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Overview

Charter schools are public schools that provide instruction in any combination of grades kindergarten through 12. As noted in the Chronology, in 1992, the state enacted legislation allowing charter schools in California to offer parents an alternative to traditional public schools and encourage local leaders to experiment with new educational programs. Except where specifically noted otherwise, California law exempts charter schools from many of the statutes and regulations that apply to school districts.

Generally, all charter schools must (1) provide nonsectarian instruction, (2) charge no tuition, and (3) admit all interested students up to school capacity. To both open and continue operating, a charter school must have an approved charter setting forth a comprehensive vision for the school.

Over the last decade, charter school enrollment has grown steadily.

In 2006, 560 charter schools served about 200,000 students (3.5 percent (3.5%) of the state’s K12 enrollment). By 2016, over 1,200 charter schools served about 580,000 students (almost 10 percent (10%) of the state’s K-12 enrollment). As of the beginning of the 2018–19 school year, 1306 charter schools and seven all-charter districts are operating in California. Significant trends over the last five years show an overall 0.8 percent (0.8%) decline in student enrollment statewide, from 6.2 million in 2014-15 to 6.19 million in 2018-19. Meanwhile, charter school enrollment grew from 544,980 students to 652,933 students during the same time period.

Most charter schools are small, compared to traditional public schools, and located in urban areas. The median charter school enrolls about 250 students, whereas the median traditional public school enrolls about 525 students.

Together, nine Bay Area counties, Los Angeles County, and San Diego County account for more than 60 percent (60%) of all charter schools and charter school enrollment in the state. Charter schools can be conversions of existing public schools or new startup schools. About 15 percent (15%) of charter schools are conversions, with the remaining 85 percent (85%) being startups. Of these, about 80 percent (80%) offer traditional, classroom-based instruction and 20 percent (20%) offer some form of independent study, such as distance learning or home study.

Charter Schools and Conflict of Interest

As the prevalence of charter schools increased, questions began to arise as to whether charter school board members are subject to the same open meeting, public disclosure, and conflict-of-interest requirements that school district board members already comply with under state law.

Various proposals to clarify these issues were vetoed, or did not move out of the legislature. These included the following:

• AB 276 (Medina) from the 2017-2018 Session, which was held on the Senate Floor, would have required charter schools and entities managing charter schools to comply with the same conflict of interest requirements as school districts.
• AB 1478 (Jones Sawyer) from the 2017-2018 Session, which failed passage on the Assembly Floor, would have required charter schools and entities managing charter schools to comply with the same conflict of interest requirements as school districts.
• AB 709 (Gibson) of the 2015-2016 Session, would have required charter schools to comply with the same conflict of interest requirements as school districts. The bill was vetoed by Governor Brown.
• AB 913 (Chau), of the 2013-2014 Session, would have required charter schools to comply with the same conflict of interest requirements as school districts, commencing July 1, 2014.
• AB 360 (Brownley), of the 2011-2012 Session, which died on the Assembly inactive file on concurrence, would have required charter schools to comply with the same conflict of interest requirements as school districts.
• AB 572 (Brownley), of the 2009-2010 Session would have required, commencing July 1, 2011, charter schools to comply with the same conflict of interest requirements as school districts, by specifying that charter schools are subject to the Brown Act, the CPRA, Government Code 1090, and the PRA. The bill was vetoed by Governor Schwarzenegger.
• AB 2115 (Mullin), of the 2007-2008 Session required charter schools to adopt and comply with a conflict of interest policy that requires its governing board members to abide by the same conflict of interest requirements as local education agency governing board members.
• AB 1772 (Bonnie Garcia), of the 2007-2008 Session, which was held in the Assembly Appropriations Committee, would have required a charter school to adopt and comply with a conflict-of-interest policy that included, but was not necessarily limited to, the requirements that charter school governing board members abide Government Code 1090, among other requirements.

In late 2018 [December 26, 2018] Attorney General (AG) Becerra issued a formal opinion stating that these laws apply to charter school governing boards. The AG expressly rejected arguments that charter schools operated as, or by, nonprofit public benefit corporations are entitled to different treatment under these laws. The AG answered each question with “yes”–with one narrow exception: that the records of State-approved charter schools are not subject to grand jury review. See: 101 Ops.Cal.Atty.Gen. 92 (2018).

Charter school advocates have consistently expressed concern with subjecting charter schools to the provisions of Government Code 1090 because it could make it more difficult for philanthropic board members to provide financial assistance or low-interest loans or make facilities available to charter schools, which may happen during the start-up phase of a charter school.

However, others argued that since charter schools are public schools and receive public funds, these schools have a fiduciary duty to taxpayers with regards to the use of those funds and should be subject to the same conflict-of-interest and disclosure requirements as traditional school districts.

In addition, statutes governing corporations requires not more than 49 percent (49%) of persons serving on the board of any corporation to be interested persons. "Interested persons" is defined as either of the following: (1) any person currently compensated by the corporation for services rendered to it within the previous 12 months (excluding any reasonable compensation paid to a director); or, (2) any relative, as specified, of any such person. Advocates of charter schools contended they should abide by conflict of interest provisions related to corporations, not local educational agencies, due to the fact that some charter schools are operated by nonprofit corporations.

Chronology

1985

AB 964 (Farr [D-]), Ch. 28 is enacted creating the California School Finance Authority (CSFA) to be comprised of the Treasurer (as chairperson), the Director of the State Department of Finance, and the Superintendent of Public Instruction (Superintendent) and granting CSFA the authority to issue for sale revenue bonds in a principal amount not to exceed $250,000,000 to reconstruct, remodel, or replace existing school buildings to acquire new school sites and buildings to be made available to school districts, and to assist school districts by providing access to financing for working capital and capital improvements. The bill also establishes the California School Finance Authority Fund to be administered by CSFA and provides that all moneys in that fund be continuously appropriated without regard to fiscal year.

1988

Albert Shanker president of the American Federation of Teachers (AFT), gave a speech at the National Press Club where he outlined his vision for a new kind of publicly funded, independently managed school. He called them “charters” and saw them as educational laboratories, where teachers could try out new pedagogical approaches. By empowering teachers to experiment with their craft, charters could serve as R&D spaces for new and better practices that could then be transferred back into traditional public schools. In a New York Times column published later that year, Shanker carried his ideas to the wider public.

1991

Minnesota becomes the first state to adopt a charter school system.

1992

SB 1448 (Hart [D-Santa Barbara]), Ch. 781/1992 created California Charter School system. SB 1448 provided that a group or individual may circulate a petition to create a "charter school" within an existing public school district. The provisions of the charter, rather than the requirements of state law, local policies or local collective bargaining agreements governed a charter school, with some exceptions. Charters must include a variety of provisions including pupil achievement, governance of the school, admissions, discipline, staff qualifications, certain employee rights and a number of other criteria. Teachers were not required to be credentialed.

All charter petitions must be signed by at least half of the teachers at the school (or by 10 percent (10%) of the teachers district-wide) and approved by the school district's governing board. Governing boards may deny a petition or revoke a charter for any reason. In addition, the State Board of Education (SBE) did not have the authority to grant or revoke charters. If a charter is rejected by the governing board, a review panel is formed to consider the basis for the rejection. If the governing board again rejects the charter, the petitioners may appeal to the county board of education, which may grant the charter.

Stated that charter schools are part of the public school system as defined in Article IX of the California Constitution and are “under the exclusive control of the officers of the public schools.” ¹

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1993

The initial law limited the total number of charters in the state to 100, and no more than 10 per school district (except Los Angeles, which was allowed 20) Funding would “follow the student” after leaving a traditional public school. In 1993, San Carlos Charter Learning Center, an elementary school in San Mateo County, became the first charter school in the state.

AB 19 (Quackenbush [R-Santa Clara]), Ch. 160/1993 and AB 1114 (Alpert [D-San Diego)]), Ch. 161/1993 are enacted. AB 19 established a voluntary system of inter-district (between school districts) school choice. AB 1114 required school districts, as a condition of receiving state apportionment funding, to establish a system of intra-district (among schools within a school district) school choice. AB 19 and AB 1114 created the template for school boards to authorize charter schools outside the boundaries of that school district. AB 1310 (Alpert-Quackenbush), Ch. 915/1993 enacted. AB 1310 made a series of technical corrections to AB 19 and AB 1114. [These provisions were to sunset but have been continually been extended.]

1998

AB 544 (Lempert [D-San Mateo]), Ch. 34/1998 enacted. AB 544 substantially revamped SB 1448 by doing the following:

• Repealed the cap of 100 charter schools, replaced with a 1998-1999 school year cap of 250, with 100 more authorized each successive school year.
• Repealed the exclusive reliance on teacher signatures to start the petition process. Now, a petition is valid if signed by the number of parents/guardians equal to at least half of the estimated students, or the number of teachers equal to at least half the teachers expected to be employed.
• The petition must display a statement that the signatory is "meaningfully interested" in sending his or her child to, or teaching at, the charter school, as the case may be.
• Petitions for the conversion of an existing public school to a charter school must be signed by at least half of the permanent status teachers currently employed at the school.
• Repealed broad discretion in granting or denying a charter.
• Following review of the petition and the requisite public hearing, the governing board of the district "shall not deny a petition" unless it makes written findings of fact that: (1) The charter school presents an unsound educational program; (2) petitioners are "demonstrably unlikely" to succeed in implementing the program; or (3) the petition lacks the required signatures, affirmations, or descriptions of program particulars
• If the school district nonetheless denies a petition, the petitioner can submit to the county board of education or the Board.
• A petitioner can submit directly to the county board of education for a charter school that would serve pupils otherwise directly served by the county office of education.
• Permit a charter school to operate as a nonprofit benefit corporation, with the school district granting the charter entitled to one representative on the board of directors.
• The Board itself, upon recommendation of the Superintendent of Public Instruction (Superintendent), can take "appropriate action," including revoking the charter of any school, if it finds "[g]ross financial mismanagement" "[i]llegal or substantially improper" use of funds; or that "[substantial and sustained departure]" from successful practices jeopardizes the educational development of the students
• No funds will be given for any pupil who also attends a private school that charges his or her family for tuition.
• All charter school teachers must hold a Commission on Teaching Credentialing certificate or equivalent.
• Petitioners must provide the chartering authority with financial statements that include a proposed first-year operational budget and three-year cash-flow and financial projections.
• Charter schools must use generally accepted accounting principles in conducting the required annual financial audits, and any exceptions or deficiencies identified during the audit must be resolved to the satisfaction of the chartering authority.
• Charter schools must "promptly respond to all reasonable inquiries" from either the chartering authority or the Superintendent.
• The chartering authority can "inspect or observe any part of the charter school at any time" and charge the school for supervisorial oversight.

1999

AB 1115 (Strom Martin [D-Duncan Mills]), Ch. 78/1999 (Urgency Clause with Item vetoes) was enacted. This bill was the omnibus Education Trailer Bill to the Budget Act of 1999. In so far as charters were concerned, the bill had numerous provisions. In substance it provided that charter schools receive operational funding equivalent to that of a similar school district serving a similar pupil population, (2) allowed charter schools to receive funding locally through its school district or directly from the state, and (3) established a three-part charter school funding model still in effect today (consisting of the average statewide revenue limit funding, categorical block grant funding, and separate categorical program funding).

SB 434 (Johnston [D-Stockton]) Ch. 162/1999 enacted. It provided that January 1, 2000, charter schools must:

• At a minimum, offer the same number of instructional minutes per grade level as required of all school districts, maintain written contemporaneous records documenting pupil attendance, and make the same available for audit and inspection.
• As a condition of apportionment of state funding, charter schools must certify that its pupils have participated in the state testing program in the same manner as all other pupils attending public schools.
• Charter schools that provide independent study must comply with statutory requirements and implementing regulations that relate to independent study.
• Charter schools will be held to the same prohibition as local education agencies when it comes to extending funds or value to pupils in independent study programs (or their parents or guardians).
• Charter schools cannot claim state funding if the funds or other value so extended could not legally be extended to similarly situated pupils of a school district (or their parents or guardians).

AB 631 (Migden [D-San Francisco]), Ch. 828/1999 enacted extending state collective bargaining laws to charter schools.

In October of 1999, the Court of Appeals for the First District in Wilson v. State Board of Education, (1999) 75 Cal.App.4th 1125 sustained the 1992 and 1998 enactments as well as SB 434 against various state constitution challenges. The California Supreme Court denied review.

Wilson rejected the contentions that AB 544 amendments to the 1992 Act violated article IX, section 5 of the state Constitution in that they reflected the Legislature's abdication of control over public education functions and gave operational independence to charter schools contrary to the constitutional mandate that the Legislature "provide a `system of common schools'" (id. at p. 1136). As to the latter claim, the court observed that the Legislature in the 1998 amendment to the Act explicitly found that charter schools are (1) part of the article IX `Public School System'; (2) under its jurisdiction; and (3) entitled to full funding. “(Wilson, at p. 1137.)

Wilson additionally held that the Act met the constitutional mandate of uniformity within the public school system because it required that charter schools receive funding comparable to other public schools, hire teachers meeting the same minimum requirements as other public school teachers, maintain programs designed to meet state standards, and have their students' progress assessed under the same approach as other public school students. (75 Cal.App.4th at 1138.)

2000

Proposition 39 approved by the voters. Proposition 39 was funded by Ann and John Doerr, John T. Walton and Reed Hastings, and was sponsored by Governors Davis and Wilson.

The main effect of Proposition 39 was to amend Proposition 13 by lowering the required supermajority vote necessary for voters to approve local school bonds from two-thirds (2/3) of the votes cast, to fifty-five percent (55%) of the votes cast. Voter approved school bonds under Proposition 39 are paid off by raising property taxes above the one percent (1%) property tax rate limit established by Proposition 13 in 1978.

Proposition 39 (Prop 39) also lowered, as it relates to school bonds, the local voter approval requirement to incur debt from a two-thirds (2/3) vote to fifty-five percent (55%). The two-thirds vote requirement to incur debt is separate from the property tax limits of Proposition 13, and had previously been part of the California Constitution since 1879.

However, Prop 39 included statutory provisions relating to charter school facilities. Prop 39 required school districts to share their facilities with charter schools so that charter school students have access to facilities "reasonably equivalent" to those available to other public school students.

Prior to Prop 39, once established, charter schools have limited means of getting public funds to cover the cost of facilities. If they do not have enough funds to rent or build their own facilities, charter schools must often rely on facilities controlled by the school districts with which they compete. (Ibid.)

Before the adoption of Prop 39, a charter school was entitled to use, at no charge, facilities not currently being used by the school district for instructional or administrative purposes, or that have not been historically used for rental purposes. In other words, charter schools had access only to public school facilities that districts were not using." (Ibid.)

Prop 39, which changed how school districts must share facilities with charter schools. Prop 39 amended state law to reflect the people's intent "that public school facilities ... be shared fairly among all public school pupils, including those in charter schools."

Prop 39 changed state law to provide in pertinent part that "Each school district shall make available, to each charter school operating in the school district, facilities sufficient for the charter school to accommodate all of the charter schools’ in-district students in conditions reasonably equivalent to those in which the students would be accommodated if they were attending other public schools of the district.... The school district shall make reasonable efforts to provide the charter school with facilities near to where the charter school wishes to locate, and shall not move the charter school unnecessarily."

[In 2002, the SBE issued regulations on how to implement this requirement. For more than a decade, these regulations and the underlying mandate of Prop 39 have been the subject of considerable litigation until resolved in 2015 by the California Supreme Court.]

2001

SB 740 (O’Connell ([D-Santa Barbara]), Ch. 892/2001, enacted. SB 740 required the SBE to:(1) develop criteria for determining the amount of funding to provide for charter school non-classroom-based instruction, (2) make specific funding determinations for individual charter schools; and (3) established the Charter School Facility Grant Program, which provides charter schools serving low-income students with grants to cover a portion of their lease costs.

2002

AB 14 (Goldberg [D-Los Angeles]), Ch. 935/2001 enacted creating the Charter Schools Facilities Program, which authorizes bond financing of new charter school facilities.

AB 1994 (Reyes [D-Fresno]), Ch. 1058/2002 enacted. AB 1994 did the following: (1) modified the county/state review and appeals process; (2) required a petition to identify each charter school site; (3) generally required these sites to be located within geographic boundaries of local school district;(4) gave counties authority to monitor charter schools; and (5) required charter schools to submit budget documents to their charter authorizers as well as audit reports to their authorizers, county office of education, and the state Controller.

2003

AB 1177 (Reyes [D-Fresno]), Ch. 892/2003 enacted. AB 1177 specified five new charter authorizer oversight duties (including visiting each charter school annually, ensuring each charter school complies with state reporting requirements, and monitoring each charter school’s fiscal condition), and (2) required charter schools to achieve specified levels of academic performance prior to receiving charter renewal.

2005

AB 740 (Huff [R-Walnut]), Ch. 359/2005 enacted. AB 740 made significant changes to the charter school categorical block grant, including: (1) revising the list of programs in the block grant and (2) specifying a single per pupil funding rate of $400 for 2006-07 and $500 for 2007-08, to be adjusted annually thereafter for inflation.

2006

The California Supreme Court addressed in Wells v. One 2 One Learning Center (2006) 39 Cal.4th 1164 to what extent charter schools, their corporate operators, and the chartering school districts were liable for various activities. Some of the schools’ students sued the charters on multiple grounds and their parents or guardians failed to deliver instructional services, equipment, and supplies as promised, and as required by law.

In effect, the plaintiffs asserted that the schools functioned only to collect "average daily attendance" (ADA) forms, based on which the schools, and the districts, fraudulently claimed and received public education funds from the state. Plaintiffs also claim violations of specific statutory rules governing "independent study" programs offered by the public schools.

The case concerned whether, and in what circumstances, public school districts, charter schools, and/or the operators of such schools may be exposed to civil liability based on allegations of this kind. Among other things, the Supreme Court was asked to determine whether such entities, or any of them, are "persons" who may be sued (1) under the unfair competition law and (2) in a qui tam action, brought by individuals on behalf of the state, under the California False Claims Act (CFCA).

The Supreme Court ruled that Public school districts are not "persons" who may be sued under the CFCA. On the other hand, charter schools, and the individuals, corporations, entities, or organizations that operate them, are "persons" subject to suit under both the CFCA and the UCL, and are not exempt from either law merely because such schools are deemed part of the public school system. The CFCA cause of action was not a barred claim for "educational malfeasance" insofar as it asserts, not simply that One2One's charter schools provided a substandard education, but that they submitted false claims for school funds while failing to furnish any significant educational services, materials, and supplies.

The Court also held that CFCA cause of action is not barred insofar as it alleges that, before 2000, the charter schools violated "independent study" rules set forth in a 1993 statute because it applied to charter schools even before its amendment in 1999. Finally, a qui tam action under the CFCA against a charter school operator is not subject to the Tort Claims Act requirement of prior presentment of a claim for payment.

2007 to 2018

As of the beginning of the 2018–19 school year, 1306 charter schools and seven all-charter districts are operating in California. Of the individual active charter schools, approximately 84 percent are start-up schools, and the remainder are conversions of pre-existing public schools. Approximately 74 percent are classroom- or site-based, and the remainder are either partially or exclusively non-classroom-based (independent study). As of the 2017–18 school year, the number of students enrolled in charter schools was approximately 628,849, or approximately ten percent of the public school student population in California.

Questions began to arise as to whether charter school board members are subject to the same open meeting, public disclosure, and conflict-of-interest requirements that school district board members already comply with under state law.

Various proposals to clarify these issues were vetoed, or did not move out of the legislature. These included the following:

• AB 276 (Medina) from the 2017-2018 Session, which was held on the Senate Floor, would have required charter schools and entities managing charter schools to comply with the same conflict of interest requirements as school districts.
• AB 1478 (Jones Sawyer) from the 2017-2018 Session, which failed passage on the Assembly Floor, would have required charter schools and entities managing charter schools to comply with the same conflict of interest requirements as school districts.
• AB 709 (Gibson) of the 2015-2016 Session, would have required charter schools to comply with the same conflict of interest requirements as school districts. The bill was vetoed by Governor Brown.
• AB 913 (Chau), of the 2013-2014 Session, would have required charter schools to comply with the same conflict of interest requirements as school districts, commencing July 1, 2014.
• AB 360 (Brownley), of the 2011-2012 Session, which died on the Assembly inactive file on concurrence, would have required charter schools to comply with the same conflict of interest requirements as school districts.
• AB 572 (Brownley), of the 2009-2010 Session would have required, commencing July 1, 2011, charter schools to comply with the same conflict of interest requirements as school districts, by specifying that charter schools are subject to the Brown Act, the CPRA, Government Code 1090, and the PRA. The bill was vetoed by Governor Schwarzenegger.
• AB 2115 (Mullin), of the 2007-2008 Session required charter schools to adopt and comply with a conflict of interest policy that requires its governing board members to abide by the same conflict of interest requirements as local education agency governing board members.
• AB 1772 (Bonnie Garcia), of the 2007-2008 Session, which was held in the Assembly Appropriations Committee, would have required a charter school to adopt and comply with a conflict-of-interest policy that included, but was not necessarily limited to, the requirements that charter school governing board members abide Government Code 1090, among other requirements.

In late 2018 [December 26, 2018] Attorney General Becerra issued a formal opinion stating that these laws apply to charter school governing boards. The AG expressly rejected arguments that charter schools operated as, or by, nonprofit public benefit corporations are entitled to different treatment under these laws. The Attorney General answered each question with “yes”–with one narrow exception: that the records of State-approved charter schools are not subject to grand jury review. See: 101 Ops.Cal.Atty.Gen. 92 (2018).

Charter school advocates have consistently expressed concern with subjecting charter schools to the provisions of Government Code 1090 because it could make it more difficult for philanthropic board members to provide financial assistance or low-interest loans or make facilities available to charter schools, which may happen during the start-up phase of a charter school.

However, others argued that since charter schools are public schools and receive public funds, they have a fiduciary duty to taxpayers with regards to the use of those funds and should be subject to the same conflict-of-interest and disclosure requirements as traditional school districts.

In addition, statutes governing corporations requires not more than 49 percent of persons serving on the board of any corporation to be interested persons. "Interested persons" is defined as either of the following: (1) any person currently compensated by the corporation for services rendered to it within the previous 12 months (excluding any reasonable compensation paid to a director); or, (2) any relative, as specified, of any such person. Advocates of charter schools contended they should abide by conflict of interest provisions related to corporations, not local educational agencies, due to the fact that some charter schools are operated by nonprofit corporations.

2010

The Legislature passes and Governor Schwarzenegger signed SBX5-4 (Romero [D-Los Angeles]) Ch 3X5/2010. SBX5-4 results in California becoming the first state in the nation with a parent trigger law. SB X5-4 passage, just before a federal deadline on January 19 allowed California to compete for $700 million in President Obama's Race to the Top initiative (which it did not ultimately receive) by complying with a Race to the Top requirement that test scores be used to evaluate teachers. SBX54 also includes an "open enrollment" provision, allowing students in underperforming schools to apply for admission at any other school.

The Open Enrollment portion of SBX5-4 allows any pupil enrolled in one of 1000 critically underperforming schools, as identified by the Superintendent to enroll in a higher performing school anywhere in the state. The district of residence is required to provide notice of the option to transfer to parents and guardians of students enrolled in these schools no later than the first day of the school year, and the Act precludes districts of enrollment from targeting individual families or neighborhoods to attract certain groups of students.

Several types of schools are exempt from classification as critically underperforming, including county community schools, community day schools, juvenile court schools, and charter schools. In addition, no district may have greater than 10 percent (10%) of its schools classified as critically underperforming and any school that would disrupt the balance of elementary, middle and high schools ranked in decile one, based on the API in the 2008-09 school-year, is exempt from the classification.

In addition, the Parent Empowerment Act, also created by SBX5-4, allows parents and guardians to petition the governing board of a school site to implement any of the Race to the Top interventions or other federally mandated alternative governance arrangements authorized by No Child Left Behind. If at least 50 percent (50%) of parents and guardians of current and future students that normally matriculate into a particular school site sign a petition so requesting, the LEA must implement one or more of the four intervention models identified in RTTT: turnaround, restart, school closure, or transformation to charter school, as well as the program improvement restructuring options.

In Ochoa v. Anaheim School District, 11 Cal.App.5th 209 (2017), the Court of Appeals for the Fourth District addressed the implementation of SB5X-4.

The Court of Appeals noted that per 5X-4, if a school in California continues to fail in meeting certain benchmarks, including the requirement that it meet AYP as defined by federal law, parents may trigger a process to implement one of the four intervention plans at the school. The process includes the submission of a petition signed by the parents of at least one-half of the school's pupils, which satisfies criteria set forth in the regulations promulgated under the Act.

In early 2015, parents of students enrolled at Palm Lane Elementary School in Anaheim submitted such a petition under the Act to the Anaheim City School District (the trigger petition). The trigger petition sought implementation of the "restart model" (intervention plan). The restart model option involves the transfer of control over the school in question from the school district to a charter school operator. The Anaheim City School District rejected the trigger petition on the ground it failed to meet certain criteria set forth in the applicable Regulations.

Palm Lane Elementary School parents Cecilia Ochoa, Magdalena Paredes, Marlene Gaytan, Mayra Cervantes, and Geronimo Gaytan, along with California Center for Parent Empowerment (collectively, the Petitioners), filed a petition for a writ of mandate against Anaheim City School District and Anaheim City School District Board of Education (together, the District). The petition sought the issuance of a writ commanding the District to accept the trigger petition or provide legally sufficient reasons for rejecting it. Following a six-day bench trial, the court found the District's reasons for rejecting the trigger petition invalid and granted the petition for a writ of mandate. The Court of Appeal affirmed the trial court and upheld the act and the trigger conditions had been met.

2011

Governor Brown vetoes AB 203 (Brownley) that makes significant changes to the petition process contained in SB5X-4. He notes that the State Board of Education has spent the past year engaged in a lengthy, contentious process to reach consensus among a diverse group of stakeholders. The result is a set of regulations that received unanimous support and address many of the changes proposed by this bill.

2013

AB 86 was enacted. This bill was the omnibus Education Trailer Bill to the Budget Act of 2013. Insofar as charters were concerned, the bill had two important provisions.

• The bill transferred administration of the Charter School Revolving Loan Fund (CSRLF) from the California Department of Education (CDE) to the California State Treasurer’s Office, California School Finance Authority commencing with the 2013-14 fiscal year. The CDE had administered (CSRLF) since its inception in 1996.
• The bill transferred administration of the Charter School Facility Grant Program (SB740) to the California State Treasurer’s Office, California School Finance Authority commencing with the 2013-14 fiscal year. With respect to the SB740 Program, the bill made the following changes:
  • Subject to the annual Budget Act, eligible schools shall receive an amount of up to, but not more than, seven hundred fifty dollars ($750) per unit of average daily attendance (ADA), as certified at the second principal apportionment (P2), to provide an amount of up to, but not more than 75 percent (75%) of the annual facilities rent and lease costs for the charter school.
  • The program eligibility threshold based on Free or Reduced-Price Meal (FRPM) eligibility was raised. In order to qualify based on its own pupil enrollment, a school must show seventy percent (70%) of its students are eligible for FRPM. In the alternative, a school with FRPM below seventy percent (70%) may be eligible if it is physically located in the attendance area of a public elementary school in which seventy percent (70%) of the pupil enrollment is eligible for FRPM and the charter school gives preference in admissions to pupils who are currently enrolled in that public elementary school and to pupils who reside in the elementary school attendance area where the charter school site it located. Both thresholds were raised from fifty-five percent (55%) to seventy percent (70%).
  • Provides that an initial apportionment shall be made by August 31 of each fiscal year or 30 days after enactment of the annual Budget Act, whichever is later, provided the charter school meets specific criteria.
  • Provides that CSFA shall use prior year rent or lease costs to determine eligibility until current year data and actual rent or lease costs become known or until June 30 of each fiscal year.
  • Grants CSFA the authority to adopt emergency regulations to implement section 47614.5 of the Education Code.

AB 86 also appropriated $1,250,000,000 from the General Fund to the Superintendent of Public Instruction for transfer to Section A of the State School Fund to support the implementation of Common Core standards.

2015

In California Charter Schools Association v. Los Angeles Unified School District, 60 Cal.4th 1221 (2015), the California Supreme Court addressed the facilities provisions in Prop 39. The Court held that in responding to a charter school's request for classroom space, a school district must follow a three-step process. First, the district must identify comparison group schools. Second, the district must count the number of classrooms in the comparison group schools using a statutory inventory and then adjust the number to reflect those classrooms "provided to" students in the comparison group schools. Third, the district must use the resulting number as the denominator in the ADA/classroom ratio for allocating classrooms to charter schools based on their projected ADA.

The Supreme Court held that LA Unified District's use of norming ratios departs from the required procedure by failing to use comparison group schools and by equating classrooms "provided to" students with classrooms staffed by teachers. In responding to future facilities requests, the District must count classrooms in a manner that conforms to the regulation. The Court remanded for further proceedings.

2017

In San Jose Unified School District v. Santa Clara County Office of Education and Rocketship Education 7 Cal.App.5th 967 (2017), the Court of Appeals for the Sixth District addressed local zoning restrictions on charter schools. Santa Clara County Office of Education, the Santa Clara County Board of Education, Rocketship Education, and Rocketship Eight Charter School, maintained that county boards of education may issue zoning exemptions from local zoning regulations.

Consistent with that position, the Santa Clara County Board of Education (County Board) approved a resolution exempting from local zoning ordinances property to be used by Rocketship Education for a charter school. The San Jose Unified School District argued that county boards of education have no authority to issue zoning exemptions. San Jose Unified successfully sought a writ of mandate to set aside the resolution in the trial court.

The Court of Appeal held that state law does not authorize county boards of education to issue zoning exemptions for charter schools.

By way of background, in Hall v. City of Taft, 47 Cal.2d 177 (1956), the California Supreme Court held that the construction of school buildings by school districts was not subject to local building regulations. The court rested its decision on two independent grounds. First, the court concluded, based on a number of constitutional provisions, that "[t]he public schools of this state are a matter of statewide rather than local or municipal concern" and "the power of the state Legislature over the public schools is plenary, subject only to any constitutional restrictions". And, two "[s]chool districts are agencies of the state for the local operation of the state school system". From those conclusions, the court reasoned that when the state, through its school districts, "engages in such sovereign activities as the construction and maintenance of its buildings, it is not subject to local regulations unless the Constitution says it is or the Legislature has consented to such regulation." Second, the court reasoned that the state had occupied the field of school building regulation, such that conflicting local regulations were invalid.

For that conclusion, the Hall court noted that "numerous comprehensive building regulations contained in the Education Code and the rules and regulations of the Division of Architecture" govern the construction of school buildings. Subsequent case law held that school districts were not required to comply with municipal zoning ordinances in designating school locations. The court’s reasoning was twofold: (1) the location and acquisition of a school site is a sovereign activity of the state and (2) the state has occupied the field of school site location.

In response to Hall, the Legislature "in effect, consented to local regulation [of state agencies] by legislation to that effect but local school districts could exempt themselves for local zoning approval.

The Court of Appeal in Rocketship held that the County Board sought to employ section 53094 in connection with a proposed location for a charter school. While county boards of education are authorized to issue charters and oversee charter schools, it is local school districts that are obligated to provide facilities to charter schools.

The Court of Appeal noted that the state has not tasked county boards of education with acquiring sites for charter schools; to the extent county boards of education do so, they are not carrying out a sovereign activity on behalf of the state. It follows, then, that empowering county boards of education to issue zoning exemptions for charter school facilities does not advance the purpose of the Hall response — namely, preventing local interference with the state's sovereign activities. For the foregoing reasons, the legislative history convinces us that the legislative response does not authorize county boards of education to issue zoning exemptions for charter school facilities. None of appellants' remaining arguments persuades us otherwise, as discussed below.

The Court of Appeal rejected the argument that its result would violate the State Constitution. Specifically, Article IX, section 6 of the Constitution states, in relevant part: "The Public School System shall include all kindergarten schools, elementary schools, secondary schools, technical schools, and state colleges, established in accordance with law and, in addition, the school districts and the other agencies authorized to maintain them. No school or college or any other part of the Public School System shall be, directly or indirectly, transferred from the Public School System or placed under the jurisdiction of any authority other than one included within the Public School System."

According to Rocketship, any construction of the relevant code section under which county boards of education cannot issue zoning exemptions violates article IX, section 6 of the Constitution by giving cities the right to exclude (and thereby control) county-run public schools. In the context of county-chartered charter schools, there is no risk of such exclusion given the obligation of the school district to provide facilities. Thus, control over county-chartered charter schools remains squarely in the public school system under its construction of the Education Code.

2019

SB 126 (Leyva) [D-San Bernardino]), Ch. 3/2019 is enacted [signed into law on March 5, 2019] as the result of a stakeholder agreement in response to the December 2018 Attorney General Opinion. It subjects charter schools and entities managing charter schools to a variety of the same open meeting, conflict-of-interest, and disclosure laws as traditional school districts. Specifically, this law:

• Requires a charter school and an entity managing a charter school to be subject to all of the following:
  • The Ralph M. Brown Act, except that a charter school operated by an entity pursuant to Chapter 5 (commencing with Section 47620) shall be subject to the Bagley-Keene Open Meeting Act, regardless of the authorizing entity.
  • The California Public Records Act. C
  • Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code.
  • The Political Reform Act of 1974.
• Requires the chartering authority of a charter school to be the custodian of records with regard to any request for information submitted to the charter school if either of the following apply: (i) The charter school is located on a federally recognized California Indian reservation or rancheria. (ii) The charter school is operated by a nonprofit public benefit corporation that was formed on or before May 31, 2002, and is currently operated by a federally recognized California Indian tribe.
• Requires a charter school and an entity managing a charter school to be considered an agency and the most decentralized level for purposes of adopting a conflict-of-interest code.
• Requires the following regarding the location of governing body meetings:
  • The governing body of one charter school shall meet within the physical boundaries of the county in which the charter school is located. A two-way teleconference location shall be established at each school-site.
  • The governing body of one non-classroom-based charter school that does not have a facility or operates one or more resource centers shall meet within the physical boundaries of the county in which the greatest number of pupils who are enrolled in that charter school reside. A two-way teleconference location shall be established at each resource center.
  • For a governing body of an entity managing one or more charter schools located within the same county, the governing body of the entity managing a charter school shall meet within the physical boundaries of the county in which that charter school or schools are located. A two-way teleconference location shall be established at each school-site and each resource center.
  • For a governing body of an entity that manages two or more charter schools that are not located in the same county, the governing body of the entity managing the charter schools shall meet within the physical boundaries of the county in which the greatest number of pupils enrolled in those charter schools managed by that entity reside. A two-way teleconference location shall be established at each school site and each resource center. The governing body of the entity managing the charter schools shall audio record, video record, or both, all the governing board meetings and post the recordings on each charter school’s website.
• Specifies that an employee of a charter school is not disqualified from serving as a member of the governing body of the charter school because of that employee’s employment status.
• Specifies that a member of the governing body of a charter school who is also an employee of the charter school shall abstain from voting on, or influencing or attempting to influence another member of the governing body, regarding all matters uniquely affecting that member’s employment.
• Specifies that, to the extent a governing body of a charter school or an entity managing a charter school engages in activities that are unrelated to a charter school, Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code, the Ralph M. Brown Act, the Bagley-Keene Open Meeting Act, the California Public Records Act, and the Political Reform Act of 1974 shall not apply with regard to those unrelated activities unless otherwise required by law.
• Prohibits a meeting of the governing body of a charter school to discuss items related to the operation of the charter school, including the discussion of any item regarding an activity of the governing body that is unrelated to the operation of the charter school.
• Defines an “entity managing a charter school” as a nonprofit public benefit corporation that operates a charter school consistent with the Education Code.
• Specifies that an entity that is not authorized to operate a charter school pursuant to the Education Code is not an “entity managing a charter school” solely because it contracts with a charter school to provide to that charter school goods or task-related services that are performed at the direction of the governing body of the charter school and for which the governing body retains ultimate decision-making authority each resource center.

On July 9, 2019 the Court of Appeals for the Fourth District decides Oxford Preparatory Academy v. Chino Valley Unified School District, 37 Cal.App.5th 413 (2019). The appeal arising from a mandamus action in the superior court presented novel issues regarding the proper scope of judicial review of a school district's decision to deny a petition to renew a charter school. Below, the trial court concluded it had to apply an extremely deferential standard of review because it believed the governing board of the Chino Valley Unified School District (District) was performing a quasi-legislative action when it denied the renewal petition submitted by Oxford Preparatory Academy (the Academy), an existing charter school within the District. Finding that the District's decision was not arbitrary or capricious, the trial court denied the Academy's writ petition.

On appeal, the Academy contends the trial court applied the incorrect standard of review because the District's decision was quasi-judicial in nature and, therefore, the trial court should have applied a less deferential standard of review. The Court of Appeal concluded that a school district's decision to deny a charter school's renewal petition is a quasi-judicial action subject to review via a petition for administrative mandamus. In considering a renewal petition, the school district is not acting in a legislative function by creating new policy, but rather performing a quasi-judicial function by applying existing standards and rules defined by state statute to determine whether the evidence presented by the charter school regarding its past performance is sufficient to satisfy those standards. The applicable statutes allow the District to deny a renewal petition only after conducting a hearing and making specific factual findings. This process bears all the hallmarks of a quasi-judicial action.

Additionally, the Court concluded that after a charter school's initial petition is approved by a school district, the petitioner has a fundamental vested right to continue operating the charter school such that a school district's decision that deprives the petitioner of that right is subject to independent judicial review.

The Court of Appeal held that the trial court did not apply these standards when reviewing the District's decision. Accordingly, it reversed and remanded for reconsideration of the Academy's writ petition under the correct standards.

On October 3, 2019, Governor Newsom approves AB 1505 (O’Donnell [D-Long Beach]), Ch. 486/2019. AB 1505 makes numerous changes relating to charter school authorizations, appeals, and renewals, clarifies the teacher credentialing requirements of charter schools teachers, and places a two-year moratorium on non-classroom-based charter schools.

On October 3, 2109 Governor Newsom signed into law AB 1507 (Smith [D-Santa Clarita]), Ch. 487/2019. AB 1507 addressed the issue of so-called satellite charters.

The charter school law [pre Prop 39 and not updated] authorized a charter school that is unable to locate within the jurisdiction of the chartering school district to establish one site outside the boundaries of the authorizer, but within the county in which that school district is located, if the school district within the jurisdiction of which the charter school proposes to operate is notified in advance of the charter petition approval, the county superintendent of schools and the Superintendent of Public Instruction are notified of the location of the charter school before it commences operations, and either of the following circumstances exists: (a) the school has attempted to locate a single site or facility to house the entire program, but a site or facility is unavailable in the area in which the school chooses to locate, or (b) the site is needed for temporary use during a construction or expansion project. Arguably this is an anomaly as under Prop 39 school districts have a duty to find a site for a charter it authorizes.

Also, non-classroom-based charter schools, those not operating in a traditional brick-and-mortar settings, may establish a resource center, meeting space, or other satellite facility in a county adjacent to the county in which the school was approved if the following apply: (a) The facility is used exclusively for the educational support of pupils who are enrolled in non-classroom-based independent study; and (b) The charter school provides its primary educational services in, and a majority of the pupils it serves are residents of, the county in which the charter was authorized.

In Anderson Union High School District v. Shasta Secondary Home School, 4 Cal.App.5th 262 (2016), the Court of Appeal for the Third District held that the Charter School Act does not per se permit a charter school that is authorized by a school district and provides support for non-classroom-based independent study to locate a resource center outside the geographic boundaries of the authorizing school district but within the same county but the State Board of Education could grant a waiver.

The Court of Appeal decision led numerous charter schools to apply for waivers from the State Board of Education as the location of their resource centers were out of compliance with the law. In 2017, the SBE received 55 waivers that were approved on a one-time basis, to give time for these resource centers to come into compliance with the law.

In some cases, districts have authorized charter schools operating in other districts to generate revenue. While existing law allows a charter school to locate a facility in a school district other than the one it is authorized by under a limited number of circumstances, there have been high-profile instances of school districts authorizing charter schools outside of the district in order to generate revenue through oversight fees.

In the Santa Clarita area, the Acton-Agua Dulce Unified School District authorized a charter school that was subsequently located in another school district that had previously denied the school. In return, the school then paid a 3.5 percent (3.5%) oversight fee to the school district. Other school districts, including Los Angeles Unified, Culver City Unified, Beverly Hills Unified, Pomona Unified, and San Diego Unified have all had charter schools located within their boundaries by other school districts.

AB 1507 with a grandfathering-transition provision eliminates the ability to authorize a charter school located outside the boundaries of the authorizing school district or county, and allows a non-classroom-based charter school to establish one or more resource centers within the jurisdiction of the school district where the charter school is located.