Proposed §100.1151(a) and (h) appear to include the following categories of individuals who are not included in TEC, §12.120(a): employees of governing bodies of charter schools and officers of governing bodies who are not also members of governing bodies of charter schools. Proposed §100.1151(a)(1) expands the kinds of convictions covered by TEC, §12.120(a)(1). Rather than covering only felonies or misdemeanors involving moral turpitude, as the statute states, the proposed rule covers misdemeanors involving moral turpitude and any felonies. Finally, proposed §100.1151(b)(1) exceeds TEC, §22.083(b), by requiring criminal history checks of a person whom the charter holder intends to employ in any capacity. TEC, §22.083(b), applies only to a person who is employed with state funds at the open-enrollment charter school. Without revision, proposed §100.1151(a), (b)(1), and (h) would require charter holders, most of whom are non-profit corporations, and who may employ many other employees who have no relationship to a charter school, to terminate those employees immediately if any of those employees have been convicted of a felony or a misdemeanor involving moral turpitude. These employees may have no relationship to the charter school, and may not be paid with state funds, yet because they are employees of the charter holder they would be subject to the proposed rules.

Agency Response. The agency agrees, in part, with the comment about proposed §100.1151(a) and (h), and has made a corresponding change to proposed subsection (j) as well. As used in proposed §100.1151(a), (h), and (j), the phrase, "as an employee, an officer, or a member of the governing body of a charter school, or as a member of the governing body of a charter holder" was intended to have the same meaning as the phrase, "as a member of the governing body of a charter holder, as a member of the governing body of a charter school, or as an officer or employee of a charter school." By reordering the words in the phrase, the agency appears to have created confusion. Accordingly, proposed §100.1151 has been modified to replace the phrase, "as an employee, an officer, or a member of the governing body of a charter school, or as a member of the governing body of a charter holder" with the phrase, "as a member of the governing body of a charter holder, as a member of the governing body of a charter school, or as an officer or employee of a charter school," in §100.1151(a), (h), and (j).

A charter holder engaged in non-charter activities may have administrators, employees, and contractors who do not perform, and are not charged with performing, any charter school functions. Such staff engaged in purely non-charter activities should be free from the requirements of House Bill 6 relating to the employees and officers of a charter school.

It is important to note that the definition of an "officer of a charter school," as proposed, does include the top administrators of the charter holder, even one with significant non-charter activities. For example, it is impossible for the chief executive officer or chief financial officer of a charter holder to fall outside the definitions provided by proposed §100.1011(18) and (21), respectively. Similarly, any employee or contractor of the charter holder who is charged with performing, or does perform, any of the functions listed in proposed §100.1011(19) is a central administration officer. These administrators are at the apex of an organization that has taken on the responsibility of operating a public school using taxpayer funds.

Also, several relevant changes to the proposed rules have been made in response to other comments. Proposed §100.1011(3) has been modified to add a new subparagraph (A) clarifying that the phrase, "employee of a charter school" as used in this subchapter, means a person paid to work at a charter school under the direction and control of an officer of a charter school, regardless of whether the person is on the payroll of the charter holder, a charter school operated by the charter holder, a management company providing management services to the charter holder, or any other person. Proposed §100.1011(1) has been revised to delete the phrase "officer of a charter school." Proposed §100.1011(17) has been revised to clarify that a charter holder employee or independent contractor engaged solely in non-charter activities for the charter holder is not an "officer of a charter school" under these rules.

Secondly, the agency agrees, in part, with the comment about proposed §100.1151(b)(1). TEC, §22.083, provides in subsection (b) that an open-enrollment charter school shall obtain from any law enforcement or criminal justice agency all criminal history record information that relates to: (1) a person whom the school intends to employ in any capacity; or (2) a person who has indicated, in writing, an intention to serve as a volunteer with the school.

As noted earlier in response to another comment, a "charter school" is not a legal entity that can enter into contracts, sue and be sued, or act as an employer. Rather, a charter school can only be operated by an "eligible entity" under TEC, §12.101. A charter holder is the only legal entity that can act as an employer on behalf of a charter school. In some cases, the charter holder has seen fit to set up subsidiary corporations for the specific purpose of operating the charter holder's charter schools. But such arrangements do not excuse the charter holder from TEC, §22.083(b). Since the employer specified by the statute cannot exist, the term is ambiguous and in need of interpretation by agency rulemaking. However, it was not the intention of proposed §100.1151(b) to capture employees who do not perform, and are not charged with performing, any charter school functions. Employees engaged in purely non-charter activities should be free from the requirements of House Bill 6 relating to the employees of a "charter school." Accordingly, proposed §100.1151(b) has been modified to read, "an employee or a person whom the charter school intends to employ in any capacity, or whom the charter holder intends to employ in any capacity relating to its charter school activities."

Finally, the agency disagrees with the comment about proposed §100.1151(a)(1). Proposed §100.1151(a)(1) does not expand on the kinds of convictions covered by TEC, §12.120(a)(1). The commenter suggests that, rather than covering "only felonies or misdemeanors involving moral turpitude, as the statute states," the proposed rule improperly covers a person convicted of "any felonies." The comment misstates the language of TEC, §12.120. Section 100.1151(a)(1) on its face applies to a person who "has been convicted of a felony or a misdemeanor involving moral turpitude." In the language used by the commenter, it is not entirely clear whether the phrase "involving moral turpitude" modifies only "misdemeanors" or modifies both "misdemeanors" and "felonies." In the language of TEC, §12.120, by contrast, the phrase "involving moral turpitude" modifies only "misdemeanors." The language in proposed §100.1151(a)(1) is intended to make clear that TEC, §12.120(a)(1), applies to a person convicted of any felony.

Comment. ACE and HCJJCS questions the cost to charter schools of conducting criminal history checks three times in the first year of service. An individual questions the cost to charter schools of conducting criminal history checks twice per year, and suggests changing the rule to require such checks only annually.

Agency Response. The agency agrees, in part, with the comment. Although the agency agrees to make the suggested change, it does so with some trepidation. Under TEC, §21.003 (Certification Required), a school district may not employ a person as an educator unless the person holds an appropriate certificate or permit issued as provided by TEC, Chapter 21, Subchapter B. Consequently, the governing body of a school district can generally rely on the State Board for Educator Certification (SBEC) for screening its population of educators under TEC, §22.082 (Access to Criminal History Records by State Board for Educator Certification). This provision authorizes SBEC to obtain criminal histories on all certified educators in Texas, but no similar law authorizes TEA or another state agency to obtain criminal histories with respect to charter holder employees. Thus, the exclusive responsibility for protecting the welfare of the students enrolled in a charter school, and for protecting taxpayers from financial improprieties relating to state funds and public property, lies with the charter holder. This situation has no parallel among Texas public schools. Further, TEC, §22.083 (Access to Criminal History Records by Local and Regional Education Authorities), does not merely authorize a charter holder to obtain criminal histories on its educators. Unique among such provisions, TEC, §22.083, imposes a statutory duty to do so. Given these circumstances, the agency urges the charter holder to seek legal counsel before determining a prudent local policy as to the frequency with which it will run criminal histories. Proposed §100.1151(b) has been modified to read, "Before the person begins service, and annually thereafter;" and proposed §100.1035(b)(5) has been modified to read, "a complete criminal history record for the individual, issued by the Texas Department of Public Safety within one year of the date of the compliance record. . ."

Comment. ACE and HCJJCS commented that the term "volunteer" in proposed §100.1151(b)(3) is vague and ambiguous, and should be clarified. Further, the definition of a volunteer should include only those persons who perform duties on school property or at another location when (not just where) students are present.

Agency Response. The agency disagrees with the comment. Proposed §100.1151(b)(3) may be further defined by local charter holder policy. TEC, §22.083, imposes a statutory duty on the charter holder to run criminal history checks on "a person who has indicated, in writing, an intention to serve as a volunteer with" the charter school. It does not define the circumstances under which the charter holder must require written statements of such an intention. This is a matter for local discretion, since what is reasonable will depend greatly on the nature of the program operated by the charter holder. The proposed subsection does provide guidance to the charter holder in exercising its local discretion. A primary consideration should be the extent to which access to students is given to the volunteer. The agency urges the charter holder to seek legal counsel before determining a prudent local policy on criminal history checks for school volunteers. For further response, see earlier response to a similar comment, "ACE and HCJJCS questions the cost to charter schools of conducting criminal history checks three times in the first year of service."

Comment. ATPE expressed concern about allowing a person convicted of a felony or a misdemeanor involving moral turpitude to drive a bus or be an aide on a bus, even if the governing body of the charter approves it. ATPD recommended deleting §100.1151(c)(2) and (4) so that a governing body may not vote to allow a person failing the criminal history check to be employed at the charter school. Another possible remedy is to set a threshold for type of crime committed and amount of time elapsed since the conviction in rule that provides guidelines for when a governing body could vote to grant employment to such a person. If the latter option is used, ATPE recommended requiring commissioner approval before the person is finally offered employment.

Agency Response. The agency disagrees with the comment. Proposed §100.1151(c)(2) and (4) simply reiterate similar provisions found in TEC, §22.084 (Access to Criminal History Records of School Bus Drivers, Bus Monitors, and Bus Aides).

Comment. ATPE suggested that proposed §100.1151(j) be revised, and expressed concern about allowing a person to continue employment beyond September 1, 2001, after failing a criminal history check, if their employment contract was executed prior to that date and has not been renewed or altered since that date. A person could have been given a contract extending three years or more, and this would allow them to remain employed by the charter for years after failing the criminal history check. This is not in students' safety interests. A person who fails to pass the criminal history check should not be allowed to continue employment around children, regardless of an employment or other written contract. ATPE recommended giving the charter school the option of reassigning that individual to a position in which they have no contact with children if the charter holder is concerned about contractual obligations.

Agency Response. The agency agrees, in part, with the comment. Proposed §100.1151(j)(2) has been modified to add a new subparagraph (C), as follows: "the person does not perform, and is not charged with performing, any charter school functions."

Proposed §100.1153. Substantial Interest in Management Company; Restrictions on Serving.

Comment. ATPE recommended that any person with substantial interest in a management company should not be allowed to provide any services to a charter, as provided in proposed §100.1153(b), especially those that include functioning as superintendent, principal, or business manager. ATPE recommended that §100.1153(b) be revised to prohibit this arrangement from occurring and specify that failure to remove such a person constitutes a material violation of the charter.

Agency Response. The agency disagrees with the comment. The definition of "management services" provided by TEC, §12.1012(5), includes some of the functions carried out by a principal, director, or other chief operating officer of a charter school; by an assistant principal or assistant director of a charter school; or by a person charged with managing the finances of a charter school. This statutory ambiguity is resolved in the proposed rule by providing that a management company may provide services that qualify it as an "officer," so long as it complies with certain restrictions imposed or implied by other provisions of TEC, Chapter 12.

Comment. An individual suggested that the rules be examined to ensure that somewhere in the provision a rule should provide that the administrator/principal of the school, even though an employee of the management company, has a higher duty/responsibility/loyalty to the State of Texas and/or the charter.

Agency Response. The agency disagrees with the comment. There is an inherent conflict between the duty of loyalty owed by a management company employee to its employer and the duty of loyalty owed by a charter school officer to the charter holder. Many of the provisions of House Bill 6 and the proposed rules are designed to manage this conflict of interest, in the public interest. However, no set of rules can eliminate the conflicts of interest inherent in such an arrangement. As interpreted by these rules, House Bill 6 does permit a management company employee to perform some functions that make him/her officers of the charter school. However, as interpreted by these rules, House Bill 6 imposes significant restrictions and duties upon both the management company and the charter holder entering into such arrangements. For further response, see earlier response to a similar comment, "ATPE recommended that any person with substantial interest in a management company should not be allowed to provide any services to a charter."

Comments. The law firm of Donald W. Hicks, Sr., P.C., Attorneys and Counselors at Law, on behalf of its client, Texans Can!, on behalf of its open-enrollment charter schools, commented as follows. Proposed §100.1153 contains the same inconsistent and excessive language as proposed §100.1151. Again, TEC, §12.120(a)(4), does not include the categories of "employee" or "officer" of the governing body of a charter school. The law firm of Donald W. Hicks, Sr., P.C., requests that proposed §100.1153 be redrafted consistent with TEC, §12.120.

Agency Response. The agency agrees, in part, with the comment. See response to subsequent comment from Bracewell & Patterson, L.L.P.

Comments. Five representatives of Texans Can! suggested modifying the language of proposed §100.1153 to more accurately reflect the language in TEC, §12.120(a).

Agency Response. The agency agrees, in part, with the comment. See response to subsequent comment from Bracewell & Patterson, L.L.P.

Comment. ACE commented that the rules should not add a new restriction on service. House Bill 6 specifically says certain persons should not be permitted to serve as an employee of a charter school, but leaves decisions pertaining to employees of a charter holder to the discretion of the governing board of the charter holder. The rule language extending statutory prohibitions to cover employees of the charter holder should be eliminated.

Agency Response. The agency agrees, in part, with the comment. See response to subsequent comment from Bracewell & Patterson, L.L.P.

Comments: The law firm of Bracewell & Patterson, L.L.P., Attorneys and Counselors at Law, on behalf of its client, Texans Can!, on behalf of its open-enrollment charter schools, commented as follows. In promulgating proposed §100.1151 to implement TEC, §12.120, the commissioner expanded the categories of individuals who are restricted from serving beyond those established by the Legislature, and expanded the categories of offenses targeted beyond those established by the Legislature. Bracewell & Patterson objected to the phrase, "an employee, an officer, or a member of the governing body of a charter school" in proposed §100.1153(a).

Proposed §100.1153(a) appears to include the following categories of individuals who are not included in TEC, §12.120(a): employees of governing bodies of charter schools and officers of governing bodies who are not also members of governing bodies of charter schools. Without revision, proposed §100.1153 would require charter holders, most of whom are non-profit corporations, and who may employ many other employees who have no relationship to a charter school, to terminate those employees immediately if any of those employees have a substantial interest in a management company. These employees may have no relationship to the charter school, and may not be paid with state funds, yet because they are employees of the charter holder they would be subject to the proposed rules.