The CHARTER Act would prohibit charter schools and charter management organizations from contracting with for-profit companies to operate, oversee, or manage their schools if those schools receive federal education funding. The bill is a response to charter schools that have restructured to work around a 2006 court ruling finding that for-profit charter schools were ineligible for federal funds under education law. The legislation would allow charter schools to continue contracting with for-profit entities only for specific support services like food, payroll, facilities maintenance, transportation, textbooks, and other ancillary supplies. The new restrictions would take effect three years after the law is enacted and would apply to any contract entered into, renewed, or extended from the date of enactment. The bill affects all charter schools receiving funds through the Elementary and Secondary Education Act or the Individuals with Disabilities Education Act.
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