| (a) Disposition of audited property. The commissioner
of education shall take possession, assume control, and supervise
the disposition of the public property disclosed by the annual audit
report as filed with the Texas Education Agency (TEA) or as revised
pursuant to subsection (b) of this section. At any time, the commissioner
may appoint a board of managers to transfer the property or may direct
the governing board of the charter holder to transfer the property.
The commissioner may transfer or direct the transfer of property to
any public school if the commissioner determines that the transfer
is in the best interest of students. For purposes of this section,
references to a charter holder refers to both an organization that
currently holds a charter contract and an organization that formerly
held a charter contract.
(b) Disposition of property--defective audit. If the
annual audit reports filed by a former charter holder are not in substantial
compliance with §100.1063(f) of this title (relating to Use of
Public Property by a Charter Holder), the commissioner shall use such
legal process as may be available under Texas law to take possession
and assume control of all property of the former charter holder and,
using such legal process, supervise the disposition of such property
in accordance with law. The commissioner may transfer or direct the
transfer of property to any public school if the commissioner determines
that the transfer is in the best interest of students.
(1) At any time, the commissioner may determine whether
the annual audit reports filed by a former charter holder substantially
comply with §100.1063(f) of this title.
(2) At the commissioner's sole discretion, the commissioner
may cure any defects in the annual audit reports by reviewing the
audit reports and reclassifying the transactions and restating the
financial statements or by securing, at the former charter holder's
expense, such professional services as may be required to create and/or
audit the necessary exhibits to the annual audit reports.
(3) The commissioner may, at the commissioner's sole
discretion, take possession, assume control, and supervise the disposition
of the public property disclosed by the annual audit reports and any
revisions made under this subsection.
(c) Method of disposition of property. The commissioner
may take possession, assume control, and supervise the disposition
of property by taking one or more of the following actions.
(1) For real property purchased with funds received
under the Texas Education Code (TEC), §12.106, the commissioner
shall direct the charter holder to dispose of the property through
one of the following methods.
(A) The charter holder may retain or sell the property
and provide reimbursement to the state. The following provisions apply
to a charter holder that retains or sells the property.
(i) The charter holder must notify the commissioner
more than 30 calendar days prior to the last day of instruction that
the charter holder intends to reimburse the state for its interest
in the property and specify whether the charter holder intends to
retain or sell the real property.
(ii) The charter holder must provide the commissioner
a written assurance that the charter holder will comply with the requirements
of TEC, §12.1284.
(iii) The charter holder must obtain the written consent
of the commissioner.
(iv) The charter holder must file an affidavit in the
real property records of the county in which the real property is
located disclosing the state interest in the property at least 30
calendar days prior to the last day of instruction.
(v) Not later than 30 calendar days after the charter
school's last day of operation, the charter holder must deposit with
the Texas Comptroller of Public Accounts an amount equal to 110% of
the estimated state reimbursement for the property as directed by
the commissioner, which TEA will calculate by taking the fair-market
value of the property as determined by an appraisal approved by the
commissioner, subtracting the principal amount of any debt described
by TEC, §12.128(e), and multiplying that result by a fraction
for which the numerator is the funds received under TEC, §12.106,
used to purchase the property and the denominator is the funds received
under TEC, §12.106, plus any non-state funds used to purchase
the property. If an appraisal cannot be obtained in 30 calendar days,
the charter holder may request that the commissioner grant an extension.
(vi) The charter holder must prepare and submit a final
audit under TEC, §44.008. This audit must be filed by the deadline
specified in TEC, §44.008, and must disclose:
(I) the total amount of funds received under TEC, §12.106,
that were used to purchase each separate item of real property to
be retained or sold by the charter holder;
(II) the total amount of federal funds that were used
to purchase each separate item of real property to be retained or
sold by the former charter holder; and
(III) the total amount of state, federal, or any other
private funds that were used to purchase the property to be retained
or sold by the former charter holder.
(vii) The charter holder shall timely make all required
payments relating to the property, including note payments; shall
maintain the premises; and shall maintain full insurance coverage
as determined by the commissioner until the state has received its
full reimbursement and released its claim to the property.
(viii) The following provisions apply if the charter
holder elects to retain the property.
(I) After the final annual audit report is filed, TEA
will calculate the final state reimbursement amount, which is calculated
by taking the fair-market value of the property as determined by the
commissioner less the final principal amount of any debt described
by TEC, §12.128(e), that was incurred prior to the charter school's
cessation of operations and multiplying that amount by a fraction
for which the numerator is the funds received under TEC, §12.106,
used to purchase the property and the denominator is the funds received
under TEC, §12.106, plus any non-state funds used to purchase
the property.
(II) If the final state reimbursement amount is greater
than the deposit made with the comptroller under this section, the
former charter holder must make the additional deposit to the comptroller
within 30 calendar days of TEA's determination of the final state
reimbursement amount or as otherwise ordered by the commissioner.
(III) Once the charter holder has filed its final audit
report under TEC, §44.008, and sufficient funds are on deposit
with the comptroller to pay the final reimbursement amount, the commissioner
may request the comptroller to distribute the deposit as directed
by TEA and release any state claim on the property. Any remaining
funds on deposit with the comptroller may be returned to the former
charter holder once the state has received the full final reimbursement
amount.
(IV) If the charter holder fails to complete its final
financial audit under TEC, §44.008, or fails to make an additional
payment to the comptroller as required, the charter holder shall forfeit
the amount deposited with the comptroller and shall dispose of the
property as ordered by the commissioner. The commissioner may extend
this deadline upon request of the charter holder.
(ix) The following provisions apply if the charter
holder sells the property.
(I) The property must be sold for at least fair-market
value, as determined under this section.
(II) The property must be sold and fully closed no
later than one year after the last day of instruction.
(III) If the property is sold prior to the completion
of the final audit report under TEC, §44.008, for an amount greater
than the fair-market value used to determine the estimated state reimbursement
amount, the charter holder shall deposit with the comptroller an amount
equal to the difference between the estimated fair-market value and
the sales price multiplied by the percentage of state funds used to
purchase the property based on the most recent audit pursuant to TEC, §44.008.
(IV) After the property has been sold and the final
audit report, pursuant to TEC, §44.008, has been filed, TEA shall
calculate the final state reimbursement amount.
(V) The final state reimbursement amount is calculated
by taking the final gross sales price of the property less the remaining
principal amount of any debt described by TEC, §12.128(e), that
was incurred prior to the charter school's cessation of operations
and multiplying that amount by a fraction for which the numerator
is the funds received under TEC, §12.106, used to purchase the
property and the denominator is the funds received under TEC, §12.106,
plus any non-state funds used to purchase the property.
Cont'd... |
