is requested, the department of education 13 shall notify the department of management of the number of 14 students in each school district designated for the following 15 school year to receive an education voucher. The department 16 of education shall also notify the parent or guardian of such 17 students who are approved to receive an education voucher. 18 c. Education vouchers shall only be approved for one school 19 year per application, and applications must be submitted under 20 paragraph “a” for education vouchers in subsequent school 21 years. 22 3. The department of management shall assign each student an 23 education voucher in an amount equal to seventy-five percent of 24 the district of residence’s regular program district cost per 25 pupil in the same school year. 26 4. An education voucher fund is created in the state 27 treasury under the control of the department of management 28 consisting of moneys appropriated to the department for 29 the purpose of providing education vouchers under this 30 section. For the fiscal year commencing July 1, 2017, and 31 each succeeding fiscal year, there is appropriated from the 32 general fund of the state to the department of management to be 33 credited to the fund the amount necessary to pay all education 34 vouchers approved for that fiscal year. The director of the 35 -3- LSB 5164YH (4) 86 md/sc 3/ 10

H.F. 2198 department of management has all powers necessary to carry out 1 and effectuate the purposes, objectives, and provisions of this 2 section pertaining to the fund, including the power to do all 3 of the following: 4 a. Make and enter into contracts necessary for the 5 administration of the fund. 6 b. Procure insurance against any loss in connection with the 7 assets of the fund or require a surety bond. 8 c. Contract with a private financial management firm to 9 manage the fund, in collaboration with the treasurer of state, 10 including providing for the disbursement of education vouchers 11 in the form of an electronic debit card or checks that are 12 payable directly from the student’s account in the fund. 13 d. Conduct audits or other review necessary to properly 14 administer the program. 15 e. Adopt rules pursuant to chapter 17A for the 16 administration of the fund and accounts in the fund. 17 5. a. For each student approved for an education voucher, 18 the department shall establish an account for that student 19 in the education voucher fund. The student’s education 20 voucher shall be deposited into the student’s account on July 21 1 and funds shall be immediately available for the payment 22 of qualified educational expenses incurred by the parent or 23 guardian for the student during that fiscal year using the 24 payment method authorized under subsection 4, paragraph “c” . 25 b. A nonpublic school or other entity that accepts payment 26 from a parent or guardian using funds from a student’s account 27 in the education voucher fund shall not refund, rebate, or 28 share any portion of such payment with the parent, guardian, 29 or student. 30 c. Moneys remaining in a student’s account upon conclusion 31 of the fiscal year shall remain in the student’s account in the 32 education voucher fund for the payment of qualified educational 33 expenses in future fiscal years, unless subject to the transfer 34 required under subsection 8. 35 -4- LSB 5164YH (4) 86 md/sc 4/ 10

H.F. 2198 6. a. For purposes of this section, “qualified educational 1 expenses” includes tuition and fees at a nonpublic school, 2 textbooks, fees, or payments for educational therapies 3 including tutoring or cognitive skills training, curriculum 4 fees and materials for a course of study for a specific 5 subject matter or grade level, tuition or fees for nonpublic 6 online education programs, education materials and services 7 for students with disabilities including the cost of 8 paraprofessionals and assistants who are trained in accordance 9 with state law, and other expenses incurred by the parent or 10 guardian that are directly related to the education of the 11 student at a nonpublic school, including a nonpublic school 12 accredited by an independent accrediting agency approved by 13 the department of education. “Qualified educational expenses” 14 does not include transportation costs for the student, the cost 15 of food or refreshments consumed by the student, the cost of 16 clothing for the student, or the cost of disposable materials, 17 including but not limited to paper, notebooks, pencils, pens, 18 and art supplies. 19 b. For purposes of this section, “nonpublic school” means 20 the same as defined in section 285.16. 21 7. A person who makes a false claim for the purpose of 22 obtaining an education voucher provided for in this section or 23 who knowingly receives the voucher or makes a payment from an 24 account in the education voucher fund without being legally 25 entitled to it is guilty of a fraudulent practice. The false 26 claim for an education voucher or a payment from an account 27 shall be disallowed and if amounts from the voucher have 28 been disbursed from the applicable account in the education 29 voucher fund, the department of management shall initiate legal 30 proceedings to recover such amounts. A parent or guardian who 31 violates this subsection is prohibited from participating in 32 the education voucher program in the future. 33 8. For each student with a positive balance in the student’s 34 account in the education voucher fund upon graduation from 35 -5- LSB 5164YH (4) 86 md/sc 5/ 10

H.F. 2198 high school or upon termination of the student’s enrollment in 1 the nonpublic school, moneys in the student’s account shall be 2 transferred by the department for deposit in the general fund 3 of the state. 4 9. A nonpublic school that accepts payment from a parent or 5 guardian using funds from a student’s account in the education 6 voucher fund is not an agent of this state or other political 7 subdivision of this state. 8 Sec. 6. Section 256F.3, subsection 2, paragraph a, Code 9 2016, is amended to read as follows: 10 a. (1) To receive approval to establish a charter school 11 in accordance with this chapter , the principal, teachers, or 12 parents or guardians of students at an existing public school 13 shall submit an application to the school board to convert an 14 existing attendance center to a charter school. An attendance 15 center shall not enter into a charter school contract with a 16 school district under this chapter unless the attendance center 17 is located within the school district. 18 (2) (a) The Except as otherwise provided in subparagraph 19 division (b), the application shall demonstrate the support 20 of at least fifty percent of the teachers employed at the 21 school on the date of the submission of the application and 22 fifty percent of the parents or guardians voting whose children 23 are enrolled at the school, provided that a majority of the 24 parents or guardians eligible to vote participate in the ballot 25 process, according to procedures established by rules of the 26 state board. 27 (b) If the attendance center at which the charter school 28 is to be established is identified by the department of 29 education as a persistently lowest-achieving school within 30 the meaning of section 256.9, subsection 61, the application 31 shall demonstrate the support of at least fifty percent of the 32 parents or guardians voting whose children are enrolled at the 33 school, provided that a majority of the parents or guardians 34 eligible to vote participate in the ballot process, according 35 -6- LSB 5164YH (4) 86 md/sc 6/ 10

H.F. 2198 to procedures established by rules of the state board. 1 Sec. 7. Section 422.7, Code 2016, is amended by adding the 2 following new subsection: 3 NEW SUBSECTION . 51. Subtract, to the extent included, the 4 amount of any education voucher under section 256E.4 received 5 during the tax year by a taxpayer authorized to spend such 6 voucher amounts for qualified educational expenses. 7 EXPLANATION 8 The inclusion of this explanation does not constitute agreement with 9 the explanation’s substance by the members of the general assembly. 10 This bill relates to persistently lowest-achieving schools 11 by authorizing parents or guardians to petition for the closure 12 of an attendance center, for implementation of an education 13 voucher program, or for establishment of a charter school. 14 Under the bill, if an attendance center is identified by 15 the department of education as a persistently lowest-achieving 16 school, the parents or guardians of students enrolled at 17 the attendance center may submit a petition to the school 18 board to either close the attendance center or authorize 19 education vouchers for students of the attendance center. A 20 valid petition must state whether the petition is requesting 21 the closure of an attendance center or the authorization of 22 education vouchers, and must contain the signatures at least 50 23 percent of the parents or guardians whose children are enrolled 24 at the attendance center. A valid petition must be received by 25 the school board not later than December 1 of the school year 26 preceding the school year during which the requested action 27 will be implemented. A petition received after that deadline 28 will be considered a petition for the next applicable school 29 year. 30 If a valid petition for closure of an attendance center 31 is received, the school board shall formulate and implement 32 a plan for the closure of the attendance center and a plan 33 for the reallocation of students currently enrolled at the 34 attendance center and those students who would, but for the 35 -7- LSB 5164YH (4) 86 md/sc 7/ 10

H.F. 2198 closure, be enrolled at the attendance center during the next 1 school year. The bill requires the plan for the reallocation 2 of students to other attendance centers in the school district 3 to include objective criteria and standards and criteria for 4 prioritizing requests that do not have an adverse impact on the 5 plan. If other attendance centers in the school district have 6 insufficient classroom space to accommodate the students from 7 the closing attendance center, the school board shall instead 8 implement the education voucher program established in the 9 bill. 10 Under the bill, the following students shall be eligible 11 to receive an education voucher: (1) students eligible to 12 enroll in kindergarten through grade 12 who are enrolled at an 13 attendance center at the time a petition authorizing education 14 vouchers is filed with the school board and (2) students 15 eligible to enroll in kindergarten through grade 12 who are 16 enrolled at an attendance center that is to be closed under 17 the bill and for whom there is insufficient classroom space at 18 other attendance centers in the school district. 19 By January 31 preceding the school year for which the 20 education voucher is requested, the parent or guardian of 21 the student requesting to receive an education voucher shall 22 submit an application to the department of education, on 23 application forms developed by the department, indicating 24 that the parent or guardian intends to enroll the student in 25 a nonpublic school. In addition to such information deemed 26 appropriate by the department of education, the application 27 shall require certification from the nonpublic school of the 28 student’s enrollment for the following school year. By March 29 1 preceding the school year for which the education voucher 30 is requested, the department of education shall notify the 31 department of management of the number of students in each 32 school district designated for the following school year to 33 receive an education voucher. The department of education 34 shall also notify the parent or guardian of such students who 35 -8- LSB 5164YH (4) 86 md/sc 8/ 10

H.F. 2198 are approved to receive an education voucher. 1 The bill authorizes education vouchers to be approved for 2 one school year per application, and additional applications 3 must be submitted for education vouchers in subsequent school 4 years. The education voucher is in an amount equal to 75 5 percent of the district of residence’s regular program district 6 cost per pupil in the same school year. 7 For the fiscal year commencing July 1, 2017, and each 8 succeeding fiscal year, the bill appropriates from the general 9 fund of the state to the department of management to be 10 credited to the education voucher fund an amount necessary to 11 pay all education vouchers approved for that fiscal year. For 12 each student approved for an education voucher, the department 13 is required to establish an account for that student in the 14 education voucher fund. The amount of the student’s education 15 voucher shall be deposited into the student’s account on July 1 16 and such amount shall be immediately available for the payment 17 of qualified educational expenses, as defined in the bill, 18 incurred by the parent or guardian for the student during that 19 fiscal year. 20 The bill specifies that a nonpublic school or other entity 21 that accepts payment from a parent or guardian using funds from 22 a student’s account in the education voucher fund shall not 23 refund, rebate, or share any portion of such payment with the 24 parent, guardian, or student. 25 Moneys remaining in a student’s account upon conclusion 26 of the fiscal year shall remain in the student’s account 27 in the education voucher fund for the payment of qualified 28 educational expenses in future fiscal years. However, for 29 each student with a positive balance in the student’s account 30 in the education voucher fund upon graduation from high 31 school or upon termination of the student’s enrollment in the 32 nonpublic school, those moneys in the student’s account shall 33 be transferred for deposit in the general fund of the state. 34 The bill provides that a person who makes a false claim for 35 -9- LSB 5164YH (4) 86 md/sc 9/ 10

H.F. 2198 the purpose of obtaining an education voucher or who knowingly 1 receives the voucher or makes a payment from an account within 2 the education voucher fund without being legally entitled to 3 it is guilty of a fraudulent practice and is subject to a 4 criminal penalty. The bill allows the department of management 5 to initiate legal proceedings to recover vouchers and amounts 6 improperly awarded or paid from accounts under the bill. 7 The bill provides that a nonpublic school that accepts 8 payment from a parent or guardian using funds from a student’s 9 account in the education voucher fund is not an agent of this 10 state or other political subdivision of this state. 11 The bill provides that moneys from an education voucher 12 under the bill are not taxable income under Code chapter 422. 13 Code chapter 256F establishes a process by which the 14 principal, teachers, or parents and guardians of students at an 15 existing public school may apply to the school board to convert 16 an existing attendance center to a charter school. Current 17 law requires the application to demonstrate the support of at 18 least 50 percent of the teachers employed at the school on the 19 date of the submission of the application and 50 percent of the 20 parents or guardians voting whose children are enrolled at the 21 school, provided that a majority of the parents or guardians 22 eligible to vote participate in the ballot process, according 23 to procedures established by rules of the state board. 24 The bill modifies the application requirements for 25 converting an existing attendance center to a charter school 26 if the attendance center is a persistently lowest-achieving 27 school. Under those circumstances, the application does not 28 need to demonstrate teacher support and shall only be required 29 to demonstrate the support of at least 50 percent of the 30 parents or guardians voting whose children are enrolled at the 31 school, provided that a majority of the parents or guardians 32 eligible to vote participate in the ballot process, according 33 to procedures established by rules of the state board. 34 -10- LSB 5164YH (4) 86 md/sc 10/ 10