House File 9 - Introduced HOUSE FILE 9 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 1487YH (2) 87 md/sc

H.F. 9 Section 1. Section 256.7, Code 2017, 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 55, 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 following school year if the 34 attendance center continues to meet the criteria of subsection 35 -1- LSB 1487YH (2) 87 md/sc 1/ 11

H.F. 9 1. 1 3. Unless rulemaking is authorized for another state 2 agency, the state board shall, after consulting with the 3 department of education and the department of management, adopt 4 rules to implement and administer this chapter. 5 Sec. 4. NEW SECTION . 256E.3 Closure of attendance center —— 6 reallocation of students. 7 1. If a valid petition for closure of an attendance center 8 is received by a school board under section 256E.2, the school 9 board shall formulate and implement a plan for the closure 10 of the attendance center and a plan for the reallocation of 11 students currently enrolled at the attendance center and those 12 students who would, but for the closure, be enrolled at the 13 attendance center during the next school year. 14 2. The plan for the reallocation of students to other 15 attendance centers in the school district shall include 16 objective criteria and standards and criteria for prioritizing 17 requests that do not have an adverse impact on the plan. 18 3. a. If other attendance centers in the school district 19 have insufficient classroom space to accommodate the students 20 from the closing attendance center, the school board shall 21 instead implement the education voucher program under section 22 256E.4. 23 b. Every school district shall adopt a policy that defines 24 the term “insufficient classroom space” for each attendance 25 center in that district that is consistent with the policy 26 adopted under section 282.18, subsection 2, paragraph “c” . 27 Sec. 5. NEW SECTION . 256E.4 Education voucher program. 28 1. a. If a valid petition authorizing education vouchers 29 is received by a school board under section 256E.2, or if 30 section 256E.3, subsection 3, is applicable, students eligible 31 to enroll in kindergarten through grade twelve and who are 32 enrolled at the attendance center at the time the applicable 33 petition is filed are eligible to receive education vouchers. 34 b. Education vouchers shall be made available to parents 35 -2- LSB 1487YH (2) 87 md/sc 2/ 11

H.F. 9 and guardians in the manner authorized under subsection 1 4, paragraph “c” , for the payment of qualified educational 2 expenses as provided in this section. 3 2. a. (1) By January 31 preceding the school year for 4 which the education voucher is requested, the parent or 5 guardian of the student requesting to receive an education 6 voucher shall submit an application to the department of 7 education, on application forms developed by the department, 8 indicating that the parent or guardian intends to enroll the 9 student in a nonpublic school. 10 (2) In addition to other information deemed appropriate 11 by the department of education, the application shall require 12 certification from the nonpublic school of the student’s 13 enrollment for the following school year. 14 b. By March 1 preceding the school year for which the 15 education voucher is requested, the department of education 16 shall notify the department of management of the number of 17 students designated for the following school year to receive 18 an education voucher. The department of education shall also 19 notify the parent or guardian of such students who are approved 20 to receive an education voucher. 21 c. Education vouchers shall only be approved for one school 22 year per application, and applications must be submitted under 23 paragraph “a” for education vouchers in subsequent school 24 years. 25 3. The department of management shall assign each student an 26 education voucher in an amount equal to seventy-five percent of 27 the district of residence’s regular program district cost per 28 pupil in the same school year. 29 4. An education voucher fund is created in the state 30 treasury under the control of the department of management 31 consisting of moneys appropriated to the department of 32 management for the purpose of providing education vouchers 33 under this section. For the fiscal year commencing July 1, 34 2018, and each succeeding fiscal year, there is appropriated 35 -3- LSB 1487YH (2) 87 md/sc 3/ 11

H.F. 9 from the general fund of the state to the department of 1 management to be credited to the fund the amount necessary 2 to pay all education vouchers approved for that fiscal year. 3 The director of the department of management has all powers 4 necessary to carry out and effectuate the purposes, objectives, 5 and provisions of this section pertaining to the fund, 6 including the power to do all of the following: 7 a. Make and enter into contracts necessary for the 8 administration of the fund. 9 b. Procure insurance against any loss in connection with the 10 assets of the fund or require a surety bond. 11 c. Contract with a private financial management firm to 12 manage the fund, in collaboration with the treasurer of state, 13 including providing for the disbursement of education vouchers 14 in the form of an electronic debit card or checks that are 15 payable directly from the student’s account in the fund. 16 d. Conduct audits or other review necessary to properly 17 administer the program. 18 e. Adopt rules pursuant to chapter 17A for the 19 administration of the fund and accounts in the fund. 20 5. a. For each student approved for an education voucher, 21 the department of management shall establish an account for 22 that student in the education voucher fund. The student’s 23 education voucher shall be deposited into the student’s 24 account on July 1 and funds shall be immediately available 25 for the payment of qualified educational expenses incurred 26 by the parent or guardian for the student during that fiscal 27 year using the payment method authorized under subsection 4, 28 paragraph “c” . 29 b. A nonpublic school or other entity that accepts payment 30 from a parent or guardian using funds from a student’s account 31 in the education voucher fund shall not refund, rebate, or 32 share any portion of such payment with the parent, guardian, 33 or student. 34 c. Moneys remaining in a student’s account upon conclusion 35 -4- LSB 1487YH (2) 87 md/sc 4/ 11

H.F. 9 of the fiscal year shall remain in the student’s account in the 1 education voucher fund for the payment of qualified educational 2 expenses in future fiscal years during which the pupil 3 participates in the program, unless subject to the transfer 4 required under subsection 8. 5 6. a. For purposes of this section, “qualified educational 6 expenses” includes tuition and fees at a nonpublic school, 7 textbooks, fees, or payments for educational therapies 8 including tutoring or cognitive skills training, curriculum 9 fees and materials for a course of study for a specific 10 subject matter or grade level, tuition or fees for nonpublic 11 online education programs, education materials and services 12 for students with disabilities including the cost of 13 paraprofessionals and assistants who are trained in accordance 14 with state law, and other expenses incurred by the parent or 15 guardian that are directly related to the education of the 16 student at a nonpublic school, including a nonpublic school 17 accredited by an independent accrediting agency approved by 18 the department of education. “Qualified educational expenses” 19 does not include transportation costs for the student, the cost 20 of food or refreshments consumed by the student, the cost of 21 clothing for the student, or the cost of disposable materials, 22 including but not limited to paper, notebooks, pencils, pens, 23 and art supplies. 24 b. For purposes of this section, “nonpublic school” means 25 the same as defined in section 285.16. 26 7. A person who makes a false claim for the purpose of 27 obtaining an education voucher provided for in this section or 28 who knowingly receives the voucher or makes a payment from an 29 account in the education voucher fund without being legally 30 entitled to do so is guilty of a fraudulent practice under 31 chapter 714. The false claim for an education voucher or a 32 payment from an account shall be disallowed. If amounts from 33 the voucher have been disbursed from the applicable account in 34 the education voucher fund, the department of management shall 35 -5- LSB 1487YH (2) 87 md/sc 5/ 11

H.F. 9 initiate legal proceedings to recover such amounts. A parent 1 or guardian who violates this subsection is prohibited from 2 participating in the education voucher program in the future. 3 8. For each student with a positive balance in the student’s 4 account in the education voucher fund upon graduation from 5 high school or upon termination of the student’s enrollment in 6 the nonpublic school, moneys in the student’s account shall be 7 transferred by the department for deposit in the general fund 8 of the state. 9 9. A nonpublic school that accepts payment from a parent or 10 guardian using funds from a student’s account in the education 11 voucher fund is not an agent of this state or other political 12 subdivision of this state. 13 Sec. 6. Section 256F.3, subsection 2, paragraph a, Code 14 2017, is amended to read as follows: 15 a. (1) To receive approval to establish a charter school 16 in accordance with this chapter , the principal, teachers, or 17 parents or guardians of students at an existing public school 18 shall submit an application to the school board to convert an 19 existing attendance center to a charter school. An attendance 20 center shall not enter into a charter school contract with a 21 school district under this chapter unless the attendance center 22 is located within the school district. 23 (2) (a) The Except as otherwise provided in subparagraph 24 division (b), the application shall demonstrate the support 25 of at least fifty percent of the teachers employed at the 26 school on the date of the submission of the application and 27 fifty percent of the parents or guardians voting whose children 28 are enrolled at the school, provided that a majority of the 29 parents or guardians eligible to vote participate in the ballot 30 process, according to procedures established by rules of the 31 state board. 32 (b) If the attendance center at which the charter school 33 is to be established is identified by the department of 34 education as a persistently lowest-achieving school within 35 -6- LSB 1487YH (2) 87 md/sc 6/ 11

H.F. 9 the meaning of section 256.9, subsection 55, the application 1 shall demonstrate the support of at least fifty percent of the 2 parents or guardians voting whose children are enrolled at the 3 school, provided that a majority of the parents or guardians 4 eligible to vote participate in the ballot process, according 5 to procedures established by rules of the state board. 6 Sec. 7. Section 422.7, Code 2017, is amended by adding the 7 following new subsection: 8 NEW SUBSECTION . 51. Subtract, to the extent included, the 9 amount of any education voucher under section 256E.4 received 10 during the tax year by a taxpayer authorized to spend such 11 voucher amounts for qualified educational expenses. 12 EXPLANATION 13 The inclusion of this explanation does not constitute agreement with 14 the explanation’s substance by the members of the general assembly. 15 This bill relates to persistently lowest-achieving schools 16 by authorizing parents or guardians to petition for the closure 17 of an attendance center, for implementation of an education 18 voucher program, or for establishment of a charter school. 19 Under the bill, if an attendance center is identified by 20 the department of education as a persistently lowest-achieving 21 school, the parents or guardians of students enrolled at 22 the attendance center may submit a petition to the school 23 board to either close the attendance center or authorize 24 education vouchers for students of the attendance center. A 25 valid petition must state whether the petition is requesting 26 the closure of an attendance center or the authorization of 27 education vouchers, and must contain the signatures at least 50 28 percent of the parents or guardians whose children are enrolled 29 at the attendance center. A valid petition must be received by 30 the school board not later than December 1 of the school year 31 preceding the school year during which the requested action 32 will be implemented. A petition received after that deadline 33 will be considered a petition for the following school year 34 if the attendance center continues to meet the criteria for a 35 -7- LSB 1487YH (2) 87 md/sc 7/ 11

H.F. 9 persistently lowest-achieving school. 1 If a valid petition for closure of an attendance center 2 is received, the school board shall formulate and implement 3 a plan for the closure of the attendance center and a plan 4 for the reallocation of students currently enrolled at the 5 attendance center and those students who would, but for the 6 closure, be enrolled at the attendance center during the next 7 school year. The bill requires the plan for the reallocation 8 of students to other attendance centers in the school district 9 to include objective criteria and standards and criteria for 10 prioritizing requests that do not have an adverse impact on the 11 plan. If other attendance centers in the school district have 12 insufficient classroom space to accommodate the students from 13 the closing attendance center, the school board shall instead 14 implement the education voucher program established in the 15 bill. 16 Under the bill, the following students shall be eligible 17 to receive an education voucher: (1) students eligible to 18 enroll in kindergarten through grade 12 who are enrolled at an 19 attendance center at the time a petition authorizing education 20 vouchers is filed with the school board and (2) students 21 eligible to enroll in kindergarten through grade 12 who are 22 enrolled at an attendance center that is to be closed under 23 the bill and for whom there is insufficient classroom space at 24 other attendance centers in the school district. 25 By January 31 preceding the school year for which the 26 education voucher is requested, the parent or guardian of 27 the student requesting to receive an education voucher shall 28 submit an application to the department of education, on 29 application forms developed by the department, indicating 30 that the parent or guardian intends to enroll the student in 31 a nonpublic school. In addition to such information deemed 32 appropriate by the department of education, the application 33 shall require certification from the nonpublic school of the 34 student’s enrollment for the following school year. By March 35 -8- LSB 1487YH (2) 87 md/sc 8/ 11

H.F. 9 1 preceding the school year for which the education voucher 1 is requested, the department of education shall notify the 2 department of management of the number of students designated 3 for the following school year to receive an education voucher. 4 The department of education shall also notify the parent or 5 guardian of such students who are approved to receive an 6 education voucher. 7 The bill authorizes education vouchers to be approved for 8 one school year per application, and additional applications 9 must be submitted for education vouchers in subsequent school 10 years. The education voucher is in an amount equal to 75 11 percent of the district of residence’s regular program district 12 cost per pupil in the same school year. 13 For the fiscal year commencing July 1, 2018, and each 14 succeeding fiscal year, the bill appropriates from the general 15 fund of the state to the department of management to be 16 credited to the education voucher fund an amount necessary to 17 pay all education vouchers approved for that fiscal year. For 18 each student approved for an education voucher, the department 19 is required to establish an account for that student in the 20 education voucher fund. The amount of the student’s education 21 voucher shall be deposited into the student’s account on July 1 22 and such amount shall be immediately available for the payment 23 of qualified educational expenses, as defined in the bill, 24 incurred by the parent or guardian for the student during that 25 fiscal year. 26 The bill specifies that a nonpublic school or other entity 27 that accepts payment from a parent or guardian using funds from 28 a student’s account in the education voucher fund shall not 29 refund, rebate, or share any portion of such payment with the 30 parent, guardian, or student. 31 Moneys remaining in a student’s account upon conclusion 32 of the fiscal year shall remain in the student’s account 33 in the education voucher fund for the payment of qualified 34 educational expenses in future fiscal years during which 35 -9- LSB 1487YH (2) 87 md/sc 9/ 11

H.F. 9 the pupil participates in the program. However, for each 1 student with a positive balance in the student’s account in 2 the education voucher fund upon graduation from high school or 3 upon termination of the student’s enrollment in the nonpublic 4 school, those moneys in the student’s account shall be 5 transferred for deposit in the general fund of the state. 6 The bill provides that a person who makes a false claim for 7 the purpose of obtaining an education voucher or who knowingly 8 receives the voucher or makes a payment from an account within 9 the education voucher fund without being legally entitled to 10 do so is guilty of a fraudulent practice and is subject to a 11 criminal penalty. The bill allows the department of management 12 to initiate legal proceedings to recover vouchers and amounts 13 improperly awarded or paid from accounts under the bill. 14 The bill provides that a nonpublic school that accepts 15 payment from a parent or guardian using funds from a student’s 16 account in the education voucher fund is not an agent of this 17 state or other political subdivision of this state. 18 The bill provides that moneys from an education voucher 19 under the bill are not taxable income under Code chapter 422. 20 Code chapter 256F establishes a process by which the 21 principal, teachers, or parents and guardians of students at an 22 existing public school may apply to the school board to convert 23 an existing attendance center to a charter school. Current 24 law requires the application to demonstrate the support of at 25 least 50 percent of the teachers employed at the school on the 26 date of the submission of the application and 50 percent of the 27 parents or guardians voting whose children are enrolled at the 28 school, provided that a majority of the parents or guardians 29 eligible to vote participate in the ballot process, according 30 to procedures established by rules of the state board. 31 The bill modifies the application requirements for 32 converting an existing attendance center to a charter school 33 if the attendance center is a persistently lowest-achieving 34 school. Under those circumstances, the application does not 35 -10- LSB 1487YH (2) 87 md/sc 10/ 11