CHAPTER 179

FORMERLY

SUBSTITUTE NO. 1

TO

SENATE BILL NO. 200

AS AMENDED BY

SENATE AMENDMENT NOS. 1, 5 AND 6

AN ACT TO AMEND TITLE 14 OF THE DELAWARE CODE RELATING TO CHARTER SCHOOLS.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:

Section 1. This Act may be referred to as the "Charter School Act of 1995."

Section 2. Amend Title 14, Delaware Code by adding a new Chapter 5 thereto to read as follows:

"Chapter 5. Charter Schools.

§ 501. Legislative intent.

The purpose of this chapter is to create an alternative to traditional public schools operated by school districts and improve public education overall by establishing a system of independent "charter" schools throughout the State.

To that end, this chapter offers members of the community a charter to organize and run independent public schools, free of most state and school district rules and regulations governing public education, as long as they meet the requirements of this chapter, and particularly the obligation to meet measurable standards of student performance. Schools established under this chapter shall be known as "charter schools".

This chapter is intended to improve student learning; encourage the use of different and innovative or proven school environments and teaching and learning methods; provide parents and students with improved measures of school performance and greater opportunities in choosing public schools within and outside their school districts; and to provide for a well-educated community.

There shall be no limit to the number of charter schools that may be established in the State; provided, however, that no more than five such schools may be established to operate in the 1996-1997 school year, and that no more than five additional charter schools may be established to operate in the 1997-1998 school year, and that no more than five additional charter schools may be established to operate in the 1998-1999 school years. If for any school year more charters are awarded than are permitted to operate by this section, the State Board shall hold a lottery to decide which charters are permitted to operate in such school year and charter applicants who lose such lottery shall be given a right of refusal for a charter for the subsequent school year.

§ 502. Potential Charter Organizers.

This legislation is intended to encourage any person, university, college, or non-religious, non-home-based, nonsectarian entity that can meet the requirements of this chapter to form a charter school. No private or religiously affiliated school may apply to become a charter school.

§ 503. Legal status.

A charter school is a public school including two or more of grade kindergarten through 12 and having at least 200 students (provided, however, that a charter school may enroll fewer than 200 but no less than 100 students in its first two years of operation or for a charter school serving at-risk or special education students), managed by a board of directors, which operates independently of any school board, under a charter granted for an initial period of three school years of operation and renewable every five school years thereafter by a public school district or the State Board of Education (hereinafter in this chapter, "State Board"), pursuant to this chapter. For purposes of this chapter as it relates to the management of a charter school, the board of directors of a charter school shall have the same standing and authority as a Reorganized School District Board of Education, except the power to tax. The State Board of Education may also approve a charter school which plans to enroll fewer than 200 students in special circumstances, such as an on-site charter school proposed by a business as an extension of an on-site early learning or day care center.

§ 504. Corporate status.

(a) A charter school shall be organized and managed under the Delaware General Corporation Law.

(a) The board of directors of a charter school shall be deemed public agents authorized by a public school district or the State Board to control the charter school.

(b) A charter school shall be considered a public school for all purposes.

(c) A charter school may sue or be sued to the same extent and on the same conditions as a public school district, and its employees, directors and officers shall enjoy the same immunities as employees, directors and officers of public school districts and other public schools. The approving authority of a charter school shall have no liability for the actions or inaction of a charter school.

§ 504A. Powers.

Consistent with its charter and the provisions of its certificate of incorporation, bylaws or membership agreements, a charter school shall have the power to:

(a) manage the implementation of its approved education program;

(b) determine its own budget and operating procedures;

(a) acquire and convey interests in real property, subject to rules and regulations established by the State Board with respect to real property acquired by charter schools using state funds;

(c) incur debt;

(d) accept gifts;

(e) contract with any school district, or any other public school or private nonsectarian, non-religious entity also empowered to enter into contracts, for any and all real property, equipment, goods, supplies and services, except that a_ school district must make unused buildings or space (defined as space no longer needed, permanently or temporarily, for non-charter school purposes) buildings or space in buildings available to a charter school, and shall bargain in good faith over the cost of rent, services and maintenance related to such space. A charter school's continued use of school district space shall be subject to review at least on a five-year basis, and may be terminated by the district with one year's notice, if the district's non-charter school capacity requirements warrant. Charter schools shall have preference over state agencies for purposes of § 1057(6) of this Title except that nothing in this section shall require the displacement of any tenant either during the term of its current lease or any renewal thereof.

(g) hire, manage, and terminate any school employee in accordance with the terms of its personnel policies or any collective bargaining agreement it negotiates with its employees;

(h) establish reasonable academic and disciplinary standards specifically related to the missions, goals and educational objectives for the charter school as set forth in its charter for students to continue enrollment in the charter school, provided, however, that an expulsion from a charter school shall have the same effect for the purposes of §4130 of this Title as expulsion from a school district; and

(i) establish an application and admissions process which shall enable the charter school to provide the local districts in which its students reside with a preliminary roster of its students for the subsequent school year on or before May I of each year. To the extent practicable, each charter school shall make the timetable for its application and admissions process identical to any such timetable set forth by this Code for the operation of a public school choice program.

§ 505. Exemption.

A charter school is exempt from all provisions of this title and all school district regulations, except as specified in this chapter, although it may elect to comply with one or more provisions.

§ 506. Restrictions.

A charter school shall not:

(a) charge tuition, except in accordance with Chapter 6 of this title, or collect fees not permitted to be assessed by other school districts;

(b) be home-based nor engage in any sectarian or religious practices in its educational program, admissions policies, employment policies or operations;

(c) restrict student admissions, except by age and grade, or by lottery in the case of over-enrollment, and except that students attending an existing public school converted to charter status and the siblings of such students shall be given preference and the students and the parents of students at a school converted to charter school status shall be provided by the local district with its plan for addressing the educational needs of any such students who will not be attending the charter school, and that students residing within a five-mile radius of the school, students residing within the school district in which the charter school is located, students who have a specific interest in the school's teaching methods, learning philosophy or subject matter focus (e.g., mathematics, science, or performing arts), and students who are at risk of academic failure may be given preference;

(a) discriminate against any student in the admissions process because of race, creed, color, sex, handicap, or national origin, or because the student's school district of residence has a per student local expenditure lower than another student seeking admission; or

(a) be formed to circumvent a court-ordered desegregation plan.

§ 507. Labor relations.

(a) A public school may only be converted to a charter school by approval of the board of the ,,chool district in which it is located and that the charter application received the approval of over 50% of the teachers and over 50% of the parents residing in the attendance area of the school with a child(ren) under the age of 18 years, who, oiler 30 days prior written notice to all teachers and parents eligible to vote, attend a public meeting held for the specific purpose of voting on the proposed conversion, provided, however, that such approval shall not be required where a district school board converts a choice school or program with a specific career or academic subject matter focus already approved as of the effective date of this chapter to a charter school with the same focus. The employees of a school converted to a charter school who are not employed by the charter school shall be accorded the rights available to them under the provisions of their collective bargaining agreement and shall, to the extent permissible under their collective bargaining agreement, be given preference in filling positions in the school district.

(b) The employees of a school converted to charter status and who are employed by the charter school shall not be part of any bargaining unit which represented employees of the school while it was still part of the school district. Employees of charter schools shall have the same right to organize and bargain collectively as employees of other public schools. A bargaining unit shall not be deemed inappropriate under Title 14, Chapter 40 simply because said unit is comprised of professional and non-professional positions within a charter school. A teacher may be a member of a bargaining unit and serve as a director of a charter school provided, however, that any teacher who is a director of a charter school shall recuse himself or herself from any board meeting, discussion or decision relating to the bargaining unit of which such teacher is a member.

(c) Labor relations between the charter school and its employees shall be governed by chapter 40 of this title, and a charter school and its employees may agree through the collective bargaining process to abide by other provision of this title or Code. The board of directors of a charter school shall hire certified teachers, or teachers who obtain an applicable limited term certification from the State or through an exception to certification regulations obtained by the charter school on the same basis as is available to school districts, to instruct students at the school.

Notwithstanding the foregoing, for any school year with respect to which there is no 'qualified alternative certification' as defined hereinafter in effect, a charter school may, where it deems it beneficial to the success of its educational program, hire non-certified teachers so long as such teachers comprise no more than thirty-five percent of the teachers at the school.

For purposes of this section, a 'qualified alternative certification program'

shall be one which:

(i) Establishes alternative routes of certification available for

candidates at all grade levels 7-12 inclusive, and in all disciplines (except special education);

(ii) Allows a candidate, under the supervision of a mentor teacher, to

commence employment as a teacher holding a limited standard certificate with:

(A) a bachelor's degree from an accredited college or university appropriate to the instructional field;

(B) completion of a full-time seminar/practicum of no less than 20 days duration which takes place prior to the time the candidate takes full responsibility for a classroom; and

(C) a passing score on the prescribed State certification exam applicable for the candidate seeking to teach in the field and at the grade level sought by the candidate;

(iii) Requires that the candidate participate in a period of intensive, on-

the-job supervision -- requiring that the candidate be visited and critiqued no less than one time every two weeks by a certified teacher -- beginning the first day on which the candidate assumes full responsibility for a classroom and continuing for a period of at least 10 weeks;

(iv) Requires that the candidate participate in a period of continued

supervision and evaluation of no less than 20 weeks duration -- requiring that the candidate be visited and critiqued at least four times;

(v) Requires of the candidate satisfactory completion of at least 200

hours of formal instruction in the areas of curriculum, student development and learning, and classroom management; and

(vi) Allows for the candidate to become fully certified upon:

(A) successful completion of one year of employment as a teacher holding a limited standard certificate; and

(B) receipt of a satisfactory performance evaluation from a review committee consisting of teachers and administrators within the school where such provisional teaching employment has occurred."

(d) At their request, teachers employed by any school district in the State, but not teachers employed by another charter school, shall be granted a three-year leave of absence to teach in a charter school or such leave as is provided in the collective bargaining agreement of the school district. At the end of that period, they shall be allowed to return to the school district with the same level of seniority as when they left to take the leave of absence, provided that they have not been terminated for cause while at the charter school, that they have given the school district notice of their intent to return on or before the April 15 preceding the school year in which they intend to return, and according to the provisions of their collective bargaining agreement in effect in the school district. This level of seniority shall also be used for determination of their tenure in accordance with Chapter 14 of this Title.

(e) Charter school employees shall remain in or be covered by the state retirement system established by Chapter 55, Title 29 of this Code; provided, however, that a charter school may offer each of its employees an option to choose another retirement system in lieu of the state retirement system.

§ 508. Responsibility for student transportation.

The charter school may request to have the school district where the charter school is located transport students residing in that district to and from the charter school on the same basis offered to other students attending schools operated by the district, or to receive from the district a payment equal to the average cost per student (regulir or special education as the case may be) of transportation within that district and become responsible for the transportation of those students to and from the charter school. In the case of students not residing in the district where the charter school is located, the parents of such students shall be responsible for transporting the child without reimbursement to and from a point on a regular bus route of the charter school, provided, however, that the school district where the student attending the charter school resides shall pay to the charter school an amount equal to that district's average cost per student (regular or special education as the case may be) of transportation in the district, which shalt be used by the charter school for the purpose of assisting such students with transportation. Notwithstanding the foregoing, a student at a charter school shalt receive such transportation assistance as is made available to students pursuant to a public school choice program established by this Code provided that such student otherwise meets the eligibility requirements for such assistance. In the event a charter school chooses to transport students itself, it shall do so in accordance with all public school transportation safety regulations. Local school districts and charter schools shall cooperate to ensure that the implementation of this chapter does not result in inefficient use of state appropriations for public school transportation and the State Board shall exercise its authority to approve bus routes so as to avoid such waste.

§ 509. School financing.

(a) Charter schools shall be eligible for public funds under procedures established by this section. Notwithstanding that this Code may establish procedures for the funding of a public school choice program and that such program may include charter schools among those schools which students may choose, funding for charter schools shall be as provided in this section.

(b) A charter school shall receive a payment with respect to each of its students equal to:

(i) From the State on or before November 30, the funding equivalent to the Division I staffing including fractional funding of partial units, excluding funding for a Superintendent, Division 11 -- All Other Costs and Energy funding, minor capital improvements and school building maintenance funded generated by the annual student unit count conducted on September 30th of each year in accordance with State board of Education regulations. In the case of Division Ili • equalization, a charter school shall receive from the State an amount that is

determined by weighting the Division III per unit values that would have been generated by its students had they been counted in their district of residence. In addition, a charter school shall receive a pro-rated portion of any other funds appropriated to the State Board of Education that are Intended to be allocated on a student, employee or school state share. For the purposes of calculating such funding, each charter school student shall be counted in a separately reported unit count of the charter school, and not counted for any purposes in his district of residence. For any partially funded unit generated at a charter school, the charter school is free to negotiate the use of such unit with the chartering district, and other public school districts, in order to purchase central custodial, administrative, clerical, direct teaching or educationally related services. If such an agreement is not negotiated, a payment based on the average State cost per unit shall be payable to both the charter school and the district issuing the charter, provided that the sum of both fractions justifies an additional unit. The State shall advance 75% of the anticipated funding pursuant to this subsection at the beginning of each fiscal year, provided that the charter school has provided the Department of Public Instruction with a preliminary roster of its students on or before May I of such year. A final roster shall be due September 30.

(ii) From the school districts in which its students reside on or before November 30 of each year, the local cost per student (regular or special education, as the case may be), net of transportation expenses provided for pursuant to § 508 of this chapter. The school districts in which its students reside shall advance at least 35% of the anticipated funding pursuant to this subsection at the beginning of each fiscal year provided that the charter school has provided the school districts of residence with a preliminary roster of its students on or before May I of such year. This advance may be paid from Division III-Equalization funds if the district's prior fiscal year current expense local funds balance was 20% or less pursuant to § 1509 of this title. A final roster shall be due September 30.

(c) If a parent or legal guardian of a student enrolled outside the district pursuant to
this chapter moves during the school year to a district different from the district in which his or her child resided at the time of the annual unit count, the child's first district of residence shall continue to be responsible for payments to the charter school for the balance of the school year pursuant to subsection (b)(ii) of this section. The child's new district of residence shall be responsible for all such payments during succeeding years.

(d) The Department of Public Instruction shall annually calculate the local cost per
student expended by
each school district for each type of student for the year immediately preceding based on the formula set forth in subsection (e) of this section, adjusted by a factor necessary to fund the charter school on a basis reasonably equivalent to the current year local cost per student, which factor shall be established in the annual appropriations act. The State Board shall annually certify each local district's local cost per student expenditure by September 1st of each year.

(e) Local cost per student as used in this section shall be calculated as follows:
Total Local Operating Expenditure in Preceding Fiscal Year

Total Division I Units minus Spec School Units minus Voc Deduct plus Vocational Units

Number of Pupils or Pupil Minutes per Unit

Where:

Total Local Operating = Sum of all expenditures

Expenditure in from local sources minus

Preceding FY local expenditures for

tuition minus local expenditures for debt service minus local

expenditures for Minor Capital Improvement

Division I Units = Division I Units certified by

For each District the State Board of Education

or Special School as of September 30th of each

year

Pupils or Pupil Minutes = Number of Pupils or Pupil

per Unit Minutes required for

particular unit of funding as specified in § 1703 of this title.

(0 For any student, who because of educational need requires services that are

appropriately financed pursuant to the provisions of Chapter 6 of this title, either at the outset or subsequent to a decision to enroll in a charter school, the student's district of residence shall remain financially responsible for such student and the charter school shall receive from such district a payment determined in accordance with the provisions of Chapter 6 of this title.

(g) Any payment received by a charter school pursuant to this section may be used for current operations, minor capital improvements, debt service payments or tuition payments.

(g) The Department of Public Instruction, in consultation with the Department of Administrative Services, shall annually publish a list of vacant and unused buildings and vacant and unused portions of buildings that are owned by this State or by school districts in this State and that may be suitable for the operation of a charter school. The Department of Public Instruction, in consultation with the Department of Administrative Services, shall make the list available to applicants for charter schools and to existing charter schools. The list shall include the address of each building, a short description of the building and the name of the owner of the building.

§ 510. State assistance.

(a) The Department of Public Instruction shall distribute information announcing the availability of the charter school program, explaining the powers and responsibilities of a charter school contained in this chapter, and describing the application process to each school district and public post-secondary educational institution, and through press releases to each major newspaper in the State.

(b) The Department of Public Instruction shall provide technical assistance to potential charter school applicants upon request.

(c) The Department of Public Instruction shall provide technical and other forms of assistance to charter schools on the same basis as to school districts.

(d) The Department of Public Instruction shall, in concert with the approving authority and the applicant, apply for available federal or foundation grants providing funding for the planning and start-up of charter schools and the Department of Public Instruction shall administer such funds as may be appropriated by the General Assembly for the purpose of assisting in the planning and start-up of charter schools.

§ 511. Approval procedure.

(a) An approved charter school application shall constitute a charter granted to the charter school by the approving authority pursuant to this chapter and shall be governed by the terms of this chapter.

(b) Charters shall be modified by the same procedure and based on the same criteria as they are approved.

(c) Charter school applications shall be submitted to a local school board or the State Board for approval as an approving authority. The approving authority shall be responsible for approval of the charter school pursuant to this section and for continuing oversight of each charter school it approves.

(d) Potential charter school applicants may engage in discussions with a potential approving authority before submitting an application for approval to establish a charter school.

(e) Charter school applications shall be submitted by December 31 for schools to be established and prepared to admit students on or before the second September thereafter, provided, however, that an application for a charter school to open in September 1996 may be submitted to an approving authority on or before October 30, 1995.

(b) Any local school board or the State Board may limit the number of applications it will consider in any year or the number of charters it will grant, but within 20 days after receiving an application must hold a public meeting to decide whether or not to consider it. Any local school board may also decide that it will not accept any applications under this chapter provided that it does so annually upon affirmative vote of its board at a public meeting on or before October 1.

(f) Within 90 days of receiving an application an approving authority has decided to consider, such approving authority must rule on whether to approve the application at a public meeting.

(g) Within 5 days of deciding to consider an application, the approving authority shall form an accountability committee to review the charter school application. The accountability committee's report to the local school board shall address the approval criteria set forth in § 512 of this chapter. The committee shall meet with the applicant in the course of its investigation and provide the applicant the opportunity to review and comment on the committee's report 15 days before it is issued to the approving authority. The committee's final report shall be provided to the applicant and be made available to the public.

(b) After giving 15 days public notice, the approving authority shall hold public hearings to assist in its decision whether to approve a charter application.

() Subject to any limitations imposed by the approving authority pursuant to subsection (f) of this section, if the application is found by the approving authority to meet the criteria set forth in § 512 of this chapter, it shall approve the application.

(k) If an application is made to the State Board or a local board as an approving authority and the charter application is not approved, such decision shall be final and not subject to judicial review.

§ 512. Approval Criteria.

Charter school applications shall be in the form of a proposed charter and shall be approved if, after the exercise of due diligence and good faith, the approving authority finds that the proposed charter demonstrates that

(a) The individuals and entities submitting the application are qualified to operate a charter school and implement the proposed educational program and the proposed board of directors includes representation from teachers and parents of students at the school and that certified teachers, parents, and community members were involved in the development of the proposed charter;

(b) The chosen form of organization, identified in the articles of incorporation and bylaws, or the membership agreement, conforms with the Delaware General Corporation Law;

(c) The mission statement, goals, and educational objectives are consistent with the description of legislative intent set forth in § 501 of this chapter and the restrictions on charter school operations set forth in § 506 in this chapter;

(d) The school has set goals for student performance and will utilize satisfactory indicators to determine whether its students meet or exceed such goals and the academic standards set by the State Board of Education. The indicators shall include the assessments required for students in other public schools, although the charter school may adopt additional performance standards or assessment requirements, and shall include timelines for the achievement of student performance goals and the assessment of such performance;

(e) The school proposes a satisfactory plan for evaluating student performance and procedures for taking corrective action in the event that student performance at the charter school falls below such standards which are reasonably likely to succeed;

(0 The school's educational program, including curriculum and instructional strategies, has the potential to improve student performance;

(g) The school's educational program sets forth strategies to be employed as it deems necessary to accommodate the needs of at-risk students and those needing special education services;

(h) The plan for the school is economically viable, based on a review of the school's proposed budget of projected revenues and expenditures for the first three years, the plan for starting the school, and the major contracts planned for equipment and services, leases, improvements, purchases of real property, and insurance;

(i) The school's financial and administrative operations meet or exceed the same standards, procedures, and requirements as a school district. If a charter school proposes to operate outside of the State's accounting, payroll, purchasing, compensation, pension and/or benefits systems, a specific memorandum of understanding shall be developed and executed by the charter school, the approving authority, the Budget Director and the Controller General to assure that the State's fiduciary duties and interests in the proper use of appropriated funds and as a benefits and pension trustee are fulfilled and protected, the State's financial reporting requirements are satisfied, and the interests of charter school employees are protected;

(j) The assessment of the school's potential legal liability, and the types and limits of insurance coverage the school plans to obtain, are adequate;

(k) The procedures the school plans to follow to discipline students and ensure its students' adherence to school attendance requirements comply with state and federal law; and

(I) The procedures the school plans to follow to assure the health and safety of students, employees and guests of the school while they are on school property are adequate and that the charter school will comply with applicable provisions of Chapter 85 of Title II of this Code.

§ 513. Reporting and oversight.

(a) On or before November 1, each charter school shall produce an annual report for the school year ending the previous June, which shall discuss the school's progress in meeting overall student performance goals and standards and contain a financial statement setting forth by appropriate categories the school's revenues and expenditures and assets and liabilities. To ensure that such reports provide parents and approving authorities with clear and comparable information about the performance of charter schools, the Department of Public Instruction shall prescribe a uniform format for such reports, which may be supplemented by requirements set by the approving authority for schools it has chartered.

(b) 'rhe annual report shall be submitted to the approving authority and the State Board. Employees of the school and parents of students attending the school shall receive a copy free of charge, upon request, The reports shall be public records pursuant to Chapter 100, Title 29 of this Code.

(c) The Department of Public Instruction, the State Board, and the approving authority may conduct financial, programmatic, or compliance audits of a charter school. In cooperation with the State Board , the approving authority shall conduct such audits no less often than every three years. The State Auditor shall conduct an audit of all charter school funds annually on the same basis as applied to regular school districts.

§ 514. State reports on the charter school program.

Annually, the State Board shall prepare a report for the Governor and the General Assembly on the success or failure of charter schools and propose changes in state law necessary to improve or change the charter school program. Such report shall contain a section comparing the per student expenditures of charter schools, considering all sources of such expenditures, with those of other public schools.

§ 515. Oversight and revocation process.

(a) The approving authority shall be responsible for oversight of the charter schools it approves.

(b) Three years after a charter school has commenced its instructional program pursuant to this chapter and not later than every five years thereafter, the approving authority shall, upon notice to the charter school, review the performance of the charter school to determine its compliance with its charter and its satisfaction of the criteria set forth in § 512 of this chapter.

(c) In addition to the review required by subsection (b) of this section, the approving authority may notify a charter school of potential violations of its charter and submit the charter to formal review to determine whether the charter school is violating the terms of its charter and whether to order remedial measures pursuant to subsection (g) of this section.

(d) The approving authority shall issue its decision within 90 days of giving the charter school notice pursuant to subsections (b) or (c). An accountability committee appointed by the approving authority shall conduct the initial review pursuant to subsections (b) or (c). The accountability committee's report to the approving authority shall address the relevant criteria set forth in § 512 and § 516 of this chapter. The committee shall meet with the applicant in the course of its investigation and provide the applicant the opportunity to review and comment on the committee's report 15 days before it is issued to the approving authority. The committee's final report shall be provided to the applicant and made available to the public.

(c) If the accountability committee reports probable grounds for remedial measures pursuant to subsection (g) of this section, the approving authority shall hold public hearings to assist in its decision whether the criteria set forth for remedial action in § 516 of this chapter have been satisfied, after giving the charter school 30 days notice. The school shall be given the opportunity to respond to the accountability committee's report at the meeting. Members of the public shall be given the opportunity to comment at the meeting.

(0 If the accountability committee reports that the school has complied with its charter and the criteria set forth in § 512 of this chapter, the approving authority shall approve or disapprove its report at a public meeting after giving the charter school 30 days notice. If the approving authority disapproves the report, it shall identify the reasons for that decision with particularity. Thereafter, the approving authority shall hold a hearing, within 30 days, to decide the appropriate remedy pursuant to subsection (g) of this section.

(g) If the approving authority determines that the criteria for remedial action set forth in § 516 of this chapter have been satisfied, it may revoke the charter and manage the school directly until alternative arrangements can be made for students at the school or place the school on a probationary status subject to terms determined by the approving authority which are directly relevant to the violation(s). Charters shall be revoked only where probationary actions are unlikely to succeed.

(h) If a local school district which is an approving authority decides to revoke the school's charter or place the school on probationary status, the applicant may file for arbitration in writing with the American Arbitration Association in Philadelphia within 20 days of the local board's decision stating the reasons why it believes the local board decision was in error. A copy of said filing shall be provided simultaneously with the approving authority. The parties shall select an Arbitrator in accordance with the American Arbitration Association's procedure for voluntary labor disputes, provided, however, that such arbitration shall occur in this State. The Arbitrator's fees and costs shall be borne equally by the parties. The Arbitrator shall convene a hearing and determine whether the local board's decision was in error. The arbitrator shall have thirty days to render his or her decision following the close of the hearing. The Arbitrator's decision shall be final and binding upon the parties.

(i) If the approving authority is the State Board and it decides to revoke the school's charter or place the school on probationary status, its decision shall be final and not subject to arbitration or judicial review.

§ 516. Revocation criteria.

Approved charters shall be subject to revocation or probation, eller the exercise of due diligence and good faith, only for the following reasons:

(a) The school, or its representatives, has committed a material fraud on the approving authority or misappropriated federal, state or local funds; or

(b) The school fails to comply with its charter or to satisfy, in its operation of the school, the criteria set forth in § 512 of this chapter."

Approved July 10, 1995