Education, Dept. of - As enacted, requires the department to allocate the state share of the Tennessee investment in student achievement formula funds generated by student members of a public charter school in the prior school year directly to the public charter school instead of allocating such funds to the local education agency in which the public charter school is located. - Amends Chapter __ of the Public Acts of 2025 (1st Ex. Sess. – SB 6001 / HB 6004); and TCA Title 49, Chapter 13 and Title 49, Chapter 3.

HB 1163 changes how Tennessee allocates state education funding for students attending public charter schools. It requires the state education department to send the state share of funds generated by charter school students directly to the charter school - instead of routing those funds through the local school district (LEA) where the charter is located. This applies to funds calculated under the Tennessee Investment in Student Achievement (TISA) formula. The bill also adds new requirements for charter schools to use standardized financial reporting systems to track all state and federal education funds. This policy directly affects public charter schools (by increasing their direct funding) and local school districts (by removing a funding source for charter students).