Florida Charter School Governance Training 2 Hour Refresher Course Kathleen W. Schoenberg, Esq. 14545 J Military Trail #226 Delray Beach, FL 33484 Tel: (561) 350-3343 Fax: (561) 431-5731 E-mail: [email_address] ©m2005-2009 Kathleen W. Schoenberg

Background Graduated from Rutgers University and Temple University Law School Worked with charter schools for 10 years Represented and consulted with over 75 charter schools in 3 states Currently in private practice in Florida

Graduated from Rutgers University and Temple University Law School

Worked with charter schools for 10 years

Represented and consulted with over 75 charter schools in 3 states

Currently in private practice in Florida

Section One Board Governance Generally

1 A. Board Responsibilities

1. Introduction to Governance: Governance is critical to charter school success Good governance can make up for turnover in administration and other inadequacies

Governance is critical to charter school success

Good governance can make up for turnover in administration and other inadequacies

2. Governance Responsibilities Preserve mission & vision Set policies that guide the school Ensure charter compliance Ensure adequate finances and fiscal propriety (approve budget)

Preserve mission & vision

Set policies that guide the school

Ensure charter compliance

Ensure adequate finances and fiscal propriety (approve budget)

3. What a Board Should Do: Review and update school policies, bylaws and tax exempt status Follow protocol for meetings and keep meetings on track Ensure Board composition reflects balance of expertise and perspectives needed to achieve the mission of the school Ensure all members are actively involved (orientation process)

Review and update school policies, bylaws and tax exempt status

Follow protocol for meetings and keep meetings on track

Ensure Board composition reflects balance of expertise and perspectives needed to achieve the mission of the school

Ensure all members are actively involved (orientation process)

4. What a Board Should Do (cont’d): Conduct strategic planning sessions Collaborate with principal on improvement goals and measurement targets Conduct annual evaluation of Principal Ensure compliance with Federal and State law and with charter.

Conduct strategic planning sessions

Collaborate with principal on improvement goals and measurement targets

Conduct annual evaluation of Principal

Ensure compliance with Federal and State law and with charter.

5. What a Board Should Do (cont’d): Develop the annual budget and regularly review spending Review the annual audit Create and maintain a board handbook

Develop the annual budget and regularly review spending

Review the annual audit

Create and maintain a board handbook

6. What a Board Shouldn’t Do: Don’t act as an individual, but rather as a Board – no individual has management oversight or decision making authority Manage the day-to-day operations Hire or fire teachers and/or members of the principal’s staff

Don’t act as an individual, but rather as a Board – no individual has management oversight or decision making authority

Manage the day-to-day operations

Hire or fire teachers and/or members of the principal’s staff

7. Sources of Board’s Legal Responsibilities Federal Law (ex: IDEA) State Law (ex: charter school law) Local Law (ex: zoning) Other (ex: charter contract)

Federal Law (ex: IDEA)

State Law (ex: charter school law)

Local Law (ex: zoning)

Other (ex: charter contract)

8. Highlights of Statutory Responsibilities: The governing body of the charter school shall be responsible for : 1. Ensuring that the charter school has retained the services of a certified public accountant or auditor for the annual financial audit who shall submit the report to the governing body. 2. Reviewing and approving the audit report, including audit findings and recommendations for the financial recovery plan. 3. Monitoring a financial recovery plan in order to ensure compliance.

The governing body of the charter school shall be responsible for :

1. Ensuring that the charter school has retained the services of a certified public accountant or auditor for the annual financial audit who shall submit the report to the governing body.

2. Reviewing and approving the audit report, including audit findings and recommendations for the financial recovery plan.

3. Monitoring a financial recovery plan in order to ensure compliance.

9. Highlights of Statutory Responsibilities (cont’d): Annual report Annually adopt and maintain operating budget Participate in governance training that must include government in the sunshine, conflicts of interest, ethics, and financial responsibility Background checks Exercise continuing oversight over school operations

Annual report

Annually adopt and maintain operating budget

Participate in governance training that must include government in the sunshine, conflicts of interest, ethics, and financial responsibility

Background checks

Exercise continuing oversight over school operations

10. Exercise continuing oversight: Develop compliance timeline Monthly, quarterly, annual requirements Review compliance regularly

Develop compliance timeline

Monthly, quarterly, annual requirements

Review compliance regularly

11. General Standards for Directors (617.0830) A director shall discharge his or her duties as a director, including his or her duties as a member of a committee: (a) In good faith; (b) With the care an ordinarily prudent person in a like position would exercise under similar circumstances; and (c) In a manner he or she reasonably believes to be in the best interests of the corporation. In discharging his or her duties, a director may rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by: (a) One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented;

A director shall discharge his or her duties as a director, including his or her duties as a member of a committee:

(a) In good faith;

(b) With the care an ordinarily prudent person in a like position would exercise under similar circumstances; and

(c) In a manner he or she reasonably believes to be in the best interests of the corporation.

In discharging his or her duties, a director may rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by:

(a) One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented;

12. General Standards for Directors (cont’d) (b) Legal counsel, public accountants, or other persons as to matters the director reasonably believes are within the persons' professional or expert competence; or (c) A committee of the board of directors of which he or she is not a member if the director reasonably believes the committee merits confidence. A director is not acting in good faith if he or she has knowledge concerning the matter in question that makes reliance otherwise permitted by this section unwarranted. A director is not liable for any action taken as a director, or any failure to take any action, if he or she performed the duties of his or her office in compliance with this section.

(b) Legal counsel, public accountants, or other persons as to matters the director reasonably believes are within the persons' professional or expert competence; or

(c) A committee of the board of directors of which he or she is not a member if the director reasonably believes the committee merits confidence.

A director is not acting in good faith if he or she has knowledge concerning the matter in question that makes reliance otherwise permitted by this section unwarranted.

A director is not liable for any action taken as a director, or any failure to take any action, if he or she performed the duties of his or her office in compliance with this section.

1 B. Policy

13. The Importance of Policy Establish a standard of behavior and a common body of knowledge Provide valuable orientation and training tool and volunteers, employees and board members Help ensure operational consistency Define rights and responsibilities of employees and students Ensure that issues are handled consistently to ensure fairness

Establish a standard of behavior and a common body of knowledge

Provide valuable orientation and training tool and volunteers, employees and board members

Help ensure operational consistency

Define rights and responsibilities of employees and students

Ensure that issues are handled consistently to ensure fairness

14. Suggested Policy Areas Governance Fiscal Management Operations Personnel Students School/Community Relations

Governance

Fiscal Management

Operations

Personnel

Students

School/Community Relations

15. How Policy is Developed Identify the need Assign a person or team to create a draft policy Circulate to relevant school staff, board members and legal counsel Make revisions and place on board agenda for consideration After adoption distribute to school community

Identify the need

Assign a person or team to create a draft policy

Circulate to relevant school staff, board members and legal counsel

Make revisions and place on board agenda for consideration

After adoption distribute to school community

16. Policy Handout Handout 1 – Sample Board Member Agreement

Handout 1 – Sample Board Member Agreement

17. Legislative Update Ethics in Education Act: Among other things, requires charter schools to adopt a policy governing ethics and professional conduct Handout 2 – Memo from FLDOE regarding the Ethics in Education Act Link to Ethics in Education Act Resources: http://www.fldoe.org/edstandards/eie.asp

Ethics in Education Act: Among other things, requires charter schools to adopt a policy governing ethics and professional conduct

Handout 2 – Memo from FLDOE regarding the Ethics in Education Act

Link to Ethics in Education Act Resources: http://www.fldoe.org/edstandards/eie.asp

Section Two Open Government Laws

2 A. Sunshine Law

18. Sunshine Law Introduction Charter school governing boards are subject to the Sunshine Law per Florida Statute 1002.33(16)(a) Policy is to provide a right of access to the decision making process of boards or commissions All meetings of charter school boards of directors at which official acts are to be taken are declared to be public meetings open to the public at all times, and no resolution, rule or formal action shall be considered binding except as taken or made at such meeting

Charter school governing boards are subject to the Sunshine Law per Florida Statute 1002.33(16)(a)

Policy is to provide a right of access to the decision making process of boards or commissions

All meetings of charter school boards of directors at which official acts are to be taken are declared to be public meetings open to the public at all times, and no resolution, rule or formal action shall be considered binding except as taken or made at such meeting

19. Scope of the Sunshine Law Applies to any gathering of two or more board members to discuss a matter which will foreseeably come before the board for action Advisory committees are subject to the Sunshine Law (unless the committee function is purely fact finding)

Applies to any gathering of two or more board members to discuss a matter which will foreseeably come before the board for action

Advisory committees are subject to the Sunshine Law (unless the committee function is purely fact finding)

20. Scope of the Sunshine Law (cont’d) Ex-Officio or non-voting board members (AGO 2005-18) Persons who vote in case of a tie E-mail communications

Ex-Officio or non-voting board members (AGO 2005-18)

Persons who vote in case of a tie

E-mail communications

21. “Open to the Sunshine” Reasonable notice of meetings must be given Minutes of the meetings must be promptly recorded The meeting site must be reasonably accessible to constituents so that a reasonable opportunity to attend the meeting is afforded Public must be afforded opportunity for participation The meeting site cannot unreasonably restrict public access nor discriminate on the basis of sex, age, race, creed, color, gender or economic status

Reasonable notice of meetings must be given

Minutes of the meetings must be promptly recorded

The meeting site must be reasonably accessible to constituents so that a reasonable opportunity to attend the meeting is afforded

Public must be afforded opportunity for participation

The meeting site cannot unreasonably restrict public access nor discriminate on the basis of sex, age, race, creed, color, gender or economic status

22. Exemptions Attorney client meetings. Collective bargaining discussions. Meetings involving minors.

Attorney client meetings.

Collective bargaining discussions.

Meetings involving minors.

23. Subsequent Corrective Action Gatherings conducted in violation of the Sunshine Law can be corrected by a subsequent meeting that complies with the law. Subsequent action may not be perfunctory or ceremonious; a full and open discussion and/or deliberation with the same individuals must take place.

Gatherings conducted in violation of the Sunshine Law can be corrected by a subsequent meeting that complies with the law.

Subsequent action may not be perfunctory or ceremonious; a full and open discussion and/or deliberation with the same individuals must take place.

24. Penalties for Violations Action taken at a meeting which violates the Sunshine Law is void and unenforceable Any person who knowingly violates the Sunshine Law is guilty of a misdemeanor of a second degree, punishable by a fine not exceeding $500 or a term of imprisonment not exceeding 60 days Any person who unknowingly violates the Sunshine Law is subject to a fine not exceeding $500 Handout 3 – Sunshine Law Q &A

Action taken at a meeting which violates the Sunshine Law is void and unenforceable

Any person who knowingly violates the Sunshine Law is guilty of a misdemeanor of a second degree, punishable by a fine not exceeding $500 or a term of imprisonment not exceeding 60 days

Any person who unknowingly violates the Sunshine Law is subject to a fine not exceeding $500

Handout 3 – Sunshine Law Q &A

2 B. Public Records Law

25. Public Records Charter school governing boards are subject to the Public Records Law per Florida Statute 1002.33(16)(a) “It is the policy of this State that all state, county and municipal records shall be open for personal inspection by any person.”

Charter school governing boards are subject to the Public Records Law per Florida Statute 1002.33(16)(a)

“It is the policy of this State that all state, county and municipal records shall be open for personal inspection by any person.”

26. Definition of Public Records “Public Records” include all documents, papers, letters, maps, books, tapes, photographs, films, sound recordings, data processing software, or other material, regardless of physical form, characteristics or means of transmission, made or received pursuant to law or ordinance or in connection with the transaction of official business by any agency

“Public Records” include all documents, papers, letters, maps, books, tapes, photographs, films, sound recordings, data processing software, or other material, regardless of physical form, characteristics or means of transmission, made or received pursuant to law or ordinance or in connection with the transaction of official business by any agency

27. Access to Public Records Public records requests must be responded to within a reasonable period of time. If a portion of a record is exempt you must redact that portion then disclose the remainder of the record. The school may charge fees for providing public records.

Public records requests must be responded to within a reasonable period of time.

If a portion of a record is exempt you must redact that portion then disclose the remainder of the record.

The school may charge fees for providing public records.

28. Access to Public Records Includes e-mails and other electronic transmissions Includes drafts of documents Includes personnel files Always check for exemptions before disclosure!

Includes e-mails and other electronic transmissions

Includes drafts of documents

Includes personnel files

Always check for exemptions before disclosure!

29. Retention of Public Records Public records must be retained in accordance with the retention schedule published by the Florida Division of Library and Information Services (a division of the Department of State. Handout 4 – sample retention schedule

Public records must be retained in accordance with the retention schedule published by the Florida Division of Library and Information Services (a division of the Department of State.

Handout 4 – sample retention schedule

30. Public Records Penalties A public officer who knowingly violates the Public Records Law is subject to suspension and removal or impeachment and is guilty of a misdemeanor of the first degree If a civil action is filed to enforce this law and if a court determines that an agency unlawfully refused to permit a public record to be inspected, examined or copied, the court shall assess and award (against the agency responsible) the reasonable costs of enforcement including attorneys’ fees

A public officer who knowingly violates the Public Records Law is subject to suspension and removal or impeachment and is guilty of a misdemeanor of the first degree

If a civil action is filed to enforce this law and if a court determines that an agency unlawfully refused to permit a public record to be inspected, examined or copied, the court shall assess and award (against the agency responsible) the reasonable costs of enforcement including attorneys’ fees

31. Public Records Charter school governing boards should have a policy for receiving and processing public records requests The policy should include who handles them and require the staff member to keep a log of all requests and responses

Charter school governing boards should have a policy for receiving and processing public records requests

The policy should include who handles them and require the staff member to keep a log of all requests and responses

Section Three Conflicts of Interest and Ethics

32. Conflicts of Interest/Ethics Generally School’s charter generally speaks to prohibited activity. Look to Florida’s Code of Ethics for Public Officers and Employees for guidance (F.S. 112 Part III). Florida Commission on Ethics.

School’s charter generally speaks to prohibited activity.

Look to Florida’s Code of Ethics for Public Officers and Employees for guidance (F.S. 112 Part III).

Florida Commission on Ethics.

33. Conflicts of Interest Doing Business with One’s Agency A board member may not purchase, rent or lease any realty, goods or services for the school from a business of which of board member (or spouse or children) is an officer, partner, director, proprietor or owner of a “material interest” (more than 5% of the total assets or capital stock of the business).

A board member may not purchase, rent or lease any realty, goods or services for the school from a business of which of board member (or spouse or children) is an officer, partner, director, proprietor or owner of a “material interest” (more than 5% of the total assets or capital stock of the business).

34. Conflicts of Interest Conflicting Employment or Contractual Relationship No board member may hold any employment or contract (written or unwritten) with an entity doing business with the school or the school itself OR that would pose a recurring or significant conflict between his or her private interests and public duties.

No board member may hold any employment or contract (written or unwritten) with an entity doing business with the school or the school itself OR that would pose a recurring or significant conflict between his or her private interests and public duties.

35. Conflicts of Interest Exceptions The business is awarded under a system of sealed, competitive bidding to the lowest or best bidder (additional regulations). The business entity involved is the only source of supply within the political subdivision of the officer and there is full disclosure by the officer or employee of his or her interest in the business entity to the governing body of the political subdivision prior to the purchase, rental, sale, leasing, or other business being transacted.

The business is awarded under a system of sealed, competitive bidding to the lowest or best bidder (additional regulations).

The business entity involved is the only source of supply within the political subdivision of the officer and there is full disclosure by the officer or employee of his or her interest in the business entity to the governing body of the political subdivision prior to the purchase, rental, sale, leasing, or other business being transacted.

36. Conflicts of Interest Exceptions (cont’d) The total amount of the transactions in the aggregate between the business entity and the agency does not exceed $500 per calendar year. The fact that a school board member is a stockholder, officer, or director of a bank will not bar such bank from qualifying as a depository of funds coming under the jurisdiction of any such public board or body, provided it appears in the records of the agency that the governing body of the agency has determined that such officer or member of a public board or body has not favored such bank over other qualified banks.

The total amount of the transactions in the aggregate between the business entity and the agency does not exceed $500 per calendar year.

The fact that a school board member is a stockholder, officer, or director of a bank will not bar such bank from qualifying as a depository of funds coming under the jurisdiction of any such public board or body, provided it appears in the records of the agency that the governing body of the agency has determined that such officer or member of a public board or body has not favored such bank over other qualified banks.

37. Conflicts of Interest Hiring of Relatives Under F.S. 112.3135 a relative of a board member may be an employee of the school. NOTE: Many charter contracts prohibit this. Additionally, a relative of a board member reporting directly to the board may cause a continuing and recurring conflict.

Under F.S. 112.3135 a relative of a board member may be an employee of the school.

NOTE: Many charter contracts prohibit this. Additionally, a relative of a board member reporting directly to the board may cause a continuing and recurring conflict.

38. Conflicts of Interest Voting Conflicts A voting conflict arises when an official is called upon to vote on any measure which would inure to the officer’s special private gain or loss (or to the special private gain of a organization by which the officer is retained or a relative). Voting conflicts must be disclosed in writing, filed prior to the meeting and made a part of the meeting minutes. If a voting conflict arises at the meeting disclosure shall be oral following up by a written memorandum within fifteen days.

A voting conflict arises when an official is called upon to vote on any measure which would inure to the officer’s special private gain or loss (or to the special private gain of a organization by which the officer is retained or a relative).

Voting conflicts must be disclosed in writing, filed prior to the meeting and made a part of the meeting minutes. If a voting conflict arises at the meeting disclosure shall be oral following up by a written memorandum within fifteen days.

39. Ethics Solicitation or Acceptance of Gifts A charter school board member is prohibited from soliciting or accepting anything of value (including payment, gift, loan, reward, promise of future employment , favor) based upon any understanding that their votes, official actions or judgment would be influenced thereby. In short, no bribery.

A charter school board member is prohibited from soliciting or accepting anything of value (including payment, gift, loan, reward, promise of future employment , favor) based upon any understanding that their votes, official actions or judgment would be influenced thereby.

In short, no bribery.

40. Ethics Misuse of Public Position A charter school board member may not corruptly use or attempt to use their official positions to secure a special privilege, benefit or exemption for themselves or someone else. “ Corruptly” is defined to mean done with a wrongful intent and for the purpose of obtaining any benefit resulting from an act of omission of a charter school board member which is inconsistent with the proper performance of his or her public duties.

A charter school board member may not corruptly use or attempt to use their official positions to secure a special privilege, benefit or exemption for themselves or someone else.

“ Corruptly” is defined to mean done with a wrongful intent and for the purpose of obtaining any benefit resulting from an act of omission of a charter school board member which is inconsistent with the proper performance of his or her public duties.

41. Ethics Disclosure of Financial Interests Many charters (and the Florida Ethics Code) require board members to file a Form 1 – Statement of Financial Interests. Must be filed within 30 days of the of his or her appointment. Thereafter, you must file by July 1 st following each calendar year for which you hold the position.

Many charters (and the Florida Ethics Code) require board members to file a Form 1 – Statement of Financial Interests.

Must be filed within 30 days of the of his or her appointment. Thereafter, you must file by July 1 st following each calendar year for which you hold the position.

42. Conflicts of Interest and Ethics Importance of Policy Every school should have a policy on conflicts of interest and ethics. Defines conflicts of interest and addresses what happens in the event of a conflict. Defines ethical guidelines for board members.

Every school should have a policy on conflicts of interest and ethics.

Defines conflicts of interest and addresses what happens in the event of a conflict.

Defines ethical guidelines for board members.

Section Four Financial Responsibilities

43. Board Member Obligations Adopt and monitor annual budget Retain CPA for annual independent audit; review and approve the audit report Monitor financial recovery plan, if applicable Review all financial reports due under charter contract Adopt financial policies to assure checks and balances

Adopt and monitor annual budget

Retain CPA for annual independent audit; review and approve the audit report

Monitor financial recovery plan, if applicable

Review all financial reports due under charter contract

Adopt financial policies to assure checks and balances

44. Internal Controls and Accounting Manuals The key to good internal controls is segregation of duties. An accounting manual describes each step of the fiscal process and contains an appropriate procedure for handling that step.

The key to good internal controls is segregation of duties.

An accounting manual describes each step of the fiscal process and contains an appropriate procedure for handling that step.

45. Audit Committee Per F.S. 218.391 charter schools are required to establish an audit committee to select the school’s auditor. Must follow statutory auditor selection process.

Per F.S. 218.391 charter schools are required to establish an audit committee to select the school’s auditor.

Must follow statutory auditor selection process.

46. Auditor Selection Process Establish factors for evaluation. Publicly announce RFP. Provide interested firms with RFP. Evaluate proposals. Rank and recommend in order of preference.

Establish factors for evaluation.

Publicly announce RFP.

Provide interested firms with RFP.

Evaluate proposals.

Rank and recommend in order of preference.

47. Auditor Selection Process (cont’d) Every procurement of audit services shall be evidenced by a written contract that includes provisions set forth in the statute (F.S. 218.391 (7)). Exception: written contracts may be renewed without the use of the auditor selection procedures. Renewal of the contract shall be in writing.

Every procurement of audit services shall be evidenced by a written contract that includes provisions set forth in the statute (F.S. 218.391 (7)).

Exception: written contracts may be renewed without the use of the auditor selection procedures. Renewal of the contract shall be in writing.

48. Financial Reporting Budget versus actual expenses Balance sheet Income and expense statement Cash flow projection Bank reconciliations

Budget versus actual expenses

Balance sheet

Income and expense statement

Cash flow projection

Bank reconciliations

49. Sources of Public Funding Charter School Program Grant Florida Education Finance Program (FEFP) Charter Schools Capital Outlay

Charter School Program Grant

Florida Education Finance Program (FEFP)

Charter Schools Capital Outlay

50. Florida Education Finance Program Developed from a head count of students which occurs during a 10-day window in early October and early February From these surveys an FTE number is generated (full-time equivalent) These numbers are entered into a Charter School FTE Funding Worksheet

Developed from a head count of students which occurs during a 10-day window in early October and early February

From these surveys an FTE number is generated (full-time equivalent)

These numbers are entered into a Charter School FTE Funding Worksheet

51. Capital Outlay Permitted Expenditures Purchase of real property. Construction of school facilities. Purchase, lease-purchase, or lease of permanent or relocatable school facilities. Purchase of vehicles to transport students to and from the charter school. Renovation, repair, and maintenance of school facilities that the charter school owns or is purchasing through a lease-purchase or long-term lease of 5 years or longer.

Purchase of real property.

Construction of school facilities.

Purchase, lease-purchase, or lease of permanent or relocatable school facilities.

Purchase of vehicles to transport students to and from the charter school.

Renovation, repair, and maintenance of school facilities that the charter school owns or is purchasing through a lease-purchase or long-term lease of 5 years or longer.

52. Financial Responsibilities Handout Handout 5: 10 questions every charter school board member should ask.

Handout 5: 10 questions every charter school board member should ask.

53. Conclusion Assessment Review Disclaimer: No material in this workshop is intended to be nor should it be construed as legal advice. If you have specific questions pertaining to your school please consult your school’s attorney.

Assessment Review

Disclaimer: No material in this workshop is intended to be nor should it be construed as legal advice. If you have specific questions pertaining to your school please consult your school’s attorney.

Contact Information Kathleen W. Schoenberg, Esq. Kathleen W. Schoenberg, P.A. 14545 J Military Trail #226 Delray Beach, FL 33484 Tel: (561) 350-3343 Fax: (561) 431-5731 E-mail: [email_address]

Kathleen W. Schoenberg, Esq.

Kathleen W. Schoenberg, P.A.

14545 J Military Trail

#226

Delray Beach, FL 33484

Tel: (561) 350-3343

Fax: (561) 431-5731

E-mail: [email_address]