HB 241

02-10 16:36  3rd Sub. (Cherry) H.B. 241
  Candice B. Pierucci proposes the following substitute bill:
1Charter School Amendments
  2026 GENERAL SESSION
  STATE OF UTAH
  Chief Sponsor: Candice B. Pierucci
  Senate Sponsor: Heidi Balderree
2
3   LONG TITLE
4   General Description:
5This bill modifies provisions related to charter schools, including property disposition,
6   governance requirements, and the Charter School Revolving Fund.
7   Highlighted Provisions:
8This bill:
9▸ gives charter schools parity with eligible entities to purchase decommissioned school
10   property;
11▸ establishes restrictions on charter school resale of acquired property;
12▸ requires charter school governing board members to take an oath of office;
13▸ clarifies that charter schools are public schools;
14▸ replaces the Charter School Revolving Account with the Charter School Revolving Fund;
15   and
16▸ makes technical changes.
17   Money Appropriated in this Bill:
  3rd Sub. H.B. 241
18None
19   Other Special Clauses:
20None
21   Utah Code Sections Affected:
22   AMENDS:
2353F-9-203, as last amended by Laws of Utah 2024, Chapter 507
2453G-4-901, as last amended by Laws of Utah 2025, First Special Session, Chapter 16
2553G-4-902, as last amended by Laws of Utah 2025, Chapter 391
2653G-5-104, as last amended by Laws of Utah 2024, Chapter 63
2753G-5-401, as last amended by Laws of Utah 2024, Chapter 63
28   ENACTS:
3rd Sub. (Cherry) H.B. 241  02-10 16:36
2953F-9-203.1, Utah Code Annotated 1953
3053G-4-904, Utah Code Annotated 1953
3153G-5-406.5, Utah Code Annotated 1953
32
33   Be it enacted by the Legislature of the state of Utah:
34Section 1. Section 53F-9-203 is amended to read:
3553F-9-203 . Charter School Revolving Account.
36   (1)(a) The terms defined in Section 53G-5-102 apply to this section.
37(b) As used in this section, "account" means the Charter School Revolving Account.
38   (2)(a) There is created within the Uniform School Fund a restricted account known as
39the "Charter School Revolving Account" to provide assistance to charter schools to:
40(i) meet school building construction and renovation needs; and
41(ii) pay for expenses related to the start[ ]up of a new charter school or the expansion
42of an existing charter school.
43(b) The state board, in consultation with the State Charter School Board, shall administer
44the Charter School Revolving Account in accordance with rules adopted by the state
45board.
46   (3) The Charter School Revolving Account shall consist of:
47(a) money appropriated to the account by the Legislature;
48(b) money received from the repayment of loans made from the account; and
49(c) interest earned on money in the account.
50   (4) The state superintendent shall make loans to charter schools from the account to pay for
51the costs of:
52(a) planning expenses;
53(b) constructing or renovating charter school buildings;
54(c) equipment and supplies; or
55(d) other start-up or expansion expenses.
56   (5) Loans to new charter schools or charter schools with urgent facility needs may be given
57priority.
58   (6) The state board shall:
59(a) review requests by charter schools for loans under this section; and
60(b) in consultation with the State Charter School Board, approve or reject each request.
61   (7) A loan under this section may not be made unless the state board, in consultation with
62the State Charter School Board, approves the loan.
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63   (8) The term of a loan to a charter school under this section may not exceed five years.
64   (9) The state board may not approve loans to charter schools under this section that exceed
65a total of $2,000,000 in any fiscal year.
66   (10)(a) On March 16, 2011, the assets of the Charter School Building Subaccount
67administered by the state board shall be deposited into the Charter School Revolving
68Account.
69(b) Beginning on March 16, 2011, loan payments for loans made from the Charter
70School Building Subaccount shall be deposited into the Charter School Revolving
71Account.
72   (11)(a) On July 1, 2026, the state board shall transfer into the Charter School Revolving
73Fund created in Section 53F-9-203.1 the assets, unused money, and obligations of the
74Charter School Revolving Account administered under this section.
75(b) Beginning July 1, 2026, the state board shall deposit loan payments received for
76loans made under this section into the Charter School Revolving Fund established in
77Section 53F-9-203.1.
78Section 2. Section 53F-9-203.1 is enacted to read:
7953F-9-203.1 . Charter School Revolving Fund.
80   (1) As used in this section:
81(a) The definitions in Section 53G-5-102 apply to this section.
82(b) "Fund" means the Charter School Revolving Fund.
83   (2)(a) There is created within the Uniform School Fund a restricted account known as
84the Charter School Revolving Fund to provide assistance to charter schools to:
85(i) meet school building construction and renovation needs; and
86(ii) pay for expenses related to the startup of a new charter school or the expansion of
87an existing charter school.
88(b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
89Utah Charter Finance Authority shall make rules to administer the fund including:
90(i) establishing the interest rates of loans;
91(ii) amortization schedules for loans; and
92(iii) other terms of repayment.
93   (3) The fund shall consist of:
94(a) assets and money deposited in accordance with Subsection (9);
95(b) money the Legislature appropriates to the fund;
96(c) money received from the repayment of loans made from the fund; and
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97(d) interest earned on money in the fund.
98   (4) The Utah Charter Finance Authority shall make loans to charter schools from the fund
99for a loan of:
100(a) up to $1,000,000 to a charter school for a school facility addition or expansion; or
101(b) up to 25% of a requested loan amount to a charter school for the acquisition or
102construction of a school facility.
103   (5) The Utah Charter Finance Authority shall:
104(a) review requests by charter schools for loans under this section; and
105(b) approve or reject each request.
106   (6) The Utah Charter Finance Authority:
107(a) shall:
108(i) make a loan that is secured by a promissory note and a deed of trust from the
109charter school; and
110(ii) require a recipient charter school to repay the funds if the recipient charter school
111sells or refinances any collateral associated with the loan; and
112(b) may make a loan that is subordinate to senior debt.
113   (7) A loan under this section may not be made unless the Utah Charter Finance Authority
114approves the loan.
115   (8) The Utah Charter Finance Authority shall set the term of a loan to a charter school
116under this section.
117   (9)(a) On July 1, 2026, the state board shall transfer into the fund the assets, unused
118money, and obligations of the Charter School Revolving Account administered under
119Section 53F-9-203.
120(b) Beginning on July 1, 2026, the state board shall deposit loan payments for loans
121made from the Charter School Revolving Account into the fund.
122Section 3. Section 53G-4-901 is amended to read:
12353G-4-901 . Definitions.
124      As used in this part:
125   (1) "Eligible entity" means[:] a city, town, or county.
126[(a) a city or town with a population density of 3,000 or more people per square mile; or]
127[(b) a county whose unincorporated area includes a qualifying planning advisory area.]
128   (2) "Purchase price" means the greater of:
129(a) an amount that is the average of:
130(i) the appraised value of the surplus property, based on the predominant zone in the
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131surrounding area, as indicated in an appraisal obtained by the eligible entity; and
132(ii) the appraised value of the surplus property, based on the predominant zone in the
133surrounding area, as indicated in an appraisal obtained by the school district; and
134(b) the amount the school district paid to acquire the surplus property.
135   [(3) "Qualifying planning advisory area" means a planning advisory area under Section
13617-79-303 that has a population density of 3,000 or more people per square mile within
137the boundaries of the planning advisory area.]
138   [(4)] (3) "Surplus property" means land owned by a school district that:
139(a) was purchased with taxpayer money;
140(b) is located within an eligible entity[a city or town that is an eligible entity or within a
141qualifying planning advisory area];
142(c) consists of one contiguous tract at least three acres in size; and
143(d) has been declared by the school district to be surplus.
144Section 4. Section 53G-4-902 is amended to read:
14553G-4-902 . Purchase of surplus property.
146   (1) [An] Subject to Subsection (9), an eligible entity or charter school may purchase, and
147each school district shall sell, surplus property as provided in this section.
148   (2)(a) Upon declaring land to be surplus property, each school district shall give written
149notice to each eligible entity in which the surplus property is located.
150(b) Each notice under Subsection (2)(a) shall:
151(i) state that the school district has declared the land to be surplus property; and
152(ii) describe the surplus property.
153   (3) Subject to Subsection (4), an eligible entity may purchase the surplus property by
154paying the school district the purchase price.
155   (4)(a) The legislative body of each eligible entity desiring to purchase surplus property
156under this section shall:
157(i) within 90 days after the eligible entity receives notice under Subsection (2), adopt
158a resolution declaring the intent to purchase the surplus property and deliver a
159copy of the resolution to the school district; and
160(ii) within 90 days after delivering a copy of the resolution under Subsection (4)(a)(i)
161to the school district, deliver to the school district an earnest money offer to
162purchase the surplus property at the purchase price.
163(b) If an eligible entity fails to comply with either of the requirements under Subsection
164(4)(a) within the applicable time period, the eligible entity forfeits the right to
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165purchase the surplus property.
166   (5)(a) An eligible entity may waive the eligible entity's right to purchase surplus
167property under this part by submitting a written waiver to the school district.
168(b) If an eligible entity submits a waiver under Subsection (5)(a), the school district has
169no further obligation under this part to sell the surplus property to the eligible entity.
170   (6) Surplus property acquired by an eligible entity may not be used for any purpose other
171than:
172(a) a county, city, or town hall;
173(b) a park or other open space;
174(c) a cultural center or community center;
175(d) a facility for the promotion, creation, or retention of public or private jobs within the
176state through planning, design, development, construction, rehabilitation, business
177relocation, or any combination of these, within a county, city, or town;
178(e) office, industrial, manufacturing, warehousing, distribution, parking, or other public
179or private facilities, or other improvements that benefit the state or a county, city, or
180town;
181(f) a facility for a charter school under Chapter 5, Charter Schools; or
182(g) the sale, use, or lease for moderate income housing, as defined in Section 63L-12-101.
183   (7)(a) A school district that sells surplus property under this part may use proceeds from
184the sale only for bond debt reduction or school district capital facilities.
185(b) Each school district that sells surplus property under this part shall place all proceeds
186from the sale that are not used for bond debt reduction in a capital facilities fund of
187the school district for use for school district capital facilities.
188   (8)(a) If both a charter school and one or more eligible entities express interest in
189purchasing the same surplus property under this section, the school district may select
190among applicants based on factors including:
191(i) educational program fit;
192(ii) financial capacity;
193(iii) community benefit; and
194(iv) the intended use of the property as described in Subsection (6).
195(b) The school district shall provide a written explanation of the school district's decision
196that identifies which factors under Subsection (8)(a) were determinative.
197   (9) Charter schools and eligible entities have equal rights to purchase property under this
198section and Section 53G-4-904, with neither having priority over the other.
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199Section 5. Section 53G-4-904 is enacted to read:
20053G-4-904 . Charter school eligible entity option to purchase decommissioned
201   school buildings and property -- Restrictions on resale.
202   (1) As used in this section:
203(a) "Originating LEA" means the LEA that owns the school building to be disposed of or
204decommissioned.
205(b) "School building and associated real property" means:
206(i) a building that has been used as a school facility and the real property on which
207the building is located; and
208(ii) does not include portable or modular classrooms that are not permanently affixed
209to the real property.
210   (2) Before an LEA may dispose of a school building and associated real property through
211the sale of the property, the LEA shall provide charter schools and eligible entities, as
212defined in Section 53G-4-902, with the option to purchase the school building and
213associated real property.
214   (3) In accordance with Subsections (5) and (9), the LEA shall provide written notice of the
215intended disposition to all charter schools authorized within the state and all eligible
216entities at least 90 days before any proposed sale.
217   (4) The LEA shall set the price of the sale using an independent appraisal assessing fair
218market value, which may be conducted by the Division of Facilities and Construction
219Management.
220   (5) The LEA shall ensure the notice includes:
221(a) a description of the property;
222(b) the proposed terms of sale including the price determined in accordance with
223Subsection (4); and
224(c) a deadline for charter schools and eligible entities to submit written expressions of
225interest, which shall be no less than 45 days from the date of notice.
226   (6) If multiple charter schools or eligible entities express interest, the LEA may select
227among applicants based on factors including educational program fit, financial capacity,
228and community benefit.
229   (7)(a) A charter school that purchases a school building and associated real property
230under this section may not dispose of the property through a sale without first
231complying with the requirements of this subsection.
232(b) If a charter school that purchased property under this section intends to sell the
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233property, the originating LEA may purchase, and the charter school shall sell, the
234property at a price equal to the price the charter school paid for the property plus the
235cost of any existing improvements that the charter school made to the property after it
236purchased the property.
237(c) If the originating LEA does not reacquire the property under Subsection (7)(b), the
238charter school shall:
239(i) provide all charter schools authorized within the state and all eligible entities with
240the option to purchase in accordance with the procedures established in this
241section; and
242(ii) after charter schools and eligible entities have exercised or waived the right, the
243charter school may offer the property for sale to any other entity.
244(d) If the originating LEA does not reacquire the property under Subsection (7)(b) and
245the charter school sells the property to another buyer under Subsection (7)(c), the
246charter school and the originating LEA shall equally share any proceeds of that sale
247that exceed the amount the charter school paid for the property plus the cost of any
248existing improvements the charter school made to the property after it purchased the
249property.
250   (8) This section does not apply to property dispositions resulting from condemnation
251proceedings or where federal or state law requires a different disposition process.
252   (9)(a) When written notice is required under this section, the originating LEA shall
253notify the state board and charter school authorizers.
254(b) Upon receiving notice under Subsection (9)(a):
255(i) each charter school authorizer shall distribute the notice to all charter schools
256authorized by that authorizer; and
257(ii) the state board shall distribute the notice to all school districts and eligible entities
258in the state.
259Section 6. Section 53G-5-104 is amended to read:
26053G-5-104 . Purpose of charter schools -- Charter schools are public schools.
261   (1) The purposes of the state's charter schools are to enhance school choice, meet the
262unique needs of Utah families, and encourage innovation within the public education
263system by:
264[(1)] (a) continuing to improve student learning;
265[(2)] (b) encouraging the use of different and innovative teaching methods;
266[(3)] (c) creating new professional opportunities for educators that allow educators to
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267actively participate in designing and implementing learning programs at the school;
268[(4)] (d) increasing choice of learning opportunities for students;
269[(5)] (e) establishing new educational models and new forms of accountability that
270emphasize unique performance measures and innovative measurement tools to
271measure education outcomes;
272[(6)] (f) providing opportunities for greater parental involvement in governance decisions
273at the school level;
274[(7)] (g) expanding public school choice in areas where there is a lack of school choice or
275where schools have been identified for school improvement, corrective action, or
276restructuring; and
277[(8)] (h) collaborating within the public education system.
278   (2) As described in Section 53G-5-401, a charter school is a public school for all purposes
279under Utah law, including:
280(a) the Legislature's authority under Utah Constitution, Article X, Section 3, to designate
281schools and educational programs, including charter schools, as part of the public
282education system;
283(b) eligibility for public funding and resources;
284(c) access to public facilities and property;
285(d) participation in public school programs and initiatives; and
286(e) application of laws governing an LEA.
287Section 7. Section 53G-5-401 is amended to read:
28853G-5-401 . Status of charter schools.
289   (1) Charter schools[ are]:
290(a) are considered to be public schools within the state's public education system;
291(b) are subject to Subsection 53E-3-401(8); and
292(c) shall be governed by an independent [boards] board whose members have taken the
293oath of office as described in Section 53G-5-406.5, and held accountable to a legally
294binding written contractual agreement.
295   (2) A charter school may be established by:
296(a) creating a new school; or
297(b) converting an existing district school to charter status.
298   (3) A parochial school or home school is not eligible for charter school status.
299Section 8. Section 53G-5-406.5 is enacted to read:
30053G-5-406.5 . Oath of office for charter school governing board members.
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301   (1) Before entering upon the duties of office, each charter school governing board member
302shall take and subscribe to the following oath: "I do solemnly swear that I will support,
303obey, and defend the Constitution of the United States and the Constitution of the State
304of Utah, and that I will discharge the duties of my office as a charter school governing
305board member with fidelity."
306   (2) The charter school's authorizer shall ensure the oath is administered by:
307(a) in accordance with Section 78B-1-142, any person authorized to administer oaths;
308(b) for a newly authorized charter school, a representative of the charter school's
309authorizer; or
310(c) after the initial board is sworn in, the chair or another member of the charter school
311governing board.
312   (3) The charter school shall:
313(a) in accordance with Subsection 51-1-2(2), maintain a record of each governing board
314member's oath; and
315(b) provide proof of compliance to the charter school's authorizer upon request.
316Section 9. Effective Date.
317   This bill takes effect on May 6, 2026.
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