ORDER OF THE
STATE SUPERINTENDENT OF PUBLIC INSTRUCTION
ADOPTING PERMANENT RULES
The scope statement for this rule, SS 041-18, was published in Register No. 748A1, on April 2, 2018, and approved by State Superintendent Tony Evers on April 27, 2018. The State Superintendent of Public Instruction hereby adopts an order to repeal s. PI 48.02 (2) and (14), 48.03 (4), (5) (a) 1., 2., (b) 1., 2., and (7) (c), 48.04 (1) (d), 48.06 (6) (b) 2. a. and b., 48.07 (3) (e), (h), (4) (b) 1., and 2., 48.08 (3) (b), (4) (a), (b), and (5) (Note), 48.10 (1) (e) 4., 48.13 (10), 48.14 (2), and 48.16 (6), (7), and (Note); to renumber s. PI 48.08 (3) (a) 1. and 3., and 48.14 (1) (a) to (c); to renumber and amend s. PI 48.03 (5) (a) (intro.), (b) (intro.), (7) (b), (d), and (e), 48.06 (6) (b) 2. (intro.) and 4., 48.07 (4) (b) (intro.), 48.08 (3) (a) (intro.), 2., (4) (intro.), 48.10 (1) (b), (3) (a) 3., and (5) (a), 48.13 (4) (c), and 48.14 (1) (intro.); to amend s. PI 48.02 (10), (12) (a), (b) (intro.), and (15), 48.03 (3), (a) 1. b., 4., (b), (5) (b) (Note), (6) (intro.), (a) (intro.), 3., 4., (b), (c), (7) (a), and (8) (a), 48.04 (1) (c), (e), (2) (f), and (3), 48.05 (1) (a), (4) (a), (b) 2., (8) (a), and (c) (intro.), 48.06 (1) (a), (5), (7) (intro.), (b), (8) (intro.), (a) 1., and (b) 1., 48.07 (1) (intro.), (a), (b), (2), (3) (d) 2., (f), (k), (L), (n), and (4) (a), 48.08 (1), (2), and (5), 48.10 (1) (e) 1., (2), (3) (a) 1., 2., 4., (b) 1., (c) 1., (d) (intro.), 1., (4), and (6), 48.11 (6), 48.12 (5), 48.13 (2) (title), (intro.), (b) (intro.), (4) (a), (8) (title), (9), (12), and (14) (b), 48.15 (1) (intro.), (a), (b), (f), (g), (h), (6) (title), (c), (d) 4. to 6., and (e), 48.16 (1) (d), 48.17 (1) and (2), 48.18 (intro.) and (1), and 48.19 (1) to (4); to repeal and recreate s. PI 48.09 (1); and to create s. PI 48.02 (14m), (22g), and (22r), 48.03 (3) (a) 2m., (7) (b) 1., (f), (9), (Note), and (10), 48.04 (1) (f) 6m. and (2) (bm), 48.06 (6) (b) 2m., 4. a., b., and (8) (a) 4., 48.07 (3) (r), 48.08 (6), 48.09 (3) to (5), 48.10 (1) (b) 1., 2., (e) 4m., (3) (a) 3. a., b., (c) 4., (5) (a) 1. to 3., and (b), 48.13 (2) (a) 7., (4) (c) 1. to 3., and (10m), 48.14 (1g), (3) (intro.), (a) 6m., and (4) to (11), and 48.19 (5), relating to changes to rules governing the Parental Choice Programs as a result of 2017 Wisconsin Acts 36 and 59 and other changes. ANALYSIS BY THE DEPARTMENT OF PUBLIC INSTRUCTION
Statute interpreted: s. 118.60, Stats. Explanation of agency authority:
The Department must promulgate rules to implement and administer the Racine and Wisconsin parental choice programs, pursuant to s. 118.60 (11) (a), Stats. Plain language analysis:
The proposed rule will amend Chapter PI 48 of the Wisconsin Administrative Code in order to conform Department rules governing the Racine and Wisconsin parental choice program to changes in statute as a result of 2017 Wisconsin Acts 36 and 59. The proposed rule will also make other various changes to conform the rule to best practices and efficiencies in program administration. Key aspects of the rule include the following:
Specifies the requirements for the modified financial audit and the standard financial audit.
Specifies the background check requirements, including how the background check must be completed.
Modifies certain due dates so the dates will not fall on a weekend.
Specifies that the budgets required for the program must include the anticipated beginning and ending reserve balance.
Clarifies that the financial audit used to ensure schools meet choice program financial requirements includes the financial audit under s. 115.7915, Stats. Also specifies the non financial viability indicators include the school having a net loss or negative change in net assets in the financial audit or the budget and cash flow.
Modifies the full time equivalent determination so that it is based on the required number of hours for first grade pupils in the private school rather than first grade pupils in the public school district.
Removes the requirement to use original classroom records when completing the procedures for choice program pupils for the enrollment audit. The procedures ensure the submitted pupil counts are accurate by comparing the school submitted pupil count reports to the official attendance records.
Specifies that the identification of choice program pupils may be in a different report than the official attendance records.
Removes summer school provisions already included in statute and modifies course eligibility provisions for summer school.
Clarifies the requirements for including fixed assets in the financial audit.
Specifies that leased right of use assets, which will be required in financial audits due to a change in generally accepted accounting principles, are not included in the required cash and investment balance calculation.
Specifies how net eligible education expenses are calculated if the school is not eligible for all choice program payments.
Specifies what is considered a management letter.
Clarifies the school’s responsibility for the financial requirements.
Specifies the impact of the statement of actual cost on the reserve balance schedule calculations.
Specifies the requirements for the governing body agreements.
Modifies the hours of instruction requirement for continuing schools.
Removes continuing eligibility requirements since they were removed from s. 118.60, Stats..
Clarifies which schools are new private schools.
Modifies the disclosure of information requirement based on changes in s. 118.60, Stats.
Specifies the requirements for a school to indicate it would like an all student accountability report card.
Modifies the auditor fee payment to allow for the amount to be paid using another guaranteed manner permitted by the department.
Modifies the continuing pupil definition and who can complete a department of revenue income determination so that the requirements are consistent with changes in s. 118.60, Stats.
Specifies that the pupil count reports must include the waiting list pupils for the Racine parental choice program.
Specifies that the Choice waiting lists and waiting list applications must be audited by the independent auditor as part of the enrollment audit.
Clarifies that the preliminary enrollment report may not include a pupil that has withdrawn from the school.
Clarifies the employee compensation documentation requirements, including specifying the requirements when schools notify employees of changes in compensation.
Removes the requirement for the risk management and insurance evaluation. All schools participating in the program are required to have a minimum amount of insurance unless a different amount is recommended by a risk or insurance consultant.
Removes the requirements and audit procedures for teacher waivers since they are no longer permitted under s. 118.60, Stats.
Specifies the surety bond requirements for schools that are new to the program.
Specifies that schools new to the program must provide evidence that the school has the required insurance and fidelity bond.
Revised the Wisconsin income limit to match the revised income limit in s. 118.60, Stats.Summary of, and comparison with, existing or proposed federal regulations: N/A
Summary of any public comments and feedback on the statement of scope for the proposed rule that the agency received at a preliminary public hearing and comment period held and a description of how and to what extent the agency took those comments into account and drafting the proposed rule:
The Department held a preliminary public hearing and comment period on April 23rd, 2018, and did not receive any comments on the statement of scope for the proposed rule.
Comparison with rules in adjacent states:
Illinois: Under the Invest in Kids Program, students are eligible to receive a scholarship to attend qualified, nonpublic schools in Illinois if their family is below 300% of the federal poverty level. Student scholarships cannot exceed the state’s average operational expense per pupil, with exceptions and a $75 million credit cap for scholarship awards.
Iowa: The School Tuition Organization Tax Credit provides that individuals, corporations, LLCs and other partnerships that donate to School Tuition Organizations (STOs) may receive a 65% tax credit, and STOs in turn give out funds as tuition grants to lower-income students to attend an accredited, nonpublic school.
Michigan: There are no rules governing private school choice in Michigan.
Minnesota: There are no rules governing private school choice in Minnesota.Summary of factual data and analytical methodologies:
2015 Wisconsin Act 55, the 2015-17 biennial budget, significantly expanded the state’s parental choice programs. The Department promulgated administrative rules, CR 16-006, relating to the parental choice program for eligible school districts and other school districts which is currently in effect. Since then, 2017 Wisconsin Act 36 and 2017 Wisconsin Act 59, the 2017-19 biennial budget, made several changes relating to the administration of the parental choice programs. As a result of recent changes in statute and items identified since the rules were implemented, modifications to PI 48 are needed to better assist participating schools and the Department in the administration of each program. Without a rule change, statute and rule will not be consistent and the Department may be prevented from efficiently administering the program. Analysis and supporting documents used to determine effect on small business or in preparation of economic impact report: N/A
Anticipated costs incurred by private sector: N/A
Effect on small business:
The proposed rules will have no significant economic impact on small businesses, as defined in s. 227.114 (1) (a), Stats. Agency contact person: (including email and telephone)
Carl Bryan
Administrative Rules Coordinator
Wisconsin Department of Public Instruction
