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18_08 Proposed New 19 TAC §105.1011

Commissioner's Rules

Proposed New 19 TAC Chapter 105, Foundation School Program, Subchapter BB, Commissioner's Rules Concerning Charter School Funding, §105.1011, Additional State Aid for Open-Enrollment Charter School Facilities

Attachments:
I. Statutory Citation (PDF)
II. Text of Proposed New 19 TAC Chapter 105, Foundation School Program, Subchapter BB, Commissioner's Rules Concerning Charter School Funding, §105.1011, Additional State Aid for Open-Enrollment Charter School Facilities (PDF)
SUMMARY: The rule action presented in this item was filed as proposed with the Texas Register under the commissioner's rulemaking authority. This item proposes new 19 TAC Chapter 105, Foundation School Program, Subchapter BB, Commissioner's Rules Concerning Charter School Funding, §105.1011, Additional State Aid for Open-Enrollment Charter School Facilities. The proposed new rule would implement changes made by House Bill (HB) 21, 85th Texas Legislature, First Called Session, 2017, by defining the most recent performance rating under Texas Education Code (TEC), Chapter 39, Subchapter C, for the purposes of determining open-enrollment charter school facilities funding eligibility.

STATUTORY AUTHORITY: TEC, §12.106, as amended by HB 21, 85th Texas Legislature, First Called Session, 2017.

TEC, §12.106(c), allows the commissioner to adopt rules for the administration of TEC, §12.106.

TEC, §12.106(d), as added by HB 21, 85th Texas Legislature, First Called Session, 2017, establishes the formula to be used to calculate open-enrollment charter school facilities funding.

TEC, §12.106(e), as added by HB 21, 85th Texas Legislature, First Called Session, 2017, sets forth eligibility to receive open-enrollment charter school facilities funding.

EARLIEST POSSIBLE DATE OF ADOPTION: September 24, 2018.

PROPOSED EFFECTIVE DATE: November 25, 2018.

BACKGROUND INFORMATION AND JUSTIFICATION: The TEC, §12.106, authorizes the commissioner of education to adopt rules for the administration of state funding for open-enrollment charter schools. HB 21, 85th Texas Legislature, First Called Session, 2017, created a new facilities allotment under TEC, §12.106(d), for open-enrollment charter schools. The allotment is based on the open-enrollment charter school's average daily attendance (ADA) multiplied by the state average interest and sinking (I&S) tax rate imposed by school districts for the current school year. An amount of $60 million was allocated in HB 21 to fund facilities payments to open-enrollment charter schools. If the statewide total exceeds $60 million, the rate per ADA is prorated to result in a total amount to which open-enrollment charter schools are entitled to for the current year equal to $60 million. Pursuant to TEC, §12.106(e), a charter holder is entitled to receive funding for facilities if the most recent overall performance rating assigned to the open-enrollment charter school under TEC, Chapter 39, Subchapter C, reflects at least acceptable performance.

To implement HB 21, proposed new §105.1011 would exercise the commissioner's authority under TEC, §12.106(c), to define the most recent rating year for the purposes of determining funding eligibility under TEC, Chapter 39, Subchapter C, as the most recent final overall performance rating issued to the open-enrollment charter school preceding the school year for which funding under TEC, §12.106(d), would be provided.

The proposed new rule would remove any ambiguity about which performance rating will be used in the allotment calculation. Since the distribution of the allotment occurs before the final accountability rating for the preceding year is determined, proposed new §105.1011(a) would specify that the preliminary rating would be used to determine funding under TEC, §12.106(d). Subsection (b) would specify that if an appeal to the preliminary rating resulted in a change to a rating of at least acceptable, then the full amount of the funds would be provided.

FISCAL IMPACT: Texas Education Agency (TEA) has determined that there are no additional costs to persons or entities required to comply with the proposed new rule. In addition, there is no direct adverse economic impact for small businesses, microbusinesses, or rural communities; therefore, no regulatory flexibility analysis, specified in Texas Government Code, §2006.002, is required. There is no effect on local economy; therefore, no local employment impact statement is required under Texas Government Code, §2001.022. The proposed new rule does not impose a cost on regulated persons, another state agency, a special district, or a local government and, therefore, is not subject to Texas Government Code, §2001.0045.

GOVERNMENT GROWTH IMPACT: TEA staff prepared a Government Growth Impact Statement assessment for this proposed rulemaking. During the first five years the proposed rulemaking would be in effect, it would not create or eliminate a government program; would not require the creation of new employee positions or elimination of existing employee positions; would not require an increase or decrease in future legislative appropriations to the agency; would not require an increase or decrease in fees paid to the agency; would not create a new regulation; would not expand, limit, or repeal an existing regulation; would not increase or decrease the number of individuals subject to its applicability; and would not positively or adversely affect the state's economy.

PUBLIC AND STUDENT BENEFIT: The proposed new rule will implement new provisions in TEC, §12.106, that provide open-enrollment charter schools with additional funding for facilities. The proposed new rule clearly defines the overall performance rating to be used in the allotment calculation and helps open-enrollment charter schools estimate state aid and prepare their budgets.

PROCEDURAL AND REPORTING IMPLICATIONS: The proposed new rule would have no new procedural and reporting implications. Open-enrollment charter schools would continue to follow current reporting requirements.

LOCALLY MAINTAINED PAPERWORK REQUIREMENTS: The proposed new rule would require no new locally maintained paperwork requirements. Open-enrollment charter schools would continue to maintain existing local records.

PUBLIC COMMENTS: The public comment period on the proposal begins August 24, 2018, and ends September 24, 2018.

ALTERNATIVES: None.

OTHER COMMENTS AND RELATED ISSUES: A request for a public hearing on the proposal submitted under the Administrative Procedure Act must be received by the commissioner of education not more than 14 calendar days after notice of the proposal has been published in the Texas Register on August 24, 2018.

Staff Members Responsible:
Leo Lopez, Associate Commissioner, School Finance / Chief School Finance Officer
Al McKenzie, Director, State Funding
Nora Rainey, Manager, State Funding 

 

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