CHARTER Act

The CHARTER Act prohibits charter schools receiving federal education funds under the Elementary and Secondary Education Act (ESEA) or Individuals with Disabilities Education Act (IDEA) from contracting with for-profit entities to manage school operations - including curriculum, budgets, or staff decisions. It directly affects public charter schools and their charter management organizations that receive these federal funds. The bill allows contracts with for-profits for specific services like food, payroll, or facilities maintenance but bans profit-driven management arrangements. The law takes effect 3 years after enactment and applies only to new or renewed contracts after that date, closing a loophole identified in a 2006 court case where for-profit schools reorganized as nonprofits to retain federal funding.