RS 17:4001 Louisiana charter school start-up loan fund; creation; purpose; distribution
PART VI. LOUISIANA CHARTER SCHOOL
START-UP LOAN FUND
§4001. Louisiana Charter School Start-Up Loan Fund; creation; purpose; distribution
A. The Louisiana Charter School Start-Up Loan Fund, hereafter referred to as the "fund", is hereby created within the state treasury for the purposes of providing a source for funding no-interest loans to assist both existing and new type 1, type 2, or type 3 charter schools with initial start-up funding and for funding the administrative and legal cost associated with the charter school program.
B. All monies appropriated to the fund and any grants, other donations, or other sources of financial assistance directed to the fund shall be deposited into the fund. Monies in the fund shall be subject to appropriation by the legislature and shall be appropriated to the State Board of Elementary and Secondary Education for allocation by the board as no-interest loans for the purposes provided in this Section or for other educational purposes as determined by the legislature. All unexpended and unencumbered monies remaining in such fund at the end of each fiscal year shall remain in the fund. The monies in such fund shall be invested by the state treasurer in accordance with state law, and interest earned on the investment of these monies shall be credited to the fund, after compliance with the requirements of Article VII, Section 9(B) of the Constitution of Louisiana, relative to the Bond Security and Redemption Fund.
C.(1) The State Board of Elementary and Secondary Education shall administer the use of the monies appropriated from the fund and shall adopt rules in accordance with the Administrative Procedure Act. The adopted rules shall specify that state board approval of any type 2 charter school proposal that includes within its budget a request for loan funding which complies with the provisions of this Section and details regarding how those loan funds are to be expended, shall constitute the approval of that loan amount. No additional loan application paperwork shall be required. Any type 1 or type 3 charter school approved by their local school board shall be required to submit no more than their approved charter proposal and a detailed budget identifying how any loan funds are to be expended and how such request complies with the provisions of this Section. The state board may reject any such request which does not comply with terms of this Section. Such rules shall also note that any loan funding may only be used to purchase tangible items such as equipment, technology, instructional materials, and facility acquisition, upgrade, and repairs. Such equipment or other items shall become the property of the state if the loan is not fully repaid by virtue of the school ceasing to operate during the three years of automatic loan repayment as noted in Paragraph (3) of this Subsection.
(2) Loans shall be made only to type 1, type 2, and type 3 charter schools and shall not exceed one hundred thousand dollars to pay for charter school start-up and early operating expenses. No money lent as provided in this Section may be used to pay prior debts of the nonprofit corporation which formed the charter school, any of the natural persons principally involved in forming the charter school, or any former or current business or nonprofit venture of any such natural persons for any purchase not related to the creation of the charter school, or to pay to members of the immediate family of any such natural persons, or to make any investments.
(3) Loans to qualifying charter schools shall be repaid with no interest and may be made by the authority for terms of up to three years. Loan repayment shall occur by having the state Department of Education automatically reduce the last state payment or payments for each charter school by one-third of the total loan amount during the initial three years of the loan term. The state Department of Education shall instead deposit those funds with the state treasury in the Louisiana Charter School Start-up Loan Fund.
(4) The state board shall not knowingly approve the loan portion of any type 2 charter school's budget proposal if the background checks required by the state board reveals that any person principal to the charter school proposal has been convicted of any felony related to misappropriation of funds or theft.
Acts 1997, No. 477, §1, eff. June 30, 1997; Acts 1999, No. 757, §1, eff. July 2, 1999; Acts 2001, No. 1182, §2, eff. July 1, 2001.