HF3776 Summary

• Charter school boards may borrow money in anticipation of receiving state aids and federal school aids, with aggregate borrowing limited to 75 percent of such aids and fees receivable in the fiscal year the money is borrowed.

• Charter schools must pass a resolution by two-thirds vote to authorize borrowing and issue certificates of indebtedness, with details of amount, date, maturity, and form specified by the board.

• Charter schools must notify the commissioner at least 15 working days before a debt payment is due if they believe they cannot make the payment, and the state shall pay the obligation from the state general fund.

• State aid payments to charter schools must be reduced by the amount the state paid for debt obligations plus interest, unless the commissioner determines that aid reduction would cause undue hardship or disruption to the school's educational program.

• If the state makes payments on behalf of a charter school or the school defaults on a debt obligation, the school must submit a plan to the commissioner detailing measures to resolve the financial issues and prevent future defaults.