Charter schools are considered independent public schools. We are a hybrid – government entities for the purposes of Public Records, the Open Meeting Law, Arizona State Retirement, and Special Education, etc, but are treated as private companies in most other regards. However, if a proposed IRS regulatory change passes, the charter system will be altered in some profound ways. Under the proposed regulation charter schools will not be considered “governmental” enough to participate in the Arizona State Retirement System. The time for public comment on this issue closes on February 6, 2012.
From the Arizona Charter Association (edited):
IMMEDIATE ACTION NEEDED – Protect Charter Teachers’ Retirement Benefits
There is a regulatory change being proposed by the Internal Revenue Service (Determination of Government Plan Status) that would prohibit Arizona’s 12,000 current and former charter teachers/employees who are in the Arizona State Retirement System from participating.
The legal issues behind the IRS proposed regulation are complex, and the Association will work with federal attorneys to sort them out and present them to members in a brief, cogent manner. The crux of the issue is whether charter schools are sufficiently “governmental” that they can participate in Arizona’s state pension plan.
For more background, read the Association’s letter to the Department here and take immediate action by sending a message here.
For those not familiar with it, the federal rulemaking process can be convoluted and difficult to understand; however, here is a brief overview of the process and where this proposed rule now stands.
Rulemaking is not part of the legislative process. Rules being promulgated by a federal regulatory agency, such as the Department of the Treasury - of which the Internal Revenue Service is a part – are not laws, but the guidelines that govern how a law is implemented, regulated, and enforced. Therefore, rules are not voted on by Members of Congress. Instead, the regulatory agencies responsible for putting forth these rules rely on their own expertise and experience to fashion rules, not on majority opinions. They also rely on input from Members of Congress and on public comment received during public comment periods. The rulemaking process is very prescriptive and periods for public comment are well defined. The rule being proposed by the Internal Revenue Service is currently in the public comment stage; however, the public comment period ends on Monday, February 6. The Department will hold a hearing in June on the matter.
Due to these deadlines, it is imperative that anyone who opposes the proposed rule submit comments to the Department by February 6. If you choose to submit a comment, feel free to express your own thoughts about how devastating implementation of this rule would be and how it would negatively affect Arizona and/or your household.
The Charter Association has created a quick and easy tool that will send your e-mail to the IRS, your congressmen, and the Secretary of Education. Simply sign up for votervoice.
Article explaining the changes and their effects:
If you would like to send an e-mail without registering for votervoice, I have listed several e-mail addresses (below). Make sure you use the subject line - RE: Response to Proposed Treasury Regulations, REG 157714-06. I also encourage you to refer to the Charter Associations guidelines for responses.
IRS Comments: firstname.lastname@example.org
Secretary of Education Arne Duncan: email@example.com
Kyl, Jon (R) – firstname.lastname@example.org or http://kyl.senate.gov/contact.cfm
McCain, John (R) – email@example.com or http://mccain.senate.gov/public/index.cfm?FuseAction=Contact.contactform
To find the e-mail for your Representative - https://writerep.house.gov/writerep/welcome.shtml