Report Title:

Education Reform; Weighted Student Formula; School Community Councils

Description:

Implements education reform and decentralization measures; establishes a weighted student formula for providing operating moneys to individual public schools; establishes school community councils. (SD1)

HOUSE OF REPRESENTATIVES

H.B. NO.

2002

TWENTY-SECOND LEGISLATURE, 2004

H.D. 2

STATE OF HAWAII

S.D. 1


 

A BILL FOR AN ACT

 

relating to education.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

PART I

PURPOSE

SECTION 1. The legislature finds that significant changes need to be made to enhance Hawaii's public education system, and improving student achievement should be the guiding principle behind this effort. However, the legislature further finds that the State's students, parents, teachers, school administrators, departmental staff, and other educational stakeholders do strive to achieve excellence. Unfortunately, their efforts will never be completely successful until various aspects of the system around them are improved.

The legislature has supported and will continue to support efforts by the department of education to reinvent Hawaii's schools to meet the needs of today's workplace. Research shows that student performance is significantly higher in smaller schools. While comprehensively establishing smaller schools throughout the State is not economically feasible, some schools have taken it upon themselves to create smaller and more manageable learning communities within their schools. Research also strongly supports the need for early childhood education and the establishment of a coherent system that spans all levels of education. The department of education teamed with the University of Hawaii and Good Beginnings Alliance to create a vision for such a system, which was presented in 2002, and is now being implemented.

Despite these efforts, more needs to be done. Currently, public school principals are faced with a nearly impossible task, as they are asked to attend to every detail of operating their schools without enough institutional support or the discretion to expend funds on programs of their choosing. While some support and additional school leadership is provided by the school/community-based management (SCBM) system at many schools throughout the State, SCBM plays a far more limited role at some locations, and has not been implemented at all at others.

Recently, departmental leadership was decentralized through the creation of the complex area system, including the hiring of complex area superintendents. While replacing the old district system with this new structure was an important first step, further changes need to be made to allow meaningful authority to exist as close to the schools as possible. The complex area structure will serve as an excellent base upon which to build these continued reforms. It is the legislature's intent to place a far greater number of decisions, and a much higher percentage of moneys, directly in the hands of individual schools and their leaders.

Another area of improvement necessary to promote excellence in learning is the method by which moneys are allocated to individual schools. Hawaii currently receives high marks nationally for funding equity, as the State's organization under a single statewide district enables it to fairly disburse moneys to schools. In other states, local revenue sources such as property taxes account for a significant portion of school and district funding, resulting in massive financial disparities between schools in more and less affluent areas.

Although the State avoids this particular pitfall, further improvements can be made to ensure that moneys go to the schools that truly have the greatest need, and to place more moneys at the discretion of individual schools. While the current funding system takes into account certain criteria when allocating moneys to schools, it does not comprehensively address the fact that some students cost more to educate than others do. For example, students with special needs, such as those with limited English proficiency, or who have physical, psychological, or other impediments to learning, are more expensive to teach than other students who are not faced with these barriers. The current system also does not adequately empower schools by giving them significant authority to expend funds.

One method that can be used to address these funding issues is a weighted student formula. Under such a system, moneys are allocated to schools based on a system of weights that applies to every student in the public schools. To determine which weights apply to each student, the cost of educating a theoretical "baseline" student with no measurable impediments to learning is calculated. Then a set of criteria is devised which can be applied to any student to determine how expensive it is to educate that student, relative to the "baseline" student.

Under a weighted student formula there are several advantages. Among other things:

(1) The true cost of educating students can be much more accurately assessed;

(2) Funds follow students to whichever school they attend;

(3) More operating moneys are placed in the hands of individual schools; and

(4) The budget process becomes more transparent as it is based on dollars, not staff positions.

However, establishing a weighted student formula cannot be effective in a vacuum. Other reform measures must be implemented as well. Principals will be empowered to act as the chief executive officers of their schools, with more authority relating to budgeting, and more flexibility to expend funds. With these expanded powers, principals will be held accountable for their performance with a system that includes both rewards and sanctions. The legislature also recognizes that principals will need more training and support if they are required to take on additional duties, and are expected to advance student success. Furthermore, the school community management and support system will need to be enhanced if it is to work effectively with principals and become a more critical part of the school's leadership team.

The department of education is also faced with significant impediments that will likely reduce its ability to effectively implement the weighted student formula. With educational responsibilities spread throughout numerous state agencies, there are various roadblocks to progress that could prevent the department of education and individual schools from successfully performing their duties and making the best use of a new funding system.

The legislature finds that a comprehensive effort addressing all of these issues is required for Hawaii's public schools to maximize student achievement. Accordingly, the purpose of this Act is to enhance educational outcomes in Hawaii's public schools by:

(1) Implementing the weighted student formula by:

(A) Requiring the department of education to apply a weighted student formula in allocating operating moneys to all public schools, except charter schools, alternative schools, laboratory schools, and schools serving special needs populations;

(B) Establishing a committee on weights within the department of education to determine student weights, and appropriating $10,000 to support the operation of the committee;

(2) Appropriating $1,500,000 to facilitate field support, security and privacy, and training regarding information technology infrastructure used to enhance accountability with the federal No Child Left Behind Act and provide schools with a firm foundation for their reinvention efforts;

(3) Supporting and empowering principals, educational officers, and business specialists by:

(A) Establishing a Hawaii principals academy to support and train complex area superintendents, principals, and prospective principals, and appropriating $500,000 to establish and operate the academy;

(B) Placing principals on a twelve month term of service, requiring the department of education to conduct a study assessing the positions, allocations, and classifications of principals, and providing a retention bonus for five consecutive years of distinguished service, and appropriating $3,900,000 to fund the extension of principals' terms of service;

(C) Encouraging and supporting better educational administration by appropriating $183,780 to operate the department of education's professional development and educational research institute and its administrator certification of excellence (ACE) program;

(D) Appropriating $325,783 for complex area business specialists to reduce the administrative burden on principals;

(E) Providing them with enhanced powers to grant geographic exemptions for students expected to enhance their learning and the school community;

(F) Convening a working group to create a plan for the implementation of performance contracts for principals;

(4) Enhancing community involvement in schools by:

(A) Transitioning the current SCBM system into a mandatory school community council system that is to be implemented at each public school while clearly articulating the balance and reciprocity of powers and responsibilities between the principal and school community council, and appropriating $250,000 to facilitate this transition;

(B) Appropriating $1,743,500 to support and enhance a proven means of enhancing parental and community involvement in the schools, parent-community networking centers;

(5) Directly, concretely supporting the academic achievement and holistic development of students by:

(A) Appropriating $2,000,000 for textbooks and other learning materials, provided that curriculum is aligned within the school complex;

(B) Appropriating $2,200,000 to reduce the student-teacher ratio in kindergarten through grade three, hire seventy-five elementary teachers, and hire one half-time teacher or teacher's aide for each third grade classroom;

(C) Appropriating $460,000 for full-time, year-round student activity coordinators;

(6) Directly, concretely supporting teachers by:

(A) Incentivizing teachers to become national board certified by establishing a national board certification incentive program and appropriating $480,000 to reimburse the application fees of successful applicants;

(B) Appropriating $92,000 for the Hawaii teacher standards board to provide training and support for national board certification applicants;

(C) Appropriating $347,783 for the staffing and operations of the Hawaii teachers standards board, and authorizing them to convert not more than two existing positions to permanent status;

(D) Increasing the pool of qualified teachers and administrators by appropriating $500,000 to fund seven special education/teacher education and one education administration faculty positions at the college of education of the University of Hawaii;

(7) Reducing the bureaucracy that hampers the effectiveness of the department of education by:

(A) Requiring the department to convene an interagency working group to address systemic impediments to the efficient management and operation of schools;

(B) Transferring certain key functions from various state agencies to the department to remove those impediments.

(8) Enhancing existing educational accountability provisions by:

(A) Refining and expanding performance indicators in the areas of academic achievement, safety and well being, and civic responsibility;

(B) Expanding it also include fiscal accountability;

(C) Expanding it to encompass complex area superintendents and principals; and

(D) Requiring clear, easily understandable report cards on key performance programmatic and fiscal indicators for schools, school complexes, and the public school system, including longitudinal data over three consecutive years;

PART II

WEIGHTED STUDENT FORMULA

SECTION 2. Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Weighted student formula. (a) In providing operating moneys to public schools, the department shall implement a weighted student formula that takes into account the educational needs of each student. Under the weighted student formula, the department shall:

(1) Create a list of applicable criteria that affect the cost of educating students;

(2) Determine the cost of educating a baseline student;

(3) Create a system of weights based upon the criteria that may be applied to the cost of a baseline student to determine the relative cost of educating any student; and

(4) Determine the appropriate amount of funding that can be effectively and efficiently budgeted and administered by the school principal under the weighted student formula.

As used in this section, "baseline student" means a public school student to which none of the criteria determined under paragraph (1) apply.

(b) The department shall be provided with supplementary per-pupil allocations for as many years as may be necessary to facilitate the successful implementation of the weighted student formula, and such allocations shall be passed through by the department directly to the principals at the beginning of each fiscal year."

SECTION 3. Section 302A-101, Hawaii Revised Statutes, is amended by adding a new definition to be appropriately inserted and to read:

""Weighted student formula" means a formula for allocating operating moneys to individual public schools that includes a system of weighted criteria affecting the baseline cost of educating each student attending a public school."

SECTION 4. There is established within the department of education the committee on weights to help the department in determining specific student weights, including their dollar value.

The composition of the committee on weights shall be determined by the board of education based on recommendations from the superintendent of education and include principals, teachers, and other members with the appropriate professional skills, experiences, and qualifications needed to facilitate the work of the committee. The superintendent or the superintendent's designee shall chair the committee on weights.

The committee on weights may form advisory subcommittees in order to obtain input from urban and rural school communities, including parents and students; teachers, principals, and other school staff, including their collective bargaining representatives; the legislative and judicial branches of state government; the counties; private businesses; and other segments of the State’s population deemed appropriate by the board of education.

The members of the committee on weights shall serve at the pleasure of the board of education and shall not be subject to section 26-34, Hawaii Revised Statutes.

All members of the committee on weights shall serve without compensation but shall be reimbursed for expenses, including travel expenses, necessary for the performance of their duties.

SECTION 5. The department of education shall submit to the legislature no later than twenty days prior to the convening of the regular session of 2005:

(1) A detailed plan for implementing the weighted student formula, which may include a targeted, phased-in implementation of the weight student formula funding system as a percentage of the total annual budget of the department of education, for example:

(A) 75% by the beginning of fiscal year 2005;

(B) 80% by the beginning of fiscal year 2006;

(C) 85% by the beginning of fiscal year 2007;

(2) A detailed plan for assuming the personnel functions of the department of human resources development as they relate to the department of education;

(3) A list of statutes, rules, policies, or procedures that need to be amended or removed to enable the effective implementation of the weighted student formula; and

(4) A list of programs recommended to be repealed to enable the department and individual schools to have greater flexibility in budgeting, operations, and curriculum management.

SECTION 6. Any law, rule, or policy enacted, adopted, or promulgated after the effective date of this Act shall not exempt a principal, the superintendent of education, or the executive secretary of the Hawaii teacher standards board from taking actions they may be required to take with respect to public school or department of education employees in order to implement the weighted student funding system.

SECTION 7. When collective bargaining agreements, memoranda of understanding, or other agreements are renegotiated, the board of education shall ensure that those agreements do not prohibit actions that a principal, the superintendent of education, or the executive secretary of the Hawaii teacher standards board may be required to take with respect to public school or department of education employees in order to implement the weighted student funding system.

SECTION 8. There is appropriated out of the general revenues of the State of Hawaii the sum of $10,000, or so much thereof as may be necessary for fiscal year 2004-2005, to support the operations of the committee on weights.

SECTION 9. The sum appropriated shall be expended by the department of education for the purposes of this part.

PART III

INFORMATION TECHNOLOGY INFRASTRUCTURE

SECTION 10. There is appropriated out of the general revenues of the State of Hawaii the sum of $1,500,000, or so much thereof as may be necessary, for fiscal year 2004-2005, to facilitate field support, security and privacy, and training regarding information technology used to enhance accountability with the federal No Child Left Behind Act and provide schools with a firm foundation for their reinvention efforts.

SECTION 11. The sum appropriated shall be expended by the department of education for the purposes of this part.

PART IV

PRINCIPALS, EDUCATIONAL OFFICERS, AND BUSINESS SPECIALISTS

SECTION 12. Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Hawaii principals academy. There is established within the department the Hawaii principals academy. To ensure that each principal is trained to fully assume the principal's role as the educational leader accountable under section 302A-1004 and facilitate excellence in the administration of public education, the academy shall fully support and train department complex area superintendents, principals, and prospective principals in areas including but not limited to:

(1) School budgeting and fiscal accountability under the weighted student formula;

(2) Curriculum development;

(3) Establishing partnerships with the private sector;

(4) Becoming better leaders;

(5) Collaborating with members of the school community councils;

(6) Fostering students' academic achievement (including satisfactory scores on standardized tests), safety and well being, and civic responsibility; and

(7) Cultivating the satisfaction of stakeholders affected by the work of the principal."

SECTION 13. Section 302A-625, Hawaii Revised Statutes, is amended to read as follows:

"§302A-625 Educational [officers' salary schedules.] officers. (a) The salary schedule for all educational officers of the department shall be negotiated pursuant to section 89-9[.]; provided that the salary schedules of principals shall be based upon:

(1) A twelve-month term of service; and

(2) A study by the department of education that:

(A) Assesses the positions, allocations, and classifications of principals, ensuring that minimum requirements and equivalencies are in line with the type of work to be performed upon entry into the classification;

(B) Includes a formal, comprehensive salary survey; and

(C) Implements a formal job evaluation methodology that is consistent with the class structure adopted.

(b) In addition to the salary increases and incentives provided under sections 302A-626, 302A-701, and 302A-703, principals and vice-principals who commit to and complete five consecutive years of distinguished service as determined by the educational accountability system and the successful execution of performance contracts shall be paid a retention bonus in an amount set by the board."

SECTION 14. Section 302A-1103, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-1103[]] Principal; authority and responsibility[.]; accountability. (a) The role of the principal shall include but not be limited to overseeing the day-to-day management of the school, the primary function of which is to develop and deliver instructional services to students in accordance with statewide educational policy and standards. The principal shall [ensure]:

(1) Ensure that the curriculum facilitates the achievement of the statewide student performance standards adopted for the public school system[.]; and

(2) Maintain and exercise exclusive authority over the implementation of the budget, policies, and operations of the school.

Any powers not delegated to the board of education, the superintendent of education, complex area superintendents, or the executive secretary of the Hawaii teacher standards board by law, nor prohibited by law to a school or the principal of a school, are reserved to the principal of the school.

Principals shall be evaluated and held accountable for observed school and student performance through a set of consequences that includes rewards and recognition, assistance, or sanctions, as appropriate.

(b) If the principal decides, through action or inaction, to contradict any decision made by the school community council, the principal shall:

(1) Promptly notify the school community council; and

(2) Be subject to the appeal process described in chapter 302A-1124(c).

(c) The principal shall collaborate with the principals complex forum, which shall be composed of the complex area superintendent and all principals in a school complex and be facilitated by the high school principal, to ensure:

(1) That the goals and objectives of the complex are being met;

(2) That the curriculum is aligned throughout the school complex;

(3) The coordinated use of school complex-based personnel and contractors who divide their time between more than one school in a school complex, which may include such personnel as psychologists, special education specials;

(4) The coordinated passage of students through the continuum of grades in a manner consistent with the accountability provisions of section 302A-1004;

(5) The availability of a forum to receive and address community concerns related to the school complex; and

(6) That moneys delegated to the school complex and school level may be retained at the complex level to address areas of mutual concern, which may include shared personnel and contractors, and areas in which the complex area superintendent would reasonably be expected to have a more comprehensive view of the appropriate prioritization of needs within the complex, which may include repair and maintenance, and capital improvement projects."

SECTION 15. Section 302A-1143, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-1143[] Attend school in what district.] School districts; attendance requirements and geographic exemptions. All persons of school age shall be required to attend the school of the district in which they reside, unless it appears to [the department] any principal for it to be desirable to allow the attendance of [pupils at a school in some other district,] any pupil or pupils from outside of the district of the principal's school to attend the principal's school. Such a determination shall be based upon a reasonable expectation by the principal that the learning environment of such a pupil or pupils and the learning community of the principal's school shall be enhanced by the attendance of any such pupil or pupils, in which case the [department] principal may grant this permission."

SECTION 16. The department of education shall convene a working group to create a plan for the implementation of performance contracts for principals beginning with the 2006-2007 school year. The working group shall consist of:

(1) The superintendent of education;

(2) Representatives of complex area superintendents;

(3) Representatives of school principals;

(4) The exclusive representative for collective bargaining unit 6; and

(5) Representatives of any other agency, organization, or group as deemed appropriate by the superintendent of education.

The working group shall:

(1) Establish appropriate performance criteria for which principals should be evaluated under performance contracts, including:

(A) Core criteria to be incorporated into performance contracts statewide; and

(B) Criteria that may be used at the discretion of individual schools;

(2) Determine appropriate performance benchmarks, or methods of devising performance benchmarks, that may be used to assess principal performance relative to expected standards, provided that such performance benchmarks shall, at a minimum, include those elements related to principals in the educational accountability system;

(3) Determine appropriate rewards, assistance, and sanctions to be included or considered for inclusion in performance contracts, including a means of identifying distinguished service; and

(4) Address any other issues necessary to allow for the implementation of performance contracts.

The department of education shall submit findings, including proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2005.

SECTION 17. There is appropriated out of the general revenues of the State of Hawaii the sum of $4,909,563, or so much thereof as may be necessary, for fiscal year 2004-2005 to be expended as follows:

(1) $500,000 for the department of education to provide professional development for principals to:

(A) Establish and operate the Hawaii principals academy which shall coordinate professional development and training within the department of education;

(B) Collaborate with public and private partners in leadership development; and

(C) Provide financial training in preparation for the implementation of the weighted student formula; and

(2) $3,900,000 to fund the additional two months salary for high school principals who are presently on a ten-month term of service and whose salary schedule is to be converted to a twelve-month term;

(3) $183,780 to increase the department of education's professional development and educational research institute's capacity to recruit and train principals and other educational officers for the department of education by funding positions, trainers, and expenses related to the operation of the administrators excellence (ACE) program, including:

(A) One full-time equivalent (1.00 FTE) educational officer position; and

(B) One full-time equivalent (1.00 FTE) clerk position; and

(4) $325,783 to provide funding for full-time, complex area business specialists in public high schools.

SECTION 18. The sum appropriated shall be expended by the department of education for the purposes of this part.

PART V

COMMUNITY INVOLVEMENT

SECTION 19. One of the most important means of enhancing public confidence on educational outcomes in schools is by enhancing community involvement. This part seeks to make facilitate such enhancement in two significant ways.

First, by establishing school community councils for each public school to provide a mechanism whereby parents, the community, and other key stakeholders can have a substantially increased voice in the affairs of their local schools, with a clear and concrete enunciation of powers and responsibilities, and how these are shared with those of the principal.

Second, by supporting and enhancing parent-community networking centers, a mechanism of community and parental involvement with a proven track record of success.

The legislature finds that according to the National Commission for Teaching and America's Future, forty-nine per cent of student success is attributed to families, forty-three per cent to teachers, and eight per cent to small class size. There also is overwhelming research evidence of the critical need for an integrated comprehensive system of family support, parent education, teacher-parent partnerships, and volunteer and resource development at the neighborhood or school, grade and classroom or family levels.

The legislature also finds that the parent-community networking centers serve to create supportive partnerships among the home, school, and community for the purposes of improving student achievement and building a sense of family among all.

The goals of parent-community networking centers are to:

(1) Assist parents to provide appropriate home support for their children's development and achievement of Hawaii content and performance standards;

(2) Create a sense of community at the school level, instill positive attitudinal changes among teachers and parents, and increase parent involvement at school and home;

(3) Strengthen teacher-parent partnerships at the grade/classroom-family levels;

(4) Ease the transition of new families from pre-K to kindergarten, elementary to middle school, middle to high school, and from high school to higher education, the world of work, or other value added roles in the community and family;

(5) Help facilitate family focus groups to unify family support efforts of the school;

(6) Coordinate and give parent education workshops based on Hawaii's standards for parents as partners and assessments of parent and teacher concerns and strengths; and

(7) Help schools to communicate parental options for services as specified under "No Child Left Behind."

There are four phases of parent-community networking centers development. Evaluative reports indicate that parent community networking centers in phases I and II:

(1) Facilitated a sense of community among parents, teachers, and community;

(2) Increased numbers of parents involved in the education of Hawaii's youth;

(3) Returned the investment in parent-community networking centers 4.45 times the amount of resources and services expended on them, making parent-community networking centers one of the most cost-effective programs in the department of education; and

(4) Revealed satisfying teacher-parent partnerships at the elementary school grade and classroom levels and higher student achievement in each of the pilot demonstration sites having at least two years of parent-community networking center phases III-IV funding. These schools attained the adequate yearly progress status or are in good standing towards achieving that status.

The parent-community networking centers shall focus on grade level parent partnerships, involvement, and education or establish infrastructures combining the wisdom of principals, counselors, guidance instructors, student activities coordinators, parent facilitators, parents, and other school and community members of the school's family focus groups.

The purpose of this part is to:

(1) Make conforming amendments with existing statutes to establish school community councils for each school, except charter schools, alternative schools, laboratory schools, and schools serving special needs populations;

(2) Appropriate funding for:

(A) Implementation of and training for school community councils; and

(B) Parent-community networking centers for ten more elementary schools at phases III and IV, as well as seven middle schools and seven high schools at pilot phases III and IV with $12,500 each.

SECTION 20. Section 89-10.6, Hawaii Revised Statutes, is amended to read as follows:

"§89-10.6 [School/community-based management waiver.] Schools; waiver of policies, rules, or procedures. [A] Any school or [a] learning support center [participating in the school/community-based management program] may initiate a waiver from policies, rules, or procedures, including collective bargaining agreements, as provided for in section 302A-1126."

SECTION 21. Section 302A-101, Hawaii Revised Statutes, is amended by deleting the definition of "school/community-based management system".

[""School/community-based management system" means a method of educational management that diffuses educational decisionmaking to involve or secure the input of those persons directly affected by the decision to be made at the school level, and encourages school-initiated methods for achieving educational goals established statewide by the board.""]

SECTION 22. Section 302A-202, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-202 Student assessments.[]] Any school [electing to participate in school/community-based management] may develop and implement its own student assessment mechanisms; provided that the board shall include the results of the assessments in the educational status report to the legislature and the governor required in section 302A-1004."

SECTION 23. Section 302A-601, Hawaii Revised Statutes, is repealed.

["[§302A-601] Selection of school personnel. School/community-based management councils may participate in the selection of school personnel by providing input into the selection process."]

SECTION 24. Section 302A-1124, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-1124[]] Mandate to initiate [school/community-based management system.] school community councils. (a) The department, through the board and its superintendent, shall [formulate policies, including criteria and procedures to determine which schools and learning support centers shall participate in the system, to initiate a school/community-based management system in the public schools.] establish school community councils that:

(1) Enhance educational decision-making by involving and securing the input of those persons directly affected at the school level;

(2) Shall adopt a weighted student funding budget to ensure student achievement by an affirmative vote of two thirds of the council members;

(3) Collaborate with the principal in the development of school policies to be implemented by the principal;

(4) Participate in principal selection and evaluation, and transmit any such evaluations to the superintendent; and

(5) Encourage school-initiated methods to develop an academic plan for success in order to achieve statewide educational goals established by the board.

Rules adopted to implement this section shall be exempt from the public notice and public hearing requirements of chapter 91.

(b) Each public school shall establish and maintain a school community council, which shall collaborate with and assist the school's principal in:

(1) Ensuring the school's compliance with the educational accountability system under section 302A-1004;

(2) Developing and implementing an academic and financial plan for success;

(3) Raising the academic performance of all students to state standards; and

(4) Providing collaborative opportunities for input and consultation.

(c) Excluding the adoption of budgets, all decisions of school community councils shall be made on the basis of majority votes. As the principal is the leader of the learning community of the individual school and must be given the tools to succeed if they are to be held accountable, the principal shall have the authority to, through action or inaction, contradict any decision made by the school community council, provided that the principal promptly notifies them, subject to the following appeal process. If there is school community council opposition to a decision of the principal, an appeal shall first be brought to the complex area superintendent for resolution and, if necessary, to the superintendent and, finally, to the board of education.

(d) The complex area superintendents shall assist the school community councils and principals within their respective complexes to:

(1) Attain the support and services of the department; and

(2) Ensure the progress and success of the school's improvement plan.

(e) The superintendent may require a school community council to revise its school improvement plan if the plan is in violation of law or conflicts with statewide educational policies and standards. The superintendent may recommend to the board the dissolution of an existing school community council and establish a new one if the existing one engages in any act or omission that would constitute gross negligence, willful and wanton misconduct, or intentional misconduct.

(f) Unless otherwise specified, the board shall establish policies governing the composition, election, staggered terms of office for members and officers, and operation of school community councils; provided that:

(1) The number of school personnel shall be equal to the number of primary stakeholders on any school community council;

(2) At the elementary and middle school levels, school community councils shall be composed of the principal and at least one member representing each of the following groups:

(A) Parents elected by ballots distributed among and collected from the parents of the school’s students;

(B) School personnel elected by ballots distributed among and collected from personnel of the school;

(C) Community representatives elected by parents of the school's students; and

(D) Student representatives selected by the student council of the school;

and

(3) At the high school level, school community councils shall be composed of the principal and at least one member representing each of the following groups:

(A) Parents elected by ballots distributed among and collected from parents of the school’s students;

(B) School personnel elected by ballots distributed among and collected from personnel of the school;

(C) Community representatives selected and elected by the parents of the school's students; and

(D) Students elected by students attending the school.

Vacancies on a school community council shall be filled according to decision made by the school community council.

For the purposes of this subsection, "primary stakeholders" means students, parents, and community members.

(g) School community councils shall elect officers, including:

(1) A chairperson;

(2) A vice-chairperson;

(3) A secretary; and

(4) Other officers as needed to perform stated duties in support of the work of the council.

(h) Existing school/community-based management council members shall assist the new school community council members for one school year. All decisions made by existing school/community-based management councils shall remain in effect until otherwise repealed or revised by the board, department, or members of the new school community council."

SECTION 25. Section 302A-1126, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-1126[]] Waiver of policy, rule, or procedures. Any state agency that may be required to act under state law on a matter affecting an individual school, its school community, or a learning support center shall waive otherwise applicable policies, rules, or procedures when requested to do so by a school or a learning support center participating in the [school/community-based management] school community council system unless the agency, within thirty days, can justify a denial to the appropriate authority. The board shall adopt procedures necessary to process waivers initiated by schools or learning support centers subject to the [school/community-based management] school community council system. This section shall apply to collective bargaining agreements as provided for in all relevant collective bargaining agreements negotiated pursuant to chapter 89."

SECTION 26. Section 302A-1306, Hawaii Revised Statutes, is repealed.

["[§302A-1306] School priority program; established. (a) There is established within the department a school priority program to augment regular instruction and other educational services at the discretion of the individual public schools. Further, it is the intent of the legislature that the school priority program promote the equitable distribution of educational resources statewide, strengthen the scope of decisionmaking, increase flexibility in resource allocation at the school level, and provide a systematic method of conforming resource allocation to the unique needs and priorities of individual schools.

(b) All moneys to carry out the purposes of the school priority program under this section to section 302A-1309 shall be allocated by the legislature through appropriations out of the state general fund.

(c) The department shall include in its budgetary request for each upcoming fiscal period, the amounts necessary to effectuate the purposes of this section to section 302A-1309."]

SECTION 27. Section 302A-1307, Hawaii Revised Statutes, is repealed.

["[§302A-1307] Distribution of resources. The superintendent shall allot the moneys of the school priority program to the school districts based on enrollment. In the allotment of positions to the districts, the superintendent shall calculate each district's entitlement based on enrollment and may deploy one instructional resource augmentation position for each two hundred fifty students enrolled in each school; provided that all positions shall be deployed."]

SECTION 28. Section 302A-1309, Hawaii Revised Statutes, is repealed.

["[§302A-1309] Departmental controls. The superintendent shall develop and implement appropriate planning procedures and follow-up accountability reports, without regard to chapter 91, to ensure sound planning, control, and accountability in the use of moneys allocated by the legislature to the school priority program. The procedures and reports, however, shall recognize the need for providing the schools latitude and discretion to determine their needs and priorities, and shall avoid imposing undue amounts of paperwork and administrative burdens on the schools.

The department shall submit an annual report to the legislature, which shall include but not be limited to an accounting of how funds were used by the schools."]

SECTION 29. Section 302A-1505, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) Prior to meeting with the department of accounting and general services to advise it of a school's repair and maintenance needs, the school's principal and the business and fiscal officer shall consider the recommendations made by the [school/community-based management council, if there is such a council at the school;] school community council or the local school board, if the school is a new century charter school or a new century conversion charter school. [If there is no school/community-based management council or local school board, then the school's principal shall appoint a standing committee composed of a teacher, a member of the support staff, a parent, a student, and a community member.]"

SECTION 30. Section 302A-1507, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-1507[]] Classroom cleaning project; established. (a) There is established a classroom cleaning project in all public schools [designated to participate in school/community-based management]. Each [school/community-based management] school, through its [council,] school community council, may develop mechanisms to provide for classroom cleaning, including but not limited to having parent, student, or other community groups clean the classrooms on a regular, continuing basis.

(b) [School/community-based management schools] Schools may use any available resources to achieve the purposes of this section; provided that no full-time custodial staff currently employed at the school shall be displaced."

SECTION 31. There is appropriated out of the general revenues of the State of Hawaii the sum of $1,993,500, or so much thereof as may be necessary for fiscal year 2004-2005 to be expended as follows:

(1) $250,000 for school community councils to:

(A) Prepare for the implementation of the school community councils; and

(B) Provide initial training for the school community councils to effectively address the implementation of the weighted student formula funding system;

(2) $1,743,500 for parent-community networking centers to be expended as follows:

(A) $483,000 to fund one hundred sixty-one schools with $3,000 each for supplies, equipment, and telephones;

(B) $191,400 to fund twenty-two schools that are currently funded at $6,800 per year, with an additional $8,700 to bring them up to the basic funding level of $15,500 to implement and sustain parent-community networking centers, phases I and II; and

(C) $1,069,500 to establish a parent-community networking center in sixty-nine schools at the rate of $15,500 per school.

SECTION 32. The sum appropriated shall be expended by the department of education for the purposes of this part.

PART VI

STUDENTS

SECTION 33. Ultimately, of course, all education reform is for naught if it does not keep the needs of the students front and center. They are the primary clients served by the public education system and they must be served well, by providing them with access to the tools they need to succeed, nurturing environments conducive to learning, and supplementary opportunities for growth that facilitate their holistic development.

The legislature finds that grade three is a pivotal year in preparation for the federal No Child Left Behind Act's assessment plans. For this reason, children in this and preceding grades should be provided with the instructional support needed to ensure superior performance in any assessment instruments mandated by the federal No Child Left Behind Act.

The purpose of this section it to appropriate funding to:

(1) Provide textbooks and other learning materials;

(2) Reduce class size and the student-teacher ratio in the early grades by amending statutes and appropriating funding; and

(3) Provide additional student activity coordinators.

SECTION 34. Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Class size reduction. (a) Subject to the availability of funds appropriated by the legislature and allotted by the governor, the department:

(1) Beginning with the 2006-2007 school year, shall reduce the ratio of students to teachers in kindergarten to not more than twenty-five students to one teacher;

(2) Beginning with the 2007-2008 school year, shall reduce the ratio of students to teachers in grade one to not more than twenty-five students to one teacher;

(3) Beginning with the 2008-2009 school year, shall reduce the ratio of students to teachers in grade two to not more than twenty-five students to one teacher; and

(4) Beginning with the 2009-2010 school year, shall reduce the ratio of students to teachers in grade three to not more than twenty-five students to one teacher.

(b) If in any year set forth in subsection (a)(1) to (4) the department fails to attain, maintain, or both, the ratio of students to teachers required by that paragraph, and the department submits to the legislature the report required by subsection (e), then:

(1) Departmental compliance with the requirements of that paragraph may be delayed until such time as the department reports to the legislature that it is able to comply with the requirements of that paragraph; provided that in no event shall compliance with the requirements of any single paragraph be delayed for more than three years; and

(2) The deadline for compliance with the requirements of any subsequent paragraph shall be postponed for an amount of time that is equal to the postponement authorized in paragraph (1).

(c) The department shall not include any students or teachers in categorical programs when computing the ratio of students to teachers specified in subsection (a).

(d) If a school will not have the classrooms needed to accommodate the additional classes created by the reduction of the student to teacher ratio as specified in subsection (a), then the governor may reallocate the unexpendable operating funds to supplement any capital investment funds that may have been appropriated by the legislature to construct permanent or portable classrooms at the school, notwithstanding any other law to the contrary.

(e) The department shall report the failure to attain, maintain, or both, the ratio of students to teachers, including the reasons therefor, to the legislature. The report shall contain a discussion of all planning, programming, and budgeting decisions contributing to the failure, and shall be submitted to the legislature not less than twenty days prior to the convening of any regular or special session.

(f) This section shall apply only to elementary schools and those portions of multi-level or comprehensive schools utilizing elementary school pedagogics, except for charter schools, alternative schools, laboratory schools, and special needs population schools.

(g) In the event of a conflict between this section and any other law, this section shall control."

SECTION 35. There is appropriated out of the general revenues of the State of Hawaii the sum of $4,660,000, or so much thereof as may be necessary for the fiscal year 2004-2005, to be expended as follows:

(1) $2,000,000 to purchase more new and recently published textbooks and other learning materials, provided that the curriculum within a school complex shall be aligned;

(2) $2,200,000 to reduce class size and the student-teacher ratio by:

(A) Reducing the ratio of students to teachers in kindergarten through grade three in public schools;

(B) Hiring seventy-five full time equivalent (75.00 FTE) regular elementary teachers for the department of education to lower average class size in kindergarten, grade 1, and grade 2; and

(C) Hiring one permanent half-time teacher or teacher's aide for each department of education third grade classroom; provided that the department of education shall first attempt to fill these positions with half-time teachers and, if none are available, a half-time teacher's aide; and

(3) $460,000 for full-time, twelve month term of service student activities coordinators in all public high schools.

SECTION 36. The sum appropriated shall be expended by the department of education for the purposes of this part.

PART VII

TEACHERS

SECTION 37. The National Commission on Teaching and America's Future, a national organization with twenty partner states, including Hawaii, focused on improving student learning by ensuring that there is a caring, competent, and qualified teacher in every classroom.

The Hawaii policy group of the National Commission on Teaching and America's Future, composed of a representative group of educational stakeholders, completed an inventory of state policies relating to teacher quality and, based on this inventory, made recommendations for improving teaching in Hawaii. The recommendations encompassed five key areas:

(1) Establishing and implementing standards for students and teachers;

(2) Teacher preparation and professional development;

(3) Teacher recruitment and placing qualified teachers in all classrooms;

(4) Encouraging and rewarding teaching knowledge and skill; and

(5) Creating schools that are organized for student and teacher success.

One thing was clear: aside from home and societal factors, teacher quality is the single most influential factor in student achievement and that national board certification prompts candidates to analyze their practice in very profound ways. It is, therefore, important to continue to identify, support, recognize, and reward Hawaii teachers in the department of education who voluntarily undergo the national board certification process.

National board certification requires a tremendous commitment of time and professional risk-taking. The application fee represents a large financial investment. To be successful, certification candidates need a strong support program, access to the program and testing facilities, and release days to organize and prepare the documents and portfolio required for submittal.

Act 312, Session Laws of Hawaii 2001, assigned responsibility for administration of the national board candidate support program to the Hawaii teacher standards board. In the past two years, the number of candidates increased from two in 2000 to seventy-four in 2001, and sixty-four in 2002. This part continues the legislature's commitment of supporting department of education teachers who voluntarily choose to pursue the rigorous process of national board certification.

In addition to supporting and recognizing highly accomplished teaching by providing establishing national board certification candidates in the public schools, the legislature finds that the overall pool of qualified teachers in the State of Hawaii must be expanded, especially in light of the teacher shortage.

Currently, however, the University of Hawaii lacks the faculty and other resources necessary to produce enough teachers for the public schools of Hawaii. While the department of education hires over one thousand three hundred new teachers each year, the college of education at Manoa and the education department at Hilo are only able to prepare four hundred to four hundred fifty teachers each year.

The legislature further finds that permanent funds are needed to replace temporary sources of funding for positions in special education in order to maintain current levels of productivity in special education. Furthermore, the legislature also finds that there is a shortage of school principals, necessitating additional faculty in the area of educational administration.

The purpose of this part is to:

(1) Establish and appropriate funding for a national board certification incentive program to be administered by the Hawaii teacher standards board;

(2) Appropriate funding to the Hawaii teacher standards board to implement Act 312 to provide training and support for national board certification applicants;

(3) Appropriate funding for the staffing and operations of the Hawaii teachers standards board, and authorize them to convert not more than two existing positions to permanent status; and

(4) Appropriate funding to establish eight faculty positions at the college of education of the University of Hawaii.

SECTION 38. Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Teacher national board certification incentive program. There is established within the department the teacher national board certification incentive program to recognize public school teachers who have achieved national board certification from the National Board for Professional Teaching Standards. The incentive program shall provide:

(1) A $5,000 bonus per year for each public school teacher who maintains current national board certification; and

(2) A one-time reimbursement of not more than $3,500 for public school teacher applicants who achieve national board certification for any application fee for national board certification not previously reimbursed.

The incentive program shall include a mentoring component that encourages and enables national board-certified teachers to assist other teachers and share their teaching expertise."

SECTION 39. The national board certification candidate support program shall provide candidate support by hiring permanent staff to plan and coordinate the program. It shall also establish release days, provide facilitator and trainer stipends, training and training materials, payment of transportation expenses to enable neighbor island candidates to attend candidate support sessions and assessment center exercises on Oahu, and conduct candidate recognition initiatives.

SECTION 40. There is appropriated out of the general revenues of the State of Hawaii the sum of $919,228, or so much thereof as may be necessary, for fiscal year 2004-2005, to be expended as follows:

(1) $480,000 to provide reimbursement incentives for a national board certification candidate support program for public school teachers, to be implemented and administered by the Hawaii teacher standards board;

(2) $92,000 for training, assistance, and operational expenses associated with the administration of the national board certification candidate support program by the Hawaii teacher standards board; and

(3) $347,783 to conduct the functions of the Hawaii teachers standards board, including the conversion of not more than two existing positions to permanent status.

The sum appropriated shall be expended by the department of education for the purposes of this part

SECTION 41. There is appropriated out of the general revenues of the State of Hawaii the sum of $500,000, or so much thereof as may be necessary, for fiscal year 2004-2005, for eight full-time equivalent faculty positions; provided that seven (7.0) full-time equivalent positions shall be for special education/teacher education and that one (1.0) full-time equivalent position shall be for educational administration.

The sum appropriated shall be expended by the University of Hawaii for the purposes of this part.

PART VIII

REDUCTION OF BUREAUCRACY

SECTION 42. Section 37-41.5, Hawaii Revised Statutes, is amended to read as follows:

"§37-41.5 Department of education; carryover of funds. [(a)] The department of education may retain up to [five] seven per cent of any appropriation, except for appropriations to fund financing agreements entered into in accordance with chapter 37D, [for the school-based budgeting program EDN 100 and for the comprehensive school support services program EDN 150] at the close of a fiscal year and the funds retained shall not lapse until June 30 of the first fiscal year of the next fiscal biennium[.], provided that individual schools may exceed the seven per cent carryover limitation. The department of education shall submit:

(1) A report to the director of finance ninety days after the close of each fiscal year, which shall be prepared in the form prescribed by the director of finance and shall identify the total amount of funds that will carry over to the next fiscal year; and

(2) A copy of this report to the legislature, as well as a report identifying the carryover of funds on a school-by-school basis, at least twenty days prior to the convening of the next regular session of the legislature.

[(b) Any appropriation retained in accordance with this section shall be used exclusively for the school-based budgeting program EDN 100 and the comprehensive school support services program EDN 150, and of those appropriations allocated to the schools, funds shall remain within the budget of the school to which they were originally allocated; provided that the] The retention of an appropriation shall not be used by the department as a basis for reducing a school's future budget requirements."

SECTION 43. Section 37-74, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

"(d) No appropriation transfers or changes between programs or agencies shall be made without legislative authorization; provided that:

(1) Authorized transfers or changes, when made, shall be reported to the legislature;

(2) Except with respect to appropriations to fund financing agreements under chapter 37D, the University of Hawaii shall have the flexibility to transfer appropriated funds and positions for the operating cost category among programs, among cost elements in a program, and between quarters, as applicable; except with respect to appropriations to fund financing agreements under chapter 37D, the department of education shall have the flexibility to transfer appropriated funds and positions for the operating cost category among programs and among cost elements in a program, as applicable; and the Hawaii health systems corporation shall have the flexibility to transfer special fund appropriations among community hospitals facilities as applicable; provided that the Hawaii health systems corporation shall maintain the integrity and services of each individual facility and shall not transfer appropriations out of any facility that would result in a reduction of services offered by the facility, with due regard for statutory requirements, changing conditions, the needs of the programs, and the effective utilization of resources; and

(3) The university and the department of education shall account for each transfer implemented under this subsection in quarterly reports to the governor and annual reports at the end of each fiscal year to the legislature and the governor, which shall be prepared in the form and manner prescribed by the governor and shall include information on the sources and uses of the transfer."

SECTION 44. (a) The department of education shall convene an interagency working group to develop comprehensive plans for transferring certain rights, powers, functions, duties, and resources, including positions from the departments of accounting and general services, budget and finance, health, human resources development, attorney general, and human services to the department of education. Rights, powers, functions, duties, and resources including positions to be transferred shall include but not be limited to:

(1) The expending of capital improvement funds for construction of new school facilities and resources including positions for repairs and maintenance services;

(2) The funding of collective bargaining agreement increases;

(3) The securing, administering, use and expending of federal funds and other aid, including their custodial supervision;

(4) The capital improvement project allotment process;

(5) The determination of retirement and other employee benefits;

(6) The operation of a human resources system including the recruitment, certification, examination, management, classification, and compensation of department of education employees and labor relations;

(7) Negotiating worker's compensation claims and labor-management relations within the department of education;

(8) Conducting employment background checks for after-school plus program, private vendor, and other employees and trainees who work with public school students; and

(9) School health aides.

(b) The comprehensive plan shall identify:

(1) Each position to be transferred by position number; and

(2) All moneys budgeted in support of each position to be transferred, including moneys for direct and indirect employee benefits,

at the lowest level on the state program structure.

(c) The working group shall include the following individuals or their designees:

(1) The superintendent of education;

(2) The comptroller;

(3) The director of human resources development;

(4) The director of human services;

(5) The director of health;

(6) The director of budget and finance;

(7) The attorney general; and

(8) Any community members that may be appointed by the superintendent.

(d) The department of education may recommend to the legislature deletion or addition of rights, powers, functions, duties and resources including positions that are to be transferred as a result of the working group's deliberations which shall be included and reflected in the required plans and legislation. The working group shall submit its comprehensive plan, including proposed legislation, to implement plans for the transfer of rights, powers, functions, duties, and resources, including positions relating to the:

(1) Department of accounting and general services and department of human resources development not less than thirty days prior to the convening of the regular session of 2005; and

(2) Department of budget and finance, attorney general, department of health, and department of human services not less than thirty days prior to the convening of the regular session of 2006.

SECTION 45. (a) All the rights, powers, functions, duties, and resources of:

(1) The department of accounting and general services relating to the:

(A) Expending of capital improvement funds for the acquisition and development of land, the design and construction of new facilities, and the making of renovations or additions to existing facilities, including moneys in the state educational facilities improvement special fund;

(B) Buying, purchasing, renting, leasing, or otherwise acquiring of any good, service, or construction, including the description of requirements, selection and solicitation of sources, preparation and awarding of contracts, payment of vendors, and all other phases of contract administration; and

(C) Expending of physical plant operations and maintenance funds, including moneys in the state educational facilities repair and maintenance account, school physical plant operations and maintenance account, and school repair and maintenance fund; and

(2) The department of human resources development relating to the:

(A) Operation of a centralized human resources system that encompasses the classes of work performed by department of education employees, and that integrates payroll, records, transactions, leaves, and reports; and

(B) Recruitment, certification, examination, management, classification, and compensation of department of education employees, including labor relations;

are transferred to the department of education effective July 1, 2005.

(b) All moneys budgeted in support of each position to be transferred to the department of education, including moneys for direct and indirect employee benefits, are transferred to the department of education effective July 1, 2005.

SECTION 46. (a) All the rights, powers, functions, duties, and resources of:

(1) The department of budget and finance relating to the:

(A) Funding of collective bargaining agreement increases; and

(B) Securing, administering, use, and expending of federal funds and other aid, including their custodial supervision; and

(2) The department of the attorney general relating to:

(A) The negotiating of workers' compensation claims; and

(B) Labor-management relations within department of education; and

(3) The department of human services relating to the conduct of employment background checks for after-school plus program, private vendor, and other employees and trainees who work with public school students; and

(4) The department of health related to the relating to school health nurses and school health aides;

are transferred to the department of education effective July 1, 2006.

(b) All moneys budgeted in support of each position to be transferred to the department of education, including moneys for direct and indirect employee benefits, are transferred to the department of education effective July 1, 2006.

SECTION 47. The working group on interagency relations shall cease to exist on June 30, 2007.

SECTION 48. All resources, appropriations, records, equipment, databases, software, programming, machines, files, supplies, contracts, books, papers, documents, maps, and other personal property heretofore made, used, acquired, or held by the department of accounting and general services, department of budget and finance, office of the attorney general, department of human services, and department of health relating to the functions transferred to the department of education shall be transferred with the functions to which they relate.

SECTION 49. No later than July 1, 2006, the board of education shall adopt for all public schools, except for multi-track schools, a single unified school calendar to apply to the 2006-2007 school year and every school year thereafter, provided that this shall not apply to charter schools, and special or alternative schools serving special needs populations.

PART IX

EDUCATIONAL ACCOUNTABILITY

SECTION 50. As a result of the passage of Act 238, Session Laws of Hawaii 2000, a report was conducted by The Accord Group, LLC. This report synthesized input from a wide variety of stakeholders throughout the State and was designed to ascertain "what the State of Hawaii – from the top of the system to the bottom – must do to hold 183,000 students, and 260+ schools accountable, and what kinds of 'public accounting' must be done by the Board of Education, District and State Offices of the Board of Education, the Governor, parents, the business community, the Legislature, and other key stakeholders in the overall system."

The collaborative fact-finding process found agreement among the stakeholders on three primary goals that the public educational system should foster among students: academic achievement, safety and well being, and civic responsibility.

The purpose of this part is to:

(1) Implement the recommendations of The Accord Group report by amending the Hawaii Revised Statutes to establish academic achievement, safety and well being, and civic responsibility as the agreed upon goals for Hawaii's public education accountability system, including a definition of civic responsibility;

(2) Adding fiscal provisions to existing accountability statutes; and

(3) Adding provisions to hold complex area superintendents and principals accountable.

SECTION 51. Section 302A-1004, Hawaii Revised Statutes, is amended to read as follows:

"§302A-1004 Educational accountability system; annual reports. (a) The department shall implement a comprehensive system of educational accountability to motivate and support the improved performance of students and the education system. This accountability system shall:

(1) Include student accountability; school or collective professional accountability; individual professional accountability for teachers, principals, and other employees; and public accounting for other significant partners to the education process (including, but not limited to, parents, community members, businesses, higher education, media, and political leadership);

(2) Link authority and adequate resources to responsibility;

(3) Define clear roles for all parties and lines of responsibility and mutual obligation and develop a collaborative process with stakeholders, including representatives of appropriate bargaining units, parents, administration, and students;

(4) Involve fair and adequate assessment against agreed upon goals[;], including longitudinal progress and improvement spanning multiple school years. Outcome measures and action plans to address improving results should include, but not be limited to, the following components:

(A) Academic achievement:

(i) Reading proficiency by the end of third grade;

(ii) Personalized education plan for each student;

(iii) Ability to think critically; and

(iv) Graduation without remediation;

(B) Safety and well being:

(i) Attendance;

(ii) Comprehensive student support system plans in place to support each student with personalized classroom climate, differentiated classroom practices, family involvement, prevention or early intervention, support for transition between grades, community outreach and support, and specialized assistance and crisis or emergency support; and

(iii) Disciplinary offenses as provided by the board of education administrative rules; and

(C) Civic responsibility:

(i) Knowledge of the fundamental processes of American democracy;

(ii) Skills necessary to actively engage in a democratic society;

(iii) Understanding and awareness of community and global issues;

(iv) Respect for self and others and ability to work together as part of a team; and

(v) Participation in school and community organizations;

(5) Invoke a full and balanced set of appropriate consequences for observed performance, including rewards and recognition for those schools that meet or exceed their goals, assistance to those that fall short, and sanctions for those that, given adequate assistance and ample time, continue to fail to meet goals;

[(6) Involve:

(A) A statewide student assessment program that provides annual data on student, school, school complex and system performance at selected benchmark grade levels in terms of student performance relative to statewide content and performance standards and embodies high and rigorous expectations for the attainment of all students; and

(B) An annual assessment in core subjects for each grade level, as conducted by each school;

(7) Involve a comprehensive school profile or report card for each school, which shall include, but not be limited to, student performance measures, school attendance, drop-out rates, and parental involvement. These reports shall be made available annually to the board, the governor, the legislature, the parents, and the general public;]

(6) Involve an annual statewide student assessment program in the form of a comprehensive profile or report card that provides not less than three consecutive years of data on student, school, school complex and system performance at selected benchmark grade levels with performance indicators in areas relating to student achievement, safety and well being, and civic responsibility, including but not limited to:

(1) Student performance relative to statewide content and performance standards which embody high and rigorous expectations for all students in core subjects for each grade level;

(2) School attendance, drop-out rates, and parental involvement;

provided that these reports shall be made available annually to the board, governor, legislature, parents, and general public in a format that is easy to comprehend by and widely available at no cost to the general public;

[(8)] (7) Require that teachers and administrators engage in the continuous professional growth and development that ensure their currency with respect to disciplinary content, leadership skill, knowledge, or pedagogical skill, as appropriate to their position. This requirement may be established by the department in terms of credit hours earned or their equivalent in professional development activity certified by the department as appropriate in focus and rigor; [and]

[(9)] (8) Establish an explicit link between professional evaluation results and individual accountability through professional development of the knowledge, skill, and professional behavior necessary to the position, by requiring that results of the professional evaluation be used by the department to prescribe professional development focus and content, as appropriate[.];

(9) Evaluate the effectiveness of deputy superintendents, complex area superintendents, and principals, which shall include:

(A) A means of identifying distinguished service; and

(B) An evaluation of the effectiveness in fostering:

(i) Students' academic achievement (including satisfactory scores on standardized tests), safety and well being, and civic responsibility;

(ii) The satisfaction of stakeholders affected by the work of the deputy superintendents, complex area superintendents, and principals, which may be measured by broadbased surveys; and

(iii) Fiscal accountability; and

(10) Involve an annual statewide fiscal accountability assessment program in the form of a comprehensive profile or report card that provides not less than three consecutive years of data on school, school complex and system performance, including:

(A) Amount budgeted;

(B) Amount expended;

(C) Amount carried over; and

(D) Any significant changes to the budget, with an explanation for the change,

provided that these reports shall be made available annually to the board, governor, legislature, parents, and general public in a format that is easy to comprehend by and widely available at no cost to the general public.

[Beginning with the 2001-2002 school year, the] (b) The department shall submit to the legislature, the governor, and the board of education at least twenty days prior to the convening of each regular legislative session a report of the specifics of the [design] implementation of the comprehensive accountability system, as well as the fiscal requirements and legislative actions necessary to [create] maintain and improve the accountability system.

[(b)] (c) The department shall submit to the legislature and to the governor, at least twenty days prior to the convening of each regular legislative session, an educational status report that includes but is not limited to the following:

(1) Results of school-by-school assessments of educational outcomes;

(2) Summaries of each school's standards implementation design;

(3) Summary descriptions of the demographic makeup of the schools, with indications of the range of these conditions among schools within Hawaii;

(4) Comparisons of conditions affecting Hawaii's schools with the conditions of schools in other states; and

(5) Other such assessments as may be deemed appropriate by the board.

[(c)] (d) The department shall provide electronic access to computer-based financial management, student information, and other information systems to the legislature and the auditor. The department shall submit to the legislature and to the governor, at least twenty days prior to the convening of each legislative session, a school-by-school expenditure report that includes but is not limited to the following:

(1) The financial analysis of expenditures by the department with respect to the following areas:

(A) Instruction, including face-to-face teaching, and classroom materials;

(B) Instructional support, including pupil, teacher, and program support;

(C) Operations, including non-instructional pupil services, facilities, and business services;

(D) Other commitments, including contingencies, capital improvement projects, out-of-district obligations, and legal obligations; and

(E) Leadership, including school management, program and operations management, and district management; and

(2) The measures of accuracy, efficiency, and productivity of the department, districts, and schools in delivering resources to the classroom and the student.

[(d)] (e) The superintendent of education is responsible for the development and implementation of an educational accountability system. The system shall include consequences and shall be designed through a collaborative process involving stakeholders that shall include parents, community members, the respective exclusive representatives, as well as others deemed appropriate by the superintendent.

For the purposes of this section, negotiations under chapter 89 shall be between the superintendent or the superintendent's designee and the respective exclusive representative, and shall be limited to the impact on personnel arising from the superintendent's decision in implementing the educational accountability system. After the initial agreement is negotiated, provisions on the impact of the accountability on personnel may be reopened only upon mutual agreement of the parties.

(f) Unless otherwise approved by the legislature, the department shall expend no less than ninety-three and one-half per cent of the total department operating budget directly to the school complex and schools to be managed at the school complex and school level under the weighted student formula. The department's administrative expenditures shall not exceed six and one-half per cent of the total department operating budget unless approved by the legislature."

SECTION 52. Section 302A-1301, Hawaii Revised Statutes, is repealed:

["[§302A-1301] School system financial accountability. (a) Beginning with the 1995-1997 fiscal biennium, the department's administrative expenditures shall not exceed 6.5 per cent of the total department operating budget unless approved by the legislature.

(b) The department shall not transfer any funds appropriated under the school-based budgeting program EDN 100 of the state budget, except for unforeseeable circumstances that pose a threat to the health and safety of personnel and students, and subject to approval by the governor and notification to the legislature."]

PART X

MISCELLANEOUS

SECTION 53. This Act shall not be applied so as to impair any contract existing as of the effective date of this Act in a manner violative of either the Hawaii Constitution or Article I, section 10, of the United States Constitution.

SECTION 54. In the event of a conflict between this Act and section 89-10(d) or 89-19, Hawaii Revised Statutes, this Act shall control.

SECTION 55. The sums appropriated by this Act for fiscal year 2004-2005 shall be deemed part of the budget appropriations of the department of education for the purposes of developing and submitting the executive budget request for the biennium budget for fiscal years 2005-2006 and 2006-2007. The department of budget and finance shall consider the sums appropriated by this Act as if appropriated in the budget Act.

SECTION 56. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 57. This Act shall take effect upon its approval, provided that:

(1) Sections 8, 9, 10, 11, 12, 17, 18, 31, 32, 35, 36, 38, 39, 40, 41, 42, and 43 shall take effect on July 1, 2004;

(2) Sections 2, 3, 26, 27, and 28 shall take effect on July 1, 2006, and shall apply to the 2006-2007 school year; and

(3) Sections 14, 20, 21, 22, 23, 24, 25, 29, and 30 shall take effect on July 1, 2005, and shall apply to the 2005-2006 school year.