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August 31, 2011
TO
THE CHARTER SUPERINTENDENT ADDRESSED:
Subject: Official Notification of the 2011 Final Charter
Districts - School FIRST Rating
The purpose of this communication
is to inform you of your open-enrollment charter district’s final 2011 School
FIRST (Financial Integrity Rating System of Texas) rating. In a TO THE CHARTER SUPERINTENDENT ADDRESSED
letter dated June 16, 2011, the Texas Education Agency (TEA or agency) notified
charter districts of the issuance of preliminary ratings under the financial
accountability review system, which officially is referred to as School FIRST. As noted in the June 16, 2011 letter, the 2011
School FIRST ratings were based upon an analysis of financial data for the 2010
fiscal year (the fiscal period ended June 30, 2010, or August 31, 2010,
depending upon the ending date of the charter district fiscal year).
A primary purpose of
the June 16, 2011 letter was to provide charter districts 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 15, 2011. Please note that TEA staff responded to all
appeals in separate correspondence. The
final ratings and the data supporting the three indicators are accessible at http://www.tea.state.tx.us/index4.aspx?id=6491. Please note that final Charter District - School
FIRST ratings are accessible only from the TEA’s website.
Within two months
after receipt of its final Charter District – School FIRST rating,
each charter district must announce and hold a public meeting to distribute a
financial management report that explains the charter district’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 Charter District - School FIRST rating may be
combined with a scheduled regular meeting of the governing board. At the public meeting, the charter district should
review the disclosures that must be included in the financial management
report. The charter district will be required to report on reimbursements to
the superintendent and governing board members for the 2009-2010 school year, and either post on
the charter district’s website or supply in the financial management report the
current superintendent’s contract or terms of employment as well as salary and
benefits. This year will be the first year
that the charter district must also provide a summary schedule of the data
previously submitted to TEA under the financial solvency provisions of TEC
§39.0822. Information regarding
these disclosures can be found in 19 TAC §109.1005 at http://ritter.tea.state.tx.us/rules/tac/chapter109/ch109aa.html on TEA’s website. 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: http://www.tea.state.tx.us/index4.aspx?id=6491.
The charter district is encouraged to provide additional information in the
report that will be beneficial to the public, especially information explaining
special circumstances, if any, which may have affected the charter district’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. The rules also established
accreditation standards and sanctions, including oversight appointments. 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 school districts since 2007-2008
and to charter schools since 2008-2009. Please
note that, in accordance with these rules, including subsequent rule revisions,
TEA will take into consideration a charter district’s School FIRST rating when
assigning an accreditation status.
Additionally, please
note that a charter district’s final School FIRST rating may impact its special
education determination status as issued by the TEA under the requirements of
the Individuals with Disabilities Education Act (IDEA) and 34 Code of Federal
Regulations (CFR) §300.608(a).
For upcoming fiscal years, certain changes
have been made, or are proposed to be made, to the School FIRST indicators. Specifically,
beginning with fiscal year 2010-2011, which will affect the ratings issued in
2012, the financial accountability rating of an open-enrollment charter district
will be based on 21 indicators similar to those used for the ratings of school
districts. Additionally, beginning with
fiscal year 2010-2011, the type of ratings to be assigned to charters will be
expanded to include Above Standard Achievement and Superior Achievement, in addition to Standard Achievement, Substandard Achievement, and Suspended—Data Quality. TEA also has proposed rules to be finalized
this summer which change the net asset balance and cash management indicators
for the FIRST rules relating to the 2010-2011 and 2011-2012 fiscal years, which
will affect FIRST ratings issued in 2012 and 2013. It is the intent of the agency to avoid
penalizing charters that elect to expend portions of their net asset balance in
the upcoming biennium as a result of current economic conditions and changes made
by the Legislature to the state funding system. Additional information on the changes can be found on the TEA website at http://www.tea.state.tx.us/index4.aspx?id=2147500883 and http://ritter.tea.state.tx.us/taa/finaudit031611.html.
The TEA gratefully
acknowledges the genero
Sincerely,
Rita Chase
Director
Financial Audits
Division
cc: Education Service Center (ESC) Executive
Directors
ESC
Charter Technical Assistance Contacts
Laura
Taylor, Associate Commissioner, Department of Accreditation, TEA
Mary
Perry, Director, Charter School Administration, TEA
Karen Johnson, Legal Services, TEA
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