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October 16, 2003

Frances Marine
(850) 245-0413

Education Commissioner Jim Horne Reports on Scholarship School Compliance With State Law and Unveils Proposed Legislation to Strengthen Scholarship Program Accountability
Vast majority of participating private schools reported to be in compliance, proposed legislation will improve DOE oversight of scholarship programs

ORLANDO — Education Commissioner Jim Horne today released preliminary figures from the sworn compliance forms submitted by private schools participating in state scholarship programs and unveiled proposed legislation aimed at strengthening accountability in the programs. Parents, students, and representatives from private schools and scholarship funding organizations joined Horne in support of added accountability measures.

"There is no doubt that scholarship programs have changed the lives of literally thousands of children and added to the quality of education in Florida," said Horne. "Over the past couple of months, we have analyzed the programs and today I am pleased to share our proposals for strengthening the programs through added accountability."

Horne's call for added accountability began with a Sworn Compliance Form, whereby private schools participating in the programs were asked to confirm that they are in compliance with state law.

Nearly 93 percent (1031) of private schools participating in the Opportunity, McKay or Corporate Tax Credit scholarship programs have completed the form. 832 of the schools report full compliance and 199 have action plans to become compliant by December 15th. The Department continues to analyze the data and has taken a number of actions.

"The Department of Education is taking measured steps to ensure that participating private schools report full compliance with the law," said Horne, "these steps will help ensure the continued success of Florida's innovative scholarship programs."

Of the schools that have filled out the form but are not yet in full compliance, the most frequent reasons for not yet being in compliance are: seventh grade scoliosis screenings (109), radon reports (106), owner fingerprints (50), school inspections (50), fire code inspections (25), and immunization reports (21).

Among the actions taken by DOE, certified letters have been sent and faxed to all the schools that did not complete either a form or an action plan, and phone calls have been made to all the schools that did not file the form. These letters warn schools that future payments to scholarship students will be suspended if the completed forms are not received by October 20th and that a letter to this effect will be sent to notify parents of the schools' warning status if they did not complete the form.

As part of the data collection process, including the new data collection system implemented by scholarship funding organizations, 110 students were flagged as being registered this year with more than one scholarship funding organizations (SFO). The majority of those students had transferred between SFOs and the SFOs have corrected the duplicate registrations. Schools that inadvertently received two different tuition payments have returned any double payments and all funds are fully accounted for.

A review of 2002 data flagged a total of 16 students out of a database of nearly 15,000 as having been registered with more than one SFO. Further review demonstrated that only 8 of those students actually received more than the $3500 allowed and the schools those students attend will be required to refund the overage.

"Our new database is a valuable accountability tool that allowed us to correct those few instances - only 8 students out of nearly 15,000 enrolled - where errors were made," said Horne.

Horne thanked Alex Penn-Williams, who has served as Director of Independent Education and is moving on to a position as Special Adviser to the Commissioner, for putting the database in place. He announced that Theresa Klebacha, former Deputy Chancellor for Community Colleges, will be the new Director of Independent Education at the department.

"Alex has made some excellent recommendations and will now move on to other projects," said Horne. "Theresa brings a wealth of management experience that will be invaluable as we seek to implement more accountability in our Office of Independent Education and Parental Choice."

Horne also announced that the Inspector General inquiry into the SFO approval process in general and the Silver Archer Foundation in particular is now closed. The matter involving Silver Archer, the SFO which Horne disqualified last month when allegations of financial misconduct surfaced, has been turned over to the Florida Department of Law Enforcement and the State Attorney's Office.

The proposed legislation unveiled today includes added accountability measures for the state, scholarship funding organizations, schools, and parents. The recommendations are as follows:

Department of Education Accountability (McKay Scholarship & Corporate Tax Scholarship):

  • Establish a toll-free information line for parents, private schools, and SFO's on all scholarship programs.

  • Establish a process for individuals to notify the Department of any private school or SFO violations of state law relating to scholarship program participation.

  • Annually administer and retain records of a sworn compliance form for private schools to certify compliance with state laws.

  • Notify SFOs of any students also receiving an Opportunity or McKay Scholarship to eliminate duplicate participation.

  • Notify SFOs of any students receiving a corporate tax credit scholarship from another SFO.

  • Provide private school profile on-line for those schools participating in the scholarship programs. DOE can use information from annual private school survey.

Scholarship Funding Organization (SFO) Accountability Recommendations (Corporate Tax Scholarship):

  • Require SFOs to be registered as a Florida corporation.

  • Clearly require each SFO to conduct an audit in compliance with generally accepted accounting principles in accordance with standards set forth pursuant to Auditor General rule.

  • Require SFOs to turn in audits to Auditor General and DOE within 120 days after completion of the SFO's fiscal year.

  • Require SFOs to submit quarterly reports to DOE.

  • Require SFOs to verify income eligibility for every student prior to the beginning of each school year through independent income verification.

  • Require the owner/operator of an SFO to submit to fingerprint/background check with Florida Department of Law Enforcement and DOE.
    • No person convicted of moral turpitude can be an owner/operator of an SFO.
    • No person who has filed within the last 7 years for personal or corporate bankruptcy can be an owner/operator of an SFO.

  • Prohibit an owner/operator of an SFO from owning or operating a private school that is participating in the program.

  • Prohibit SFOs from discriminating against any applicant for a scholarship based upon race, color, national origin, sex, or religion.

  • Requiring SFOs to allow parents to participate at any qualified private school and allow parents to transfer their scholarship to any qualified participating private school.

  • Prohibits SFOs from targeting scholarships to particular private schools or from providing scholarships to their own employees.

  • Require SFOs to obtain verification from the private school of a student's continued attendance at the school prior to each scholarship payment.

  • Require SFOs to distribute payments on a cycle of no less than quarterly payments.

  • Require SFOs to maintain separate accounts for scholarship funds and operating funds - prohibit commingling of these funds.

  • Require SFOs to report any private school not in compliance with the law relating to the scholarship program to the Commissioner of Education. Authorize the SFO to stop payment of any scholarship funds to the private school pursuant to the Commissioner's determination of noncompliance.

  • Provide the Commissioner of Education with additional authority to take action against an SFO found to be in violation of the law.

Additional prohibitions:

  • Prohibit duplicate participation in scholarship programs. Students must not receive both a CIT scholarship and a McKay or Opportunity Scholarship.

  • Prohibit a student from receiving a scholarship from more than one SFO.

    Private School Accountability (McKay Scholarship & Corporate Tax Scholarship):

  • Change fiscal soundness requirements from:
    • 1 year in existence, or
    • surety bond or letter of credit, or
    • letter from CPA


    • 3 years in existence, or
    • surety bond or letter of credit

  • List more clearly the state and local health and safety laws and codes private schools must comply with.

  • List more clearly the private school laws described in current law.

  • Require private schools participating in the scholarship programs to annually comply with DOE's sworn compliance form relating to state laws.

  • Require the FDLE fingerprint/criminal background check results of the owner/operator go to DOE.

  • Require all personnel with direct student contact to have FDLE fingerprint/criminal background check. (currently only required of owner/operator)

Private School Accountability (Corporate Tax Scholarship only):

  • Require private schools to notify DOE of their intent to participate in the CIT program. (already required in McKay)

  • Require private schools to employ teachers who hold baccalaureate or higher degree, 3 years of experience, or special skills. (already required in McKay)

  • Require private schools to administer one of the nationally norm-referenced tests identified by department to scholarship students. Student with disabilities for whom standardized testing is not appropriate are exempt from the testing provision. DOE must identify all nationally norm-referenced tests that are comparable to the norm-referenced test included in the FCAT (currently the SAT 9). Results would go to parents and to a private 3rd party research entity. The research entity would report to the state on the aggregate learning gains of the students.

  • Require private schools to notify DOE and the SFOs of any student receiving a check from more than one SFO.

Parent/Student Accountability (Corporate Tax Scholarship only):

  • Require students participating to comply with private school's attendance policies and code of conduct. (already required in McKay).

  • Require parents of students participating to comply with private school's parental involvement requirements. (already required in McKay).

  • Require parents of students participating to ensure that the student participates in the nationally norm-referenced test given by the private school. Student with disabilities for whom standardized testing is not appropriate are exempt.

  • Require parents to restrictively endorse check from SFO to private school. (already required in McKay).

  • Failure to comply with the provisions of program participation result in forfeiture of the scholarship. (already required in McKay).

    Parent/Student Accountability (McKay Scholarship & Corporate Tax Scholarship):

  • Prohibits the use of power of attorney relating to a parent restrictively endorsing the check to the private school.

The current number of students participating in these scholarship programs is 24,368. Of those, 12,305 participate in the McKay Scholarship program for students with disabilities, 11,420 participate in the Corporate Tax Credit scholarship for low income students, and 643 participate in the Opportunity Scholarship program for students from double F schools.

Copies of the IG report on Silver Archer, a summary of the sworn compliance survey results, and the proposed legislation on scholarship program accountability are attached.