NC H1119

Requires operators of nontraditional public schools (schools run by nonprofit boards or private entities rather than local school boards) to maintain reserve funds totaling a minimum of $100,000 to cover expenses related to breach of contract, early termination, or school closure.

Permits operators to satisfy the reserve requirement through one or more of the following options: an escrow account, a letter of credit, a bond, or a deed of trust.

Prohibits the state from allocating funds to nontraditional public school operators unless they provide documentation to the State Board of Education demonstrating compliance with the reserve fund requirements.

Appropriates $20,000 from the General Fund to the Department of Public Instruction for the 2016-2017 fiscal year to implement the new reserve fund requirements.

Takes effect upon becoming law, except the appropriation section becomes effective July 1, 2016.