Bill Text: NY S00612 | 2025-2026 | General Assembly | Introduced

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Bill Title: 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.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced) 2025-01-08 - REFERRED TO EDUCATION [S00612 Detail]

Download: New_York-2025-S00612-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                           612

                               2025-2026 Regular Sessions

                    IN SENATE

                                       (Prefiled)

                                     January 8, 2025
                                       ___________

        Introduced  by  Sens. LIU, RYAN S -- read twice and ordered printed, 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.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD02081-01-5
        S. 612                              2

     1  The  appointment  of  an  independent fiduciary may be terminated by the
     2  commissioner for a violation of law or the commissioner's regulations or
     3  for breach of contract or neglect of duty as determined by  the  commis-
     4  sioner.    In  the  event that an independent fiduciary's appointment is
     5  terminated by the  commissioner,  a  replacement  independent  fiduciary
     6  shall  be appointed by the commissioner as soon as practicable following
     7  the effective date of such termination.
     8    2-b. Notwithstanding any other provision of law to the  contrary,  the
     9  independent  fiduciary  shall  have  the  power  to  review all existing
    10  disbursements and  to  review,  disallow,  modify  or  approve  all  new
    11  contracts and disbursements of the charter school subsequent to the date
    12  of  the  fiduciary's  appointment,  the  authority to prepare and file a
    13  petition regarding the disposition  of  assets  and/or  a  petition  for
    14  dissolution on behalf of the charter school's board of trustees, and may
    15  supersede  any decision or policy of the charter school that in the sole
    16  judgment of the independent fiduciary conflicts with the school  dissol-
    17  ution  plan.  The independent fiduciary shall, within sixty days follow-
    18  ing the formal dissolution of the charter school, submit a comprehensive
    19  report to the  commissioner  including  information  pertaining  to  the
    20  disposition of assets pursuant to section twenty-eight hundred fifty-one
    21  of this article.
    22    2-c.  It  shall be the duty of the charter school trustees and manage-
    23  ment to fully cooperate with the independent fiduciary. The  independent
    24  fiduciary may visit, examine into and inspect any records of such school
    25  under its oversight.
    26    § 2. Paragraph h of subdivision 4 of section 1950 of the education law
    27  is amended by adding a new subparagraph 14 to read as follows:
    28    (14)  To enter into contracts with individual charter schools to serve
    29  as an independent fiduciary pursuant  to  section  twenty-eight  hundred
    30  fifty-five of this chapter.
    31    §  3.  This  act  shall take effect on the sixtieth day after it shall
    32  have become a law. Effective immediately, the addition, amendment and/or
    33  repeal of any rule or regulation necessary  for  the  implementation  of
    34  this  act  on its effective date are authorized to be made and completed
    35  on or before such effective date.