| (xii) The charter holder has received an audit containing
an adverse or disclaimed opinion, and based on the opinion is assigned
a financial accountability rating that is less than satisfactory.
(B) Charter holder financial performance will be evaluated
in accordance with the following standards.
(i) Step transactions. The commissioner may view the
transaction as a whole and may disregard any nonsubstantive intervening
transaction taken to achieve the final results.
(ii) Arm's length transaction. A transaction that is
described in subparagraph (A) of this paragraph that is the result
of an arm's length transaction between completely unrelated parties
is only a serious unsatisfactory financial performance if the transaction
resulted in a significant wasting of financial resources.
(2) Finality of audits and reports.
(A) Any review of a specific audited financial statement
or investigative report must be brought using the procedures provided
in the notice of the statement or report.
(B) Any challenge to a TEA rule, financial standard,
or audit procedure must be brought using the procedures outlined in
Texas Government Code, Chapter 2001, for requesting agency rulemaking
or challenging agency rules.
(d) Minimum compliance performance required. Continuation
of an open-enrollment charter is contingent on the charter holder's
compliance with TEC, Chapter 12, Subchapter D; federal and state laws
and rules; financial accountability standards, including student attendance
accounting and grant requirements; and data integrity standards as
demonstrated by monitoring reports under TEC, §7.028, final investigative
reports issued by the TEA, and other evidence.
(1) Standard of required performance. The open-enrollment
charter authorizing a charter school that has unsatisfactory compliance
performance for three consecutive school years will be revoked.
(2) Determination of performance. For purposes of this
subsection, required minimum compliance performance shall be determined
as follows. A charter holder's compliance with TEC, Chapter 12, Subchapter
D; federal and state laws and rules; financial accountability standards,
including student attendance accounting and grant requirements; or
data integrity standards may be determined by applying the applicable
standards to the facts as found by the TEA monitoring reports under
TEC, §7.028, or final investigative reports issued by the TEA.
Such reports establish non-compliance if the facts found therein are
not in compliance with the standards set forth in this subsection.
Other evidence may be considered.
(3) Finality of compliance reports.
(A) Any review of a specific monitoring report or investigative
report must be brought using the procedures described in the notice
of the report.
(B) Any challenge to a TEA rule or compliance standard
must be brought using the procedures outlined in Texas Government
Code, Chapter 2001, for requesting agency rulemaking or challenging
agency rules.
(e) Minimum health and safety performance required.
Continuation of an open-enrollment charter is contingent on the charter
holder protecting the health, safety, and welfare of the students
enrolled at the school, as determined by the commissioner under §100.1025
of this title (relating to Intervention Based on Health, Safety, or
Welfare of Students) and this subsection or by an official report
issued by a federal, state, or local authority with jurisdiction to
issue the report.
(1) Standard of required performance. The open-enrollment
charter authorizing a charter school that fails to protect the health,
safety, or welfare of the students enrolled at its school while on
school property, while at school-related events, or at any time while
under the supervision of school personnel shall be revoked effective
immediately.
(2) Determination of performance. For purposes of this
subsection, required minimum health and safety performance shall be
determined as follows.
(A) A final investigative report issued by the TEA
is admissible to prove whether the charter holder failed to protect
the health, safety, or welfare of the students enrolled at its school.
(B) An official report issued by a federal, state,
or local authority acting within its jurisdiction, as well as hearsay
evidence and telephone testimony offered by officials from such authority,
are admissible to prove whether the charter holder failed to protect
the health, safety, or welfare of the students enrolled at its school.
(C) Documents and testimony considered by the commissioner
in making a determination under §100.1025 of this title are admissible
to prove whether the charter holder failed to protect the health,
safety, or welfare of the students enrolled at its school.
(3) Finality of health and safety reports.
(A) Any appeal to a specific official report issued
by a federal, state, or local authority acting within its jurisdiction
must be brought using the procedures provided in law for the review
of such findings.
(B) Any challenge to a TEA rule or compliance standard
must be brought using the procedures outlined in Texas Government
Code, Chapter 2001, for requesting agency rulemaking or challenging
agency rules.
(f) Minimum charter performance required. Continuation
of an open-enrollment charter is contingent on the charter holder's
implementation of and compliance with the terms of its open-enrollment
charter as defined by §100.1001(15) of this title (relating to
Definitions).
(1) Standard of required performance. The open-enrollment
charter authorizing a charter school that commits a material violation
of its open-enrollment charter shall be revoked.
(2) Determination of performance. For purposes of this
subsection, required minimum charter performance shall be determined
as follows.
(A) A charter holder's compliance with its open-enrollment
charter may be determined by applying the charter terms to the facts
as found by the TEA monitoring reports under TEC, §7.028, or
final investigative reports issued by the TEA. Such reports establish
non-compliance if the facts found therein are not in compliance with
these terms. Other evidence may be considered.
(B) A violation of the contract for charter, request
for applications (RFA), or other document approved by the State Board
of Education (SBOE) or of a condition, amendment, modification, or
revision of a charter approved by the commissioner is material if
it directly violates the purpose of the contract, the RFA, or other
documents approved by the SBOE or a condition, amendment, modification,
or revision of the contract.
(C) An open-enrollment charter as defined by §100.1001(15)
of this title includes all applicable state and federal laws, rules,
and regulations. A violation of such laws, rules, or regulations may
be considered both under this subsection and under subsections (b)-(e)
of this section, as appropriate.
(3) Finality of charter violation reports.
(A) Any review of a specific investigative report must
be brought using the procedures set forth in the notice of the report.
(B) Any challenge to a TEA rule or compliance standard
must be brought using the procedures outlined in Texas Government
Code, Chapter 2001, for requesting agency rulemaking or challenging
agency rules.
(g) Performance frameworks. Continuation of an open-enrollment
charter is contingent upon the charter holder's satisfaction of standards
set forth in the Charter School Performance Framework Manual established
under TEC, §12.1181.
(h) Imminently insolvent. For purposes of this section
"imminently insolvent" means that the charter holder:
(1) has incurred liabilities in excess of net assets;
(2) is unable to pay its debts or financial obligations
within 90 days of the date they become due;
(3) has declared bankruptcy;
(4) has otherwise sought the protection of bankruptcy
laws;
(5) had a lien or warrant hold placed against it by
the Internal Revenue Service;
(6) had a warrant hold placed against it by the Teacher
Retirement System; or
(7) has a judgment lien placed against it.
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