Requires the appointment of an independent fiduciary upon the closing of a charter school to develop and implement the dissolution plan of such charter school, including the distribution of assets.
STATE OF NEW YORK
________________________________________________________________________
2171
2023-2024 Regular Sessions
IN SENATE
January 19, 2023
___________
Introduced by Sens. LIU, MANNION, RYAN -- read twice and ordered print-
ed, and when printed to be committed to the Committee on Education
AN ACT to amend the education law, in relation to the appointment of an
independent fiduciary upon the dissolution of a charter school
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 2855 of the education law is amended by adding
2 three new subdivisions 2-a, 2-b and 2-c to read as follows:
3 2-a. (a) Within thirty days of a final decision, or as soon as practi-
4 cable thereafter, by a charter entity to revoke, to not renew, or to
5 acknowledge the expiration or surrender of a charter, the commissioner
6 may appoint an independent fiduciary to implement the dissolution plan
7 of such charter school, including the distribution of assets pursuant to
8 paragraph (t) of subdivision two of section twenty-eight hundred fifty-
9 one of this article, and shall notify the closing charter school, the
10 school district of location for the charter school and the school
11 districts of residence for the charter school in writing of the
12 appointed independent fiduciary responsible for overseeing the school's
13 dissolution and closure process.
14 (b) The independent fiduciary may be a non-profit entity, board of
15 cooperative educational services (BOCES), a school district other than
16 the school district of location for the charter school or a school
17 district of residence for pupils of such charter school, or an individ-
18 ual.
19 (c) The independent fiduciary shall contract with the charter school
20 and shall be compensated, and shall be reimbursed for reasonable and
21 necessary expenses incurred as determined by the commissioner. Such
22 compensation and reimbursement shall be paid by the charter school. The
23 independent fiduciary shall be entitled to defense and indemnification
24 by the charter school to the same extent as a charter school employee.
25 The appointment of an independent fiduciary may be terminated by the
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD06029-01-3
S. 2171 2
1 commissioner for a violation of law or the commissioner's regulations or
2 for breach of contract or neglect of duty as determined by the commis-
3 sioner. In the event that an independent fiduciary's appointment is
4 terminated by the commissioner, a replacement independent fiduciary
5 shall be appointed by the commissioner as soon as practicable following
6 the effective date of such termination.
7 2-b. Notwithstanding any other provision of law to the contrary, the
8 independent fiduciary shall have the power to review all existing
9 disbursements and to review, disallow, modify or approve all new
10 contracts and disbursements of the charter school subsequent to the date
11 of the fiduciary's appointment, the authority to prepare and file a
12 petition regarding the disposition of assets and/or a petition for
13 dissolution on behalf of the charter school's board of trustees, and may
14 supersede any decision or policy of the charter school that in the sole
15 judgment of the independent fiduciary conflicts with the school dissol-
16 ution plan. The independent fiduciary shall, within sixty days follow-
17 ing the formal dissolution of the charter school, submit a comprehensive
18 report to the commissioner including information pertaining to the
19 disposition of assets pursuant to section twenty-eight hundred fifty-one
20 of this article.
21 2-c. It shall be the duty of the charter school trustees and manage-
22 ment to fully cooperate with the independent fiduciary. The independent
23 fiduciary may visit, examine into and inspect any records of such school
24 under its oversight.
25 § 2. Paragraph h of subdivision 4 of section 1950 of the education law
26 is amended by adding a new subparagraph 14 to read as follows:
27 (14) To enter into contracts with individual charter schools to serve
28 as an independent fiduciary pursuant to section twenty-eight hundred
29 fifty-five of this chapter.
30 § 3. This act shall take effect on the sixtieth day after it shall
31 have become a law. Effective immediately, the addition, amendment and/or
32 repeal of any rule or regulation necessary for the implementation of
33 this act on its effective date are authorized to be made and completed
34 on or before such effective date.