HB2233 - 552R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 15-183, Arizona Revised Statutes, is amended to read:

START_STATUTE15-183. Charter schools; application; requirements; immunity; exemptions; renewal of application; reprisal; fee; funds; annual reports

A. An applicant seeking to establish a charter school shall apply in writing to a proposed sponsor as prescribed in subsection C of this section. The application, application process and application time frames shall be posted on the sponsor's website and shall include the following, as specified in the application adopted by the sponsor:

1. A detailed educational plan.

2. A detailed business plan.

3. A detailed operational plan.

4. Any other materials required by the sponsor.

B. The sponsor of a charter school may contract with a public body, private person or private organization for the purpose of establishing a charter school pursuant to this article.

C. The sponsor of a charter school may be either the state board of education, the state board for charter schools, a university under the jurisdiction of the Arizona board of regents, a community college district or a group of community college districts, subject to the following requirements:

1. An applicant may not apply for sponsorship to any person or entity other than those prescribed in this subsection.

2. The applicant may apply to the state board of education or the state board for charter schools. Notwithstanding any other law, neither the state board for charter schools nor the state board of education shall grant a charter to a school district governing board for a new charter school or for the conversion of an existing district public school to a charter school. The state board of education or the state board for charter schools may approve the application if the application meets the requirements of this article and may approve the charter if the proposed sponsor determines, within its sole discretion, that the applicant is sufficiently qualified to operate a charter school and that the applicant is applying to operate as a separate charter holder by considering factors such as whether:

(a) The schools have separate governing bodies, governing body membership, staff, facilities and student population.

(b) Daily operations are carried out by different administrators.

(d) The applicant's charter management organization has multiple charter holders serving varied grade configurations on one physical site or nearby sites serving one community.

(e) The applicant is reconstituting an existing school site population at the same or new site.

(f) The applicant is reconstituting an existing grade configuration from a prior charter holder with at least one grade remaining on the original site with the other grade or grades moving to a new site. The state board of education or the state board for charter schools may approve any charter schools transferring charters. If the state board of education or the state board for charter schools rejects the preliminary application, the state board of education or the state board for charter schools shall notify the applicant in writing of the reasons for the rejection and of suggestions for improving the application. An applicant may submit a revised application for reconsideration by the state board of education or the state board for charter schools. The applicant may request, and the state board of education or the state board for charter schools may provide, technical assistance to improve the application.

3. The applicant may submit the application to a university under the jurisdiction of the Arizona board of regents, a community college district or a group of community college districts. A university, a community college district or a group of community college districts shall not grant a charter to a school district governing board for a new charter school or for the conversion of an existing district public school to a charter school. A university, a community college district or a group of community college districts may approve the application if it meets the requirements of this article and if the proposed sponsor determines, in its sole discretion, that the applicant is sufficiently qualified to operate a charter school.

4. Each applicant seeking to establish a charter school shall submit a full set of fingerprints to the approving agency for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. If an applicant will have direct contact with students, the applicant shall possess a valid fingerprint clearance card that is issued pursuant to title 41, chapter 12, article 3.1. The department of public safety may exchange this fingerprint data with the federal bureau of investigation. The criminal records check shall be completed before the issuance of a charter.

5. All persons engaged in instructional work directly as a classroom, laboratory or other teacher or indirectly as a supervisory teacher, speech therapist or principal shall have a valid fingerprint clearance card that is issued pursuant to title 41, chapter 12, article 3.1, unless the person is a volunteer or guest speaker who is accompanied in the classroom by a person with a valid fingerprint clearance card. A charter school shall not employ in any position that requires a valid fingerprint clearance card a person against whom the state board of education has taken disciplinary action as prescribed in section 15-505 or whose certificate has been suspended, surrendered or revoked, unless the person's certificate has been subsequently reinstated by the state board of education. All other personnel shall be fingerprint checked pursuant to section 15-512, or the charter school may require those personnel to obtain a fingerprint clearance card issued pursuant to title 41, chapter 12, article 3.1. Before employment, the charter school shall make documented, good faith efforts to contact previous employers of a person to obtain information and recommendations that may be relevant to the person's fitness for employment as prescribed in section 15-512, subsection F, including checking the educator information system that is maintained by the department of education pursuant to section 15-505. The charter school shall notify the department of public safety if the charter school or sponsor receives credible evidence that a person who possesses a valid fingerprint clearance card is arrested for or is charged with an offense listed in section 41-1758.03, subsection B. A person who is employed at a charter school that has met the requirements of this paragraph is not required to meet any additional requirements that are established by the department of education or that may be established by rule by the state board of education. The state board of education may not adopt rules that exceed the requirements for persons who are qualified to teach in charter schools prescribed in title I of the every student succeeds act (P.L. 114-95) or the individuals with disabilities education improvement act of 2004 (P.L. 108-446). Charter schools may hire personnel who have not yet received a fingerprint clearance card if proof is provided of the submission of an application to the department of public safety for a fingerprint clearance card and if the charter school that is seeking to hire the applicant does all of the following:

(a) Documents in the applicant's file the necessity for hiring and placing the applicant before the applicant receives a fingerprint clearance card.

(b) Ensures that the department of public safety completes a statewide criminal records check on the applicant. A statewide criminal records check shall be completed by the department of public safety every one hundred twenty days until the date that the fingerprint check is completed or the fingerprint clearance card is issued or denied.

(c) Obtains references from the applicant's current employer and the two most recent previous employers except for applicants who have been employed for at least five years by the applicant's most recent employer.

(d) Provides general supervision of the applicant until the date that the fingerprint card is obtained.

(e) Completes a search of criminal records in all local jurisdictions outside of this state in which the applicant has lived in the previous five years.

(f) Verifies the fingerprint status of the applicant with the department of public safety.

6. A charter school that complies with the fingerprinting requirements of this section shall be deemed to have complied with section 15-512 and is entitled to the same rights and protections provided to school districts by section 15-512.

7. If a charter school operator is not already subject to a public meeting or hearing by the municipality in which the charter school is located, the operator of a charter school shall conduct a public meeting at least thirty days before the charter school operator opens a site or sites for the charter school. The charter school operator shall post notices of the public meeting in at least three different locations that are within three hundred feet of the proposed charter school site.

8. A person who is employed by a charter school or who is an applicant for employment with a charter school, who is arrested for or charged with a nonappealable offense listed in section 41-1758.03, subsection B and who does not immediately report the arrest or charge to the person's supervisor or potential employer is guilty of unprofessional conduct and the person shall be immediately dismissed from employment with the charter school or immediately excluded from potential employment with the charter school.

9. A person who is employed by a charter school and who is convicted of any nonappealable offense listed in section 41-1758.03, subsection B or is convicted of any nonappealable offense that amounts to unprofessional conduct under section 15-550 shall immediately do all of the following:

(a) Surrender any certificates issued by the department of education.

(b) Notify the person's employer or potential employer of the conviction.

(d) Surrender the person's fingerprint clearance card.

D. An entity that is authorized to sponsor charter schools pursuant to this article has no legal authority over or responsibility for a charter school sponsored by a different entity. This subsection does not apply to the state board of education's duty to exercise general supervision over the public school system pursuant to section 15-203, subsection A, paragraph 1.

E. The charter of a charter school shall do all of the following:

1. Ensure compliance with federal, state and local rules, regulations and statutes relating to health, safety, civil rights and insurance. The department of education shall publish a list of relevant rules, regulations and statutes to notify charter schools of their responsibilities under this paragraph.

2. Ensure that it is nonsectarian in its programs, admission policies and employment practices and all other operations.

3. Ensure that it provides a comprehensive program of instruction for at least a kindergarten program or any grade between grades one and twelve, except that a school may offer this curriculum with an emphasis on a specific learning philosophy or style or certain subject areas such as mathematics, science, fine arts, performance arts or foreign language.

4. Ensure that it designs a method to measure pupil progress toward the pupil outcomes adopted by the state board of education pursuant to section 15-741.01, including participation in the statewide assessment and the nationally standardized norm-referenced achievement test as designated by the state board and the completion and distribution of an annual report card as prescribed in chapter 7, article 3 of this title.

5. Ensure that, except as provided in this article and in its charter, it is exempt from all statutes and rules relating to schools, governing boards and school districts.

6. Ensure that, except as provided in this article, it is subject to the same financial and electronic data submission requirements as a school district, including the uniform system of financial records as prescribed in chapter 2, article 4 of this title, procurement rules as prescribed in section 15-213 and audit requirements. The auditor general shall conduct a comprehensive review and revision of the uniform system of financial records to ensure that the provisions of the uniform system of financial records that relate to charter schools are in accordance with commonly accepted accounting principles used by private business. A school's charter may include exceptions to the requirements of this paragraph that are necessary as determined by the university, the community college district, the group of community college districts, the state board of education or the state board for charter schools. The department of education or the office of the auditor general may conduct financial, program or compliance audits.

7. Ensure compliance with all federal and state laws relating to the education of children with disabilities in the same manner as a school district.

8. Ensure that it provides for a governing body for the charter school that is responsible for the policy decisions of the charter school. Notwithstanding section 1-216, if there is a vacancy or vacancies on the governing body, a majority of the remaining members of the governing body constitute a quorum for the transaction of business, unless that quorum is prohibited by the charter school's operating agreement.

9. Ensure that it provides a minimum of one hundred eighty instructional days before June 30 of each fiscal year unless it is operating on an alternative calendar approved by its sponsor. The superintendent of public instruction shall adjust the apportionment schedule accordingly to accommodate a charter school utilizing an alternative calendar.

F. A charter school shall keep in the personnel file of each current employee who provides instruction to pupils at the charter school information about the employee's educational and teaching background and experience in a particular academic content subject area. A charter school shall inform parents and guardians of the availability of the information and shall make the information available for inspection on request of parents and guardians of pupils enrolled at the charter school. This subsection does not require any charter school to release personally identifiable information in relation to any teacher or employee, including the teacher's or employee's address, salary, social security number or telephone number.

G. The charter of a charter school may be amended at the request of the governing body of the charter school and on the approval of the sponsor.

H. Charter schools may contract, sue and be sued.

I. The charter is effective for fifteen years from the first day of the fiscal year as specified in the charter, subject to the following:

1. At least eighteen months before the the charter expires, the sponsor shall notify the charter school that the charter school may apply for renewal and shall make the renewal application available to the charter school. A charter school that elects to apply for renewal shall file a complete renewal application at least fifteen months before the charter expires. A sponsor shall give written notice of its intent not to renew the charter school's request for renewal to the charter school at least twelve months before the expiration of the charter. The sponsor shall make data used in making renewal decisions available to the school and the public and shall provide a public report summarizing the evidence basis for each decision. The sponsor may deny the request for renewal if, in its judgment, the charter holder has failed to do any of the following:

(a) Meet or make sufficient progress toward the academic performance expectations set forth in the performance framework.

(b) Meet the operational performance expectations set forth in the performance framework or any improvement plans.

(d) Complete the obligations of the contract.

(e) Comply with this article or any provision of law from which the charter school is not exempt.

2. A charter operator may apply for early renewal. At least nine months before the charter school's intended renewal consideration, the operator of the charter school shall submit a letter of intent to the sponsor to apply for early renewal. The sponsor shall review fiscal audits and academic performance data for the charter school that are annually collected by the sponsor, review the current contract between the sponsor and the charter school and provide the qualifying charter school with a renewal application. On submission of a complete application, the sponsor shall give written notice of its consideration of the renewal application. The sponsor may deny the request for early renewal if, in the sponsor's judgment, the charter holder has failed to do any of the following:

(a) Meet or make sufficient progress toward the academic performance expectations set forth in the performance framework.

(b) Meet the operational performance expectations set forth in the performance framework or any improvement plans.

(d) Complete the obligations of the contract.

(e) Comply with this article or any provision of law from which the charter school is not exempt.

3. A sponsor shall review a charter at five-year intervals using a performance framework adopted by the sponsor and may revoke a charter at any time if the charter school breaches one or more provisions of its charter or if the sponsor determines that the charter holder has failed to do any of the following:

(a) Meet or make sufficient progress toward the academic performance expectations set forth in the performance framework.

(b) Meet the operational performance expectations set forth in the performance framework or any improvement plans.

(d) Comply with this article or any provision of law from which the charter school is not exempt.

4. In determining whether to renew or revoke a charter holder, the sponsor must consider making sufficient progress toward the academic performance expectations set forth in the sponsor's performance framework as one of the most important factors.

5. At least sixty days before the effective date of the proposed revocation, the sponsor shall give written notice to the operator of the charter school of its intent to revoke the charter. Notice of the sponsor's intent to revoke the charter shall be delivered personally to the operator of the charter school or sent by certified mail, return receipt requested, to the address of the charter school. The notice shall incorporate a statement of reasons for the proposed revocation of the charter. The sponsor shall allow the charter school at least sixty days to correct the problems associated with the reasons for the proposed revocation of the charter. The final determination of whether to revoke the charter shall be made at a public hearing called for that purpose.

J. The charter may be renewed for successive periods of twenty years.

K. Except as otherwise allowed and required under law, A charter school that is sponsored by the state board of education, the state board for charter schools, a university, a community college district or a group of community college districts may not be located on the property of a school district unless the district governing board grants this authority.

L. A governing board or a school district employee who has control over personnel actions shall not take unlawful reprisal against another employee of the school district because the employee is directly or indirectly involved in an application to establish a charter school. A governing board or a school district employee shall not take unlawful reprisal against an educational program of the school or the school district because an application to establish a charter school proposes to convert all or a portion of the educational program to a charter school. For the purposes of this subsection, "unlawful reprisal" means an action that is taken by a governing board or a school district employee as a direct result of a lawful application to establish a charter school and that is adverse to another employee or an education program and:

1. With respect to a school district employee, results in one or more of the following:

(a) Disciplinary or corrective action.

(b) Detail, transfer or reassignment.

(d) An unfavorable performance evaluation.

(e) A reduction in pay, benefits or awards.

(f) Elimination of the employee's position without a reduction in force by reason of lack of monies or work.

(g) Other significant changes in duties or responsibilities that are inconsistent with the employee's salary or employment classification.

2. With respect to an educational program, results in one or more of the following:

(a) Suspension or termination of the program.

(b) Transfer or reassignment of the program to a less favorable department.

(d) Significant reduction or termination of funding for the program.

M. Charter schools shall secure insurance for liability and property loss. The governing body of a charter school that is sponsored by the state board of education or the state board for charter schools may enter into an intergovernmental agreement or otherwise contract to participate in an insurance program offered by a risk retention pool established pursuant to section 11-952.01 or 41-621.01 or the charter school may secure its own insurance coverage. The pool may charge the requesting charter school reasonable fees for any services it performs in connection with the insurance program.

N. Charter schools do not have the authority to acquire property by eminent domain.

O. A sponsor, including members, officers and employees of the sponsor, is immune from personal liability for all acts done and actions taken in good faith within the scope of its authority.

P. Charter school sponsors and this state are not liable for the debts or financial obligations of a charter school or persons who operate charter schools.

Q. The sponsor of a charter school shall establish procedures to conduct administrative hearings on determination by the sponsor that grounds exist to revoke a charter. Procedures for administrative hearings shall be similar to procedures prescribed for adjudicative proceedings in title 41, chapter 6, article 10. Except as provided in section 41-1092.08, subsection H, final decisions of the state board of education and the state board for charter schools from hearings conducted pursuant to this subsection are subject to judicial review pursuant to title 12, chapter 7, article 6.

R. The sponsoring entity of a charter school shall have oversight and administrative responsibility for the charter schools that it sponsors. In implementing its oversight and administrative responsibilities, the sponsor shall ground its actions in evidence of the charter holder's performance in accordance with the performance framework adopted by the sponsor. The performance framework shall be publicly available, shall be placed on the sponsoring entity's website and shall include:

1. The academic performance expectations of the charter school and the measurement of sufficient progress toward the academic performance expectations.

2. The operational expectations of the charter school, including adherence to all applicable laws and obligations of the charter contract.

3. The financial expectations of the charter school.

4. Intervention and improvement policies.

S. Charter schools may pledge, assign or encumber their assets to be used as collateral for loans or extensions of credit.

T. All property accumulated by a charter school shall remain the property of the charter school.

U. Charter schools may not locate a school on property that is less than one-fourth mile from agricultural land regulated pursuant to section 3-365, except that the owner of the agricultural land may agree to comply with the buffer zone requirements of section 3-365. If the owner agrees in writing to comply with the buffer zone requirements and records the agreement in the office of the county recorder as a restrictive covenant running with the title to the land, the charter school may locate a school within the affected buffer zone. The agreement may include any stipulations regarding the charter school, including conditions for future expansion of the school and changes in the operational status of the school that will result in a breach of the agreement.

V. A transfer of a charter to another sponsor, a transfer of a charter school site to another sponsor or a transfer of a charter school site to a different charter shall be completed before the beginning of the fiscal year that the transfer is scheduled to become effective. An entity that sponsors charter schools may accept a transferring school after the beginning of the fiscal year if the transfer is approved by the superintendent of public instruction. The superintendent of public instruction shall have the discretion to consider each transfer during the fiscal year on a case-by-case basis. A charter holder seeking to transfer sponsors shall comply with the current charter terms regarding assignment of the charter. A charter holder transferring sponsors shall notify the current sponsor that the transfer has been approved by the new sponsor.

W. Notwithstanding subsection V of this section, a charter holder on an improvement plan must notify parents or guardians of registered students of the intent to transfer the charter and the timing of the proposed transfer. On the approved transfer, the new sponsor shall enforce the improvement plan but may modify the plan based on performance.

X. Notwithstanding subsection Y of this section, the state board for charter schools shall charge a processing fee to any charter school that amends its contract to participate in Arizona online instruction pursuant to section 15-808. The charter Arizona online instruction processing fund is established consisting of fees collected and administered by the state board for charter schools. The state board for charter schools shall use monies in the fund only for processing contract amendments for charter schools participating in Arizona online instruction. Monies in the fund are continuously appropriated.

Y. The sponsoring entity may not charge any fees to a charter school that it sponsors unless the sponsor has provided services to the charter school and the fees represent the full value of those services provided by the sponsor. On request, the value of the services provided by the sponsor to the charter school shall be demonstrated to the department of education.

Z. Charter schools may enter into an intergovernmental agreement with a presiding judge of the juvenile court to implement a law-related education program as defined in section 15-154. The presiding judge of the juvenile court may assign juvenile probation officers to participate in a law-related education program in any charter school in the county. The cost of juvenile probation officers who participate in the program implemented pursuant to this subsection shall be funded by the charter school.

AA. The sponsor of a charter school shall modify previously approved curriculum requirements for a charter school that wishes to participate in the board examination system prescribed in chapter 7, article 6 of this title.

BB. If a charter school decides not to participate in the board examination system prescribed in chapter 7, article 6 of this title, pupils enrolled at that charter school may earn a Grand Canyon diploma by obtaining a passing score on the same board examinations.

CC. Notwithstanding subsection Y of this section, a sponsor of charter schools may charge a new charter application processing fee to any applicant. The application fee shall fully cover the cost of application review and any needed technical assistance. Authorizers may approve policies that allow a portion of the fee to be returned to the applicant whose charter is approved.

DD. A charter school may choose to provide a preschool program for children with disabilities pursuant to section 15-771.

EE. Pursuant to the prescribed graduation requirements adopted by the state board of education, the governing body of a charter school operating a high school may approve a rigorous computer science course that would fulfill a mathematics course required for graduation from high school. The governing body may approve a rigorous computer science course only if the rigorous computer science course includes significant mathematics content and the governing body determines the high school where the rigorous computer science course is offered has sufficient capacity, infrastructure and qualified staff, including competent teachers of computer science.

FF. A charter school may permit allow the use of school property, including school buildings, grounds, buses and equipment, by any person, group or organization for any lawful purpose, including a recreational, educational, political, economic, artistic, moral, scientific, social, religious or other civic or governmental purpose. The charter school may charge a reasonable fee for the use of the school property.

GG. A charter school and its employees, including the governing body, or chief administrative officer, are immune from civil liability with respect to all decisions made and actions taken to allow the use of school property, unless the charter school or its employees are guilty of gross negligence or intentional misconduct. This subsection does not limit any other immunity provisions that are prescribed by law.

HH. Sponsors authorized pursuant to this section shall submit an annual report to the auditor general on or before October 1. The report shall include:

1. The current number of charters authorized and the number of schools operated by authorized charter holders.

2. The academic, operational and financial performance of the sponsor's charter portfolio as measured by the sponsor's adopted performance framework.

3. For the prior year, the number of new charters approved, the number of charter schools closed and the reason for the closure.

4. The sponsor's application, amendment, renewal and revocation processes, charter contract template and current performance framework as required by this section.

II. The auditor general shall prescribe the format for the annual report required by subsection HH of this section and may require that the annual report be submitted electronically. The auditor general shall review the submitted annual reports to ensure that the reports include the required items in subsection HH of this section and shall make the annual reports available on request. If the auditor general finds significant noncompliance or if a sponsor fails to submit the annual report required by subsection HH of this section, on or before December 31 of each year the auditor general shall report to the governor, the president of the senate, the speaker of the house of representatives and the chairs of the senate and house education committees or their successor committees, and the legislature shall consider revoking the sponsor's authority to sponsor charter schools.

JJ. Notwithstanding any other law, a charter school that has been approved as an achievement district school under section 41-5841 may expand to serve more students through either of the following:

1. An enrollment cap increase. The charter school shall apply to the charter sponsor for approval of an enrollment cap increase pursuant to this subsection through an expedited process that is established by the charter sponsor.

2. The establishment of a new school. The charter school shall apply to the charter sponsor for approval of a new school pursuant to this subsection through an expedited process that is established by the charter sponsor.

KK. The expedited process prescribed in subsection JJ of this section established by the state board for charter schools shall:

1. Require that an application for an enrollment cap increase or establishment of a new school pursuant to subsection JJ of this section be reviewed and acted on within thirty days after submission.

2. Require the approval of the executive director of the state board for charter schools only, except that if the executive director denies the application, the application shall be transmitted to the state board for charter schools for a final determination.

3. Reduce unnecessary and duplicative paperwork requirements. A charter school applying under subsection JJ of this section to the state board for charter schools:

(a) Is not required to submit more than a one full page narrative explaining the rationale for growth.

(b) Is not required to submit an enrollment matrix and staffing chart. END_STATUTE

Sec. 2. Section 15-241, Arizona Revised Statutes, is amended to read:

START_STATUTE15-241. School, charter school and school district accountability; annual achievement profiles; classification; letter grade system; profiles; appeals process; failing schools tutoring fund; definition

A. On or before November 1 of each year, the department of education shall compile for each public school and local education agency, and shall recommend to the state board of education, an annual achievement profile that consists of an educational dashboard that reflects the achievement for each public school and local education agency on the academic and educational performance indicators prescribed in subsection D of this section, except that a career technical education district may not be assigned a letter grade pursuant to this section. The department shall provide any technical assistance needed by the state board to make final adoption of the annual achievement profile.

B. Each school, charter holder and school district shall submit to the department of education any data that is required and requested and that is necessary to compile the achievement profile. A school or local education agency that fails to submit the information that is necessary is not eligible to receive monies from the classroom site fund established by section 15-977.

C. The annual achievement profile compiled by the department of education and recommended to the state board of education shall be used to determine a standard measurement of acceptable academic progress for each school and local education agency and a school and local education agency classification pursuant to subsection G of this section. Any disclosure of educational records compiled by the department pursuant to this section shall comply with the family educational rights and privacy act of 1974 (20 United States Code section 1232g).

D. The annual achievement profile for schools and local education agencies shall include, at a minimum, the following academic and educational performance indicators:

1. Multiple measures of student academic performance or other academically relevant indicators of school quality that are appropriate to assess the educational impact of a school during the academic year as determined by the state board of education.

2. student academic progress on assessments adopted pursuant to sections 15-741 and 15-741.02 in English language arts and mathematics.

3. Student academic progress on the English language learner assessments administered pursuant to section 15-756, subsection B and section 15-756.05.

4. Student progress toward college and career readiness for all schools and local education agencies that offer instruction in any of grades nine through twelve.

5. Student academic progress on assessments administered pursuant to section 15-741.02.

6. Multiple measures of educational performance or other relevant indicators of school quality that assess a school's educational impact, such as graduation rates and attendance rates.

E. If neither the school nor the school district meets the minimum student count as recommended by the department of education and approved by the state board of education for any of the performance indicators prescribed in subsection D of this section, the performance indicator shall not be factored into the letter grade assigned pursuant to this section.

F. Subject to final adoption by the state board of education, the department of education shall determine the criteria for each school and local education agency classification on each performance indicator of the annual achievement profile prescribed in subsection D of this section using a researched-based research-based methodology and shall recommend to the state board for final adoption the criteria for each school and local education agency classification. The department shall develop the methodology in collaboration with a coalition of qualified technical and policy stakeholders appointed by the state board. The department shall provide technical assistance and, on request, student or statewide performance indicator data needed to determine and calculate the methodology and final letter grades. At a minimum, the methodology shall include the performance of pupils at all achievement levels, account for pupil mobility, account for the distribution of pupil achievement at each school and local education agency and include longitudinal indicators of academic performance. For the purposes of this subsection, "researched-based research-based methodology" means the systematic and objective application of statistical and quantitative research principles to calculate the indicators used to determine A through F letter grades.

G. The annual achievement profile shall use classifications based on an A through F letter grade system adopted by the state board of education in which a letter grade of A reflects an excellent level of performance and a letter grade of F reflects a failing level of performance. The A through F letter grade system shall be applied to each performance indicator of the annual achievement profile prescribed in subsection D of this section, and the state board shall assign an overall letter grade for the public school or local education agency. The A through F letter grade system shall indicate expected standards of performance for all schools on each performance indicator of the annual achievement profile prescribed in subsection D of this section and the manner in which schools may rise above or fall below those expected standards of performance. The state board may also assign a school a letter grade of F on each performance indicator of the annual achievement profile prescribed in subsection D of this section if the state board determines that the school is among the persistently lowest-achieving schools in the state on the majority of the performance indicators of the annual achievement profile under the federal school accountability requirements pursuant to section 1003(g) of the elementary and secondary education act (20 United States Code section 6303).

H. The classification on each performance indicator of the annual achievement profile for each school and the criteria used to determine classification pursuant to subsections F and G of this section shall be included on the school report card prescribed in section 15-746.

I. Subject to final adoption by the state board of education, the department of education shall use achievement profiles appropriately to assess the educational impact of accommodation schools, alternative schools and extremely small schools, may develop profiles for schools that participate in the board examination system prescribed in chapter 7, article 6 of this title and schools that participate in Arizona online instruction pursuant to section 15-808 and may develop other exceptions as prescribed by the state board for the purposes of this section.

J. The department of education shall establish a process, including a deadline for when requests must be submitted, for a school or local education agency to correct student data used to determine the school's or local education agency's annual achievement profile. If a correction to student data is required, the department shall notify the school or local education agency of the data correction process and shall annually process student data correction requests. The state board of education shall establish an appeals process to allow a school or local education agency to appeal the school's or local education agency's final letter grade, or a letter grade applied to a performance indicator prescribed in subsection D of this section, based on mitigating factors, including achievement profile designations based on incorrect data, identified by the department.

K. The failing schools tutoring fund is established consisting of monies collected pursuant to section 42-5029, subsection E and section 42-5029.02, subsection A, paragraph 8 as designated for this purpose. The department of education shall administer the fund. The department may use monies from the fund to purchase materials designed to assist students to meet the Arizona academic standards and to achieve a passing score on assessments adopted by the state board of education.

L. For the purposes of this section, "academic progress" means measures of both proficiency and academic gain. END_STATUTE

Sec. 3. Section 15-241.01, Arizona Revised Statutes, is amended to read:

START_STATUTE15-241.01. School accountability; alternative operation plans

A. If a school district has six or more schools and at least one-half of the schools in the district are assigned a letter grade of D or F pursuant to this section and at least one school is assigned a letter grade of F, the department of education may submit to the state board of education a recommendation for a public hearing to determine if whether the school district should be subject to an alternative operation plan and the reasons for that recommendation. When considering whether to recommend a public hearing pursuant to this subsection, the department shall consider at least the following:

1. The likelihood that continued school-based interventions will be successful.

2. The extent to which the school district administrators and the school district governing board impacted the assignment of the letter grades of D and F to the district's schools.

3. Whether those schools assigned a letter grade of D or F have demonstrated reasonable academic growth as determined by the measure of academic progress established pursuant to this section.

B. If the department of education recommends a public hearing pursuant to subsection A of this section, the state board of education shall meet and may provide by a majority vote of the entire board for the development and implementation of an alternative operation plan as allowed by this section. When determining whether to place a school district under an alternative operation plan, the state board shall consider at least the following:

1. The likelihood that continued school-based interventions will be successful.

2. The extent to which the school district administrators and the school district governing board impacted the assignment of the letter grades D and F to the district's schools.

3. Whether those schools assigned a letter grade of D or F have demonstrated reasonable academic growth as determined by the measure of academic progress established pursuant to this section.

C. Before a public hearing is held pursuant to subsection B of this section, the department of education shall recommend to the state board of education at least three governmental, nonprofit or private organizations or persons to manage the school district's affairs. If the state board approves the implementation of an alternative operation plan, it shall make an appointment from the list provided by the department of education. On making this appointment the state board shall immediately determine which powers enumerated in subsection D of this section shall will be temporarily granted to the appointed organization or person. The authority granted pursuant to this subsection shall be is effective until the state board reviews the alternative operation plan as described in subsection E of this section.

D. An organization or person appointed pursuant to subsection C of this section shall begin a full review and investigation of the school district's educational affairs and shall submit to the state board of education a detailed report listing the findings of that investigation. This report shall include an alternative operation plan that details how the school district will raise the level of academic achievement so that all of the schools in the school district are assigned grade letters letter grades of A, B or C pursuant to this section. The plan shall include a proposed timeline for improving academic achievement. The alternative operation plan shall also include a timeline and details concerning how the organization or person will transition the administration of the school district back to the locally elected governing board. The organization or person shall submit the report within one hundred twenty days from after the date the organization or person was appointed by the state board. If approved by the state board, the alternative operation plan may authorize the appointed organization or person to do any of the following:

1. Override any decisions of the school district governing board or the school district superintendent, or both, concerning the management and operation of the school district, and initiate and make decisions concerning the management and operation of the school district, including reopening the school as a charter school.

2. Hire personnel, terminate personnel and cancel existing employment contracts, including the district superintendent, to the extent permitted by law. The appointed organization or person may refuse to reemploy any certificated teacher who has not been employed by the school district for more than the major portion of three consecutive school years as provided in section 15-536.

3. Attend any meetings of the school district governing board and administrative staff.

4. Supervise the activities of the school district's staff, including reassigning the duties and responsibilities of personnel in a manner that, as determined by the appointed organization or person, best suits the needs of the school district.

5. To the extent permitted by law, cancel or renegotiate any contract, other than contracts of certificated teachers who have been employed by the school district in the capacity of a certificated teacher for more than one year, to which the governing board or the school district is a party if the cancellation or renegotiation of the contract will produce needed economies in the operation of the district's schools.

E. The state board of education shall periodically review the status of a school district that is operating under an alternative operation plan pursuant to this section to determine whether the operations of the school district should be returned to the school district governing board. Before the state board makes a determination to terminate an alternative operation plan, the state board or its designee shall meet with the school district governing board or its designee to establish an appropriate time frame and address any additional operational considerations that are necessary to ensure a smooth transition of authority from the appointed organization or person back to the school district governing board. When determining whether to terminate an alternative operation plan, the state board shall consider whether the district's schools have made significant academic gains as determined by individual school achievement profiles established pursuant to this section.

F. If at any time the state board determines that the progress of an organization or person who is appointed pursuant to this subsection or subsection C of this section is insufficient, the state board may remove that organization or person and make an alternative appointment. All authority granted pursuant to the approved alternative operation plan shall be transferred to the newly appointed organization or person. The state board may require the newly appointed organization or person to prepare a revised alternative operation plan as described in subsection D of this section.

G. All expenses and costs of an organization or person appointed by the state board pursuant to subsection C or F of this section shall be paid by the school district. The state board of education shall review the expenses and costs at least twice each calendar year to ensure that the fees are reasonable and appropriate.

H. The operation of a school district by an organization or person appointed pursuant to this section shall not interfere with the election of school district governing board members.

I. The school district shall indemnify the organization or person appointed pursuant to subsection C or F of this section if that organization or person is made or threatened to be made a party to any litigation by reason of the organization's or person's status under this section and if the organization or person acted in good faith and in a manner the organization or person believed to be lawful and in the best interest of the school district.

J. All information received and records or reports kept by the state board of education during an investigation resulting from a complaint against an organization or person appointed pursuant to subsection C or F of this section are confidential and are not public records.

K. Notwithstanding any other law and beginning January 1, 2029, the state board of education shall require any school that is operated by a school district, that is assigned a letter grade of F pursuant to section 15-241 for three consecutive years and that has not demonstrated student growth at a rate higher than this state to select to either initiate a collaborative operational and instructional partnership as prescribed in paragraph 1 of this subsection or be assigned a solutions team and an alternative operation plan as prescribed in paragraph 2 of this subsection. Depending on the school's selection, the state board of education shall either:

1. Require the school to initiate a collaborative operational and instructional partnership with a school that is assigned a letter grade of A pursuant to section 15-241 or an organization that has demonstrated increasing academic achievement with students similar to the student demographic population of the school. The state board of education shall allow for a variety of options in the selection and development of the collaborative operational and instructional partnership and may not prescribe the scope of the partnership. If a school selects this option, the state board of education shall review and approve the partnership plan. The state board of education may establish a subcommittee of the board that includes state board of education members, members of the local school community, representatives of the department of education, the county school superintendent from the county in which the school is located or other members as determined by the board to make recommendations to the state board of education regarding the collaborative operational and instructional partnership. A collaborative operational and instructional partnership developed under this subsection must address all of the following:

(a) A school improvement framework that has DEMONSTRATED success in like populations.

(b) Identified focus on guaranteed and viable curriculum.

(d) Evidence of a focus on data-driven decisions.

(e) Identified focus on DEVELOPMENT of site leaders.

2. Direct the superintendent of public instruction and the county educational service agency to collaborate to assign a solutions team under section 15-241.02, subsection E and hold a public hearing to provide an alternative operation plan for the school pursuant to section 15-241.02, subsection K.

L. The state board of education may waive the requirements of subsection K of this section for one year if the school in the most recent school year for which data is available has achieved significant academic growth with students, as determined by the state board of education. END_STATUTE

Sec. 4. Section 15-241.02, Arizona Revised Statutes, is amended to read:

START_STATUTE15-241.02. School improvement plans; solutions teams; withholding of state monies

A. If a school is assigned a letter grade of D pursuant to section 15-241, within ninety days after receiving notice of the classification, the school district governing board shall develop an improvement plan for the school, submit a copy of the plan to the superintendent of public instruction and the county educational service agency and supervise the implementation of the plan. The governing board shall include in the plan necessary components as identified by the state board of education. Within thirty days after submitting the improvement plan to the superintendent of public instruction and the county educational service agency, the governing board shall hold a public meeting in each school that has been assigned a letter grade of D and shall present the respective improvement plans that have been developed for each school. The governing board, within thirty days after receiving notice of the classification, shall provide written notification of the classification to each residence within the attendance area of the school. The notice shall explain the improvement plan process and provide information regarding the public meeting required by this subsection.

B. A school that has not submitted an improvement plan pursuant to subsection A of this section is not eligible to receive monies from the classroom site fund established by section 15-977 for every day that a plan has not been received by the superintendent of public instruction within the time specified in subsection A of this section plus an additional ninety days. The state board of education shall require the superintendent of the school district to testify before the board and explain the reasons that an improvement plan for that school has not been submitted.

C. If a charter school is assigned a letter grade of D pursuant to section 15-241, within thirty days the school shall notify the parents of the students attending the school of the classification. The notice shall explain the improvement plan process and provide information regarding the public meeting required by this subsection. Within ninety days after receiving the classification, the charter holder shall present an improvement plan to the charter sponsor at a public meeting and submit a copy of the plan to the sponsor of the charter school. The charter holder shall include in the improvement plan necessary components as identified by the state board of education. The school is not eligible to receive monies from the classroom site fund established by section 15-977 for every day that an improvement plan has not been received by the sponsor of the charter school within the time specified in this subsection plus an additional ninety days. The charter holder shall appear before the sponsoring board and explain why the improvement plan has not been submitted.

D. If a school is assigned a letter grade of D pursuant to section 15-241 for a third consecutive year, the department of education shall visit the school site to confirm the classification data and to review the implementation of the school's improvement plan. The school shall be assigned a letter grade of F unless an alternate letter grade is assigned after an appeal pursuant to section 15-241, subsection J. A school that is assigned a letter grade of D for fewer than three consecutive years may also be assigned a letter grade of F if the state board of education determines that there is no reasonable likelihood that the school will achieve an average level of performance within the next two years.

E. The superintendent of public instruction and the county educational service agency shall collaborate to assign a solutions team to a school assigned a letter grade of D pursuant to section 15-241, or a school assigned a letter grade of F pursuant to section 15-241 or a school that has selected the option prescribed in section 15-241.01, subsection K, paragraph 2 based on academic need and available resources. County educational service agencies may enter into agreements to provide services to schools from other counties. Any other school, subject to available resources, may be assigned a solutions team pursuant to a mutual agreement between the department of education or the county education service agency, or both, and the school. The solutions team shall be composed of master teachers, fiscal analysts and curriculum assessment experts who are certified by the state board of education as Arizona academic standards technicians. The department of education or the county educational service agency may hire or contract with administrators, principals and teachers who have demonstrated experience in improving academic outcomes and may use these personnel as part of the solutions team. The department of education shall work with staff at the school to assist in curricula alignment and shall instruct teachers on how to increase pupil academic progress, considering the school's annual achievement profile. The solutions team shall consider the existing improvement plan to assess the need for changes to curricula, professional development and resource allocation and shall present a statement of its findings to the school administrator and district superintendent. Within forty-five days after the presentation of the solutions team's statement of findings, the school district governing board, in cooperation with each school within the school district that is assigned a letter grade of D and its assigned solutions team representative, shall develop and submit to the department of education and the county educational service agency an action plan that details the manner in which the school district will assist the school as the school incorporates the findings of the solutions team into the improvement plan. The department of education shall review the action plan and shall either accept the action plan or return the action plan to the school district for modification. If the school district does not submit an approved action plan within forty-five days, the state board of education may direct the superintendent of public instruction to withhold up to ten percent of state monies that the school district would otherwise be entitled to receive each month until the plan is submitted to the department of education and the county educational service agency, at which time those monies shall be returned to the school district.

F. The parent or guardian of a pupil may apply to the department of education, in a manner determined by the department of education, for a certificate of supplemental instruction from the failing schools tutoring fund established by section 15-241. Pupils attending a school assigned a letter grade of D or F may select an alternative tutoring program in academic standards from a provider that is certified by the state board of education. To qualify, the provider must state in writing a level of academic improvement for the pupil that includes a timeline for improvement that is agreed to by the parent or guardian of the pupil. The state board of education shall annually review academic performance levels for certified providers and may remove a provider at a public hearing from an approved list of providers if that provider fails to meet its stated level of academic improvement. The state board of education shall determine the application guidelines and the maximum value for each certificate of supplemental instruction. The state board of education shall annually complete a market survey in order to determine the maximum value for each certificate of supplemental instruction. This subsection does not require this state to provide additional monies beyond the monies provided pursuant to section 42-5029, subsection E, paragraph 7 or section 42-5029.02, subsection A, paragraph 7.

G. Within sixty days after receiving notification of a school being assigned a letter grade of F pursuant to section 15-241, the school district governing board shall evaluate needed changes to the existing school improvement plan, consider recommendations from the solutions team, submit a copy of the plan to the superintendent of public instruction and the county educational service agency and supervise the implementation of the plan. Within thirty days after submitting the improvement plan to the superintendent of public instruction and the county educational service agency, the governing board shall hold a public meeting in each school that has been assigned a letter grade of F and shall present the respective improvement plans that have been developed for each school. The governing board, within thirty days after receiving notice of the classification, shall provide written notification of the classification to each residence in the attendance area of the school. The notice shall explain the improvement plan process and provide information regarding the public meeting required by this subsection.

H. A school that has not submitted an improvement plan pursuant to subsection G of this section is not eligible to receive monies from the classroom site fund established by section 15-977 for every day that a plan has not been received by the superintendent of public instruction within the time specified in subsection G of this section plus an additional ninety days. The state board of education shall require the superintendent of the school district to testify before the board and explain the reasons that an improvement plan for that school has not been submitted.

I. If a charter school is assigned a letter grade of F pursuant to section 15-241, the department of education shall immediately notify the charter school's sponsor. The charter school's sponsor shall either take action to restore the charter school to acceptable performance pursuant to a process established by the charter sponsor or revoke the charter school's charter. Within thirty days, the charter school shall notify the parents of the students attending the school of the classification and of any pending public meetings to review the issue.

J. The department of education shall evaluate a school that has been assigned a letter grade of F pursuant to section 15-241 to determine whether the school, charter holder or school district failed to properly implement its school improvement plan, align the curricula with academic standards, provide teacher training, prioritize the budget or implement other proven strategies to improve academic performance. After visiting the school site pursuant to subsection D of this section, the department of education shall submit to the state board of education a recommendation either to proceed pursuant to subsections E, F and G of this section or that the school be subject to a public hearing to determine whether the school failed to properly implement its improvement plan and the reasons for the department's recommendation. If the school is a charter school, the department shall submit a report to the sponsor of the charter school. The sponsor shall make a determination pursuant to subsection N of this section.

K. If the department recommends a public hearing or if a school selects the option prescribed in section 15-241.01, subsection K, paragraph 2, the state board of education shall meet and may provide by a majority vote at the public hearing for the continued operation of the school as allowed by this subsection. The state board of education shall determine whether governmental, nonprofit and private organizations may submit applications to the state board to fully or partially manage the school. The state board's determination shall include:

1. Whether and to what extent the local governing board may participate in the operation of the school, including personnel matters.

2. Whether and to what extent the state board will participate in the operation of the school.

3. Resource allocation pursuant to subsection M of this section.

4. Provisions for the development and submittal of a school improvement plan to be presented in a public meeting at the school.

5. A suggested time frame for the alternative operation of the school.

L. The state board of education shall periodically review the status of a school that is operated by an organization other than the school district governing board to determine whether the operation of the school should be returned to the school district governing board. Before the state board makes a determination, the state board or its designee shall meet with the school district governing board or its designee to determine the time frame, operational considerations and appropriate continuation of existing improvements that are necessary to ensure a smooth transition of authority from the other organization back to the school district governing board.

M. If an alternative operation plan is provided pursuant to subsection K of this section, the state board of education shall pay for the operation of the school and shall adjust the school district's district additional assistance pursuant to section 15-961, base support level pursuant to section 15-943, monies distributed from the classroom site fund established by section 15-977 and transportation support level pursuant to section 15-945 to accurately reflect any reduction in district services that are no longer provided to that school by the district. The state board may modify the school district's revenue control limit, the district support level and the general budget limit calculated pursuant to section 15-947 by an amount that corresponds to this reduction in services. The state board shall retain the portion of state aid that would otherwise be due the school district for the school and shall distribute that portion of state aid directly to the organization that contracts with the state board to operate the school.

N. If the sponsor of a charter school determines that a charter holder failed to properly implement its improvement plan, the sponsor of the charter school shall revoke the charter school's charter.

O. If there are more than two schools in a district and more than one-half, or in any case more than five, of the schools in the district are assigned a letter grade of F pursuant to section 15-241 for more than two consecutive years, in the next election of governing board members the election ballot shall contain the following statement immediately above the listing of governing board candidates:

Within the last five years, (number of schools) schools in the ________ school district have been assigned a letter grade of D or F.

P. At least twice each year the department of education shall publish in a newspaper of general circulation in each county of this state a list of schools that are assigned a letter grade of F pursuant to section 15-241.

Q. The state board of education shall adopt guidelines to include supplementary training in reading instruction for teachers who provide instruction to pupils in a kindergarten program or grade one, two or three in an improvement plan pursuant to subsection A of this section.

R. In addition to any other corrective procedures prescribed in this section and sections 15-241 and 15-241.01, a school that has been assigned a letter grade of D or F for two consecutive years shall implement a science, technology, engineering and mathematics intervention strategy under the supervision of the state board of education.

S. In addition to any other corrective procedures prescribed in this section, a school district that has been assigned a letter grade of D or F pursuant to section 15-241 for two consecutive years shall implement a parent involvement strategy. The parent involvement strategy shall be included in the school improvement plan for each applicable school within the district, as prescribed in subsection A or G of this section, as applicable.

T. The department of education shall publish criteria for a school's or school district's exit status from a previous assignment of a letter grade of F in accordance with this section. The criteria shall prescribe the actions and results necessary to be deemed to have complied with this section regarding school improvement, including the proper implementation of a school improvement plan pursuant to subsection J of this section. These criteria shall be provided to a school or school district if it is assigned a letter grade of F pursuant to section 15-241. END_STATUTE

Sec. 5. Section 41-5702, Arizona Revised Statutes, is amended to read:

START_STATUTE41-5702. Powers and duties; staffing; reporting requirements

A. The division shall:

1. Assess school facilities and equipment deficiencies and approve the distribution of grants as appropriate.

2. Maintain a database of school facilities to allow for the administration of the new school facilities formula and the building renewal grant fund. The facilities listed in the database must include all buildings that are owned by school districts. The division shall ensure that the database is updated on at least an annual basis. Each school district shall report to the division not later than September 1 of each year information as required by the division to administer the building renewal grant fund and by the school facilities oversight board to compute new school facilities formula distributions, including the nature and cost of major repairs, renovations or physical improvements to or replacement of building systems or equipment that were made in the previous year and that were paid for either with local monies or monies provided from the building renewal grant fund. Each school district shall report any school or school buildings that have been closed, that are vacant or partially used pursuant to section 15-119 and that have been leased to another entity or that operate as a charter school. The division shall develop guidelines and definitions for the reporting prescribed in this paragraph and may shall review or audit the information, or both, to confirm the information submitted by a school district. Notwithstanding any other provision of this chapter, if a school district converts space that is listed in the database maintained pursuant to this paragraph to space that will be used for administrative purposes, the school district is responsible for any costs associated with converting, maintaining and replacing that space. If a building is significantly upgraded or remodeled, the division shall adjust the age of that school facility in the database as follows:

(a) Determine the building capacity value as follows:

(i) Multiply the student capacity of the building by the per pupil square foot capacity established by section 41-5741.

(ii) Multiply the product determined in item (i) of this subdivision by the cost per square foot established by section 41-5741.

(b) Divide the cost of the renovation by the building capacity value determined in subdivision (a) of this paragraph.

(c) Multiply the quotient determined in subdivision (b) of this paragraph by the currently listed age of the building in the database.

(d) Subtract the product determined in subdivision (c) of this paragraph from the currently listed age of the building in the database, rounded to the nearest whole number. If the result is a negative number, use zero.

3. Inspect, contract with a third party to inspect or certify school district self-inspections of school buildings at least once every five years to ensure compliance with the building adequacy standards prescribed in section 41-5711, the accuracy of the reporting of vacant and partially used buildings pursuant to this subsection and routine preventive maintenance guidelines as prescribed in this section with respect to constructing new buildings and maintaining existing buildings. The division shall randomly select twenty school districts every thirty months and provide for them to be inspected pursuant to this paragraph.

4. Develop prototypical elementary and high school designs. The division shall review the design differences between the schools with the highest academic productivity scores and the schools with the lowest academic productivity scores. The division shall also review the results of a valid and reliable survey of parent quality rating in the highest performing schools and the lowest performing schools in this state. The survey of parent quality rating shall be administered by the department of education. The division shall consider the design elements of the schools with the highest academic productivity scores and parent quality ratings in the development of elementary and high school designs. The division shall develop separate school designs for elementary, middle and high schools with varying pupil capacities.

5. Develop application forms, reporting forms and procedures to carry out the requirements of this article, including developing and implementing policies and procedures to:

(a) Ensure that the division and the school facilities oversight board, as applicable, notify school districts in a uniform manner of the services and funding available for school districts from the board or the division for facility construction, renovation and repair projects. The policies and procedures shall require the division and the board to provide at least one annual communication to school districts in a manner prescribed by the division and shall require each school district to develop and maintain a list of persons who are responsible for facilities management at that school district.

(b) Establish a project eligibility assessment for all projects submitted for building renewal grant funding or emergency deficiencies correction funding, including establishing standardized criteria for project eligibility. Before the division formally approves a project, the staff of the division may review the costs and scope of the proposed project with persons and entities that have submitted bids on the project.

(c) Ensure that the division and the school facilities oversight board maintain standardized documentation of all projects submitted to the board and the division for consideration to receive services or a financial award from the board or the division. The board and the division shall maintain standardized documentation of any project awarded monies by the board or the division, including records of payments to school districts in a manner prescribed by the division. The standardized documentation shall include the following as part of the eligibility determination criteria:

(i) Whether the problem that the proposed project intends to address caused the building or facility to fall below the minimum school facility adequacy guidelines prescribed in section 41-5711.

(ii) Whether the school district performed the routine preventive maintenance required by section 41-5731 on the building or facility.

(d) Require a school district to submit contact information for each proposed project, including the name, email address and telephone number of persons who are responsible for facilities management at the school district.

(e) Require a school district to provide justification for each proposed project, including all of the following:

(i) The school district's use or planned use of the facility.

(ii) A detailed description of the problem and the school district's recommended solution.

(iii) Any completed professional study regarding the proposed project.

(iv) Any citation or report from government entities.

(v) The estimated cost of the proposed project, with documentation.

(vi) The project category.

(vii) A description of any local funding that will be used for the proposed project.

(viii) Documentation on associated insurance coverage, if applicable.

(f) Require that an initial application not be considered complete until all necessary information is submitted.

(g) Allow a school district to submit an incomplete application and request technical assistance from the staff of the board if the school district is unable to provide sufficient information in the initial application.

(h) If applicable, require that a complete application be received by the board at least fifteen business days before the next regularly scheduled board meeting in order for the application to be considered at that meeting. An incomplete application may be considered at that meeting if both the staff of the board and the superintendent of the school district deem the project critical.

(i) Allow the staff of the board or the division, as applicable, to notify a school district in writing before review by the board or division that the proposed project does not meet eligibility criteria prescribed in this chapter. The written notification shall include documentation to support the determination that the proposed project does not meet the eligibility criteria prescribed in this chapter. The school district may directly appeal the determination of ineligibility to the director of the division. The school district may directly appeal the director's determination of ineligibility to the board.

(j) Prohibit the staff of the board or division from requesting that a school district withdraw a project application from review by the board or division if the initial review determines that the proposed project may be ineligible for monies pursuant to this chapter.

6. Submit electronically an annual report on or before December 15 to the speaker of the house of representatives, the president of the senate, the superintendent of public instruction, the secretary of state and the governor that includes the following information:

(a) A detailed description of the amount of monies distributed by the division under this chapter in the previous fiscal year.

(b) A list of each capital project that received monies from the division under this chapter during the previous fiscal year, a brief description of each project that was funded and a summary of the division's reasons for distributing monies for the project.

(c) A summary of the findings and conclusions of the building maintenance inspections conducted pursuant to this article during the previous fiscal year.

(d) A summary of the findings of common design elements and characteristics of the highest performing schools and the lowest performing schools based on academic productivity, including the results of the parent quality rating survey. For the purposes of this subdivision, "academic productivity" means academic year advancement per calendar year as measured with student-level data using the statewide nationally standardized norm-referenced achievement test.

7. On or before December 1 of each year, report electronically to the joint committee on capital review the amounts necessary to fulfill the requirements of section 41-5721 for the following three fiscal years. In developing the amounts necessary for this report, the division shall use the most recent average daily membership data available. On request from the division, the department of education shall make available the most recent average daily membership data for use in calculating the amounts necessary to fulfill the requirements of section 41-5721 for the following three fiscal years. The division shall provide copies of the report to the president of the senate, the speaker of the house of representatives and the governor.

8. On or before June 15 of each year, submit electronically detailed information regarding demographic assumptions and a proposed construction schedule for individual projects approved in the current fiscal year and expected project approvals for the upcoming fiscal year to the joint committee on capital review for its review. A copy of the report shall also be submitted electronically to the governor's office of strategic planning and budgeting. The joint legislative budget committee staff, the governor's office of strategic planning and budgeting staff and the division staff shall agree on the format of the report.

9. Every two years, provide school districts with information on improving and maintaining the indoor environmental quality in school buildings.

10. Adopt rules regarding the validation of adjacent ways projects pursuant to paragraph 11 of this subsection.

11. Validate proposed adjacent ways projects that are submitted by school districts as prescribed in section 15-995 pursuant to rules adopted by the division under paragraph 10 of this subsection.

12. Submit a monthly report to the school facilities oversight board that details each adjacent ways project validated pursuant to paragraph 11 of this subsection.

13. Brief the joint committee on capital review at least once each year regarding the use of monies from all of the following:

(a) The emergency deficiencies correction fund established by section 41-5721.

(b) The building renewal grant fund established by section 41-5731.

B. The school facilities oversight board or the division may contract for the following services in compliance with the procurement practices prescribed in chapter 23 of this title:

1. Private services.

2. Construction project management services.

3. Assessments for school buildings to determine if the buildings have outlived their useful life pursuant to section 41-5741, subsection G or have been condemned.

4. Services related to land acquisition and development of a school site.

C. The school facilities oversight board shall:

1. Review and approve student population projections submitted by school districts to determine to what extent school districts are entitled to monies to construct new facilities pursuant to section 41-5741. The board shall make a final determination within five months after receiving an application from a school district for monies from the new school facilities fund.

2. Certify that plans for new school facilities meet the building adequacy standards prescribed in section 41-5711.

3. Review and approve or reject requests submitted by school districts to take actions pursuant to section 15-341, subsection G.

4. On or before December 15 of each year, electronically submit a report to the speaker of the house of representatives, the president of the senate, the superintendent of public instruction, the secretary of state and the governor that includes the following information:

(a) A detailed description of the amount of monies the board distributed under this chapter in the previous fiscal year.

(b) A list of each capital project that received monies from the board under this chapter during the previous fiscal year, a brief description of each project that was funded and a summary of the board's reasons for distributing monies for the project.

(c) A summary of the findings and conclusions of the building maintenance inspections conducted pursuant to this article during the previous fiscal year.

5. On or before December 1 of each year, electronically report to the joint committee on capital review the amounts necessary to fulfill the requirements of section 41-5741 for the following three fiscal years. In developing the amounts necessary for this report, the board shall use the most recent average daily membership data available. On request from the board, the department of education shall make available the most recent average daily membership data for use in calculating the amounts necessary to fulfill the requirements of section 41-5741 for the following three fiscal years. The board shall provide copies of the report to the president of the senate, the speaker of the house of representatives and the governor.

6. Adopt minimum school facility adequacy guidelines to provide the minimum quality and quantity of school buildings and the facilities and equipment necessary and appropriate to enable pupils to achieve the educational goals of the Arizona state schools for the deaf and the blind. The board shall establish minimum school facility adequacy guidelines applicable to the Arizona state schools for the deaf and the blind.

7. On or before June 15 of each year, electronically submit to the joint committee on capital review for its review detailed information regarding demographic assumptions, a proposed construction schedule and new school construction cost estimates for individual projects approved in the current fiscal year and expected project approvals for the upcoming fiscal year. A copy of the report shall also be submitted electronically to the governor's office of strategic planning and budgeting. The joint legislative budget committee staff, the governor's office of strategic planning and budgeting staff and the board staff shall agree on the format of the report.

8. On or before December 31 of each year, report to the joint legislative budget committee on all class B bond approvals by school districts in that year. Each school district shall report to the board on or before December 1 of each year information required by the board for the report prescribed in this paragraph.

D. The director of the division shall serve as the director of the school facilities oversight board. The director may hire and fire necessary staff subject to chapter 4, article 4 of this title and as approved by the legislature in the budget. The staff of the school facilities oversight board is exempt from chapter 4, articles 5 and 6 of this title. The director:

1. Shall analyze applications for monies submitted to the board and to the division by school districts.

2. Shall assist the board and the division in developing forms and procedures for distributing and reviewing applications and distributing monies to school districts.

3. May review or audit, or both, the expenditure of monies by a school district for deficiencies corrections and new school facilities.

4. Shall assist the board and the division in preparing the board's and division's annual reports.

5. Shall research and provide reports on issues of general interest to the board and the division.

6. May aid school districts in developing reasonable and cost-effective school designs in order to avoid statewide duplicated efforts and unwarranted expenditures in the area of school design.

7. May assist school districts in facilitating the development of multijurisdictional facilities.

8. Shall assist the board and the division in any other appropriate matter or method as directed by the division and the members of the board.

9. Shall establish procedures to ensure compliance with the notice and hearing requirements prescribed in section 15-905. The notice and hearing procedures adopted by the board shall include the requirement, with respect to the board's consideration of any application filed after July 1, 2001 or after December 31 of the year in which the property becomes territory in the vicinity of a military airport or ancillary military facility as defined in section 28-8461 for monies to fund the construction of new school facilities proposed to be located in territory in the vicinity of a military airport or ancillary military facility, that the military airport receive notification of the application by first class mail at least thirty days before any hearing concerning the application.

10. May expedite any request for monies in which the local match was not obtained for a project that received preliminary approval by the state board for school capital facilities.

11. Shall expedite any request for monies in which the school district governing board submits an application that shows an immediate need for a new school facility.

12. Shall determine administrative completeness within one month after receiving an application from a school district for monies from the new school facilities fund.

13. Shall provide technical support to school districts as requested by school districts in connection with constructing new school facilities and maintaining existing school facilities and may contract directly with construction project managers pursuant to subsection B of this section. This paragraph does not restrict a school district from contracting with a construction project manager using district or state resources.

E. When appropriate, the board and the division shall review and use the statewide school facilities inventory and needs assessment conducted by the joint committee on capital review and issued in July, 1995.

F. The school facilities oversight board shall contract with one or more private building inspectors to complete an initial assessment of school facilities and equipment and shall inspect each school building in this state at least once every five years to ensure compliance with section 41-5711. A copy of the inspection report, together with any recommendations for building maintenance, shall be provided to the school facilities oversight board and the governing board of the school district.

G. The division or the board, as applicable, may consider appropriate combinations of facilities or uses in assessing and curing deficiencies pursuant to subsection A, paragraph 1 of this section and in certifying plans for new school facilities pursuant to subsection C, paragraph 2 of this section.

H. The board shall not award any monies to fund new facilities that are financed by class A bonds that are issued by the school district.

I. The board or the division shall not distribute monies to a school district for replacing or repairing facilities if the costs associated with the replacement or repair are covered by insurance or a performance or payment bond.

J. The division may contract for construction services and materials that are necessary to correct existing deficiencies in school district facilities. The division may procure the construction services necessary pursuant to this subsection by any method, including construction-manager-at-risk, design-build, design-bid-build or job-order-contracting as provided by chapter 23 of this title. The construction planning and services performed pursuant to this subsection are exempt from section 41-791.01.

K. The division may enter into agreements with school districts to allow division staff and contractors access to school property for the purposes of performing the construction services necessary pursuant to subsection J of this section.

L. Each school district shall develop routine preventive maintenance guidelines for its facilities. The guidelines shall include plumbing systems, electrical systems, heating, ventilation and air conditioning systems, special equipment and other systems and for roofing systems shall recommend visual inspections performed by district staff for signs of structural stress and weakness. The guidelines shall be submitted to the division for review and approval. If on inspection by the division it is determined that a school district facility was inadequately maintained pursuant to the school district's routine preventive maintenance guidelines, the school district shall return the building to compliance with the school district's routine preventive maintenance guidelines.

M. The board and the division may temporarily transfer monies, or, if applicable, the board may direct the division to transfer monies, between the emergency deficiencies correction fund established by section 41-5721 and the new school facilities fund established by section 41-5741 if all of the following conditions are met:

1. The transfer is necessary to avoid a temporary shortfall in the fund into which the monies are transferred.

2. The transferred monies are restored to the fund where the monies originated as soon as practicable after the temporary shortfall in the other fund has been addressed.

3. The board and the division report to the joint committee on capital review the amount of and the reason for any monies transferred.

N. After notifying each school district, and if a written objection from the school district is not received by the board or the division within thirty days after the notification, the board or the division may access public utility company records of power, water, natural gas, telephone and broadband usage to assemble consistent and accurate data on utility consumption at school facilities to determine the effectiveness of facility design, operation and maintenance measures intended to reduce energy and water consumption and costs. Any public utility that provides service to a school district in this state shall provide the data requested by the board or the division pursuant to this subsection.

O. The division or the board shall not require a common school district that provides instruction to pupils in grade nine to obtain approval from the division or the board to reconfigure its school facilities. A common school district that provides instruction to pupils in grade nine is not entitled to additional monies from the division or the board for facilities to educate pupils in grade nine.

P. A school district may appeal the denial of a request for monies pursuant to this chapter or any other appealable agency action by the division or the board pursuant to chapter 6, article 10 of this title. For the purposes of this subsection, "appealable agency action" has the same meaning prescribed in section 41-1092. END_STATUTE

Sec. 6. Operation excellence school improvement program; school achievement improvement fund; distributions; improvement plans; request for proposals; independent school improvement partners; reporting requirements; delayed repeal

A. Beginning in fiscal year 2022-2023, the operation excellence school improvement program is established to improve academic outcomes and opportunities for all students in schools that meet the eligibility requirements prescribed in subsections C and D of this section. Schools that receive funding from the school achievement improvement fund pursuant to this section shall prioritize these resources to implement evidence-based, proven strategies to increase academic proficiency and growth.

B. The school achievement improvement fund is established for the purposes of this section. The fund consists of legislative appropriations, gifts, grants, donations and any other monies transferred to the fund. The department of education shall administer the fund at the direction of the state board of education. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190, Arizona Revised Statutes, relating to lapsing of appropriations, except that any monies remaining in the fund on December 31, 2027 revert to the state general fund. The department of education may accept and spend federal monies and private grants, gifts, contributions and devises to assist in carrying out this section.

C. Beginning January 1, 2023, the state board of education shall identify schools that will be designated as operation excellence schools. The state board shall identify schools that meet either of the following criteria:

1. Any school operated by a school district or charter holder that received a letter grade of D or F during both the 2018-2019 fiscal year and the 2021-2022 fiscal year pursuant to section 15-241, Arizona Revised Statutes.

2. Any school operated by a school district or charter holder that is not eligible to receive or has not been assigned a letter grade pursuant to section 15-241, Arizona Revised Statutes, and that has been identified by the department of education as a school requiring comprehensive support and improvement for low achievement pursuant to the every student succeeds act (P.L. 114–95; 129 Stat. 1802) in the prior or most recent fiscal year.

D. A school operated by a school district or charter holder may opt to participate in the operation excellence school improvement program by notifying the state board of education. A school may opt into operation excellence if either of the following applies:

1. The school is operated by a school district or charter holder that has been assigned a letter grade of C, D or F during the 2018-2019 fiscal year or the 2021-2022 fiscal year pursuant to section 15-241, Arizona Revised Statutes, and at least sixty percent of the pupils enrolled in the school meet the eligibility requirements established under the national school lunch and child nutrition acts (42 United States Code sections 1751 through 1793) for free or reduced-price lunches, or an equivalent measure recognized for participating in the federal free and reduced-price lunch program and other school programs dependent on a poverty measure, including the community eligibility provision for which free and reduced-price lunch data is not available. For the purposes of this paragraph, only students who are eligible to be included in a school's student count shall be considered in determining that school's percentage of free or reduced-price lunch students or other poverty indicators.

2. The school is operated by a school district or charter holder that has been identified by the department of education as a school requiring comprehensive support and improvement for low achievement pursuant to the every student succeeds act (P.L. 114–95; 129 Stat. 1802) in the prior or most recent fiscal year.

E. A school that is opting to participate pursuant to subsection D of this section shall notify the state board of education on or before January 30, 2023.

F. Notwithstanding any other law, a charter school that is participating in the operation excellence school improvement program is not immune from or otherwise protected against the charter school's sponsor revoking the charter school's charter during the duration of the charter school's participation in the program.

G. For fiscal years 2023-2024, 2024-2025 and 2025-2026, at the direction of the state board of education, the department of education shall distribute monies from the school achievement improvement fund to school districts and charter schools that have selected to engage in school improvement pursuant to subsection D of this section or required to participate pursuant to subsection C of this section in the amount of $150 per student who is enrolled in the current school year. A school that is eligible to receive funding for the small school weight prescribed in section 15-943, paragraph 1, Arizona Revised Statutes, may not receive less than $30,000 in total funding pursuant to this subsection.

H. Any monies a school district or charter holder receives from the school achievement improvement fund shall be separately accounted for in the school district's or charter holder's annual financial report.

I. All monies a school district or charter holder receives pursuant to this section shall be spent at and for the benefit of a qualifying school site.

J. The department of education shall disburse funding only for that fiscal year on the state board of education's approval of the school's improvement plan submitted pursuant to subsection K, L or M of this section. The state board of education shall direct the department of education to provide payments to schools for the operation excellence school improvement program that are in compliance with this section on July 1 of each year. If the appropriated amount is not sufficient to fully pay each school, the department of education shall first fund all school sites pursuant to subsection C of this section and then proportionately allocate the funding per student for school sites pursuant to subsection D of this section.

K. Not later than March 1, 2023, a school district or charter holder of a school that meets the requirements prescribed in subsection D of this section shall submit to the state board of education an improvement plan to improve student outcomes, which may include targeted academic interventions, professional development, adaptive technology or other evidence-based, proven strategies to close the achievement gap. The plan must also identify a mentor who can assist with academic achievement. The mentor must be a current or former school leader with a demonstrable record of leading a successful school improvement effort and must commit to providing regular check-ins and advice to the participating school leader whom the person is mentoring.

L. The school district governing board of a school that meets the requirements prescribed in subsection C of this section is subject to both of the following:

1. The school district governing board shall establish an operation excellence committee composed of at least all of the following:

(a) The superintendent of the school district.

(b) The school principal from the identified school.

(c) At least one parent of a child who attends the identified school and at least one teacher from the identified school. There shall be an equal number of parents and teachers on the committee.

2. Not later than March 1, 2023, the operation excellence committee shall submit an improvement plan to the state board of education to improve student outcomes, which may include targeted academic interventions, professional development, adaptive technology or other evidence-based, proven strategies to close the achievement gap. The committee shall inform the state board of education which approved school improvement partner or partners from the partner network list identified by the state board pursuant to subsection N of this section will implement the improvement plan developed under this paragraph. Notwithstanding any other law, subject to the approval of the state board of education, the school district governing board of a school that is submitting an improvement plan pursuant to this paragraph may apply to the state board of education for a waiver of identified provisions of title 15, chapter 5, Arizona Revised Statutes, for the duration of the improvement plan authorized pursuant to this section. The school district governing board shall identify the provisions of title 15, chapter 5, Arizona Revised Statutes, that apply and shall explain the reasons for exemption from those provisions of state law during the duration of the improvement plan.

M. The charter holder of a charter school that meets the requirements prescribed in subsection C of this section is subject to both of the following:

1. The charter holder shall establish an operation excellence committee composed of at least all of the following:

(a) The chief administrative officer of the identified charter school.

(b) The school principal from the identified charter school.

(c) At least one parent of a child who attends the identified school and at least one teacher from the identified school. There shall be an equal number of parents and teachers on the committee.

2. Not later than March 1, 2023, the committee shall submit an improvement plan to the state board of education to improve student outcomes, which may include targeted academic interventions, professional development, adaptive technology or other evidence-based, proven strategies to close the achievement gap. The committee shall partner with approved independent school improvement partners from the partner network list identified by the state board of education pursuant to subsection N of this section to implement the improvement plan developed under this paragraph.

N. On or before January 1, 2023, the state board of education shall identify approved independent school improvement partners to be included on a partner network list through a request for proposals process. A school district or the charter holder of a school that meets the requirements prescribed in subsection C of this section shall select from the partner network list to implement, in partnership with the school's operation excellence committee, the improvement plan submitted under subsection L or M of this section. A state agency, or any subsidiary of the state agency, that meets the criteria prescribed in subsection O of this section is eligible for inclusion on the partner network list.

O. For the purposes of subsection N of this section, the state board of education shall award contracts to independent school improvement partners that meet all of the following requirements:

1. Have a credible track record of improving student academic achievement in public schools with various demographic characteristics, as measured by statewide assessments.

2. Have experience designing, implementing and evaluating data-driven instructional systems in public schools.

3. Have experience coaching public school administrators and teachers on designing and implementing data-driven school improvement plans.

4. Have experience delivering high quality professional development and coaching in instructional effectiveness to public school administrators and teachers.

P. In addition to assisting in implementing the improvement plan prescribed in subsection L or M of this section, the state board of education shall assist the operation excellence school in all of the following:

1. Collecting and analyzing data on student achievement.

2. Recommending changes to the school to improve student achievement.

3. Monitoring the implementation of the improvement plan.

4. Providing implementation support for the improvement plan.

Q. If a participating school is not demonstrating student academic growth or is otherwise dissatisfied with the services provided by a contracted independent school improvement partner, the school may submit a request to the state board of education to cancel that contract and select a different independent school improvement partner at the approval by the state board of education.

R. The state board of education shall review and approve all improvement plans submitted under this section within ninety days after submission.

S. If a school district has an existing improvement plan on file with the department of education under any provision of title 15, Arizona Revised Statutes, or pursuant to the every student succeeds act (P.L. 114-95; 129 Stat. 1802), the plan submitted under this section must attempt to align with or expand on the existing improvement plan.

T. The state board of education may adopt rules, policies and procedures to carry out this section, including rules to establish an appeals process for a school that does not receive approval of its improvement plan.

U. On or before June 1 of each year, each school that received monies pursuant to this section in the prior fiscal year shall submit a report to the state board of education that describes how the improvement plan developed pursuant to this section has improved student academic achievement. The state board of education may request additional information or data to be included in these reports. The state board of education may require additional reports as needed throughout the year to assess a school's progress. The state board of education shall review each improvement plan annually and require any modifications. If an improvement plan or report is not submitted, the state board of education shall withhold monies under this section until the plan or report is submitted according to this section.

V. On or before October 1, 2024, October 1, 2025 and October 1, 2026, the state board of education shall compile each report submitted pursuant to subsection U of this section and provide that information to the joint legislative budget committee, the governor's office of strategic planning and budgeting and the chairpersons of the education committees of the house of representatives and the senate, or their successor committees.

W. On or before December 1, 2027, the state board of education shall submit a final report on the operation excellence school improvement program to the governor, the president of the senate, the speaker of the house of representatives, the joint legislative budget committee and the governor's office of strategic planning and budgeting and shall provide a copy of the report to the secretary of state. The report shall include information on all of the following:

1. The schools and independent school improvement partners that participated in the program.

2. The academic progress of students in schools participating in the program.

3. Any other information necessary to evaluate the effectiveness of the program.

X. The state board of education shall consult and engage with school improvement experts that have proven to be successful in this state to develop an evidence-based model framework for school improvement.

Y. This section is repealed from and after December 31, 2027.

Sec. 7. Appropriations; school achievement improvement fund; state board of education

A. The sum of $58,000,000 is appropriated from the state general fund in each of fiscal years 2022-2023, 2023-2024 and 2024-2025 to the school achievement improvement fund established by section 6 of this act.

B. Of the amounts appropriated under subsection A of this section, the state board of education may use up to $1,000,000 in each of fiscal years 2022-2023, 2023-2024 and 2024-2025 to administer the operation excellence school improvement program established by section 6 of this act. Notwithstanding any other law, seven full-time equivalent positions are appropriated from the state general fund in each of fiscal years 2022-2023, 2023-2024 and 2024-2025 to the state board of education for the purposes prescribed in this subsection.

Sec. 8. Retroactivity

This act applies retroactively to from and after June 30, 2022.