Section 1: The Charter Agreement
Section 8 of the charter agreement mentions financial and governance noncompliance. Let’s break this down……What does this mean? Linked below are the North Carolina Administrative Codes that define and outline financial and governance noncompliance. Some parts have been highlighted to guide you to the “important” sections.
Financial NonCompliance
Governance NonCompliance
- How do I know if our school is in noncompliance?
EDDIE, EDDIE, EDDIE!!!! The best way to be informed of any noncompliance notification from any department in DPI is by making sure EDDIE is updated and correct with the current school leader and board chair. Anytime these two positions change you MUST update EDDIE. This is the authoritative source for DPI when sending communication to charter schools. Non compliance letters are sent to both the school leader and board chair.
- What can we do to prevent this from happening to us?
- Again, make sure EDDIE is up to date.
- For EDDIE Help CLICK HERE
- For assistance please send email to eddie@dpi.nc.gov
- Do not assume your school leader is reading and sharing all email communications with the board. We often see noncompliance letters falling through the cracks during leadership transitions and/or leadership vacations. It is imperative that the board chair reads all DPI communications in a timely manner.
- Part of board oversight is holding the school leader accountable. However, the board must know enough about what they are delegating to the school leader to know the right questions to ask. Ultimately, the board holds the charter agreement and is accountable for ensuring any noncompliance issues are resolved.
- Did you know…… there are several sections of the charter application that, prior to making changes, must receive approval by OCS or CSRB? The amendment process is governed by administrative code and statute. If you have made any changes to the charter application please reach out to OCS for guidance. Some common amendments include:
- Education Plan
- Bylaws
- Relocation under or over 5-miles
- Transportation
- Lunch Program
- Article of Incorporation filed with the NC Secretary of State
- Changing the name of your school
- Mission Statement
- Charter schools must clearly indicate to vendors and other entities and individuals that the obligations of the agreement or contract are solely the responsibility of the charter school by including the “No Indebtedness” clause.
No indebtedness of any kind incurred or created by the Public Charter School shall constitute an indebtedness of the State or its political subdivisions, and no indebtedness of the Public Charter School shall involve or be secured by the faith, credit, or taxing power of the State or its political subdivisions.
Section 2: Fiscal Oversight
School Business will hold a conference on Jul 22, 2025. Last year’s conference included many sessions specifically for charter schools which will benefit your board’s treasurer, school leader, and finance officer.
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Location: Embassy Suites in Cary, NC. The link for the hotel room discount ends on July 1; please don't wait to reserve your room.
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Registration: Follow this link to register: https://go.ncdpi.gov/25FBSRegistration Once you have submitted your registration, you will receive an email confirmation from noreply@dpi.nc.gov (subject line "2025 FBS Summer Conference Registration FBS25"). Be sure to check your spam folder if it does not appear in your inbox. The invoice attached to that email will provide you with your conference code and invoice number, which you will need whensubmitting your payment.
- This is a great time of year to ensure the school’s insurance policy aligns with the requirements of Section 13 in the charter agreement.
- The Nonprofit shall name the SBE as an Additional Named Insured to their liability coverage for operation of a charter school while obtaining and maintaining insurance at a minimum in the following amounts:
- Errors and Omissions: one million dollars ($1,000,000) per occurrence;
- General Liability: one million dollars ($1,000,000) per occurrence;
- Property Insurance: For owned building and contents, including boiler and machinery coverage, if owned;
- Crime Coverage: no less than two hundred fifty thousand dollars ($250,000) to cover employee theft and dishonesty;
- Automobile Liability: one million dollars ($1,000,000) per occurrence; and
- Workers’ Compensation: as specified by Chapter 97 of NC General Statute, Workers’ Compensation Law.
Hopefully your school’s annual budget for the 25-26 school year has been approved. Check out this article, Charter School Budget Overview: Best Practices and Processes, which states the process consists of five fundamental activities.
Section 3: Governance Tips & Tricks
What does the evaluation process look like for your school’s leader? BoardOnTrack has a great article on the Top 10 Mistakes to Avoid When Evaluating Your School Leader which includes:
- You just don’t do it.
- The board is unclear about what you’re measuring performance against.
- The board doesn’t speak with one voice.
- Misusing parent and teacher satisfaction surveys.
- The board doesn’t complete a parallel evaluation process.
What does the evaluation process look like for the board? How do you know you are an effective board? A board self-evaluation is a great way to communicate to all stakeholders that your board is reflective, responsive, and accountable. Here is some information from the North Carolina School Boards Association that may be helpful.
Section 4.3 of the charter agreement states the Nonprofit board of directors shall adopt and ensure compliance with a conflict of interest and anti-nepotism policy. An annual retreat over the summer is a great time to make sure all board members sign the policy. This policy shall include, at a minimum, the following provisions: 1. No voting member of the governing board shall be an employee of a for-profit company that provides substantial services to the charter school for a fee. 2. (a) Prior to employing any immediate family, as defined in G.S. 115C‑12.2, of any member of the board of directors or a charter school employee with supervisory authority shall be employed or engaged as an employee, independent contractor, or otherwise by the board of directors in any capacity, such proposed employment or engagement shall be:
(i) disclosed to the board of directors and
(ii) approved by the board of directors in a duly called open‑session meeting. (b) The burden of disclosure of such a conflict of interest shall be on the applicable board member or employee with supervisory authority. If the requirements of this subsection are complied with, the charter school may employ the immediate family of any member of the board of directors or a charter school employee with supervisory authority.
3. A requirement that a person shall not be disqualified from serving as a member of a charter school's board of directors because of the existence of a conflict of interest, so long as the person's actions comply with: a. the school's conflict of interest policy established as provided in this subsection; and b. applicable law.
4. No teacher or staff member who is the immediate family of the chief administrator shall be hired without the board of directors evaluating their credentials, establishing a structure to prevent conflicts of interest, and notifying the Department, with evidence, that this process has occurred.
5. Members of the board of directors, decision-making and supervisory employees, and agents of the nonprofit must disclose to the board any direct or indirect conflicts of interest in proposed transactions with the board. A board member with a conflict of interest must recuse himself or herself from considering or voting on a matter in which he or she has a conflict of interest. The remaining board of directors members may approve a conflict of interest transaction provided that the transaction is fair to the corporation. G.S. 55A-8-31.
6. No employee, officer, or agent of the Nonprofit may participate in the selection, award, or administration of a contract supported by a Federal award if he or she has a real or apparent conflict of interest. 2 C.F.R. § 200.318(c); 09 NCAC 03M .0201.
Section 4: Academic Monitoring
- Although the board is not directly involved in the academics of the school, you are tasked with oversight of ensuring adequate academic performance. Understanding adequate academic performance is essential when determining charter renewal terms. SBE Policy CHTR-007: Charter School Renewal Process provides guidance for renewal terms including comparability data.
- As schools move into summer break, what questions can I ask when the school leader is presenting academic information?
- When teachers return for the 25-26 SY, how will they analyze student data from the 24-25 SY? Will they have adequate time to analyze student data? If not, why not. If so, how will the data be used to move academic achievement forward?
- Are students aware of how they are doing academically? If not, why not? If so, how do they hold themselves accountable for improving?
- Based on the end of year assessments, what are the preliminary results saying about student proficiency and growth?
- What can be removed from the school leader/teacher’s plates to free up time to focus on instruction and student progress?
Section 5: Operations
- It’s hiring season! What do we need to know?
- Charter schools must verify that their background checks align with their local LEA in order to comply with the statutory requirement regarding background checks. G.S. 115C-218.90(b).
- Licensed Employees
- 50% of teachers must be licensed
- 100% of EC teachers must be licensed
- Before hiring an unlicensed teacher or allowing someone to volunteer, the school must check the SBE revoked license list. No person shall be hired whose name is on this list.
Section 6: Resources & Professional Development
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