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TEA Correspondence

A Microsoft Word version of this letter is available for download and PRINTING.

August 30, 2010


Subject: Official Notification of the 2010 Final School FIRST for Charter Schools Rating

The purpose of this communication is to inform you of your open-enrollment charter school’s final 2010 School FIRST (Financial Integrity Rating System of Texas) rating. In a TO THE CHARTER SUPERINTENDENT ADDRESSED letter dated June 10, 2010, the Texas Education Agency (TEA) notified charters of the issuance of preliminary ratings under the financial accountability review system. As noted in the June 10, 2010 letter, the 2010 School FIRST ratings were based upon an analysis of financial data for the 2009 fiscal year (the fiscal period ended June 30, 2009, or August 31, 2009, depending upon the ending date of the charter fiscal year).

A primary purpose of the June 10, 2010 letter was to provide charter schools an opportunity to review the preliminary ratings and data supporting the three indicators, and to submit a written appeal, as appropriate. As documented, written appeals were due to the TEA by July 12, 2010. Please note that the TEA staff responded to all appeals in separate correspondence. The final ratings and the data supporting the three indicators are accessible at Please note that final School FIRST for Charter Schools ratings are accessible only from the TEA’s website.

Within two months after receipt of its final School FIRST for Charter Schools rating, each charter must announce and hold a public meeting to distribute a financial management report that explains the charter’s rating and its performance under each of the three indicators for the current and prior year. The first of two required published newspaper notices, to inform the public of the meeting, may not be more than 30 days prior to or less than 14 days prior to the public meeting, in accordance with 19 TAC §109.1005. The public meeting to present the School FIRST for Charter Schools rating may be combined with a scheduled regular meeting of the governing board. At the public meeting, the charter should review the disclosures that must be included in the financial management report. The charter school will be required to report on reimbursements to the superintendent and governing board members for the 2008-2009 school year, and either post on the charter school’s website or supply in the financial management report the current superintendent’s contract or terms of employment as well as salary and benefits. Information regarding these disclosures can be found in 19 TAC §109.1005 or on the TEA website at Additionally, the TEA has posted on its website a template that charters may use to help facilitate the compilation of this information. The template can be found at the following web address: The charter is encouraged to provide in the report additional information that will be beneficial to the public, especially information explaining special circumstances, if any, which may have affected the charter’s performance under one or more of the indicators.

In December 2007, TEA adopted 19 TAC Chapter 97, Planning and Accountability, Subchapter EE, Accreditation Status, Standards, and Sanctions, in response to the requirements of House Bill (HB) 1, of the 79th Texas Legislature, Third Called Session, 2006. This subchapter, which became effective in January 2008, defined the accreditation statuses of Accredited, Accredited-Warned, Accredited-Probation, and Not Accredited-Revoked and stated how accreditation statuses would be determined and assigned to school districts. On November 23, 2008, 19 TAC §97.1037, 97.1051, 97.1053, and 97.1055 were amended to make the rules on accreditation status applicable to charter schools. Under the authority of the Texas Education Code (TEC) and adopted rules, accreditation statuses have been assigned to charter schools in 2008-2009 and 2009-2010. It is important to note that the results of the 2010 School FIRST for Charter Schools will be used in the assignment of an accreditation status to charter schools. Additionally, please note that a charter’s final School FIRST rating may impact its special education determination status as issued by the TEA Division of Individuals with Disabilities Education Act (IDEA) Coordination under the requirements of 34 Code of Federal Regulations (CFR) §300.608(a).

The agency is taking steps to expand the financial accountability indicators for charter schools through a subsequent rule adoption, with the expectation that an expanded system be in effect for the 2010-2011 fiscal year. The new indicators will address the areas of fiscal responsibility and data quality, budgeting, personnel, and cash management. The goal of the expansion is to create additional indicators that align, to the extent appropriate, with the financial accountability indicators established for traditional school districts. Information for proposed rules will be available on the TEA website at

The TEA gratefully acknowledges the generous assistance provided by the Texas Comptroller of Public Accounts, and charter school and education service center officials in the ongoing implementation of School FIRST. If you have questions about your charter’s School FIRST rating, please contact Janice Hollingsworth or me in the Division of Financial Audits at (512) 463-9095.


Rita Chase
Financial Audits Division

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