Elementary and Secondary Education Act Reauthorization: Comparison of Proposed Charter School Legislation (H.R. 2218) and Current Law

Elementary and Secondary Education Act Reauthorization: Comparison of Proposed Charter School Legislation (H.R. 2218) and Current Law

Elementary and Secondary Education Act
Reauthorization: Comparison of Proposed
Charter School Legislation (H.R. 2218) and
Current Law
Rebecca R. Skinner
Specialist in Education Policy
September 2, 2011
Congressional Research Service
7-5700
www.crs.gov
R41877
CRS Report for Congress
Pr
epared for Members and Committees of Congress

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

Summary
The primary source of federal aid to K-12 education is the Elementary and Secondary Education
Act (ESEA). The ESEA was initially enacted in 1965 (P.L. 89-10), and was most recently
amended and reauthorized by the No Child Left Behind Act of 2001 (NCLB, P.L. 107-110),
which authorized virtually all ESEA programs through FY2008. The 112th Congress is actively
engaged in work to amend the ESEA. On June 16, 2011, Representative Duncan Hunter,
Chairman of the Early Childhood, Elementary, and Secondary Education Subcommittee of the
House Education and the Workforce Committee, introduced the Empowering Parents through
Quality Charter Schools Act (H.R. 2218). The bill was subsequently ordered reported by the
House Education and Workforce Committee on July 22, 2011 (H.Rept. 112-178). This bill would
modify the existing Charter Schools Program, Per-Pupil Facilities Aid program, and Credit
Enhancement Initiatives to Assist Charter School Facility Acquisition, Construction, and
Renovation program (hereinafter referred to as the Credit Enhancement program) currently
authorized under ESEA Title V-B-1 and 2.
H.R. 2218 would make substantial changes to Title V-B-1 and 2, while preserving many of the
provisions of current law, albeit in a different structure. Some of the most substantial changes that
would be made by H.R. 2218 include the following:
• Expand the scope of the Charter School Program to include funding for new
charter schools; replicable, high-quality charter school models; and the expansion
of high-quality charter schools.
• Change applicant eligibility for the Charter School Program.
• Extend the grant period under the Charter School Program from up to three years
to up to five years for both state entities receiving grants from the Secretary of
Education and eligible applicants receiving grants from state entities.
• Emphasize the need for charter schools to serve all students, including children
with disabilities and English language learners, and increase the focus placed on
having a quality chartering process at the state and local levels.
• Retain both the Per-Pupil Facilities Aid program and the Credit Enhancement
program with provisions similar to those contained in current law, but restructure
current law provisions to authorize both programs under a new section entitled
Facilities Financing Assistance. Priority would be given to using funds for the
Credit Enhancement program over the use of funds for the Per-Pupil Facilities
Aid program.
• Change the use of funds for national activities to focus on providing charter
school startup grants to eligible applicants and disseminating technical assistance
to state entities in awarding subgrants, disseminating best practices, and
evaluating the impact of the charter school program.
• Alter the authorization of funds for all three charter school programs, as well as
for national activities, authorizing 15% of the total appropriation for Facilities
Financing Assistance, up to 5% for national activities, and the remaining funds
for the Charter School Program.

Congressional Research Service

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

Contents
Overview of Major Differences Between Current Law and H.R. 2218........................................... 1
Comparison of Provisions................................................................................................................ 6

Tables
Table 1. Program Appropriations for Charter School Program Activities Authorized
Under Title V-B-1 and 2 of the ESEA and Under H.R. 2218, as Reported .................................. 4
Table 2. Set-Asides for Administrative Expenses for Charter School Program Activities
Authorized Under Title V-B-1 and 2 of the ESEA and Under H.R. 2218, as Reported ............... 4
Table 3. Overview of the Current Structure of ESEA Title V-B-1 and 2 and Proposed
Changes to This Structure Made by H.R. 2218 ............................................................................ 5
Table 4. Comparison of Major Provisions in the Elementary and Secondary Education
Act (ESEA) Title V-B-1 and 2, and H.R. 2218............................................................................. 6

Contacts
Author Contact Information........................................................................................................... 55

Congressional Research Service

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

he primary source of federal aid to K-12 education is the Elementary and Secondary
Education Act (ESEA). The ESEA was initially enacted in 1965 (P.L. 89-10), and was
T most recently amended and reauthorized by the No Child Left Behind Act of 2001 (NCLB,
P.L. 107-110), which authorized virtually all ESEA programs through FY2008.
The 112th Congress is actively engaged in work to amend the ESEA. On June 16, 2011,
Representative Duncan Hunter, Chairman of the Early Childhood, Elementary, and Secondary
Education Subcommittee of the House Education and the Workforce Committee, introduced the
Empowering Parents through Quality Charter Schools Act (H.R. 2218). The bill was subsequently
ordered reported by the House Education and Workforce Committee on July 22, 2011 (H.Rept.
112-178). This bill would modify the existing Charter Schools Program, Per-Pupil Facilities Aid
programs, and Credit Enhancement Initiatives to Assist Charter School Facility Acquisition,
Construction, and Renovation program (hereinafter referred to as the Credit Enhancement
program) currently authorized under ESEA Title V-B-1 and 2.
More specifically, ESEA Title V-B-1 authorizes the Charter School Program, which provides
grants to state educational agencies (SEAs) or, if a state’s SEA chooses not to apply for a grant,
charter school developers, to support the development and initial implementation of public
charter schools. Priority in awarding grants is to be given to states with charter school policies
meeting such criteria as holding charter schools accountable for meeting clear and measurable
objectives, or establishing one or more public chartering agencies that are not LEAs. Up to 5% of
program funds may be reserved by ED for technical assistance to, as well as studies of, charter
schools. ESEA Title V-B-1 also authorizes the Per-Pupil Facilities Aid program. Under this
program, the Secretary provides competitive grants to states to pay the federal share of
establishing or enhancing, and administering, Per-Pupil Facilities Aid program for charter
schools. ESEA Title V-B-2 authorizes the Credit Enhancement program. Under this program, ED
awards competitive grants to three or more entities to demonstrate innovative ways to help charter
schools acquire appropriate facilities.
The first section of this report provides an overview of major differences between current law and
the House reported version of H.R. 2218, including an examination of changes to program
authorizations and set-asides for administration. This is followed by an analysis of the proposed
statutory language in H.R. 2218 compared with current law. The analysis focuses on major
differences between the proposed language and current law. It does not attempt to identify every
difference between the two.
Overview of Major Differences Between Current
Law and H.R. 2218
H.R. 2218 would make substantial changes to ESEA Title V-B-1 and 2 while preserving many of
the provisions of current law, albeit in a different structure. Some of the most substantial
differences between H.R. 2218 and current law include the following:
• Under current law, grants may be awarded to SEAs to make subgrants to eligible
applicants for planning and program design, initial implementation of a charter
school, and dissemination activities, such as assisting other individuals with the
start-up of another charter school or partnering with other schools to improve
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

student achievement. H.R. 2218 eliminates dissemination activities as a use of
funds and specifies that grants may be used for new charter schools; replicable,
high-quality charter school models; and the expansion of high-quality charter
schools. While the expansion and replication of charter schools is not included in
current law, funds under the Charter School Program may be used for these
purposes currently based on changes made by appropriations acts.1
• Under current law, only SEAs are generally eligible to apply for grants under the
Charter School Program. H.R. 2218 would extend eligibility to include state
charter school boards and governors.
• Under current law, an eligible applicant (i.e., charter school developer meeting
specific criteria) is able to apply directly to the Secretary of Education
(hereinafter referred to as the Secretary) for a grant under the Charter School
Program if the SEA does not apply. H.R. 2218 would not permit an eligible
applicant to apply directly for a grant under this program. However, under
national activities (Section 5205), H.R. 2218 would permit the Secretary to award
grants directly to eligible applicants located in states that did not apply for a
grant, were not awarded a grant, or are in the fourth or fifth year of their grant
period.
• Under current law, grants to SEAs and eligible applicants are made for a period
of not more than three years. Under H.R. 2218, grants would be made to state
entities and eligible entities for a period of not more than five years.
• H.R. 2218 would specifically addresses the need for charter schools to be
inclusive, including with respect to children with disabilities and English
language learners. Current law does not address this issue specifically.
• Under H.R. 2218, eligible entities would be required to reserve 10% of their
funds to provide technical assistance to eligible applicants and chartering
agencies in opening, expanding, and replicating charter schools, as well as
working with chartering agencies to improve the authorizing process. Under
current law, the authorizing process is not addressed in this manner. However,
requirements included in appropriations acts have increased the emphasis placed
on the support and monitoring of chartering agencies.2
• H.R. 2218 would continue to authorize both the Per-Pupil Facilities Aid program
and the Credit Enhancement program with provisions similar to those contained
in current law,3 but it restructures current law provisions to authorize both

1 See, for example, P.L. 111-117.
2 See, for example, P.L. 111-117.
3 Under the Per-Pupil Facilities Aid program, the Secretary provides competitive grants to states to pay the federal
share of establishing or enhancing, and administering, Per-Pupil Facilities Aid program for charter schools. Under the
Credit Enhancement program, ED awards competitive grants to three or more entities to demonstrate innovative ways
to help charter schools acquire appropriate facilities.
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

programs under a new section entitled Facilities Financing Assistance.4 Priority
would be given to using funds for the Credit Enhancement program over the use
of funds for the Per-Pupil Facilities Aid program.
• Under current law, the Secretary is authorized to reserve funds to carry out
several types of national activities, including providing information to charter
schools about their eligibility to receive federal funds, evaluating the impact of
charter schools on student academic achievement, providing technical assistance,
disseminating information on promising charter school practices, providing for
the collection of information on the financial resources available to charter
schools, and carrying out evaluations and technical assistance related to the Per-
Pupil Facilities Aid program. The Per-Pupil Facilities Aid program is also
authorized under national activities in current law. Under H.R. 2218, at least half
of the funds reserved for national activities would be used to provide start-up
grants directly to eligible applicants. The remainder of the funds would be used
to disseminate technical assistance to state entities in awarding subgrants,
disseminate best practices, and evaluate the impact of the charter school program.
The Per-Pupil Facilities Aid program would be authorized under a new section
(Section 5204) focused on facilities financing.
H.R. 2218 would also alter the authorization of appropriations for all three programs, as well as
for national activities. Under H.R. 2218, 15% of the total appropriation for Title V-B-1 would be
used for Facilities Financing Assistance (Section 5204), up to 5% for national activities (Section
5205), and the remaining funds for the Charter School Program (Section 5203). Under current
law, $200 million of the total appropriation is reserved for Title V-B-1 activities other than the
Per-Pupil Facilities Assistance program (i.e., for the Charter School Program and national
activities). Any funds in excess of $200 million but not greater than $300 million are used for the
Per-Pupil Facilities Assistance program. Any appropriations in excess of $300 million are divided
evenly between Title V-B-1 activities other than the Per-Pupil Facilities Assistance program and
the Per-Pupil Facilities Assistance program. Funding for national activities is the greater of 5% or
$5 million of the amount appropriated for Title V-B-1, but funding may not exceed $8 million.
The Credit Enhancement program (Title V-B-2) has a separate authorization. In recent years,
Congress has appropriated funds for the Charter School Program and specified an amount that the
Secretary may use for both the Per-Pupil Facilities Assistance program and the Credit
Enhancement program, as well as for national activities, through appropriations acts.5 Differences
between authorizations of funds under current law and H.R. 2218 are summarized in Table 1.

4 Both programs would be authorized under Section 5204. Title V-B-2 of current law would be repealed.
5 For example, in FY2010 the Charter School Program (Title V-B-1) received an appropriation of $256 million in the
Consolidated Appropriations Act, 2010 (P.L. 111-117). The Secretary was permitted to use up to $23 million of these
funds for the Per-Pupil Facilities Assistance program and the Credit Enhancement program. Statutory language also
specified that $10 million be reserved from the amount appropriated for the Charter School Program for national
activities.
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

Table 1. Program Appropriations for Charter School Program Activities Authorized
Under Title V-B-1 and 2 of the ESEA and Under H.R. 2218, as Reported
Program/Activity
Current Law
H.R. 2218, as Reported
Charter School Program
Initially, $200 million is provided for
All funds not otherwise reserved are
these activities. Half of any funds in
provided for this program.
excess of $300 million is also provided
National activities
for these activities. National activities
Up to 5% of total appropriation
may receive the greater of 5% of the
reserved for these activities.
amount appropriated for Title V-B-1
or $5 million but is capped at $8
million.
Per-Pupil Facilities Assistance
Initially, any funding in excess of $200
15% of total appropriation reserved
program
million but not greater than $300
for these activities. Funds must be
million is provided for this program.
used to support the Credit
Half of any funds in excess of $300
Enhancement program prior to being
million is also provided for this
used for the Per-Pupil Facilities
program.
Assistance program.
Credit Enhancement program
Separate authorization providing funds
for this program (Title V-B-2).
Source: Table prepared by CRS, September 2, 2011, based on CRS analysis of ESEA current law and H.R. 2218
as reported.
In addition to altering authorizations of appropriations, H.R. 2218 would also change the
percentage of funds that could be used for administration under the Charter School Program and
the Credit Enhancement program. These differences are depicted on Table 2.
Table 2. Set-Asides for Administrative Expenses for Charter School Program
Activities Authorized Under Title V-B-1 and 2 of the ESEA and Under H.R. 2218,
as Reported
Program/Activity
Current Law
H.R. 2218, as Reported
Charter School Program
Each SEA may reserve not more than
Each state entity may use up to 3% of
5% of grant funds for administrative
grant funds for administrative costs.
expenses.
Per-Pupil Facilities Assistance
Not included.a Not
included.a
program
Credit Enhancement program
0.25% for administrative costs.
2.5% for administrative costs.
Source: Table prepared by CRS, September 2, 2011, based on CRS analysis of ESEA current law and H.R. 2218
as reported.
a. Funds received by a state under this program may be used to establish or enhance, and administer, a per-
pupil facilities aid program for charter schools in the state.
H.R. 2218 also changes the structure of Title V-B-1 and 2. Table 3 summarizes these structural
changes.
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

Table 3. Overview of the Current Structure of ESEA Title V-B-1 and 2 and Proposed
Changes to This Structure Made by H.R. 2218
Current Law
H.R. 2218, as Reported
Comments
Subpart 1: Charter School

Programs
Section 5201: Purpose
Section 5201: Purpose
H.R. 2218 maintains many of the
current program purposes and
expands on the purpose of the
program.
Section 5202: Program
Section 5202: Program Authorized
H.R. 2218 changes the purposes for
Authorized
which grants can be made.
Section 5203: Applications
Section 5203: Grants to Support High-
H.R. 2218 makes substantial changes
Quality Charter Schools
to the grant program.
Section 5204: Administration
Section 5204: Facilities Financing
H.R. 2218 moves the Credit
Assistance
Enhancement program authorized
under Title V-B-2 and the majority of
its provisions to Section 5204. The bill
also moves the Per-Pupil Facilities Aid
program from Section 5205(b) to
Section 5204.
Section 5205: National Activities
Section 5205: National Activities
H.R. 2218 makes substantial changes
to the national activities to be
conducted.
Section 5206: Federal Formula
Section 5206: Federal Formula
No amendments.
Allocation During First Year and
Allocation During First Year and for
for Successive Enrollment
Successive Enrollment Expansions
Expansions
Section 5207: Solicitation of Input
Section 5207: Solicitation of Input
No amendments.
from Charter School Operators
from Charter School Operators
Section 5208: Records Transfer
Section 5208: Records Transfer
H.R. 2218 makes minor amendments
to this section.
Section 5209: Paperwork
Section 5209: Paperwork Reduction
No amendments.
Reduction
Section 5210: Definitions
Section 5210: Definitions
H.R. 2218 alters two existing
definitions and adds three new
definitions.
Section 5211: Authorization of
Section 5211: Authorization of
H.R. 2218 has a different authorization
Appropriations
Appropriations
of appropriations than current law.
Subpart 2: Credit
Repealed
H.R. 2218 repeals all of Title V-B-2.
Enhancement Initiatives to
However, the bill moves the Credit
Assist Charter School Facility
Enhancement program and the
Acquisition, Construction,
majority of its provisions to Section
and Renovation
5204.
Section 5221: Purpose
Repealed
H.R. 2218 does not retain a purpose
section for this program.
Section 5222: Grants to Eligible
Repealed
H.R. 2218 retains the majority of
Entities
these provisions in Section 5204.
Section 5223: Applications
Repealed
H.R. 2218 retains the majority of
these provisions in Section 5204.
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

Current Law
H.R. 2218, as Reported
Comments
Section 5224: Charter School
Repealed
H.R. 2218 retains the majority of
Objectives
these provisions in Section 5204.
Section 5225: Reserve Account
Repealed
H.R. 2218 retains the majority of
these provisions in Section 5204.
Section 5226: Limitation on
Repealed
H.R. 2218 retains the majority of
Administrative Costs
these provisions in Section 5204.
Section 5227: Audits and Reports
Repealed
H.R. 2218 retains the majority of
these provisions in Section 5204.
Section 5228: No Full Faith and
Repealed
H.R. 2218 retains the majority of
Credit for Grantee Obligation
these provisions in Section 5204.
Section 5229: Recovery of Funds
Repealed
H.R. 2218 retains the majority of
these provisions in Section 5204.
Section 5230: Definitions
Repealed
Due to the new structure of H.R.
2218, this section may no longer be
needed.
Section 5231: Authorization of
Repealed
Due to the new structure of H.R.
Appropriations
2218, this section may no longer be
needed.
Source: Table prepared by CRS, September 2, 2011, based on CRS analysis of ESEA current law and H.R. 2218
as reported.
Comparison of Provisions
This section examines the proposed statutory language included in H.R. 2218 compared with
current law (Table 4). Comments on differences between the two are provided; however, this
analysis is not intended to be comprehensive. Rather, it focuses on major provisions included in
H.R. 2218 and current law. Please note that the designation of “similar” in the table generally
indicates that there are some non-substantive differences between the proposed provisions and
current law, such as structural differences with respect to where the provisions appear in current
law versus H.R. 2218. Provisions are generally presented in the order in which they appear in
current law and are organized under the law’s current section headers.
Table 4. Comparison of Major Provisions in the Elementary and Secondary
Education Act (ESEA) Title V-B-1 and 2, and H.R. 2218
ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
This act may be cited as the
Short title of H.R. 2218.
‘‘Empowering Parents through Quality
Charter Schools Act’’.
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
Except as otherwise specifically
All changes made by H.R. 2218 are to
provided, whenever in this act a
the ESEA.
section or other provision is amended
or repealed, such amendment or
repeal shall be considered to be made
to that section or other provision of
the Elementary and Secondary
Education Act of 1965 (20 U.S.C.
6301 et seq.).
Subpart 1: Charter School

Programs
Section 5201: Purpose
Section 5201: Purpose

It is the purpose of this subpart to “It is the purpose of this subpart to—
H.R. 2218 retains several of the
increase national understanding of
program purposes from current law
the charter schools model by—
‘‘(1) provide financial assistance for
and adds two new purposes. First,
the planning, program design, and
H.R. 2218 drops the general
(1) providing financial assistance
initial implementation of charter
references to the program increasing
for the planning, program design,
schools;
national understanding of the charter
and initial implementation of
schools model. The bill retains the
charter schools;
‘‘(2) expand the number of high-
quality charter schools available to
focus on providing financial assistance
(2) evaluating the effects of such
students across the Nation;
for charter schools, expanding the
schools, including the effects on
number of charter schools, and
students, student academic
‘‘(3) evaluate the impact of such
encouraging states to provide facilities
achievement, staff, and parents;
schools on student achievement,
financing to charter schools.
families, and communities, and share
(3) expanding the number of high-
best practices between charter
Under current law, one purpose of
quality charter schools available to schools and other public schools;
the program is to evaluate the effects
students across the Nation; and
of charter schools on students,
‘‘(4) encourage States to provide
academic achievement, and parents.
(4) encouraging the States to
support to charter schools for
H.R. 2218 modifies this purpose to
provide support to charter
facilities financing in an amount more
evaluate the impact of charter schools
schools for facilities financing in an nearly commensurate to the amount
on student achievement, families, and
amount more nearly
the States have typically provided for
communities. It expands the
commensurate to the amount the
traditional public schools;
program’s purpose to include the
States have typically provided for
sharing of best practices with other
traditional public schools.
‘‘(5) improve student services to
increase opportunities for students
public schools.
with disabilities, English language
H.R. 2218 adds two new program
learners, and other traditionally
purposes. The first focuses on
underserved students to attend
improving student services to increase
charter schools and meet challenging
opportunities for traditionally
State academic achievement
underserved students to attend
standards; and
charter schools and meet state
‘‘(6) support efforts to strengthen the
academic standards. The second
charter school authorizing process to
focuses on strengthening the charter
improve performance management,
school authorizing process.
including transparency, monitoring,
and evaluation of such schools.’’.
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Section 5202: Program

Authorized
Not included. (Current law does
‘‘(a) IN GENERAL.—This subpart
H.R. 2218 adds additional language
not include a general statement
authorizes the Secretary to carry out
regarding the types of activities that
regarding all of the activities that
a charter school program that
can be supported through the charter
are authorized under Title V-B-1
supports charter schools that serve
school program overall. Most notably,
and 2.)
elementary school and secondary
the Secretary could award funds to
school students by—
support the replication and expansion
of charter schools. (Note: Statutory
‘‘(1) supporting the startup,
language permitting the use of Charter
replication, and expansion of charter
School Program funds for replication
schools;
and expansion has been included in
‘‘(2) assisting charter schools in
FY2010 and FY2011 appropriations
accessing credit to acquire and
language, but the ESEA has not been
renovate facilities for school use; and
amended to include these new uses of
funds.)a
‘‘(3) carrying out national activities to
support—
‘‘(A) charter school development;
‘‘(B) the dissemination of best
practices of charter schools for all
schools; and
‘‘(C) the evaluation of the impact of
the program on schools participating
in the program.
Not included.
‘‘(c) PRIOR GRANTS AND
H.R. 2218 includes a provision that
SUBGRANTS.—The recipient of a
would provide for the continuation of
grant or subgrant under this subpart,
grants made prior to the enactment of
as such subpart was in effect on the
H.R. 2218.
day before the date of enactment of
the Empowering Parents through
Quality Charter Schools Act, shall
continue to receive funds in
accordance with the terms and
conditions of such grant or subgrant.’’.
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(a) IN GENERAL.—The Secretary ‘‘(a) IN GENERAL.—From the
H.R. 2218 specifies that grants can be
may award grants to State
amount reserved under section
made to state entities (which include
educational agencies having
5202(b)(3), the Secretary shall award
more entities than just SEAs) to
applications approved pursuant to
grants to State entities having
award subgrants for new charter
section 5203 to enable such
applications approved pursuant to
schools, as well as for the replication
agencies to conduct a charter
subsection (e) to enable such entities
and expansion of high-quality charter
school grant program in
to—
schools. The bill also permits state
accordance with this subpart.
agencies to use funds to assist eligible
‘‘(1) award subgrants to eligible
applicants and chartering agencies
applicants for—
with the new charter schools,
‘‘(A) opening new charter schools;
replication, or expansion. It should be
noted that while replication and
‘‘(B) opening replicable, high-quality
expansion are not included in current
charter school models; or
law, funds have been provided for
‘‘(C) expanding high-quality charter
these purposes through
schools; and
appropriations acts (see, for example,
P.L. 111-117). H.R. 2218 also permits
‘‘(2) provide technical assistance
the state entity to use funds to work
(which may be provided by awarding
with charter authorizers to improve
subgrants to other entities) to eligible
the quality of charter authoring.
applicants and authorized public
chartering agencies in carrying out the
activities described in paragraph (1)
and work with authorized public
chartering agencies in the State to
improve the authorizing quality.
(b) SPECIAL RULE.—If a State
Not included.
H.R. 2218 does not include a
educational agency elects not to
provision that would permit eligible
participate in the program
applicants to apply directly to the
authorized by this subpart or does
Secretary for grants if the SEA chose
not have an application approved
not to apply for a grant. However,
under section 5203, the Secretary
under the national activities provisions
may award a grant to an eligible
included in H.R. 2218 (Section 5205),
applicant that serves such State
eligible applicants could apply for
and has an application approved
grants for start up, expansion, or
pursuant to section 5203(c).
replication.
(c) PROGRAM PERIODS.—
‘‘(1) PROGRAM PERIODS.—

(1) GRANTS TO STATES.—
‘‘(A) GRANTS.—A grant awarded by
H.R. 2218 extends the period of grant
Grants awarded to State
the Secretary to a State entity under
availability from not more than three
educational agencies under this
this section shall be for a period of
years to not more than five years for
subpart shall be for a period of
not more than 5 years.
state entities.
not more than 3 years.

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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(2) GRANTS TO ELIGIBLE
‘‘(B) SUBGRANTS.—A subgrant
H.R. 2218 extends the period of grant
APPLICANTS.—Grants awarded
awarded by a State entity to an eligible availability from not more than three
by the Secretary to eligible
applicant under this section shall be
years to not more than five years for
applicants or subgrants awarded
for a period of not more than 5 years,
eligible applicants. In addition, H.R.
by State educational agencies to
of which the eligible applicant may use
2218 only specifies the amount of
eligible applicants under this
not more than 18 months for planning
time funds may be used for a
subpart shall be for a period of
and program design.
particular activity for planning and
not more than 3 years, of which
program design.
the eligible applicant may use—
(A) not more than 18 months for
planning and program design;
(B) not more than 2 years for the
initial implementation of a charter
school; and
(C) not more than 2 years to
carry out dissemination activities
described in section 5204(f)(6)(B).
(d) LIMITATION.—A charter
‘‘(d) LIMITATIONS.—
Rather than placing limitations on the
school may not receive—
number of grants a charter school
‘‘(1) GRANTS.—A State entity may
may receive, H.R. 2218 places
(1) more than one grant for
not receive more than 1 grant under
limitations on the number of grants
activities described in
this section for a 5-year period.
that a state entity and eligible entity
subparagraphs (A) and (B) of
may receive. Under H.R. 2218, state
subsection (c)(2); or
‘‘(2) SUBGRANTS.—An eligible
applicant may not receive more than 1 entities are limited to one grant per
(2) more than one grant for
subgrant under this section per
five-year period. Eligible applicants are
activities under subparagraph (C)
charter school for a 5-year period.
limited to no more than one subgrant
of subsection (c)(2).
per charter school per five-year
period. Thus, an eligible applicant
could potentially receive multiple
awards during a five-year period,
provided that the awards were made
for different charter schools. A single
charter school that initially received a
grant to open, however, could not
receive a grant to expand within the
same five-year period.
(e) PRIORITY TREATMENT.—
Not included.
This general statement is not included
in H.R. 2218. H.R. 2218 does,
(1) IN GENERAL.—In awarding
however, include priority criteria for
grants under this subpart for fiscal
awarding grants to state entities (see
year 2002 or any succeeding fiscal
below).
year from any funds appropriated
under section 5211 (other than
funds reserved to carry out
section 5205(b)), the Secretary
shall give priority to States to the
extent that the States meet the
criteria described in paragraph (2)
and one or more of the criteria
described in subparagraph (A),
(B), or (C) of paragraph (3).
Congressional Research Service
10

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(2) REVIEW AND EVALUATION
Not included.
H.R. 2218 does not include priority
PRIORITY CRITERIA.—The
criteria based on the frequency with
criteria referred to in paragraph
which chartering agencies are
(1) are that the State provides for
required to review charter schools or
periodic review and evaluation by
on the specifics of that review.
the authorized public chartering
agency of each charter school, at
least once every 5 years unless
required more frequently by State
law, to determine whether the
charter school is meeting the
terms of the school’s charter, and
is meeting or exceeding the
student academic achievement
requirements and goals for
charter schools as set forth under
State law or the school’s charter.
(3) PRIORITY CRITERIA.—The
“(2) PRIORITY.—In awarding grants
Both current law and H.R. 2218
criteria referred to in paragraph
under this section, the Secretary shall
include priority criteria to be used by
(1) are the following:
give priority to State entities to the
the Secretary in selecting state entities
extent that they meet the following
for awards.
criteria:
(A) The State has demonstrated
Not included.
H.R. 2218 does not include this as a
progress, in increasing the
specific priority.
number of high-quality charter
schools that are held accountable
in the terms of the schools’
charters for meeting clear and
measurable objectives for the
educational progress of the
students attending the schools, in
the period prior to the period for
which a State educational agency
or eligible applicant applies for a
grant under this subpart.
Congressional Research Service
11

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(B) The State—
“(A) In the case in which a State entity Under current law, priority is given to
is located in a State that allows an
states that have at least one chartering
(i) provides for one authorized
entity other than the State educational agency that is not an LEA or, if LEAs
public chartering agency that is
agency to be an authorized public
are the only authorized chartering
not a local educational agency,
chartering agency or a State in which
agency, priority is given the states
such as a State chartering board,
only a local educational agency may be with an appeals process for denial of a
for each individual or entity
an authorized public chartering
charter school application. Under H.R.
seeking to operate a charter
agency, the State has an appeals
2218, if a state allows more than an
school pursuant to such State law; process for the denial of an
SEA or LEA to be an authorized
or
application for a charter school.
chartering agency, priority is given to
(ii) in the case of a State in which
a state that has a quality authorized
local educational agencies are the
chartering agency other than the SEA.
only authorized public chartering
The term “quality authorized
agencies, allows for an appeals
chartering agency”, however, is not
process for the denial of an
defined. This is a change in emphasis
application for a charter school.
from current law, which focuses on
having charter authorizers other than
LEAs. H.R. 2218 also gives priority to
states that have developed an appear
process for charter schools who have
had their applications denied.
(C) The State ensures that each
Not included.
H.R. 2218 does not include this as a
charter school has a high degree
specific priority. The issue of
of autonomy over the charter
autonomy is addressed elsewhere in
school’s budgets and
H.R. 2218.
expenditures.
Not included.
“(B) The State entity is located in a
H.R. 2218 includes a priority related
State that does not impose any
to limits on the number of charter
limitation on the number or
schools that can exist in a state or the
percentage of charter schools that
percentage of students that may
may exist or the number or
attend charter schools.
percentage of students that may
attend charter schools in the State.
Not included.
“(C) The State entity is located in a
H.R. 2218 includes a priority related
State that ensures equitable financing,
to the equitable financing of charter
as compared to traditional public
schools.
schools, for charter schools and
students in a prompt manner.
Not included.
“(D) The State entity supports full-,
H.R. 2218 includes a priority related
blended-, or hybrid-online charter
to online charter schools.
school models.
Not included.
“(E) The State entity is located in a
H.R. 2218 includes a priority related
State that uses charter schools and
to using charter schools to help
best practices from charter schools to
improve struggling schools and LEAs.
help improve struggling schools and
local educational agencies.
Not included.
“(F) The State entity partners with an
H.R. 2218 includes a priority related
organization that has a demonstrated
to partnering with an organization
record of success in developing
with demonstrated success in
management organizations to support
developing management organizations
the development of charter schools in
to support the development of
the State.
charter schools.
Congressional Research Service
12

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
“(G) The State entity demonstrates
H.R. 2218 includes a priority for state
quality policies and practices to
entities that have include the
support and monitor charter schools
monitoring of the proportion of high-
through factors, including--
quality charter schools in the state
and the rate of enrollment of
“(i) the proportion of high-quality
traditionally underserved populations
charter schools in the State; and
in charter schools compared with
“(ii) the proportion of charter schools
traditional public schools.
enrolling, at a rate similar to
traditional public schools, traditionally
underserved students, including
students with disabilities and English
language learners.
(f) AMOUNT CRITERIA.—In
Not included.
H.R. 2218 does not require the
determining the amount of a grant
Secretary to take into consideration
to be awarded under this subpart
the number of charter schools
to a State educational agency, the
operating or the number of charter
Secretary shall take into
schools approved to open when
consideration the number of
awarding grants to state entities.
charter schools that are
operating, or are approved to
open, in the State.
Section 5203: Applications

(a) APPLICATIONS FROM
“(e) APPLICATIONS.—A State entity
Similar, except that H.R. 2218 extends
STATE AGENCIES.—Each State
desiring to receive a grant under this
the eligibility of which state entities
educational agency desiring a
section shall submit an application to
may apply for a grant to include an
grant from the Secretary under
the Secretary at such time and in such
SEA, state charter school board, or
this subpart shall submit to the
manner as the Secretary may require.
the governor.
Secretary an application at such
The application shall include the
time, in such manner, and
following:
containing or accompanied by
such information as the Secretary

may require.
(b) CONTENTS OF A STATE

EDUCATIONAL AGENCY
APPLICATION.—
Each application submitted
pursuant to subsection (a) shall—
(1) describe the objectives of the
“(1) Description of Program.—A

State educational agency’s charter
description of the entity’s objectives in
school grant program and a
running a quality charter school
description of how such
program under this section and how
objectives will be fulfilled,
the objectives of such program will be
including steps taken by the State
carried out, including a description—
educational agency to inform
teachers, parents, and
“(A) of how the entity—
communities of the State
educational agency’s charter
school grant program; and
Congressional Research Service
13

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(2) describe how the State
“(iii) will work with eligible applicants
H.R. 2218 requires state entities to
educational agency—
to ensure that the applicants access all describe how they will work with
Federal funds that they are eligible to
eligible applicants to ensure that the
(A) will inform each charter
receive, and help the charter schools
applicants access all Federal funds that
school in the State regarding—
supported by the applicants and the
they are eligible to receive, rather
(i) Federal funds that the charter
students attending the charter
than informing charter schools about
school is eligible to receive; and
schools--
federal fund and program eligibility.
(ii) Federal programs in which the
“(I) participate in the Federal

charter school may participate;
programs in which the schools and
students are eligible to participate; and
(B) will ensure that each charter
“(II) receive the commensurate share
Current law requires SEAs to ensure
school in the State receives the
of Federal funds the schools and
that each charter school in the state
charter school’s commensurate
students are eligible to receive under
will receive its commensurate share of
share of Federal education funds
such programs;
federal education funding allocated by
that are allocated by formula each
formula, including during a school’s
year, including during the first
first year of operation. H.R. 2218 also
year of operation of the charter
requires state entities to address the
school; and
issue of commensurate funding in
their applications but focuses on
commensurate funding for both
charter schools and charter school
students and does not limit this to
formula grant funding only. H.R. 2218
does not include the current law
language about providing funds during
a charter school’s first year of
operation, but this is addressed in
Section 5206.
(C) will disseminate best or
“(ix) will share best and promising
H.R. 2218 also requires the sharing of
promising practices of charter
practices between charter schools and information about best and promising
schools to each local educational
other public schools;
practices, but focuses on the sharing
agency in the State; and
of information between charter
schools and other public schools
rather than between charter schools
and LEAs in the state.
Congressional Research Service
14

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
“(i) will support both new charter
H.R. 2218 also requires state entities
school startup and the expansion and
to address numerous other issues

replication of high-quality charter
during the application process, such as
school models;
how the entity will work with start
up, expansion, and replication charter
“(ii) will inform eligible charter
school models; how it will support
schools, developers, and authorized
efforts to increase quality initiatives
public chartering agencies of the
for charter schools; how a non-SEA
availability of funds under this
applicant will work with the SEA on
program;
charter school issues; and how the
“(iv) in the case in which the entity is
applicant will promote the inclusion of
not a State educational agency--
all students. It is unclear whether
supporting charter schools in LEAs
“(I) will work with the State
with large numbers of schools that
educational agency and the charter
have been identified for school
schools in the State to maximize
improvement, corrective action, or
charter school participation in Federal
restructuring would mean that the
and State programs for charter
entity would encourage schools
schools; and
required to implement restructuring
“(II) will work with the State
to choose to become charter schools.
educational agency to adequately
operate the entity's program under
this section, where applicable;
“(v) will ensure eligible applicants that
receive a subgrant under the entity's
program are prepared to continue to
operate the charter schools receiving
the subgrant funds once the funds
have expired;
“(vi) will support charter schools in
local educational agencies with large
numbers of schools that must comply
with the requirements of section
1116(b);
“(vii) will work with charter schools
to promote inclusion of all students
and support all students once they are
enrolled to promote retention;
“(viii) will work with charter schools
on recruitment practices, including
efforts to engage groups that may
otherwise have limited opportunities
to participate in charter schools;

“(x) will ensure the charter schools

they support can meet the educational
needs of their students, including
students with disabilities and English
language learners; and
`(xi) will support efforts to increase
quality initiatives, including meeting
the quality authorizing elements
described in paragraph (2)(E);

Congressional Research Service
15

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
“(B) of the extent to which the
H.R. 2218 requires state entities to
entity—
discuss the extent to which they can

meet priority selection criteria and
“(i) is able to meet and carry out the
the extent to which the entity is
priorities listed in subsection (f)(2);
working to develop a statewide
and
system to support charter school
“(ii) is working to develop or
development, expansion, and
strengthen a cohesive statewide
replication.
system to support the opening of new
charter schools and high-quality
replicable charter school models, and
expanding high-quality charter
schools;
Not included.
“(D) in the case of an entity that
For state entities that are partnering
partners with an outside organization
with an outside organization, the state
to carry out the entity's quality
entity must specify the responsibilities
charter school program, in whole or
of this organization in the application.
in part, of the roles and
responsibilities of this partner.
Congressional Research Service
16

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
“ (2) ASSURANCES- Assurances,
Current law does not require states
including a description of how the
to provide the assurances included in
assurances will be met, that--
H.R. 2218 in the application process.
However, some of these assurances
“ (A) each charter school receiving
may be addressed elsewhere in
funds under the entity's program will
current law. For example, charter
have a high degree of autonomy over
school autonomy is addressed in the
budget and operations;
priority criteria for selecting SEAs.
“ (B) the entity will support charter
One of the assurances requires that
schools in meeting the educational
each charter school that receives
needs of their students as described in funds from the entity have a high
paragraph (1)(A)(x);
degree of autonomy over budget and
`(C) the entity will ensure that the
operations. Under current law, this is
authorized public chartering agency of
addressed in the definition of a
any charter school that receives funds
charter school, which requires a
under the entity's program--
charter school to be exempted from
state and local rules that “inhibit the
“ (i) ensures that the charter school is
flexible operation and management”
meeting the obligations under this
of the school. H.R. 2218 is more
Act, part B of the Individuals with
specific about the type of autonomy
Disabilities Education Act, title VI of
that would have to be afforded to
the Civil Rights Act of 1964, and
charter schools. However, the bill
section 504 of the Rehabilitation Act
does not define “operations.” In
of 1973; and
addition, H.R. 2218 does not amend
“ (ii) adequately monitors and helps
the current definition of a charter
the schools in recruiting, enrolling,
school to include the specific
and meeting the needs of all students,
requirement for charter schools to
including students with disabilities and
receive a high degree of autonomy
English language learners;
over budget and operations.
“ (D) the entity will provide adequate

technical assistance to eligible
applicants to--
“ (i) meet the objectives described in
clauses (vii) and (viii) of paragraph
(1)(A) and paragraph (2)(B); and
“ (ii) enroll traditionally underserved
students, including students with
disabilities and English language
learners, to promote an inclusive
education environment;
“ (E) the entity will promote quality
authorizing, such as through providing
technical assistance, to support all
authorized public chartering agencies
in the State to improve the
monitoring of their charter schools,
including by--
“ (i) using annual performance data,
which may include graduation rates
and student growth data, as
appropriate, to measure the progress
of their schools toward becoming
high-quality charter schools; and
Congressional Research Service
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments

“ (ii) reviewing the schools'

independent, annual audits of financial
statements conducted in accordance
with generally accepted accounting
principles, and ensuring any such
audits are publically reported; and

“(F) the entity will work to ensure

that charter schools are included with
the traditional public school system in
decision-making about the public
school system in the State.
Not included.
“(3) Requests for waivers.—A request H.R. 2218 requires a state entity to
and justification for waivers of any
request and justify its request for
Federal statutory or regulatory
waivers of any federal statutory or
provisions that the entity believes are
regulatory provisions. The application
necessary for the successful operation
must also include a description of
of the charter schools that will receive state and local rules that generally
funds under the entity’s program
apply to public schools that will be
under this section, and a description
waived for charter schools. While
of any State or local rules, generally
current law does not address waivers
applicable to public schools, that will
in the state application process, it
be waived, or otherwise not apply to
does address this issue in
such schools.
requirements for eligible applicant
applications.
Congressional Research Service
18

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(3) contain assurances that the
“(C) how the entity will carry out the
Both current law and H.R. 2218
State educational agency will
subgrant competition, including--
require the eligible entity to provide
require each eligible applicant
information about the subgrant
desiring to receive a subgrant to
“(i) a description of the application
process. Current law requires eligible
submit an application to the State
each eligible applicant desiring to
entities to provide assurances that the
educational agency containing—
receive a subgrant will submit,
subgrant application will address
including--
numerous topics such as the
(A) a description of the
educational program of the school,
educational program to be
“(I) a description of the roles and
the management of the charter
implemented by the proposed
responsibilities of eligible applicants,
school, parent and community
charter school, including—
partner organizations, and
management organizations, including
involvement, and waiver requests.
(i) how the program will enable all the administrative and contractual
H.R. 2218 is not as specific regarding
students to meet challenging State roles and responsibilities; and
the information that must be collected
student academic achievement
through the application. It does
standards;
“(II) a description of the quality
require a description of the roles and
controls agreed to between the
responsibilities of the eligible applicant
(ii) the grade levels or ages of
eligible applicant and the authorized
and its partners, quality controls that
children to be served; and
public chartering agency involved, such will exist between the eligible
as a contract or performance
(iii) the curriculum and
applicant and the chartering agency,
agreement, and how a school's
instructional practices to be used;
how performance on the state’s
performance on the State's academic
accountability system will be a primary
(B) a description of how the
accountability system will be a primary charter renewal factor, and how
charter school will be managed;
factor for renewal; and
applications will be reviewed.
(C) a description of—
“(ii) a description of how the entity
With respect to the requirement that
will review applications; and
(i) the objectives of the charter
a school’s performance on the state’s
school; and
accountability system be used as a
primary factor in renewal decisions,
(ii) the methods by which the
while this is not a requirement in
charter school will determine its
current law, a similar requirement has
progress toward achieving those
been added through appropriations
objectives;
acts (see, for example, P.L. 111-117).
(D) a description of the
administrative relationship
between the charter school and
the authorized public chartering
agency;
(E) a description of how parents
and other members of the
community will be involved in the
planning, program design, and
implementation of the charter
school;
Congressional Research Service
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(F) a description of how the

authorized public chartering
agency will provide for continued
operation of the school once the
Federal grant has expired, if such
agency determines that the school
has met the objectives described
in subparagraph (C)(i);
(G) a request and justification for
waivers of any Federal statutory
or regulatory provisions that the
eligible applicant believes are
necessary for the successful
operation of the charter school,
and a description of any State or
local rules, generally applicable to
public schools, that will be waived
for, or otherwise not apply to, the
school;
(H) a description of how the

subgrant funds or grant funds, as
appropriate, will be used,
including a description of how
such funds will be used in
conjunction with other Federal
programs administered by the
Secretary;
(I) a description of how students
in the community will be—
(i) informed about the charter
school; and
(ii) given an equal opportunity to
attend the charter school;
(J) an assurance that the eligible
applicant will annually provide the
Secretary and the State
educational agency such
information as may be required to
determine if the charter school is
making satisfactory progress
toward achieving the objectives
described in subparagraph (C)(i);
Congressional Research Service
20

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(K) an assurance that the eligible

applicant will cooperate with the
Secretary and the State
educational agency in evaluating
the program assisted under this
subpart;
(L) a description of how a charter
school that is considered a local
educational agency under State
law, or a local educational agency
in which a charter school is
located, will comply with sections
613(a)(5) and 613(e)(1)(B) of the
Individuals with Disabilities
Education Act;
(M) if the eligible applicant desires
to use subgrant funds for
dissemination activities under
section 5202(c)(2)(C), a
description of those activities and
how those activities will involve
charter schools and other public
schools, local educational
agencies, developers, and
potential developers; and
(N) such other information and
assurances as the Secretary and
the State educational agency may
require.
(c) ELIGIBLE APPLICANT
Not included.
H.R. 2218 does not permit an eligible
APPLICATION.—Each eligible
applicant to apply directly for a grant
applicant desiring a grant pursuant
under this section. Eligible applicants,
to section 5202(b) shall submit an
however, may apply directly to the
application to the Secretary at
Secretary for a grant under provisions
such time, in such manner, and
included under National Activities
accompanied by such information
(Section 5205).
as the Secretary may reasonably
require.
Congressional Research Service
21

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(d) CONTENTS OF ELIGIBLE
Not included.
H.R. 2218 does not permit an eligible
APPLICANT APPLICATION.—
applicant to apply directly for a grant
Each application submitted
under this section. Eligible applicants,
pursuant to subsection (c) shall
however, may apply directly to the
contain—
Secretary for a grant under provisions
included under National Activities
(1) the information and
(Section 5205).
assurances described in
subparagraphs (A) through (N) of
subsection (b)(3), except that for
purposes of this subsection
subparagraphs (J), (K), and (N) of
such subsection shall be applied
by striking ‘‘and the State
educational agency’’ each place
such term appears;
(2) assurances that the State
educational agency—
(A) will grant, or will obtain,
waivers of State statutory or
regulatory requirements; and
(B) will assist each subgrantee in
the State in receiving a waiver
under section 5204(e); and
(3) assurances that the eligible
applicant has provided its
authorized public chartering
authority timely notice, and a
copy, of the application, except
that the State educational agency
(or the Secretary, in the case of
an application submitted to the
Secretary) may waive the
requirement of this paragraph in
the case of an application for a
precharter planning grant or
subgrant if the authorized public
chartering authority to which a
charter school proposal will be
submitted has not been
determined at the time the grant
or subgrant application is
submitted.
Section 5204: Administration

(a) SELECTION CRITERIA FOR
“(f) SELECTION CRITERIA; PRIORITY.—
Similar.
STATE EDUCATIONAL
AGENCIES.—
“(1) SELECTION CRITERIA.—The
Secretary shall award grants to State
The Secretary shall award grants
entities under this section on the basis
to State educational agencies
of the quality of the applications
under this subpart on the basis of
submitted under subsection (e), after
the quality of the applications
taking into consideration—
submitted under section 5203(b),
after taking into consideration

such factors as—
Congressional Research Service
22

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(1) the contribution that the
Not included.
H.R. 2218 does not include this as a
charter schools grant program
factor that must be taken into
will make to assisting
consideration when awarding grants
educationally disadvantaged and
to state entities.
other students in meeting State
academic content standards and
State student academic
achievement standards;
(2) the degree of flexibility
“(A) the degree of flexibility afforded
Similar, except that H.R. 2218
afforded by the State educational
by the State’s public charter school
requires evaluation of the state
agency to charter schools under
law and how the entity will work to
entity’s plan for maximizing charter
the State’s charter schools law;
maximize the flexibility provided to
school flexibility, in addition to
charter schools under the law;
considering the degree of flexibility
provided to charter schools.
(3) the ambitiousness of the
“(B) the ambitiousness of the State
Similar, except that H.R. 2218
objectives for the State charter
entity’s objectives for the quality
references “quality charter school
school grant program;
charter school program carried out
program.” This term is not defined.
under this section;
(4) the quality of the strategy for
“(C) the quality of the strategy for
Similar.
assessing achievement of those
assessing achievement of those
objectives;
objectives;
(5) the likelihood that the charter
“(D) the likelihood that the eligible
H.R. 2218 focuses on the likelihood of
school grant program will meet
applicants receiving subgrants under
the eligible applicant achieving
those objectives and improve
the program will meet those
objectives and improving educational
educational results for students;
objectives and improve educational
results for students, rather than
results for students;
whether the overall charter school
program does this.
(6) the number of high-quality
“(E) the proposed number of new
H.R. 2218 expands the categories of
charter schools created under this charter schools to be opened, and the
schools to reflect the new uses of
subpart in the State; and
number of high-quality charter schools funds with respect to expansion and
to be replicated or expanded under
replication of charter schools.
the program;
(7) in the case of State educational Not included.
This provision is Not included as H.R.
agencies that propose to use
2218 does not support dissemination
grant funds to support
activities at the local level.
dissemination activities under
subsection (f)(6)(B), the quality of
those activities and the likelihood
that those activities will improve
student academic achievement.
Not included.
“(F) the entity's plan to--
H.R. 2218 adds this factor for
consideration in awarding grants to
“(i) adequately monitor the eligible
state entities. It requires evaluation of
applicants receiving subgrants under
the state entity’s plan for monitoring
the entity's program; and
eligible applicants and for working
“(ii) work with the authorized public
with chartering agencies to avoid
chartering agencies involved to avoid
duplication of work for the charter
duplication of work for the charter
schools and chartering agencies.
schools and authorized public
chartering agencies;
Congressional Research Service
23

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
“(G) the entity's plan to provide
H.R. 2218 adds this factor for
adequate technical assistance, as
consideration in awarding grants to
described in the entity's application
state entities. It requires evaluation of
under subsection (e), for the eligible
the state entity’s plan for providing
applicants receiving subgrants under
technical assistance to eligible
the entity's program under this
applicants that received subgrants.
section; and
Not included.
“(H) the entity's plan to support
H.R. 2218 adds this factor for
quality authorizing efforts in the State,
consideration in awarding grants to
consistent with the objectives
state entities. It requires evaluation of
described in subparagraph (B).
the state entity’s plan to support
quality authorizing efforts. The term
“quality authoring efforts” is not
defined.
(b) SELECTION CRITERIA FOR
Not included.
H.R. 2218 does not permit an eligible
ELIGIBLE APPLICANTS.—The
applicant to apply directly for a grant
Secretary shall award grants to
under this section. Eligible applicants,
eligible applicants under this
however, may apply directly to the
subpart on the basis of the quality
Secretary for a grant under provisions
of the applications submitted
included under National Activities
under section 5203(c), after taking
(Section 5205).
into consideration such factors
as—
(1) the quality of the proposed
curriculum and instructional
practices;
(2) the degree of flexibility
afforded by the State educational
agency and, if applicable, the local
educational agency to the charter
school;
(3) the extent of community
support for the application;
(4) the ambitiousness of the
objectives for the charter school;
(5) the quality of the strategy for
assessing achievement of those
objectives;
(6) the likelihood that the charter
school will meet those objectives
and improve educational results
for students; and
(7) in the case of an eligible
applicant that proposes to use
grant funds to support
dissemination activities under
subsection (f)(6)(B), the quality of
those activities and the likelihood
that those activities will improve
student achievement.
Congressional Research Service
24

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(c) PEER REVIEW.—The
“(2) PEER REVIEW.—The Secretary, and
Similar.
Secretary, and each State
each State entity receiving a grant
educational agency receiving a
under this section, shall use a peer
grant under this subpart, shall use
review process to review applications
a peer review process to review
for assistance under this section.
applications for assistance under
this subpart.
(d) DIVERSITY OF PROJECTS.—
“(3) DIVERSITY OF PROJECTS.—Each
Similar, except that H.R. 2218 does
The Secretary and each State
State entity receiving a grant under
not include the Secretary, as the
educational agency receiving a
this section, shall award subgrants
Secretary does not make grants
grant under this subpart, shall
under this section in a manner that, to directly to eligible applicants under
award grants and subgrants under
the extent possible, ensures that such
this section.
this subpart in a manner that, to
subgrants—
the extent possible, ensures that
such grants and subgrants—
(1) are distributed throughout
“(A) are distributed throughout
Similar, except that H.R. 2218 drops
different areas of the Nation and
different areas, including urban,
the reference to the nation and each
each State, including urban and
suburban, and rural areas; and
state.
rural areas; and
(2) will assist charter schools
“(B) will assist charter schools
Similar, except that H.R. 2218 does
representing a variety of
representing a variety of educational
not specify class size reduction as an
educational approaches, such as
approaches.
educational approach.
approaches designed to reduce
school size.

(e) WAIVERS.—The Secretary
Not included.
Current law allows the Secretary to
may waive any statutory or
waive various statutory and regulatory
regulatory requirement over

requirements over which the
which the Secretary exercises

Secretary has authority if the waiver is
administrative authority except
requested on the application, and the
any such requirement relating to
Secretary determines the waiver
the elements of a charter school
promotes the purpose of the
described in section 5210(1), if—
program. H.R. 2218 does not include
a similar provision.
(1) the waiver is requested in an
approved application under this
subpart; and
(2) the Secretary determines that
granting such a waiver will
promote the purpose of this
subpart.
Congressional Research Service
25

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(f) USE OF FUNDS.—
“(b) STATE USES OF FUNDS.—
H.R. 2218 differs from current law
with respect to the required state
(1) STATE EDUCATIONAL
“(1) IN GENERAL.—A State entity
uses of funds. Under current law,
AGENCIES.—Each State
receiving a grant under this section
funds must be used to award
educational agency receiving a
shall—
subgrants to eligible applicants to
grant under this subpart shall use
enable them to implement a charter
such grant funds to award
“(A) use 90 percent of the grant funds
school, and SEAs may reserve up to
subgrants to one or more eligible
to award subgrants to eligible
10% of their grant funds for
applicants in the State to enable
applicants, in accordance with the
dissemination activities.
such applicant to plan and
quality charter school program
implement a charter school in
described in the entity's application
Under H.R. 2218, each state entity is
accordance with this subpart,
approved pursuant to subsection (f),
required to use 90% of the funds
except that the State educational
for the purposes described in
received to make subgrants to eligible
agency may reserve not more
subparagraphs (A) through (C) of
applicants for new charter schools;
than 10 percent of the grant funds subsection (a)(1); and
replicable, high-quality charter
to support dissemination
“(B) reserve 10 percent of such funds
schools; and the expansion of high-
activities described in paragraph
to carry out the activities described in
quality charter schools. The remaining
(6).
subsection (a)(2), of which not more
10% of funds must be used to provide
than 30 percent may be used for
technical assistance and to work with
administrative costs which may
chartering agencies to improve the
include technical assistance.
authorizing quality.
Not included.
“ (2) CONTRACTS AND GRANTS-
H.R. 2218 adds a provision that
A State entity may use a grant
permits the Secretary to carry out
received under this section to carry
national activities directly or through
out the activities described in
grants, contracts, or cooperative
subparagraphs (A) and (B) of
agreements.
paragraph (1) directly or through
grants, contracts, or cooperative
agreements.
(2) ELIGIBLE APPLICANTS.—
“(g) Local Uses of Funds- An eligible
H.R. 2218 modifies and expands the
Each eligible applicant receiving
applicant receiving a subgrant under
required uses of funds by eligible
funds from the Secretary or a
this section shall use such funds to
applicants. Under current law, eligible
State educational agency shall use
open new charter schools or
applicants are required to use funds to
such funds to plan and implement
replicable, high-quality charter school
plan and implement a charter school
a charter school, or to
models, or expand existing high-
or disseminate information about a
disseminate information about the quality charter schools.
successful charter school. Under H.R.
charter school and successful
2218, an eligible applicant must use
practices in the charter school, in

the funds to open new charter
accordance with this subpart.
schools and high-quality charter
school models that are replicable, or
expand existing high-quality charter
schools. Funds cannot be used by the
eligible applicant for dissemination
activities.
Congressional Research Service
26

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(3) ALLOWABLE ACTIVITIES.—
Not included.
H.R. 2218 does not specify allowable
An eligible applicant receiving a
activities for eligible applicants. Only
grant or subgrant under this
required activities are specified (see
subpart may use the grant or
above).
subgrant funds only for—
(A) post-award planning and
design of the educational
program, which may include—
(i) refinement of the desired
educational results and of the
methods for measuring progress
toward achieving those results;
and
(ii) professional development of
teachers and other staff who will
work in the charter school; and
(B) initial implementation of the
charter school, which may
include—
(i) informing the community about
the school;
(ii) acquiring necessary equipment
and educational materials and
supplies;
(iii) acquiring or developing
curriculum materials; and
(iv) other initial operational costs
that cannot be met from State or
local sources.
(4) ADMINISTRATIVE
“(2) ADMINISTRATIVE COSTS.—A State
H.R. 2218 limits the amount of funding
EXPENSES.—
entity receiving a grant under this
a state entity may use for
section may not use more than 30
administrative costs to 3% of the grant
(A) STATE EDUCATIONAL
percent of the funds reserved under
funds awarded to the state. Under
AGENCY ADMINISTRATIVE
paragraph (1)(B) for administrative
current law, the SEA may use up to
EXPENSES.—
costs, which may include providing the 5% of the grant amount for
Each State educational agency
technical assistance described in
administrative costs.
receiving a grant pursuant to this
subsection (a)(2).
subpart may reserve not more

than 5 percent of such grant funds
for administrative expenses
associated with the charter school
grant program assisted under this
subpart.
Congressional Research Service
27

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(B) LOCAL ADMINISTRATIVE
Not included.
H.R. 2218 does not include provisions
EXPENSES.—A local educational
regarding the use of funds for LEA
agency may not deduct funds for
administrative fees or expenses.
administrative fees or expenses
from a subgrant awarded to an
eligible applicant, unless the
eligible applicant enters voluntarily
into a mutually agreed upon
arrangement for administrative
services with the relevant local
educational agency. Absent such
approval, the local educational
agency shall distribute all such
subgrant funds to the eligible
applicant without delay.
(5) REVOLVING LOAN
Not included.
H.R. 2218 does not authorize SEAs to
FUNDS.—Each State educational
use funds to support a revolving loan
agency receiving a grant pursuant
fund.
to this subpart may reserve not
more than 10 percent of the grant
funds for the establishment of a
revolving loan fund. Such fund
may be used to make loans to
eligible applicants that have
received a subgrant under this
subpart, under such terms as may
be determined by the State
educational agency, for the initial
operation of the charter school
grant program of the eligible
applicant until such time as the
recipient begins receiving ongoing
operational support from State or
local financing sources.
Congressional Research Service
28

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(6) DISSEMINATION.—
Not included.
H.R. 2218 does not authorize grants
to charter schools specifically for
(A) IN GENERAL.—A charter
dissemination purposes.
school may apply for funds under
this subpart, whether or not the
charter school has applied for or
received funds under this subpart
for planning, program design, or
implementation, to carry out the
activities described in
subparagraph (B) if the charter
school has been in operation for
at least 3 consecutive years and
has demonstrated overall success,
including—
(i) substantial progress in
improving student academic
achievement;
(ii) high levels of parent
satisfaction; and
(iii) the management and
leadership necessary to overcome
initial start-up problems and
establish a thriving, financially
viable charter school.
Congressional Research Service
29

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(B) ACTIVITIES.—A charter
Not included.
H.R. 2218 does not authorize grants
school described in subparagraph
to charter schools specifically for
dissemination purposes.
(A) may use funds reserved under
paragraph (1) to assist other
schools in adapting the charter
school’s program (or certain
aspects of the charter school’s
program), or to disseminate
information about the charter
school, through such activities
as—
(i) assisting other individuals with
the planning and start-up of one
or more new public schools,
including charter schools, that are
independent of the assisting
charter school and the assisting
charter school’s developers, and
that agree to be held to at least as
high a level of accountability as
the assisting charter school;
(ii) developing partnerships with
other public schools, including
charter schools, designed to
improve student academic
achievement in each of the
schools participating in the
partnership;
(iii) developing curriculum
materials, assessments, and other
materials that promote increased
student achievement and are
based on successful practices
within the assisting charter
school; and
(iv) conducting evaluations and
developing materials that
document the successful practices
of the assisting charter school and
that are designed to improve
student performance in other
schools.
Congressional Research Service
30

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(g) TRIBALLY CONTROLLED
Not included.
H.R. 2218 does not include this
SCHOOLS.—Each State that
provision.
receives a grant under this
subpart and designates a tribally
controlled school as a charter
school shall not consider
payments to a school under the
Tribally Controlled Schools Act of
1988 (25 U.S.C. 2507) in
determining—
(1) the eligibility of the school to
receive any other Federal, State,
or local aid; or
(2) the amount of such aid.
Congressional Research Service
31

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
“(h) REPORTING REQUIREMENTS.—Each
H.R. 2218 adds new reporting
State entity receiving a grant under
requirements. Each state entity that
this section shall submit at the end of
receives a grant is required to submit
the third year of the 5-year grant
a report to the Secretary at the end
period and at the end of such grant
of the third year of a five-year grant
period a report to the Secretary on—
and at the end of the five-year grant
period. The report must address
“(1) the number of students served
issues such as the number of students
and, if applicable how many new
served, progress the entity met its
students were served during each year objectives, and how the state entity
of the grant period;
worked with authorized chartering
”(2) the number of subgrants awarded
agencies.
under this section to carry out each of
the following--
“(A) the opening of new charter
schools;
“(B) the opening of replicable, high-
quality charter school models; and
“(C) the expansion of high-quality
charter schools;
“(3) the progress the entity made
toward meeting the priorities
described in subsection (f)(2), as
applicable;
“(4) how the entity met the objectives
of the quality charter school program
described in the entity's application
under subsection (e);
“(5) how the entity complied with,
and ensured that eligible applicants
complied with, the assurances
described in the entity's application;
and
“(6) how the entity worked with
authorized public chartering agencies,
including how the agencies worked
with the management company or
leadership of the schools in which the
subgrants were awarded.
Not included.
“(i) STATE ENTITY DEFINED.—For
H.R. 2218 adds a new definition for
purposes of this section, the term
the purposes of Section 5203. The bill
‘State entity’ means—
defines a state entity as an SEA, state
charter school board, or a governor.
“(1) a State educational agency;
“(2) a State charter school board; or
“(3) a Governor of a State.”.
Section 5205: National

Activities
Congressional Research Service
32

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(a) IN GENERAL.—The Secretary “(b) Funding Allotment.—From the
Under current law, the Secretary is
shall reserve for each fiscal year
amount made available under section
permitted to reserve the greater of
the greater of 5 percent or
5211 for a fiscal year, the Secretary
5% or $5 million for national activities,
$5,000,000 of the amount
shall—
provided the amount reserved does
appropriated to carry out this
not exceed $8 million. H.R. 2218
subpart, except that in no fiscal
“(2) reserve not more than 5 percent
removes the minimum dollar amount
year shall the total amount so
to carry out national activities under
for national activities and eliminates
reserved exceed $8,000,000, to
section 5205;
the cap on the amount that can be
carry out the following activities:
“(a) I
used for this purpose.
N GENERAL.—From the amount
(1) To provide charter schools,
reserved under section 5202(b)(2),
H.R. 2218 requires the Secretary to
either directly or through State
the Secretary shall—
use at least 50% of the funds reserved
educational agencies, with—
for national activities to award startup
“(1) use not less than 50 percent of
grants to eligible applicants. This is not
(A) information regarding—
such funds to award startup grants in
a required use of funds under current
(i) Federal funds that charter
accordance with subsection (b); and
law. Under current law, eligible
schools are eligible to receive; and
applicants are able to apply directly
“(2) use the remainder of such funds
for grants to implement a charter
(ii) other Federal programs in
to—
school under Section 5203.
which charter schools may
participate; and
“(A) disseminate technical assistance
Under H.R. 2218, any remaining funds
to State entities in awarding subgrants
after the provision of startup grants
(B) assistance in applying for
under section 5203;
must be used to disseminate technical
Federal education funds that are
assistance to state entities in awarding
allocated by formula, including
“(C) evaluate the impact of the
subgrants under Section 5203,
assistance with filing deadlines and
charter school program carried out
disseminate best practices, and
submission of applications.
under this subpart.
evaluate the impact of the charter

school program overall (including the
Per-Pupil Facilities Aid program and
the Credit Enhancement program).
Current law requires funds to be used
for similar purposes, but also specifies
additional uses of funds such as
providing information to charter
schools about federal funds for which
they are eligible, the collection of
information regarding the financial
resources available to charter schools,
and specific data that must be
collected through evaluations.
(2) To provide for other
Not included.
H.R. 2218 requires the Secretary to
evaluations or studies that include
evaluate the impact of the charter
the evaluation of the impact of
school program (see above). It does
charter schools on student
not require a general evaluation of the
academic achievement, including
effects of charter schools generally on
information regarding—
academic achievement nor does it
specify what must be examined in the
(A) students attending charter
evaluation.
schools reported on the basis of
race, age, disability, gender,
limited English proficiency, and
previous enrollment in public
school; and
(B) the professional qualifications
of teachers within a charter
school and the turnover of the
teaching force.
Congressional Research Service
33

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(3) To provide—
“(B) disseminate best practices; and
H.R. 2218 requires the dissemination
of best practices under national
(A) information to applicants for
activities as does current law. The bill
assistance under this subpart;
does not specify to which entities
(B) assistance to applicants for
information should be disseminated.
assistance under this subpart with
H.R. 2218 requires the Secretary to
the preparation of applications
provide technical assistance to state
under section 5203;
entities in awarding subgrants (see
above) but does not address the types
(C) assistance in the planning and
of assistance included in this provision
startup of charter schools;
of current law.
(D) training and technical
assistance to existing charter
schools; and
(E) for the dissemination to other
public schools of best or
promising practices in charter
schools.
(4) To provide (including through
Not included.
H.R. 2218 does not include this
the use of one or more contracts
provision.
that use a competitive bidding
process) for the collection of
information regarding the financial
resources available to charter
schools, including access to
private capital, and to widely
disseminate to charter schools
any such relevant information and
model descriptions of successful
programs.
Congressional Research Service
34

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(5) To carry out evaluations of,
Not included.
H.R. 2218 does not include the
technical assistance for, and
evaluation of or the provision of
information dissemination
technical assistance for the Per-Pupil
regarding, the Per-Pupil Facilities
Facilities Aid program under national
Aid program. In carrying out the
activities. This is possibly due, in part,
evaluations, the Secretary may
to structural changes that H.R. 2218
carry out one or more
makes to Title V-B-1. Under current
evaluations of State programs
law, the Per-Pupil Facilities Aid
assisted under this subsection,
program is authorized under national
which shall, at a minimum,
activities (Section 5205(b)). Under
address—
H.R. 2218, it would be authorized
under facilities financing assistance
(A) how, and the extent to which,
(Section 5204). H.R. 2218 would
the programs promote
continue to allow states to reserve up
educational equity and excellence;
to 5% of the funds they receive
and
through the Per-Pupil Facilities Aid
(B) the extent to which charter
program for evaluation, technical
schools supported through the
assistance, and dissemination.
programs are—
(i) held accountable to the public;
(ii) effective in improving public
education; and
(iii) open and accessible to all
students.
Current law provides for eligible
“(b) Startup grants.—
H.R. 2218 adds a new use of funds
applicants to apply directly for
under national activities to provide
grants to open charter schools
“(1) IN GENERAL- The Secretary
startup grants directly to eligible
under Section 5203.
shall make grants, on a competitive
applicants.
basis, to eligible applicants for the
purpose of carrying out the activities
described in section 5202(a)(1),
subparagraphs (A) through (C) of
section 5203(a)(1), and section
5203(g).
“(2) TERMS AND CONDITIONS-
Except as otherwise provided in this
subsection, grants awarded under this
subsection shall have the same terms
and conditions as grants awarded to
State entities under section 5203.
Congressional Research Service
35

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments

“(3) Eligible applicant defined.—For
H.R. 2218 adds a definition of an
purposes of this subsection, the term
eligible applicant for the purposes of
‘eligible applicant’ means an eligible
awarding startup grants. An eligible
applicant that desires to open a
applicant has to be located in a state
charter school in—
that did not apply for or did not
receive a grant under Section 5203, or
“(A) a State that did not apply for a
must be located in state that is in its
grant under section 5203;
fourth or fifth year of a grant period
“(B) a State that did not receive a
for a grant awarded under Section
grant under section 5203; or
5203. Presumably, this grant
competition would need to be
“(C) a State that received a grant
administered after grants are awarded
under section 5203 and is in the 4th or under section 5203, so that eligible
5th year of a grant period for such
applicants would know whether they
grant.
are able to meet the eligibility criteria.

Not included.
“(c) CONTRACTS AND GRANTS.—
H.R. 2218 adds a provision that
Contracts and Grants- The Secretary
permits the Secretary to carry out
may carry out any of the activities
national activities directly or through
described in this section directly or
grants, contracts, or cooperative
through grants, contracts, or
agreements.
cooperative agreements.”.

(b) PER-PUPIL FACILITIES AID
H.R. 2218 retains this program but
Similar.
PROGRAM.—
moves it to a new Section 5204,
Facilities Financing Assistance.
(1) DEFINITION OF PER-PUPIL
‘‘(1) DEFINITION OF PER-PUPIL
Similar.
FACILITIES AID PROGRAM.—In
FACILITIES AID PROGRAM..—In this
this subsection, the term ‘‘Per-
subsection, the term ‘per-pupil
Pupil Facilities Aid program’’
facilities aid program’ means a
means a program in which a State
program in which a State makes
makes payments, on a per pupil
payments, on a per-pupil basis, to
basis, to charter schools to
charter schools to provide the schools
provide the schools with
with financing—
financing—
‘‘(A) that is dedicated solely for
funding charter school facilities; or
(A) that is dedicated solely for
‘‘(B) a portion of which is dedicated
funding charter school facilities; or for funding charter school facilities.
(B) a portion of which is
dedicated for funding charter
school facilities.
Congressional Research Service
36

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(2) GRANTS.—
‘‘(2) GRANTS.—
Similar, except that funding for the
Per-Pupil Facilities Aid program is
(A) IN GENERAL.—From the
‘‘(A) IN GENERAL.—From the
provided through a reservation of
amount made available to carry
amount reserved under section
funds under H.R. 2218 and through a
out this subsection under
5202(b)(1) remaining after the
set-aside under current law. In
paragraphs (2) and (3)(B) of
Secretary makes grants under
addition, in Section 5204, H.R. 2218
section 5211(b) for any fiscal year, subsection (a), the Secretary shall
prioritizes funding for the Credit
the Secretary shall make grants,
make grants, on a competitive basis,
Enhancement program over funding
on a competitive basis, to States
to States to pay for the Federal share
for the Per-Pupil Facilities Aid
to pay for the Federal share of the of the cost of establishing or
program by requiring funds reserved
cost of establishing or enhancing,
enhancing, and administering the Per-
for this section to be used first to
and administering Per-Pupil
Pupil Facilities Aid program.
make grants under the Credit
Facilities Aid program.
Enhancement program. If funds remain
after making these grants, remaining
funds are to be used for the Per-Pupil
Facilities Aid program. This
prioritization does not occur under
current law.
(B) PERIOD.—The Secretary shall ‘‘(B) PERIOD.—The Secretary shall
Similar.
award grants under this
award grants under this subsection for
subsection for periods of not
periods of not more than 5 years.
more than 5 years.
(C) FEDERAL SHARE.—The
‘‘(C) FEDERAL SHARE.—The Federal
Similar.
Federal share of the cost
share of the cost described in
described in subparagraph (A) for
subparagraph (A) for a Per-Pupil
a Per-Pupil Facilities Aid program
Facilities Aid program shall be not
shall be not more than—
more than—
(i) 90 percent of the cost, for the
‘‘(i) 90 percent of the cost, for the
first fiscal year for which the
first fiscal year for which the program
program receives assistance under receives assistance under this
this subsection;
subsection;
(ii) 80 percent in the second such
‘‘(ii) 80 percent in the second such
year;
year;
(iii) 60 percent in the third such
‘‘(iii) 60 percent in the third such year;
year;
‘‘(iv) 40 percent in the fourth such
(iv) 40 percent in the fourth such
year; and
year; and
‘‘(v) 20 percent in the fifth such year.
(v) 20 percent in the fifth such
year.
Not included.
‘‘(D) STATE SHARE.—A State
H.R. 2218 adds a new provision to
receiving a grant under this subsection allow states to partner with one or
may partner with 1 or more
more organizations to provide up to
organizations to provide up to 50
50% of the state’s share of the
percent of the State share of the cost
program.
of establishing or enhancing, and
administering per pupil facilities aid
program.

Congressional Research Service
37

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
‘‘(E) MULTIPLE GRANTS.—A State
H.R. 2218 adds a new provision that
may receive more than 1 grant under
permits states to receive more than
this subsection, so long as the amount
one grant under this program as long
of such funds provided to charter
as amount of funding provided to
schools increases with each
charter schools increases with each
successive grant.
successive grant.
(3) USE OF FUNDS.—
‘‘(3) USE OF FUNDS.—

(A) IN GENERAL.—A State that
‘‘(A) IN GENERAL.—A State that
Similar.
receives a grant under this
receives a grant under this subsection
subsection shall use the funds
shall use the funds made available
made available through the grant
through the grant to establish or
to establish or enhance, and
enhance, and administer, a per-pupil
administer, a per pupil facilities aid facilities aid program for charter
program for charter schools in
schools in the State of the applicant.
the State.
(B) EVALUATIONS; TECHNICAL ‘‘(B) EVALUATIONS; TECHNICAL
Similar.
ASSISTANCE;
ASSISTANCE; DISSEMINATION.—
DISSEMINATION.—From the
From the amount made available to a
amount made available to a State
State through a grant under this
through a grant under this
subsection for a fiscal year, the State
subsection for a fiscal year, the
may reserve not more than 5 percent
State may reserve not more than
to carry out evaluations, to provide
5 percent to carry out
technical assistance, and to
evaluations, to provide technical
disseminate information.
assistance, and to disseminate
information.
(C) SUPPLEMENT, NOT
‘‘(C) SUPPLEMENT, NOT
Similar.
SUPPLANT.—Funds made
SUPPLANT..—Funds made available
available under this subsection
under this subsection shall be used to
shall be used to supplement, and
supplement, and not supplant, State,
not supplant, State and local
and local public funds expended to
public funds expended to provide
provide per pupil facilities aid
per pupil facilities aid programs,
programs, operations financing
operations financing programs, or
programs, or other programs, for
other programs, for charter
charter schools.
schools.
(4) REQUIREMENTS.—
‘‘(4) REQUIREMENTS.—

(A) VOLUNTARY
‘‘(A) VOLUNTARY
Similar.
PARTICIPATION.—No State may PARTICIPATION.—No State may be
be required to participate in a
required to participate in a program
program carried out under this
carried out under this subsection.
subsection.
Congressional Research Service
38

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(B) STATE LAW.—To be eligible
‘‘(B) STATE LAW.—
Similar.
to receive a grant under this
subsection, a State shall establish
‘‘(i) IN GENERAL.—To be eligible to
or enhance, and administer, a Per-
receive a grant under this subsection,
Pupil Facilities Aid program for
a State shall establish or enhance, and
charter schools in the State,
administer, a Per-Pupil Facilities Aid
that—
program for charter schools in the
State, that—
(i) is specified in State law; and
‘‘(I) is specified in State law; and
(ii) provides annual financing, on a
per-pupil basis, for charter school
‘‘(II) provides annual financing, on a
facilities.
per-pupil basis, for charter school
facilities.
Not included.
‘‘(ii) SPECIAL RULE.—A State that is
H.R. 2218 specifies that states that are
required under State law to provide
required to provide their charter
its charter schools with access to
schools with adequate facility space
adequate facility space may be eligible
may be eligible for funds, if the state
to receive a grant under this
agrees to use the funds to develop a
subsection if the State agrees to use
program consistent with the
the funds to develop a per pupil
requirements of the Per-Pupil
facilities aid program consistent with
Facilities Aid program.
the requirements of this subsection.
(5) APPLICATIONS.—To be
‘‘(5) APPLICATIONS.—To be eligible
Similar.
eligible to receive a grant under
to receive a grant under this
this subsection, a State shall
subsection, a State shall submit an
submit an application to the
application to the Secretary at such
Secretary at such time, in such
time, in such manner, and containing
manner, and containing such
such information as the Secretary may
information as the Secretary may
require.’’.
require.
(6) PRIORITIES.—In making
Not included.
H.R. 2218 does not specify priority
grants under this subsection, the
criteria for making grants under this
Secretary shall give priority to
program.
States that meet the criteria
described in paragraph (2), and
subparagraphs (A), (B), and (C) of
paragraph (3), of section 5202(e).
(c) RULE OF
Not included.
Due to the different construction of
CONSTRUCTION.—Nothing in
H.R. 2218, this provision may not be
this section shall be construed to
needed. (Under current law, this
require charter schools to collect
provision specifies that charter
any data described in subsection
schools do not have to collect the
(a).
data the Secretary is required to
collect under national activities.)
Section 5206: Federal
This section is not amended by H.R.

Formula Allocation During
2218.
First Year and For Successive
Enrollment Expansions
Congressional Research Service
39

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(a) IN GENERAL.—For purposes

of the allocation to schools by the
States or their agencies of funds
under part A of title I, and any
other Federal funds which the
Secretary allocates to States on a
formula basis, the Secretary and
each State educational agency
shall take such measures as are
necessary to ensure that every
charter school receives the
Federal funding for which the
charter school is eligible not later
than 5 months after the charter
school first opens,
notwithstanding the fact that the
identity and characteristics of the
students enrolling in that charter
school are not fully and
completely determined until that
charter school actually opens. The
measures similarly shall ensure
that every charter school
expanding its enrollment in any
subsequent year of operation
receives the Federal funding for
which the charter school is
eligible not later than 5 months
after such expansion.
Congressional Research Service
40

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(b) ADJUSTMENT AND LATE

OPENINGS.—
(1) IN GENERAL.—The measures
described in subsection (a) shall
include provision for appropriate
adjustments, through recovery of
funds or reduction of payments
for the succeeding year, in cases
where payments made to a
charter school on the basis of
estimated or projected
enrollment data exceed the
amounts that the school is eligible
to receive on the basis of actual
or final enrollment data.
(2) RULE.—For charter schools
that first open after November 1
of any academic year, the State, in
accordance with guidance
provided by the Secretary and
applicable Federal statutes and
regulations, shall ensure that such
charter schools that are eligible
for the funds described in
subsection (a) for such academic
year have a full and fair
opportunity to receive those
funds during the charter schools’
first year of operation.
Section 5207: Solicitation of
This section is not amended by H.R.

Input from Charter School
2218.
Operators
To the extent practicable, the

Secretary shall ensure that
administrators, teachers, and
other individuals directly involved
in the operation of charter
schools are consulted in the
development of any rules or
regulations required to implement
this subpart, as well as in the
development of any rules or
regulations relevant to charter
schools that are required to
implement part A of title I, the
Individuals with Disabilities
Education Act, or any other
program administered by the
Secretary that provides education
funds to charter schools or
regulates the activities of charter
schools.
Congressional Research Service
41

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Section 5208: Records

Transfer
State educational agencies and
Section 5208 (20 U.S.C. 7221g) is
H.R. 2218 puts increased emphasis on
local educational agencies, to the
amended—
the need to transfer student records
extent practicable, shall ensure
between charter schools and other
that a student’s records and, if
(1) by inserting ‘‘as quickly as possible
public schools as quickly as possible.
applicable, a student’s
and’’ before ‘‘to the extent
H.R. 2218 also changes the specific
individualized education program
practicable’’; and
reference to individualized education
as defined in section 602 of the
(2) by striking ‘‘section 602’’ and
programs (IEPs) in the Individuals with
Individuals with Disabilities
inserting ‘‘section 602(14)’’.
Disabilities Education Act (IDEA).
Education Act, are transferred to
a charter school upon the transfer
of the student to the charter
school, and to another public
school upon the transfer of the
student from a charter school to
another public school, in
accordance with applicable State
law.
Section 5209: Paperwork
This section is not amended by H.R.

Reduction
2218.
To the extent practicable, the

Secretary and each authorized
public chartering agency shall
ensure that implementation of this
subpart results in a minimum of
paperwork for any eligible
applicant or charter school.
Congressional Research Service
42

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Section 5210: Definitions

(1) CHARTER SCHOOL.—The
(1) in paragraph (1)—
H.R. 2218 adds an additional provision
term ‘‘charter school’’ means a
to the definition of a charter school
public school that—
(A) by striking ‘‘and’’ at the end of
stating that charter schools may serve
subparagraph (K);
students in prekindergarten or
(A) in accordance with a specific
postsecondary education.
State statute authorizing the
(B) by striking the period at the end of
granting of charters to schools, is
subparagraph (L) and inserting ‘‘; and’’;
exempt from significant State or
and
local rules that inhibit the flexible
(C) by adding at the end, the
operation and management of
following: ‘‘(M) may serve
public schools, but not from any
prekindergarten or postsecondary
rules relating to the other
students.’’;
requirements of this paragraph;
(B) is created by a developer as a
public school, or is adapted by a
developer from an existing public
school, and is operated under
public supervision and direction;
(C) operates in pursuit of a
specific set of educational
objectives determined by the
school’s developer and agreed to
by the authorized public
chartering agency;
(D) provides a program of
elementary or secondary
education, or both;
(E) is nonsectarian in its
programs, admissions policies,
employment practices, and all
other operations, and is not
affiliated with a sectarian school
or religious institution;
(F) does not charge tuition;
(G) complies with the Age
Discrimination Act of 1975, title
VI of the Civil Rights Act of 1964,
title IX of the Education
Amendments of 1972, section 504
of the Rehabilitation Act of 1973,
and part B of the Individuals with
Disabilities Education Act;
Congressional Research Service
43

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(H) is a school to which parents

choose to send their children, and
that admits students on the basis
of a lottery, if more students
apply for admission than can be
accommodated;
(I) agrees to comply with the
same Federal and State audit
requirements as do other
elementary schools and secondary
schools in the State, unless such
requirements are specifically
waived for the purpose of this
program;
(J) meets all applicable Federal,
State, and local health and safety
requirements;
(K) operates in accordance with
State law; and
(L) has a written performance
contract with the authorized
public chartering agency in the
State that includes a description
of how student performance will
be measured in charter schools
pursuant to State assessments
that are required of other schools
and pursuant to any other
assessments mutually agreeable to
the authorized public chartering
agency and the charter school.
(2) DEVELOPER.—The term
No amendments.

‘‘developer’’ means an individual
or group of individuals (including a
public or private nonprofit
organization), which may include
teachers, administrators and
other school staff, parents, or
other members of the local
community in which a charter
school project will be carried out.
(3) ELIGIBLE APPLICANT.—The
(2) in paragraph (3), by striking ‘‘under H.R. 2218 eliminates the reference to
term ‘‘eligible applicant’’ means a
section 5203(d)(3)’’;
Section 5203(d)(3), as it refers to the
developer that has—
contents of an eligible applicant
application under the Charter School
(A) applied to an authorized
Program. H.R. 2218 does not permit
public chartering authority to
an eligible applicant to apply directly
operate a charter school; and
for a grant under this section.
(B) provided adequate and timely
notice to that authority under
section 5203(d)(3).
Congressional Research Service
44

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(4) AUTHORIZED PUBLIC
No amendments.

CHARTERING AGENCY.—The
term ‘‘authorized public
chartering agency’’ means a State
educational agency, local
educational agency, or other
public entity that has the authority
pursuant to State law and
approved by the Secretary to
authorize or approve a charter
school.
Not included.
‘‘(5) EXPANSION OF A HIGH-
As H.R. 2218 expands the uses of
QUALITY CHARTER
funds under Section 5203 to include
the expansion of high-quality charter
SCHOOL.—The term ‘expansion of a
schools, a new definition of “high-
high-quality charter school’ means a
quality charter school” has been
high-quality charter school that either
added.
significantly increases its enrollment
or adds one or more grades to its
school.
Not included.
‘‘(6) HIGH-QUALITY CHARTER
While this term is used in current law,
SCHOOL.—The term ‘high-quality
it is not defined. H.R. 2218 adds a
charter school’ means a charter
definition of a “high-quality charter
school that—
school” that emphasizes student
achievement.
‘‘(A) shows evidence of strong
academic results, which may include
strong academic growth as
determined by a State;
‘‘(B) has no significant issues in the
areas of student safety, financial
management, or statutory or
regulatory compliance;
‘‘(C) has demonstrated success in
significantly increasing student
academic achievement and attainment
for all students served by charter
schools; and
‘‘(D) has demonstrated success in
increasing student academic
achievement for the subgroups of
students described in section
1111(b)(2)(C)(v)(II).’’.
Congressional Research Service
45

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Not included.
‘‘(7) REPLICABLE CHARTER
As H.R. 2218 expands the uses of
SCHOOL MODEL.—
funds under Section 5203 to include
the replication of charter school
The term ‘replicable charter school
models, and adds a new definition of
model’ means a high-quality charter
“replicable charter school model”.
school that will open a new campus
Depending on how a charter
under an existing charter.
authorizer handles the chartering
process, it may not be possible for a
charter school to replicate under an
existing charter. For example, if the
school plans to open a new campus
some distance from an existing
campus, it is possible that the school
may be required to seek a new
charter. In addition, if the goal is to
support the replication of successful
charter models, such as KIPP, this
provision may result only in local
replication of these models.
Section 5211: Authorization

of Appropriations
(a) IN GENERAL.—There are
‘‘There are authorized to be
H.R. 2218 authorizes appropriations
authorized to be appropriated to
appropriated to carry out this subpart
for all three charter school programs.
carry out this subpart
$300,000,000 for fiscal year 2012 and
From FY2012 through FY2017, the
$300,000,000 for fiscal year 2002
each of the succeeding 5 fiscal years.’’.
authorization is $300 million for each
and such sums as may be
fiscal year.
necessary for each of the 5
succeeding fiscal years.
(b) RESERVATION.—From the
‘‘(b) FUNDING ALLOTMENT.—
H.R. 2218 adds new reservations of
amount appropriated under
From the amount made available
funds for the charter school program.
subsection
under section 5211 for a fiscal year,
Under current law, funds for Per-Pupil
the Secretary shall—
Facilities Aid are provided under
(a) for each fiscal year, the
national activities. Grants for Credit
Secretary shall reserve—
‘‘(1) reserve 15 percent to support
Enhancement are provided for under
charter school facilities assistance
(1) $200,000,000 to carry out this
Title V-B-2.
under section 5204;
subpart, other than section
Under current law, the Secretary is
5205(b); and
‘‘(2) reserve not more than 5 percent
permitted to reserve the greater of
to carry out national activities under
(2) any funds in excess of
5% or $5 million for national activities,
section 5205; and
$200,000,000, that do not exceed
provided the amount reserved does
$300,000,000, to carry out
‘(3) use the remaining amount after
not exceed $8 million. H.R. 2218
section 5205(b); and
the Secretary reserves funds under
removes the minimum dollar amount
paragraphs (1) and (2) to carry out
for national activities and eliminates
(3)(A) 50 percent of any funds in
section 5203.
the cap on the amount that can be
excess of $300,000,000 to carry
used for this purpose.
out this subpart, other than

section 5205(b); and
H.R. 2218 states that all remaining
funds after reservations shall be used
(B) 50 percent of any funds in
to provide Grants to Support High-
excess of $300,000,000 to carry
Quality Charter Schools.
out section 5205(b).
Congressional Research Service
46

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
Subpart 2: Credit
H.R. 2218 repeals Subpart 2.

Enhancement Program
However, it includes the Credit
Enhancement Program as
Section 5204. For the purposes of
this report, the provisions
included in H.R. 2218 continue to
be aligned with how the Credit
Enhancement program
provisions appear in current law.
Section 5221: Purpose

The purpose of this subpart is to
Not included,
H.R. 2218 does not include a
provide grants to eligible entities
“purposes” section for the Credit
to permit the eligible entities to
Enhancement program.
demonstrate innovative credit
enhancement initiatives that assist
charter schools to address the
cost of acquiring, constructing,
and renovating facilities.
Section 5222: Grants to

Eligible Entities
(a) GRANTS.—The Secretary
‘‘(a) GRANTS TO ELIGIBLE
Similar.
shall use 100 percent of the
ENTITIES.—
amount available to carry out this
subpart to award not less than
‘‘(1) IN GENERAL.—From the
three grants to eligible entities
amount reserved under section
that have applications approved
5202(b)(1), the Secretary shall award
under this subpart to
not less than 3 grants to eligible
demonstrate innovative methods
entities that have applications
of assisting charter schools to
approved under subsection (d) to
address the cost of acquiring,
demonstrate innovative methods of
constructing, and renovating
assisting charter schools to address
facilities by enhancing the
the cost of acquiring, constructing,
availability of loans or bond
and renovating facilities by enhancing
financing.
the availability of loans or bond
financing.
(b) GRANTEE SELECTION.—
‘‘(b) GRANTEE SELECTION.—
Similar.
(1) EVALUATION OF
‘‘(1) EVALUATION OF

APPLICATION.—The Secretary
APPLICATION.—The Secretary shall
shall evaluate each application
evaluate each application submitted
submitted under section 5223,
under subsection (d), and shall
and shall determine whether the
determine whether the application is
application is sufficient to merit
sufficient to merit approval.
approval.
Congressional Research Service
47

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(2) DISTRIBUTION OF
‘‘(2) DISTRIBUTION OF GRANTS.—
Similar.
GRANTS.—The Secretary shall
The Secretary shall award at least one
award at least one grant to an
grant to an eligible entity described in
eligible entity described in section
subsection (a)(2)(A), at least one grant
5230(2)(A), at least one grant to
to an eligible entity described in
an eligible entity described in
subsection (a)(2)(B), and at least one
section 5230(2)(B), and at least
grant to an eligible entity described in
one grant to an eligible entity
subsection (a)(2)(C), if applications are
described in section 5230(2)(C), if
submitted that permit the Secretary
applications are submitted that
to do so without approving an
permit the Secretary to do so
application that is not of sufficient
without approving an application
quality to merit approval.
that is not of sufficient quality to
merit approval.
(c) GRANT
‘‘(c) GRANT CHARACTERISTICS.—
Similar.
CHARACTERISTICS.—Grants
Grants under subsection (a) shall be
under this subpart shall be of a
of a sufficient size, scope, and quality
sufficient size, scope, and quality
so as to ensure an effective
so as to ensure an effective
demonstration of an innovative means
demonstration of an innovative
of enhancing credit for the financing of
means of enhancing credit for the
charter school acquisition,
financing of charter school
construction, or renovation.
acquisition, construction, or
renovation.
(d) SPECIAL RULE.—In the event
Not included.
H.R. 2218 does not include a
the Secretary determines that the
provision regarding the distribution of
funds made available under this
funds if funds are not sufficient to
subpart are insufficient to permit
permit the Secretary to award at least
the Secretary to award not less
three grants.
than three grants in accordance
with subsections (a) through (c),
such three-grant minimum and
subsection (b)(2) shall not apply,
and the Secretary may determine
the appropriate number of grants
to be awarded in accordance with
subsection (c).
Section 5223: Applications

(a) IN GENERAL.—To receive a
‘‘(d) APPLICATIONS.—
Similar.
grant under this subpart, an
eligible entity shall submit to the
‘‘(1) IN GENERAL.—To receive a
Secretary an application in such
grant under subsection (a), an eligible
form as the Secretary may
entity shall submit to the Secretary an
reasonably require.
application in such form as the
Secretary may reasonably require.
(b) CONTENTS.—An application
‘‘(2) CONTENTS.—An application
Similar.
submitted under subsection (a)
submitted under paragraph (1) shall
shall contain—
contain—
Congressional Research Service
48

ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(1) a statement identifying the
‘‘(A) a statement identifying the
Similar.
activities proposed to be
activities proposed to be undertaken
undertaken with funds received
with funds received under subsection
under this subpart, including how
(a), including how the eligible entity
the eligible entity will determine
will determine which charter schools
which charter schools will receive
will receive assistance, and how much
assistance, and how much and
and what types of assistance charter
what types of assistance charter
schools will receive;
schools will receive;
(2) a description of the
“(B) a description of the involvement
Similar.
involvement of charter schools in
of charter schools in the application’s
the application’s development and
development and the design of the
the design of the proposed
proposed activities;
activities;
(3) a description of the eligible
“(C) a description of the eligible
Similar.
entity’s expertise in capital market entity’s expertise in capital market
financing;
financing;
(4) a description of how the
‘‘(D) a description of how the
Similar, except that H.R. 2218 also
proposed activities will leverage
proposed activities will leverage the
requires the entity to address how it
the maximum amount of private-
maximum amount of private-sector
will offer a combination of rates and
sector financing capital relative to
financing capital relative to the amount terms more favorable that the rates
the amount of government
of government funding used and
and terms that a charter school could
funding used and otherwise
otherwise enhance credit available to
receive without assistance. Current
enhance credit available to
charter schools, including how the
law requires an entity to discuss other
charter schools;
entity will offer a combination of rates
means by which it will enhance
and terms more favorable than the
available credit for charter schools.
rates and terms that a charter school
H.R. 2218 does not require this
could receive without assistance from
information. As the role of the entity
the entity under this section;
is to help leverage private-sector
financing to assist charter schools with
their facility needs rather than to
provide funds directly to meet charter
school facility needs, it may be more
appropriate to include language that
addresses the entity’s role in helping
to obtain a combination of more
favorable rates and terms.
(5) a description of how the
‘‘(E) a description of how the eligible
Similar.
eligible entity possesses sufficient
entity possesses sufficient expertise in
expertise in education to evaluate
education to evaluate the likelihood of
the likelihood of success of a
success of a charter school program
charter school program for which
for which facilities financing is sought;
facilities financing is sought;
and
(6) in the case of an application
‘‘(F) in the case of an application
Similar.
submitted by a State
submitted by a State governmental
governmental entity, a description
entity, a description of the actions that
of the actions that the entity has
the entity has taken, or will take, to
taken, or will take, to ensure that
ensure that charter schools within the
charter schools within the State
State receive the funding the charter
receive the funding the charter
schools need to have adequate
schools need to have adequate
facilities.
facilities; and
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ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(7) such other information as the
Not included.
H.R. 2218 does not include a
Secretary may reasonably require.
provision allowing the Secretary to
require additional information be
included on the application.
Section 5224: Charter School

Objectives
An eligible entity receiving a grant
‘‘(e) CHARTER SCHOOL
Similar.
under this subpart shall use the
OBJECTIVES.—An eligible entity
funds deposited in the reserve
receiving a grant under this section
account established under section
shall use the funds deposited in the
5225(a) to assist one or more
reserve account established under
charter schools to access private
subsection (f) to assist one or more
sector capital to accomplish one
charter schools to access private
or both of the following
sector capital to accomplish one or
objectives:
both of the following objectives:
(1) The acquisition (by purchase,
‘‘(1) The acquisition (by purchase,
Similar.
lease, donation, or otherwise) of
lease, donation, or otherwise) of an
an interest (including an interest
interest (including an interest held by
held by a third party for the
a third party for the benefit of a
benefit of a charter school) in
charter school) in improved or
improved or unimproved real
unimproved real property that is
property that is necessary to
necessary to commence or continue
commence or continue the
the operation of a charter school.
operation of a charter school.
(2) The construction of new
‘‘(2) The construction of new facilities, H.R. 2218 permits an eligible entity to
facilities, or the renovation,
including predevelopment costs, or
assist charter schools in accessing
repair, or alteration of existing
the renovation, repair, or alteration of private sector capital to pay for
facilities, necessary to commence
existing facilities, necessary to
predevelopment costs. This is not
or continue the operation of a
commence or continue the operation
specified under current law.
charter school.
of a charter school.
Section 5225: Reserve

Account
(a) USE OF FUNDS.—To assist
‘‘(f) RESERVE ACCOUNT.—
Similar.
charter schools to accomplish the
objectives described in section
‘‘(1) USE OF FUNDS.—To assist
5224, an eligible entity receiving a
charter schools to accomplish the
grant under this subpart shall, in
objectives described in subsection (e),
accordance with State and local
an eligible entity receiving a grant
law, directly or indirectly, alone
under this subsection (a) shall, in
or in collaboration with others,
accordance with State and local law,
de posit the funds received under
directly or indirectly, alone or in
this subpart (other than funds
collaboration with others, deposit the
used for administrative costs in
funds received under subsection (a)
accordance with section 5226) in
(other than funds used for
a reserve account established and administrative costs in accordance
maintained by the eligible entity
with subsection (g)) in a reserve
for this purpose. Amounts
account established and maintained by
deposited in such account shall be
the eligible entity for this purpose.
used by the eligible entity for one
Amounts deposited in such account
or more of the following
shall be used by the eligible entity for
purposes:
one or more of the following
purposes:
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ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(1) Guaranteeing, insuring, and
‘‘(A) Guaranteeing, insuring, and
Similar.
reinsuring bonds, notes, evidences reinsuring bonds, notes, evidences of
of debt, loans, and interests
debt, loans, and interests therein, the
therein, the proceeds of which
proceeds of which are used for an
are used for an objective
objective described in subsection (e).
described in section 5224.
(2) Guaranteeing and insuring
‘‘(B) Guaranteeing and insuring leases
Similar.
leases of personal and real
of personal and real property for an
property for an objective
objective described in subsection (e).
described in section 5224.
(3) Facilitating financing by
‘‘(C) Facilitating financing by identifying Similar.
identifying potential lending
potential lending sources, encouraging
sources, encouraging private
private lending, and other similar
lending, and other similar activities activities that directly promote lending
that directly promote lending to,
to, or for the benefit of, charter
or for the benefit of, charter
schools.
schools.
(4) Facilitating the issuance of
‘‘(D) Facilitating the issuance of bonds
Similar.
bonds by charter schools, or by
by charter schools, or by other public
other public entities for the
entities for the benefit of charter
benefit of charter schools, by
schools, by providing technical,
providing technical, administrative, administrative, and other appropriate
and other appropriate assistance
assistance (including the recruitment
(including the recruitment of bond of bond counsel, underwriters, and
counsel, underwriters, and
potential investors and the
potential investors and the
consolidation of multiple charter
consolidation of multiple charter
school projects within a single bond
school projects within a single
issue).
bond issue).
(b) INVESTMENT.—Funds
‘‘(2) INVESTMENT.—Funds received
Similar.
received under this subpart and
under this section and deposited in
deposited in the reserve account
the reserve account established under
established under subsection (a)
paragraph (1) shall be invested in
shall be invested in obligations
obligations issued or guaranteed by
issued or guaranteed by the
the United States or a State, or in
United States or a State, or in
other similarly low-risk securities.
other similarly low-risk securities.
(c) REINVESTMENT OF
‘‘(3) REINVESTMENT OF
Similar.
EARNINGS.—Any earnings on
EARNINGS.—Any earnings on funds
funds received under this subpart
received under subsection (a) shall be
shall be deposited in the reserve
deposited in the reserve account
account established under
established under paragraph (1) and
subsection (a) and used in
used in accordance with such
accordance with such subsection.
subsection.
Section 5226: Limitation on

Administrative Costs
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ESEA: Comparison of Charter School Legislation (H.R. 2218) and Current Law

ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
An eligible entity may use not
‘‘(g) LIMITATION ON
H.R. 2218 increases the percentage of
more than 0.25 percent of the
ADMINISTRATIVE COSTS.—An
funds available for administrative costs
funds received under this subpart
eligible entity may use not more than
from 0.25% to 2.5%.
for the administrative costs of
2.5 percent of the funds received
carrying out its responsibilities
under subsection (a) for the
under this subpart.
administrative costs of carrying out its
responsibilities under this section
(excluding subsection (k)).
Section 5227: Audits and

Reports
(a) FINANCIAL RECORD
‘‘(h) AUDITS AND REPORTS.—
Similar.
MAINTENANCE AND AUDIT.—
The financial records of each
‘‘(1) FINANCIAL RECORD
eligible entity receiving a grant
MAINTENANCE AND AUDIT.—The
under this subpart shall be
financial records of each eligible entity
maintained in accordance with
receiving a grant under subsection (a)
generally accepted accounting
shall be maintained in accordance with
principles and shall be subject to
generally accepted accounting
an annual audit by an independent
principles and shall be subject to an
public accountant.
annual audit by an independent public
accountant.
(b) REPORTS.—
‘‘(2) REPORTS.—
Similar.
(1) GRANTEE ANNUAL
‘‘(A) GRANTEE ANNUAL
REPORTS.—Each eligible entity
REPORTS.—Each eligible entity
receiving a grant under this
receiving a grant under subsection (a)
subpart annually shall submit to
annually shall submit to the Secretary
the Secretary a report of its
a report of its operations and
operations and activities under
activities under this section.
this subpart.
(2) CONTENTS.—Each annual
‘‘(B) CONTENTS.—Each annual
Similar.
report submitted under paragraph report submitted under subparagraph
(1) shall include—
(A) shall include—
(A) a copy of the most recent
‘‘(i) a copy of the most recent financial
financial statements, and any
statements, and any accompanying
accompanying opinion on such
opinion on such statements, prepared
statements, prepared by the
by the independent public accountant
independent public accountant
reviewing the financial records of the
reviewing the financial records of
eligible entity;
the eligible entity;
(B) a copy of any report made on
‘‘(ii) a copy of any report made on an
Similar.
an audit of the financial records of
audit of the financial records of the
the eligible entity that was
eligible entity that was conducted
conducted under subsection (a)
under paragraph (1) during the
during the reporting period;
reporting period;
(C) an evaluation by the eligible
‘‘(iii) an evaluation by the eligible
Similar.
entity of the effectiveness of its
entity of the effectiveness of its use of
use of the Federal funds provided
the Federal funds provided under
under this subpart in leveraging
subsection (a) in leveraging private
private funds;
funds;
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ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(D) a listing and description of the ‘‘(iv) a listing and description of the
Similar, except that H.R. 2218
charter schools served during the
charter schools served during the
specifies information that must be
reporting period;
reporting period, including the amount included in the annual report.
of funds used by each school, the type

of project facilitated by the grant, and
the type of assistance provided to the
charter schools;
(E) a description of the activities
‘‘(v) a description of the activities
Similar.
carried out by the eligible entity
carried out by the eligible entity to
to assist charter schools in
assist charter schools in meeting the
meeting the objectives set forth in objectives set forth in subsection (e);
section 5224; and
and
(F) a description of the
‘‘(vi) a description of the

characteristics of lenders and
characteristics of lenders and other
other financial institutions
financial institutions participating in
participating in the activities
the activities undertaken by the
undertaken by the eligible entity
eligible entity under this section
under this subpart during the
(excluding subsection (k)) during the
reporting period.
reporting period.
(3) SECRETARIAL REPORT.—
‘‘(C) SECRETARIAL REPORT.—The
Similar. (Note: The exclusion related
The Secretary shall review the
Secretary shall review the reports
to Subsection (k) under H.R. 2218
reports submitted under
submitted under subparagraph (A) and reflects the new structure of Title V-
paragraph (1) and shall provide a
shall provide a comprehensive annual
B-1. Subsection (k) is the Per-Pupil
comprehensive annual report to
report to Congress on the activities
Facilities program, so reporting on
Congress on the activities
conducted under this section
that program is not included with the
conducted under this subpart.
(excluding subsection (k)).
reporting on the Credit Enhancement
program.)
Section 5228: No Full Faith

and Credit for Grantee
Obligations
No financial obligation of an
‘‘(i) NO FULL FAITH AND CREDIT
Similar.
eligible entity entered into
FOR GRANTEE OBLIGATION.—No
pursuant to this subpart (such as
financial obligation of an eligible entity
an obligation under a guarantee,
entered into pursuant to this section
bond, note, evidence of debt, or
(such as an obligation under a
loan) shall be an obligation of, or
guarantee, bond, note, evidence of
guaranteed in any respect by, the
debt, or loan) shall be an obligation of,
United States. The full faith and
or guaranteed in any respect by, the
credit of the United States is not
United States. The full faith and credit
pledged to the payment of funds
of the United States is not pledged to
which may be required to be paid
the payment of funds which may be
under any obligation made by an
required to be paid under any
eligible entity pursuant to any
obligation made by an eligible entity
provision of this subpart.
pursuant to any provision of this
section.
Section 5229: Recovery of

Funds
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ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(a) IN GENERAL.—The
‘‘(j) RECOVERY OF FUNDS.—
Similar.
Secretary, in accordance with
chapter 37 of title 31, United
‘‘(1) IN GENERAL.—The Secretary, in
States Code, shall collect—
accordance with chapter 37 of title
31, United States Code, shall collect—
(1) all of the funds in a reserve
account established by an eligible
‘‘(A) all of the funds in a reserve
entity under section 5225(a) if the
account established by an eligible
Secretary determines, not earlier
entity under subsection (f)(1) if the
than 2 years after the date on
Secretary determines, not earlier than
which the eligible entity first
2 years after the date on which the
received funds under this subpart,
eligible entity first received funds
that the eligible entity has failed to under this section (excluding
make substantial progress in
subsection (k)), that the eligible entity
carrying out the purposes
has failed to make substantial progress
described in section 5225(a); or
in carrying out the purposes described
in subsection (f)(1); or
(2) all or a portion of the funds in
a reserve account established by
‘‘(B) all or a portion of the funds in a
an eligible entity under section
reserve account established by an
5225(a) if the Secretary
eligible entity under subsection (f)(1) if
determines that the eligible entity
the Secretary determines that the
has permanently ceased to use all
eligible entity has permanently ceased
or a portion of the funds in such
to use all or a portion of the funds in
account to accomplish any
such account to accomplish any
purpose described in section
purpose described in subsection (f)(1).
5225(a).
(b) EXERCISE OF
‘‘(2) EXERCISE OF AUTHORITY.—
Similar.
AUTHORITY.—The Secretary
The Secretary shall not exercise the
shall not exercise the authority
authority provided in paragraph (1) to
provided in subsection (a) to
collect from any eligible entity any
collect from any eligible entity any
funds that are being properly used to
funds that are being properly used achieve one or more of the purposes
to achieve one or more of the
described in subsection (f)(1).
purposes described in section
5225(a).
(c) PROCEDURES.—The
‘‘(3) PROCEDURES.—The provisions
Similar.
provisions of sections 451, 452,
of sections 451, 452, and 458 of the
and 458 of the General Education
General Education Provisions Act shall
Provisions Act shall apply to the
apply to the recovery of funds under
recovery of funds under
paragraph (1).
subsection (a).
(d) CONSTRUCTION.—This
‘‘(4) CONSTRUCTION.—This
Similar.
section shall not be construed to
subsection shall not be construed to
impair or affect the authority of
impair or affect the authority of the
the Secretary to recover funds
Secretary to recover funds under part
under part D of the General
D of the General Education Provisions
Education Provisions Act.
Act.
Section 5230: Definitions

(1) CHARTER SCHOOL.—The
Not included.
Not included in H.R. 2218, but may
term ‘‘charter school’’ has the
not be needed given the structural
meaning given such term in
changes made by H.R. 2218.
section 5210.
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ESEA Title V-B-1 and 2
H.R. 2218, Reported
Comments
(2) ELIGIBLE ENTITY.—The term ‘‘(2) ELIGIBLE ENTITY DEFINED.—
Similar.
‘‘eligible entity’’ means—
For purposes of this section, the term
‘eligible entity’ means—
(A) a public entity, such as a State
or local governmental entity;
‘‘(A) a public entity, such as a State or
local governmental entity;
(B) a private nonprofit entity; or
‘‘(B) a private nonprofit entity; or
(C) a consortium of entities
described in subparagraphs (A)
‘‘(C) a consortium of entities
and (B).
described in subparagraphs (A) and
(B).
Section 5231: Authorization

of Appropriations
For the purpose of carrying out
Not included.
Not included in H.R. 2218, but may
this subpart, there are authorized
not be needed given the structural
to be appropriated $150,000,000
changes made by H.R. 2218.
for fiscal year 2002 and such sums
as may be necessary for fiscal year
2003.
Source: Table prepared by CRS, September 2, 2011, based on CRS analysis of ESEA current law and H.R. 2218
as reported.
a. For example, in FY2010 the Charter School Program received $256 million in the Consolidated
Appropriations Act, 2010 (P.L. 111-117). The Secretary was permitted to reserve up to $50 million of the
amount provided for the Charter Schools Program to make multiple awards to charter management
organizations and other nonprofit entities for replication and expansion of successful charter school models.

Author Contact Information

Rebecca R. Skinner

Specialist in Education Policy
rskinner@crs.loc.gov, 7-6600

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