STAND. COM. REP. NO.1251-02

Honolulu, Hawaii

, 2002

RE: S.B. No. 2512

S.D. 2

H.D. 2




Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii


Your Committee on Finance, to which was referred S.B. No. 2512, S.D. 2, H.D. 1, entitled:


begs leave to report as follows:

The purpose of this bill is to provide equity to New Century Charter Schools (Charter Schools) and their teachers by:

(1) Enabling teachers who meet the requirements for regular Department of Education (DOE) teachers and are employed at Charter Schools to receive probationary and tenure status and acquire seniority;

(2) Requiring Charter Schools to receive an allocation of state funds based on the total DOE appropriation for EDN 100, 200, 300, 400, and 500 and projected per-pupil allocation for the current fiscal year;

(3) Requiring DOE to determine and provide an appropriate level of special education staff and services to Charter Schools to ensure that students' educational needs as indicated in the individualized educational plans are met;

(4) Limiting reimbursements by a Charter School to DOE for administrative services related to federal grants and subsidies to six and one-half percent of the Charter School's federal grants and subsidies;

(5) Establishing deadlines for DOE to provide a Charter School's per-pupil allocation each year; and

(6) Repealing:

(A) The provision declaring that the allocation for special education students shall be adjusted appropriately to reflect the additional expenses incurred for students in these programs, provided that any increment to the per pupil allocation made shall not exceed the increment available to all other public schools;

(B) The provision declaring that the per pupil allocation to any Charter School shall not exceed DOE's average per pupil expenditure; and

(C) The requirement that the Auditor explicitly consider the advice of the Superintendent of Education and representatives of local school boards when determining the per-pupil allocation for Charter Schools.

Kamehameha Schools, South Maui Learning Ohana, Inc., Hawaii Association of Charter Schools, and numerous citizens supported this bill. The Department of Budget and Finance and Hawaii Governmental Employees Association opposed this bill. The DOE, Hawaii State Teachers Association, and Voyager Public Charter School Local School Board offered comments.

Your Committee has amended this measure by:

(1) Deleting the provision enabling teachers, who are employed at Charter Schools and who fulfill the requirements set forth for regular DOE teachers, to receive probationary and tenure status and acquire seniority;

(2) Basing the allocation formula for funding of Charter Schools on the total DOE general fund allocation for EDN 100, 200, 300, and 400, instead of total DOE appropriations for the respective program ID's listed;

(3) Requiring the DOE to provide appropriate transitional resources to a conversion charter school for its first year of operation as a Charter School based on the DOE's allocation to the school for the year prior to conversion;

(4) Requiring the Auditor to consider DOE-imposed budget restrictions when determining allocation amounts;

(5) Requiring the Auditor to develop a methodology for allocating funds for conversion charter schools by basing the allocation for each newly converted school on the EDN 100, 200, and upon written agreement between the conversion charter school's local school board and DOE, specified sections of the EDN 300 and 400 budgets the school received in the year prior to conversion; provided that the allocation may be adjusted to account for any changes that may be made by the Legislature, Governor, DOE-imposed restrictions, or applicable collective bargaining negotiated amounts;

(6) Clarifying that if a Charter School dissolves or is denied continuation, the State of Hawaii shall have first right to all assets and facilities of the Charter School, except as otherwise provided in the detailed implementation plan; and

(7) Making technical, nonsubstantive amendments for purposes of style and clarity.

As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2512, S.D. 2, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2512, S.D. 2, H.D. 2.

Respectfully submitted on behalf of the members of the Committee on Finance,