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 TCSA Legal Advisory                                          
Annual Public Hearing on Financial Management Report  
Deadline:  November 5, 2014     
We write to remind member schools of the legal obligation to create a 2014 financial management report and to host a public hearing on the same. The public hearing must be hosted by the charter holder board of directors and must be held on or before November 5, 2014. (This date is two months after  TEA released the final 2013 School FIRST ratings on September 5, 2014). The hearing can be held in concert with any regular meeting of the board of directors and must be held at a charter school facility. Here is additional information:

Advanced Notice.  Advanced notice of the public hearing must be published in a newspaper of general circulation in the geographic boundaries of the open-enrollment charter school. Notice must be published two times, once a week for two weeks prior to the public hearing. The first published notice may not be published more than 30 days prior to or less than 14 days prior to the hearing date. If there is not a newspaper published in the county where the charter school's central administrative office is located, then notice may be published in a newspaper in the nearest county seat. Additionally, notice of the hearing must be sent through electronic mail to media serving the charter schools. These newspaper and media notices do not replace the 72-hour board meeting agenda posting required under the Texas open meetings laws. Therefore, be certain to post the open meetings notice as well.

Dissemination and Retention of the Financial Management Report.  At the public hearing, disseminate written copies of the prepared financial management report to parents and taxpayers who attend. A designated spokesperson(s) should review the information included in the report. Give members of the public an opportunity to comment on the report. Retain a copy of the report for at least a three year period after the hearing. After the public hearing, make the written report available to parents and taxpayers on request.

Contents of the Financial Management Report.  The 2014 Financial Management Report is based on financial data from the 2012 - 2013 fiscal year. The report must include the following information:
  1. The school's final rating under Charter FIRST. The school's charter FIRST rating can be viewed on  TEA's website.  
  2. The charter holder's financial performance under each of the indicators used in TEA's analysis for the current year and for the previous year's financial accountability rating:
  • A copy of the superintendent's current employment contract or other written documentation of employment where no contract exists. The purpose of this disclosure is to report all compensation and benefits paid to the superintendent. In lieu of publishing the contract in the financial management report, the charter holder may post the contract on the charter school's internet website.
  • A summary schedule for the 2012 - 2013 fiscal year of total reimbursements received by the superintendent and each board member, including transactions on the charter school's credit cards. The report must separately show reimbursements for meals, lodging, transportation, fuel, and any other items excluding supplies and materials purchased for the school.
  • A summary schedule for the 2012 - 2013 fiscal year of the dollar amount of compensation and/or fees received by the superintendent from another charter school, school district or outside entity in exchange for professional consulting and/or other personal services. Separately report the amount received from each outside entity.
  • A summary schedule for the 2012-2013 fiscal year of the total dollar amount by the charter holder's or charter school's executive officers and board members (and their immediate family as described by Government Code, Chapter 573, Subchapter B, as a person related to another person within the first degree by consanguinity or affinity) of gifts that had an aggregate economic value of $250 or more. Gifts must be reported if they were received from an outside entity that received payments from the charter school or charter holder. Gifts also must be reported if they were received from competing vendors that were not awarded contracts from the charter. Travel reimbursements from outside entities do not need to be reported if the purpose of the travel was for the duties of the executive officers or board members or for travel to attend conferences or seminars whose primary purpose is continuing education.
  • A summary schedule for the 2012 - 2013 fiscal year of the dollar amount by board member for the aggregate amount of business transactions with the charter school or charter holder. These do not include expense reimbursements.
  • The charter must also provide a summary schedule of the data previously submitted to TEA for purposes related to financial solvency.  
  • Any other information the board of directors determines to be useful, especially information that can explain any special circumstances that may have affected the LEA's FIRST rating.  

Template for the Financial Management Report.  There is not a legally prescribed form for the financial management report. However, TEA has posted a sample template on their website.  


Corrective Action Plans for Some Charter Schools.  Any open-enrollment charter school that received a FIRST rating of Substandard Achievement or Suspended-Data Quality is required to submit a corrective action plan to the Agency within one month of the public hearing.  


We hope that this information has been helpful to you. If you have any questions contact
Lindsey Gordon, Director of Legal and Policy Services
at  512.584.TCSA (8272), ext. 307.
TCSA periodically will send a legal advisory. Each TCSA Legal Advisory alerts members to significant legal developments occurring through court decisions, laws, and/or regulations. Legal advisories provide only general legal information. For specific legal counsel concerning the impact of any court decision, law or regulation a particular school, TCSA members are encouraged to contact a school attorney. TCSA Legal Advisories are e-mailed on the date of publication to all TCSA members.