46th legislature - STATE OF NEW MEXICO - first session, 2003

RELATING TO EDUCATION; CHANGING PRIORITIES FOR ENROLLMENT IN CHARTER SCHOOLS; PROVIDING FOR MEDIATION, ARBITRATION AND DISPUTE RESOLUTION PROCESSES; AMENDING, REPEALING AND ENACTING SECTIONS OF THE 1999 CHARTER SCHOOLS ACT.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 22-8B-1 NMSA 1978 (being Laws 1999, Chapter 281, Section 1) is amended to read:

"22-8B-1. SHORT TITLE.--[Sections 1 through 15 of this act] Chapter 22, Article 8B NMSA 1978 may be cited as the "1999 Charter Schools Act"."

Section 2. Section 22-8B-2 NMSA 1978 (being Laws 1999, Chapter 281, Section 2) is amended to read:

"22-8B-2. DEFINITIONS.--As used in the 1999 Charter Schools Act:

A. "arbitration" means a process whereby a decision-maker is selected by the interested parties or appointed by the judiciary to act as an arbitrator and render a binding decision in a dispute concerning the appeal of a decision, other than a decision regarding the application of a charter school or the denial, nonrenewal or revocation of a charter, of a local school board or its designee;

B. "arbitrator" means an individual who is independent of the parties to a dispute between a charter school governing body and a school district and who is selected to hold a hearing and render a binding decision regarding the dispute;

[A.] C. "charter school" means a conversion school or start-up school within a school district authorized by the local school board to operate as a charter school;

[B.] D. "conversion school" means an existing public school within a school district authorized by the local school board to become a charter school;

[C.] E. "governing body" means the governing structure of a charter school as set forth in the school's charter; [and]

F. "interested party" means a charter school applicant, charter school governing body or local school board or its designee involved in a dispute that participates in mediation or arbitration regarding that dispute;

G. "mediation" means a process whereby a neutral party not associated with the dispute concerning a decision of a local school board or its designee helps the interested parties try to resolve the dispute through negotiation and problem solving;

H. "mediator" means an individual or organization that is independent of the parties to a dispute concerning the decision of a local school board or its designee and that acts to assist the interested parties in the resolution of the dispute; and

[D.] I. "start-up school" means a public school developed by one or more parents, teachers or community members authorized by the local school board of the school district in which the school is located to become a charter school."

Section 3. Section 22-8B-4 NMSA 1978 (being Laws 1999, Chapter 281, Section 4, as amended) is amended to read:

"22-8B-4. CHARTER SCHOOLS' RIGHTS AND RESPONSIBILITIES--OPERATION.--

A. A charter school shall be subject to all federal and state laws and constitutional provisions prohibiting discrimination on the basis of disability, race, creed, color, gender, national origin, religion, ancestry or need for special education services.

B. A charter school shall be [administered and] governed by a governing body in the manner set forth in the charter.

C. A charter school shall be responsible for its own operation, including preparation of a budget, contracting for services and personnel matters.

D. A charter school may negotiate or contract with a [local] school district, a university or college or any third party for the use of a facility, its operation and maintenance and the provision of any service or activity that the charter school is required to perform in order to carry out the educational program described in its charter.

E. In no event shall a charter school be required to pay rent for space that is deemed available, as negotiated by contract, in school district facilities; provided that the facilities can be made available at no cost to the district. All costs for the operation and maintenance of the facilities used by the charter school shall be subject to negotiation between the charter school and the district.

F. A charter school shall negotiate with a [local] school district to provide transportation to students eligible for transportation under the provisions of the Public School Code. The [local] school district, in conjunction with the charter school, may establish a limit for student transportation to and from the charter school site not to extend beyond the [local] school district boundary.

G. A charter school may negotiate with a [local] school district for capital expenditures.

H. A charter school shall be a nonsectarian, nonreligious and non-home-based public school that operates within a [public] school district.

I. Except as otherwise provided in the Public School Code, a charter school shall not charge tuition or have admission requirements.

J. A charter school shall be subject to the provisions of Sections 22-1-6 and 22-2-8 NMSA 1978.

K. A charter school may acquire [pledge] and dispose of property; provided that, upon termination of the charter, all assets of the charter school shall revert to the local school board that authorized the charter.

L. A charter school may accept or reject any charitable gift, grant, devise or bequest; provided that no such gift, grant, devise or bequest shall be accepted if subject to any condition contrary to law or to the terms of the charter. The particular gift, grant, devise or bequest shall be considered an asset of the charter school to which it is given.

M. A charter school may contract and sue and be sued. A local school board [that approves a charter school] or its designee shall not be liable for any acts or omissions of the charter school. If a local school board that approved a charter school is sued because of an act or omission of the charter school, upon dismissal of the suit, the court shall assess all costs and reasonable attorney fees against the plaintiff.

N. A charter school shall comply with all state and federal health and safety requirements applicable to public schools."

Section 4. Section 22-8B-5 NMSA 1978 (being Laws 1999, Chapter 281, Section 5) is amended to read:

"22-8B-5. CHARTER SCHOOLS--LOCAL SCHOOL BOARD AUTHORITY--STATE BOARD AUTHORITY.--

A. The local school board may waive only locally imposed school district requirements.

B. The state board shall approve all reasonable requests to waive requirements relating to individual class load and teaching load, length of the school day, staffing patterns, subject areas and the purchase of instructional material. The state board may waive state board requirements or rules and provisions of the Public School Code pertaining to graduation requirements, evaluation standards for school personnel, school principal duties and driver education. Any waivers granted pursuant to this section shall be for the term of the charter granted.

C. A charter school shall be a public school accredited by the state board and shall be accountable to the [school district's] local school board or its designee for [purposes of ensuring] compliance with applicable laws, rules and charter provisions.

D. [No] A local school board shall not require any employee of the school district to be employed in a charter school.

E. [No] A local school board shall not require any student residing within the geographic boundary of its district to enroll in a charter school.

F. A student who is suspended or expelled from a charter school shall be deemed to be suspended or expelled from the school district in which the student resides."

Section 5. Section 22-8B-6 NMSA 1978 (being Laws 1999, Chapter 281, Section 6) is amended to read:

"22-8B-6. CHARTER SCHOOL REQUIREMENTS--APPLICATION PROCESS--AUTHORIZATION.--

A. The local school board shall have the authority to approve the establishment of a charter school within the [local] school district in which it is located.

B. A charter school applicant shall apply to a local school board for a charter. An applicant shall only submit an application in the school district in which the school is located. Applications shall be submitted by [October] July 1 to be eligible for consideration for the following [school] fiscal year. The [October] July 1 deadline may be waived upon agreement of the applicant and the local school board.

C. An application for a start-up school may be made by one or more teachers, parents or community members.

D. An application for a conversion school shall include a petition of support signed by not less than sixty-five percent of the employees in the school. Additionally, a petition in support of the charter school signed by [a majority] no fewer than two-thirds of the households whose children are enrolled in a proposed conversion school [must] shall accompany the application.

E. The local school board shall receive and review all applications for charter schools. The local school board shall not charge application fees. If the local school board finds the charter school application is incomplete, the local school board shall request the necessary information from the charter applicant.

F. The local school board shall hold at least [one meeting] two public meetings to obtain information and community input to assist the local school board in its decision whether to grant a charter school application. Upon receipt of the charter application, the local school board shall hold the first meeting to inform the community and begin a discussion of the charter school application with the applicants and other interested parties. The local school board shall rule on the application for a charter school in a second public meeting within sixty days after receiving the application. If not ruled upon within sixty days, the charter application will be automatically reviewed by the state board in accordance with the provisions of Section [7 of the 1999 Charter Schools Act] 22-8B-7 NMSA 1978. The charter applicant and the local school board may, however, jointly waive the deadlines set forth in this section.

G. If the local school board denies a charter school application or imposes conditions that are unacceptable to the charter applicant, the charter applicant may appeal the decision to the state board pursuant to Section [7 of the 1999 Charter Schools Act] 22-8B-7 NMSA 1978.

H. If a local school board denies a charter school application, it shall state in writing its reasons for the denial and provide the applicant with the written reasons for the denial within fifteen days of the date of denial. If a local school board grants a charter, it shall send a copy of the approved charter to the department of education within fifteen days after granting the charter."

Section 6. Section 22-8B-7 NMSA 1978 (being Laws 1999, Chapter 281, Section 7) is amended to read:

"22-8B-7. CHARTER SCHOOL APPLICATION APPEAL--MEDIATION PROCEDURES.--

A. The state board, upon receipt of a notice of appeal or upon its own motion, shall review decisions regarding the denial, nonrenewal or revocation of a charter of any local school board [concerning charter schools] in accordance with the provisions of this section.

B. A charter applicant or governing body of a charter school that wishes to appeal a decision of a local school board concerning the denial, nonrenewal or revocation of a charter school or the imposition of conditions that are unacceptable to the charter school [or charter school applicant] shall provide the state board with a notice of appeal within thirty days [after] from the receipt of the local school board's written decision. The charter school applicant or governing body of the charter school bringing the appeal shall limit the grounds of the appeal to the grounds for denial, nonrenewal or revocation specified by the local school board. The notice shall include a brief statement of the reasons the charter school applicant or governing body contends the local school board's decision was in error. The appeal and review process shall be as follows:

(1) within sixty days after receipt of the notice of appeal, the state board, at a public hearing that may be held in the school district in which the proposed charter school has applied for a charter or the charter school is located, shall review the decision of the local school board and make its findings. If the state board finds that the local school board's decision was arbitrary, capricious or contrary to the best interests of the students residing in the school district, the school district or the community, the state board shall [remand] refer the decision back to the local school board with written instructions for [approval of the charter. The instructions shall include specific recommendations concerning approval of the charter. The decision of the state board shall be final and not subject to appeal; and] reconsideration;

(2) within thirty days following the [remand] state board's referral of a decision [by the state board] to the local school board, [at a public hearing, shall approve the charter] if the local school board does not decide in favor of the charter applicant or the governing body, the interested parties shall enter mediation, as provided in Section 22-8B-16 NMSA 1978, in an effort to resolve the dispute concerning the local school board's decision. The school district shall pay the cost of the mediation; and

(3) at the conclusion of the mediation, if the interested parties do not reach an agreement, either interested party may appeal the unresolved issues in the dispute to the state board. After review and consideration of the issues mediated, the state board shall render its decision. The decision of the state board shall be final and not subject to appeal.

C. The state board, on its own motion, may review a local school board's decision to grant a charter. Within sixty days after the making of a motion to review by the state board, the board, at a public hearing that may be held in the school district in which the proposed charter school has applied for a charter, shall review the decision of the local school board and determine whether the decision was arbitrary and capricious or whether the establishment or operation of the proposed charter school would:

(1) violate any federal or state laws concerning civil rights;

(2) violate any court order;

(3) threaten the health and safety of students within the school district; or

(4) violate the provisions of Section [11 of the 1999 Charter Schools Act] 22-8B-11 NMSA 1978, prescribing the permissible number of charter schools.

D. If the state board determines that the charter would violate the provisions set forth in Subsection C of this section, the state board shall remand the decision to the local school board with instructions to deny the charter application. The state board may extend the timelines established in this section for good cause. The decision of the state board shall be final and not subject to appeal."

Section 7. Section 22-8B-8 NMSA 1978 (being Laws 1999, Chapter 281, Section 8) is amended to read:

"22-8B-8. CHARTER APPLICATION--CONTENTS.--The charter school application, whether for a start-up school or a conversion school, shall be a proposed agreement between the local school board and the charter school and shall include:

A. the mission statement of the charter school;

B. the goals, objectives and student performance standards to be achieved by the charter school;

C. a description of the charter school's educational program, student performance standards and curriculum that must meet or exceed the state [board of education's] board's educational standards and must be designed to enable each student to achieve those standards;

D. a description of the way [a] the charter school's educational program will meet the individual needs of the students, including those students determined to be at risk;

E. a description of the charter school's plan for evaluating student performance, the types of assessments that will be used to measure student progress toward achievement of the state's standards and the school's student performance standards, the timeline for achievement of the standards and the procedures for taking corrective action in the event that student performance falls below the standards;

F. evidence that the plan for the charter school is economically sound, including a proposed budget for the term of the charter and a description of the manner in which the annual audit of the financial and administrative operations of the charter school is to be conducted;

G. evidence that the fiscal management of the charter school complies with all applicable federal and state laws and regulations relative to fiscal procedures;

H. evidence of a plan for the displacement of students, teachers and other employees who will not attend or be employed in the conversion school;

I. a description of the governing body and operation of the charter school, including how the governing body will be selected, the nature and extent of parental, professional educator and community involvement in the governance and operation of the school and the relationship between the governing body and the local school board or its designee;

J. an explanation of the relationship that will exist between the proposed charter school and its employees, including evidence that the terms and conditions of employment will be addressed with affected employees and their recognized representatives, if any;

K. the employment and student discipline policies of the proposed charter school;

L. an agreement between the charter school and the local school board regarding their respective legal liability and applicable insurance coverage;

M. a description of how the charter school plans to meet the transportation and food service needs of its students;

N. a description of the waivers that the charter school is requesting from the local school board and the state board and the charter school's plan for addressing these waiver requests;

O. a description of the facilities the charter school plans to use; and

P. any other information reasonably required by the local school board."

Section 8. Section 22-8B-9 NMSA 1978 (being Laws 1999, Chapter 281, Section 9) is amended to read:

"22-8B-9. CHARTER SCHOOL--CONTRACT CONTENTS--RULES-- DISPUTE RESOLUTION--ARBITRATION.--

A. An approved charter application shall be a contract between the charter school and the local school board.

B. The contract between the charter school and the local school board shall reflect all agreements regarding the release of the charter school from school district policies.

C. The contract between the charter school and the local school board shall reflect all requests for release of the charter school from state board rules or the Public School Code. Within ten days after the contract is approved by the local school board, any request for release from state board rules or the Public School Code shall be delivered by the local school board to the state board. If the state board grants the request, it shall notify the local school board and the charter school of its decision. If the state board denies the request, it shall notify the local school board and the charter school that the request is denied and specify the reasons for denial.

[D. Upon approval of the charter by the local school board, the charter school shall be waived from the Public School Code provisions relating to individual class load and teaching load requirements, length of school day, staffing patterns, subject areas and purchase of instructional materials.

E.] D. The charter school shall participate in the public school insurance authority.

[F.] E. Any revision or amendment to the terms of the contract may be made only with the approval of the local school board and the governing body of the charter school.

[G.] F. The charter shall include procedures agreed upon by the charter school and the local school board for the resolution of disputes between the charter school and the local school board. If the charter school and the local school board do not reach an agreement regarding a dispute, the interested parties shall enter mediation in an effort to resolve the dispute.

[H. The charter shall include procedures that shall be agreed upon by the charter school and the local school board in the event that such board determines that the charter shall be revoked pursuant to the provisions of Section 12 of the 1999 Charter Schools Act.]

G. At the conclusion of the mediation, if the issues mediated remain partially or wholly unresolved, either interested party may apply to enter into arbitration as provided in Section 22-8B-19 NMSA 1978 to resolve the issues remaining in the dispute."

Section 9. Section 22-8B-11 NMSA 1978 (being Laws 1999, Chapter 281, Section 11) is amended to read:

"22-8B-11. CHARTER SCHOOLS--MAXIMUM NUMBER ESTABLISHED.--

A. A local school [boards] board shall [authorize the approval of both] approve or disapprove conversion and start-up charter schools within [their] its school [districts] district.

B. No more than fifteen start-up schools and five conversion schools may be established per year statewide. The [number of] charter school slots remaining in [that] any year shall be transferred to succeeding years [up to]; provided that a maximum of seventy-five start-up schools and twenty-five conversion schools may be established in any five-year period. The [state board] department of education shall [promptly] notify the local school board of each school district or its designee when the limits set forth in this section have been reached."

Section 10. Section 22-8B-12 NMSA 1978 (being Laws 1999, Chapter 281, Section 12) is amended to read:

"22-8B-12. CHARTER SCHOOLS--TERM--RENEWAL OF CHARTER--GROUNDS FOR NONRENEWAL OR REVOCATION.--

A. A charter school may be approved for an initial term of five or six years; provided that, if the approved term is for six years, the first year is used for planning. A charter may be renewed for successive periods of five years each. Approvals of less than five years [can] may be agreed to between the charter school and the local school board.

B. No later than [January] July 1 of the fiscal year [prior to the year] in which the charter expires, the governing body of a charter school may submit a renewal application to the local school board. The local school board shall rule in a public hearing on the renewal application no later than [March] September 1 of the fiscal year in which the charter expires, or on a mutually agreed date.

C. A charter school renewal application submitted to the local school board shall contain:

(1) a report on the progress of the charter school in achieving the goals, objectives, student performance standards, state board minimum educational standards and other terms of the initial approved charter application, including the accountability requirements set forth in Section 22-1-6 NMSA 1978;

(2) a financial statement that discloses the costs of administration, instruction and other spending categories for the charter school that is understandable to the general public, that will allow comparison of costs to other schools or comparable organizations and that is in a format required by the state board;

(3) contents of the charter application set forth in Section [8 of the 1999 Charter Schools Act] 22-8B-8 NMSA 1978;

(4) a petition in support of the charter school renewing its charter status signed by not less than sixty-five percent of the employees in the charter school; and

(5) a petition in support of the charter school renewing its charter status signed by a majority of the households whose children are enrolled in the charter school.

D. A charter may be revoked or not renewed by the local school board if the board determines that the charter school did any of the following:

(1) committed a material violation of any of the conditions, standards or procedures set forth in the charter;

(2) failed to meet or make substantial progress toward achievement of the state board minimum educational standards or student performance standards identified in the charter application;

(3) failed to meet generally accepted standards of fiscal management; or

(4) violated any provision of law from which the charter school was not specifically exempted.

E. If a local school board revokes or does not renew a charter, the local school board shall, [state in writing its] within fifteen days of the date that it revokes or does not renew the charter, provide the charter school with written reasons for the revocation or nonrenewal.

F. A decision to revoke or not to renew a charter may be appealed by the governing body of the charter school pursuant to Section [7 of the 1999 Charter Schools Act] 22-8B-7 NMSA 1978."

Section 11. Section 22-8B-14 NMSA 1978 (being Laws 1999, Chapter 281, Section 14) is amended to read:

"22-8B-14. CHARTER SCHOOLS STIMULUS FUND CREATED.--

A. The "charter schools stimulus fund" is created in the state treasury. Money in the fund is appropriated to the department of education to provide financial support to charter schools, whether start-up or conversion, for initial planning and start-up costs and initial costs associated with renovating or remodeling existing buildings and structures [for expenditure in fiscal year 2000 and subsequent fiscal years]. The fund shall consist of money appropriated by the legislature and grants, gifts, devises and donations from any public or private source. The department of education shall administer the fund in accordance with rules adopted by the state board. The department of education may use up to three percent of the fund for administrative costs. Money in the fund shall not revert to the general fund at the end of a fiscal year.

B. If the charter school receives an initial grant and fails to begin operating a charter school within the next [eighteen] twenty-four months, the charter school shall immediately reimburse the fund."

Section 12. A new section of the 1999 Charter Schools Act, Section 22-8B-16 NMSA 1978, is enacted to read:

"22-8B-16. [NEW MATERIAL] DISPUTE RESOLUTION--MEDIATION REQUIREMENT--EXEMPTION--SELECTION OF MEDIATOR.--

A. If the dispute arising from a decision of a local school board concerning the application of a charter school or the denial, nonrenewal or revocation of a charter remains wholly or partially unresolved thirty days after it was referred to the local school board for reconsideration, prior to an appeal to the state board the interested parties shall enter mediation as provided in this section.

B. Prior to entering an arbitration process regarding the appeal of a decision of a local school board or its designee pursuant to Section 22-8B-9 NMSA 1978, the governing body and the local school board or its designee shall enter mediation as provided in this section.

C. The provisions of this section shall not apply in a dispute:

(1) between a charter school employee and the charter school or the school district; or

(2) arising as a result of the negotiation of a contract, or from a contract agreement, between a charter school and any person other than the local school board or its designee.

D. The mediator hired to perform a mediation pursuant to this section shall be agreed to by each interested party.

E. The local board or its designee entering mediation shall provide written notice of the date, time and location of the mediation session to all interested parties at least fourteen days prior to the first session and at least five days prior to each succeeding session.

F. The mediation session shall take place at a neutral location providing no advantage to any interested party. The location shall be within the boundaries of the school district in which the charter school is proposed to be established or is located. The mediator has final authority regarding the location of a mediation session if the interested parties are unable to agree on a location."

Section 13. A new section of the 1999 Charter Schools Act, Section 22-8B-17 NMSA 1978, is enacted to read:

"22-8B-17. [NEW MATERIAL] INTERESTED PARTIES PREPARATION--WRITTEN SUMMARIES--ATTENDANCE--DURATION.--

A. Prior to the first mediation session, each interested party shall prepare a written summary that contains a list of the issues to be resolved in the mediation and that party's position relative to each issue. The summary shall not exceed five pages and shall be delivered to the mediator seven days prior to the first mediation session. A mediator may request additional information from any interested party.

B. All interested parties properly notified of a mediation session shall attend the session for a minimum of eight hours unless otherwise agreed to by all other interested parties and the mediator. An interested party attending a mediation session may enter into a settlement of any issue being mediated.

C. The mediation of the dispute shall be completed within forty-five days from the date of the first mediation session."

Section 14. A new section of the 1999 Charter Schools Act, Section 22-8B-18 NMSA 1978, is enacted to read:

"22-8B-18. [NEW MATERIAL] MEDIATION REPORT--COSTS.-- A. Within ten days of the completion of the mediation process, the mediator shall provide each interested party and the state board a copy of the mediation report. The report shall state:

(1) the issues that were mediated;

(2) which issues, if any, were resolved; and

(3) which issues, if any, remain partially or wholly unresolved and suggestions of the mediator for resolution of unresolved issues.

B. Except as otherwise provided in Section 22-8B-7 NMSA 1978, the costs associated with a mediation between a charter school and the local school board or its designee shall be borne equally by the interested parties to the dispute."

Section 15. A new section of the 1999 Charter Schools Act, Section 22-8B-19 NMSA 1978, is enacted to read:

"22-8B-19. [NEW MATERIAL] DISPUTE RESOLUTION--ARBITRATION--SELECTION OF ARBITRATOR.--

A. After participation in mediation with the local school board or its designee to resolve a dispute as provided in Section 22-8B-16 NMSA 1978, if a governing body remains aggrieved by the decision of the local school board or its designee, or the issues mediated remain partially or wholly unresolved regarding a dispute other than a dispute concerning the denial of a charter application or the renewal, nonrenewal or revocation of a charter, the governing body may appeal the decision or unresolved issues to an independent arbitrator. A written notice of appeal shall be submitted to the local school board or its designee within fifteen days of receipt of the mediation report.

B. After participation in mediation with a governing body to resolve a dispute with a charter school, as provided in Section 22-8B-16 NMSA 1978, regarding a dispute other than a dispute concerning the denial of a charter application or the renewal, nonrenewal or revocation of a charter, if the issues mediated remain partially or wholly unresolved, the local school board or its designee may appeal the unresolved issues to an independent arbitrator. A written notice of the appeal shall be submitted to the governing body within fifteen days of receipt of the mediation report. C. The interested parties in the dispute that is the subject of the appeal shall meet to select an arbitrator within ten days from the date the governing body or the local school board or its designee receives the notice of appeal. If the interested parties do not agree to the selection of an arbitrator, the local school board or its designee shall request the presiding judge in the judicial district in which the charter school is located to select an independent arbitrator. The presiding judge shall select the arbitrator and notify the local school board or its designee of the selection within five days from the date the request is received. The local school board or its designee shall provide the governing body with the name, address and phone number of the selected arbitrator within three days of receiving the selection from the presiding judge.

D. An individual shall not be appointed to serve as the arbitrator if the individual:

(1) has any direct or indirect financial interest in the outcome of the proceeding;

(2) has any relationship to any interested party in the proceeding;

(3) is employed by the local school board, the charter school or any member of the governing body; or

(4) is employed by a professional organization of which charter school staff or school district staff are members."

Section 16. A new section of the 1999 Charter Schools Act, Section 22-8B-20 NMSA 1978, is enacted to read:

"22-8B-20. [NEW MATERIAL] ARBITRATION PROCESS AND PROCEDURES.--

A. An appeal to an arbitrator of a dispute between a governing body and a local school board or its designee shall be decided after a de novo hearing before an arbitrator.

B. The hearing shall commence within thirty days from the date of the selection of the arbitrator. The arbitrator shall provide all interested parties with written notice of the date, time and place of the hearing.

C. Each interested party may be represented by counsel at the hearing before the arbitrator.

D. Discovery shall be limited to depositions and requests for production of documents, and shall be allowed on a time schedule set by the arbitrator.

E. An arbitrator may issue subpoenas for the attendance of witnesses and for the production of books, records, documents and other evidence and shall have the power to administer oaths. Subpoenas issued by the arbitrator shall be served and enforced in the manner provided by law for the service and enforcement of subpoenas in a civil action.

F. The rules of civil procedure shall not apply; however, the arbitrator shall allow either interested party to call and examine witnesses, cross-examine witnesses and introduce exhibits. The rules of evidence shall not apply, but in ruling on the admissibility of evidence, the arbitrator may require reasonable substantiation of statements or records tendered, the accuracy or truth of which is in reasonable doubt.

G. An official record of the hearing shall be made. Either interested party may order and pay for a transcript of the hearing."

Section 17. A new section of the 1999 Charter Schools Act, Section 22-8B-21 NMSA 1978, is enacted to read:

"22-8B-21. [NEW MATERIAL] DECISION OF ARBITRATOR--HARMLESS ERROR--COSTS.--

A. The arbitrator shall render a decision affirming or reversing the action of the local school board or its designee. The decision shall contain findings of fact and conclusions of law. The arbitrator shall provide each interested party and the state board with a copy of the decision within thirty days from the date of the conclusion of the hearing.

B. Unless an interested party can demonstrate prejudice arising from a departure from procedures established in this section, the departure shall be presumed to constitute a harmless error.

C. The decision of the arbitrator shall be final and binding on all interested parties and shall not be appealable except if the decision was procured by corruption or collusion, in which case it may be appealed to the court of appeals by filing a notice of appeal as provided in the New Mexico rules of appellate procedure.

D. Each interested party in an appeal decided by an arbitrator shall bear its own costs and expenses. The arbitrator's fees and expenses incurred in the conduct of the arbitration shall be assigned at the discretion of the arbitrator."

Section 18. REPEAL.--Section 22-8B-15 NMSA 1978 (being Laws 1999, Chapter 281, Section 15) is repealed.