Senate Bill S2171

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2171
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             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:
 
   Section 1.  Section 2855 of the education law  is  amended  by  adding
 three new subdivisions 2-a, 2-b and 2-c to read as follows:
   2-A. (A) WITHIN THIRTY DAYS OF A FINAL DECISION, OR AS SOON AS PRACTI-
 CABLE  THEREAFTER,  BY  A  CHARTER ENTITY TO REVOKE, TO NOT RENEW, OR TO
 ACKNOWLEDGE THE EXPIRATION OR SURRENDER OF A CHARTER,  THE  COMMISSIONER
 MAY  APPOINT  AN INDEPENDENT FIDUCIARY TO IMPLEMENT THE DISSOLUTION PLAN
 OF SUCH CHARTER SCHOOL, INCLUDING THE DISTRIBUTION OF ASSETS PURSUANT TO
 PARAGRAPH (T) OF SUBDIVISION TWO OF SECTION TWENTY-EIGHT HUNDRED  FIFTY-
 ONE  OF  THIS ARTICLE,  AND SHALL NOTIFY THE CLOSING CHARTER SCHOOL, THE
 SCHOOL DISTRICT OF LOCATION  FOR  THE  CHARTER  SCHOOL  AND  THE  SCHOOL
 DISTRICTS  OF  RESIDENCE  FOR  THE  CHARTER  SCHOOL  IN  WRITING  OF THE
 APPOINTED INDEPENDENT FIDUCIARY RESPONSIBLE FOR OVERSEEING THE  SCHOOL'S
 DISSOLUTION AND CLOSURE PROCESS.
   (B)  THE  INDEPENDENT  FIDUCIARY  MAY BE A NON-PROFIT ENTITY, BOARD OF
 COOPERATIVE EDUCATIONAL SERVICES (BOCES), A SCHOOL DISTRICT  OTHER  THAN
 THE  SCHOOL  DISTRICT  OF  LOCATION  FOR  THE CHARTER SCHOOL OR A SCHOOL
 DISTRICT OF RESIDENCE FOR PUPILS OF SUCH CHARTER SCHOOL, OR AN  INDIVID-
 UAL.
   (C)  THE  INDEPENDENT FIDUCIARY SHALL CONTRACT WITH THE CHARTER SCHOOL
 AND SHALL BE COMPENSATED, AND SHALL BE  REIMBURSED  FOR  REASONABLE  AND
 NECESSARY  EXPENSES  INCURRED  AS  DETERMINED  BY THE COMMISSIONER. SUCH
 COMPENSATION AND REIMBURSEMENT SHALL BE PAID BY THE CHARTER SCHOOL.  THE
 INDEPENDENT  FIDUCIARY  SHALL BE ENTITLED TO DEFENSE AND INDEMNIFICATION
 BY THE CHARTER SCHOOL TO THE SAME EXTENT AS A CHARTER  SCHOOL  EMPLOYEE.
 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
 
 COMMISSIONER FOR A VIOLATION OF LAW OR THE COMMISSIONER'S REGULATIONS OR
 FOR BREACH OF CONTRACT OR NEGLECT OF DUTY AS DETERMINED BY  THE  COMMIS-
 SIONER.    IN  THE  EVENT THAT AN INDEPENDENT FIDUCIARY'S APPOINTMENT IS
 TERMINATED  BY  THE  COMMISSIONER,  A  REPLACEMENT INDEPENDENT FIDUCIARY
 SHALL BE APPOINTED BY THE COMMISSIONER AS SOON AS PRACTICABLE  FOLLOWING
 THE EFFECTIVE DATE OF SUCH TERMINATION.
   2-B.  NOTWITHSTANDING  ANY OTHER PROVISION OF LAW TO THE CONTRARY, THE
 INDEPENDENT FIDUCIARY SHALL  HAVE  THE  POWER  TO  REVIEW  ALL  EXISTING
 DISBURSEMENTS  AND  TO  REVIEW,  DISALLOW,  MODIFY  OR  APPROVE  ALL NEW
 CONTRACTS AND DISBURSEMENTS OF THE CHARTER SCHOOL SUBSEQUENT TO THE DATE
 OF THE FIDUCIARY'S APPOINTMENT, THE AUTHORITY  TO  PREPARE  AND  FILE  A
 PETITION  REGARDING  THE  DISPOSITION  OF  ASSETS  AND/OR A PETITION FOR
 DISSOLUTION ON BEHALF OF THE CHARTER SCHOOL'S BOARD OF TRUSTEES, AND MAY
 SUPERSEDE ANY DECISION OR POLICY OF THE CHARTER SCHOOL THAT IN THE  SOLE
 JUDGMENT  OF THE INDEPENDENT FIDUCIARY CONFLICTS WITH THE SCHOOL DISSOL-
 UTION PLAN.  THE INDEPENDENT FIDUCIARY SHALL, WITHIN SIXTY DAYS  FOLLOW-
 ING THE FORMAL DISSOLUTION OF THE CHARTER SCHOOL, SUBMIT A COMPREHENSIVE
 REPORT  TO  THE  COMMISSIONER  INCLUDING  INFORMATION  PERTAINING TO THE
 DISPOSITION OF ASSETS PURSUANT TO SECTION TWENTY-EIGHT HUNDRED FIFTY-ONE
 OF THIS ARTICLE.
   2-C. IT SHALL BE THE DUTY OF THE CHARTER SCHOOL TRUSTEES  AND  MANAGE-
 MENT  TO FULLY COOPERATE WITH THE INDEPENDENT FIDUCIARY. THE INDEPENDENT
 FIDUCIARY MAY VISIT, EXAMINE INTO AND INSPECT ANY RECORDS OF SUCH SCHOOL
 UNDER ITS OVERSIGHT.
   § 2. Paragraph h of subdivision 4 of section 1950 of the education law
 is amended by adding a new subparagraph 14 to read as follows:
   (14) TO ENTER INTO CONTRACTS WITH INDIVIDUAL CHARTER SCHOOLS TO  SERVE
 AS  AN  INDEPENDENT  FIDUCIARY  PURSUANT TO SECTION TWENTY-EIGHT HUNDRED
 FIFTY-FIVE OF THIS CHAPTER.
   § 3. This act shall take effect on the sixtieth  day  after  it  shall
 have become a law. Effective immediately, the addition, amendment and/or
 repeal  of  any  rule  or regulation necessary for the implementation of
 this act on its effective date are authorized to be made  and  completed
 on or before such effective date.