Report Title:

Education

Description:

Eliminates the DOE and BOE and establishes elected local school boards in at least 7 independent school districts. The duties of the local school boards would include: the appointment of the respective district superintendents; and the appointment of performance-based contracts principals within the district.

Allows the establishment of up to a total of 46 new century charter schools.Establishes a 7-member education standards and accountability commission, and authorizes the commission to adopt: (1) a weighted student formula to determine the allocation of funds to all schools; (2) a formula to determine the allocation of funds for capital improvement projects to the school districts; (3) statewide content and performance standards; and to establish statewide requirements for school district data collection.

 

HOUSE OF REPRESENTATIVES

H.B. NO.

2332

TWENTY-SECOND LEGISLATURE, 2004

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO EDUCATION.

 

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

SECTION 1. This Act shall be known as the "Local Voice, Local Control Act of 2004."

SECTION 2. The purpose of this Act is to reform the existing public education system by eliminating the department of education and board of education and establishing elected local school boards in at least seven independent school districts. The local school boards will be responsible for the management and operation of public schools in their respective districts.

Under the new school system established in this Act, principals will be empowered with the resources needed to achieve student success. In addition, school and local communities will have a meaningful voice in the management and operation of the schools in their school districts.

This Act recognizes that parents should have a greater voice in how they want their children to be educated. This Act enables parents, guardians, and caregivers to select the school they want their child to attend, within resource limitations. Each school will be required to enroll students residing within the geographic boundaries of the school. The school will also be required to fulfill any legal requirements, such as those of the federal No Child Left Behind Act of 2001. The school will also be required to use a lottery system to select applicants living outside the geographic boundaries of the school until the school reaches its capacity.

Local school boards will have the authority to establish policies for the school districts, select principals for the schools in the school district, and administer programs that any school would not be able to undertake alone.

This Act provides for a new entity called the education standards and accountability commission that will establish statewide student performance standards. The individual school districts and the schools will determine how they will achieve the objectives set forth by the education standards and accountability commission. This discretion allows diversity in public education and empowers schools to incorporate community needs, values, and expectations in curriculum and instruction.

The education standards and accountability commission will also determine funding formulas for distributing moneys for operation costs and capital improvement projects in each school district. Each allocation, whether for operation costs or capital improvement projects, will be made in a lump sum to the education standards and accountability commission for distribution to the local school boards based on these formulas. The establishment of these formulas ensures that more money will be used in the classroom for the benefit of public school students.

The principal, as the educational leader of the school, will determine how to spend the school's allocation for operations and be responsible for all matters affecting educational quality. At the same time, the principal will be expected to consult with teachers, other school staff, the parents of students, and interested members of the larger community. The principal at each school will be held accountable for student performance and the quality of education at the school. Principals will be evaluated by the local school board on the basis of progress students make toward achieving performance standards established by the educational standards and accountability commission, along with demonstrated management and leadership skills.

SECTION 3. The Hawaii Revised Statutes is amended by adding a new chapter to title 2 to be appropriately designated and to read as follows:

"CHAPTER

SCHOOL DISTRICTS

§ -A Local school boards; members. (a) The state public education system shall be organized into seven or more school districts, as provided for in the state constitution. Each school district shall be headed by a local school board, which shall be deemed a state agency. A local school board shall be composed of five members who shall be elected in a nonpartisan manner.

(b) Subject to section -E, the school districts shall be as follows:

(1) District 1: Hawaii Island District

(2) District 2: Maui District

(3) District 3: Honolulu District

(4) District 4: Central District

(5) District 5: Leeward District

(6) District 6: Windward District

(7) District 7: Kauai District

The initial boundaries of the seven school districts shall be the same boundaries in existence as of the effective date of this chapter.

(c) The members of a local school board shall serve without compensation, but may be reimbursed for all necessary expenses incurred during the performance of their duties.

§ -B Qualifications of local school board members. (a) No person shall be eligible for election or appointment to a local school board unless the person is a registered voter and a resident of the school district for which seat the person is seeking election or appointment. No member of a local school board shall hold or be a candidate for any other public office under the state or county governments in accordance with Article II, section 7 of the Constitution of the State; nor shall a person be eligible for election or appointment to a local school board if that person is also a candidate for any other public office under the state or county governments.

(b) As used in this section, "public office" does not include notaries public, reserve police officers, or officers of emergency organizations for civilian defense or disaster relief.

§ -C Election of members. (a) Except for the initial members of a local school board, who shall be elected by special election, members of a local school board shall be elected at the general election. Except as otherwise provided by this chapter, the candidates for a local school board shall be elected in the manner prescribed by this title.

(1) Nomination papers, preparation of. The chief election officer shall prepare nomination papers in such a manner that a candidate desiring to file for election to a local school board shall specify the school district from which the candidate is running.

(2) Ballot. The local school board ballot shall afford every eligible voter the opportunity to vote for as many candidates as there are vacancies from that school district.

The local school board ballot shall contain the names of all board candidates arranged alphabetically in a nonpartisan manner.

(3) General election. Each voter in the general election shall be entitled to receive the local school board ballot and to vote for the number of seats available in the respective school districts.

(b) In the event that there are fewer candidates than contested seats in any election in a particular school district, after the close of filing of nomination papers, the chief election officer shall declare such candidate or candidates to be duly and legally elected. The close of filing for nomination papers for a local school board seat shall be the same date as the close of filing for legislative seats.

§ -D Local school board members; term, vacancies. (a) With the exception of the initial term of local school board members elected by special election pursuant to subsection (c), the term of office of members of a local school board shall be for four years beginning on the day of the general election in which they are elected. Members of a local school board may be re-elected without restriction as to the number of terms.

(b) Any vacancy that may occur in a local school board through any cause other than the expiration of the term of office shall be filled in accordance with section 17-6.

(c) As soon as practicable but no later than June 1, 2005, the office of elections shall conduct a special election to select the initial members of the local school boards. Members of a local school board elected at the special election held for the purpose of electing the initial local school board members shall be elected to terms ending the day before general election in 2008.

§ -E Expansion; consolidation. (a) Any community within a school district desiring to form a separate school district may petition the affected local school board to become a separate school district. Members of a new local school board created pursuant to this section shall be elected at the next general election.

(b) A school district may choose to consolidate with one or more school districts so long as all affected school districts consent to the consolidation and there would continue to be no fewer than seven school districts after the consolidation.

(c) In all cases of expansion and consolidation, the decision of the respective affected local school boards shall be final."

SECTION 4. The Hawaii Revised Statutes is amended by adding two new chapters to title 18 to be appropriately designated and to read as follows:

"CHAPTER

PUBLIC EDUCATION SYSTEM

PART I. GENERAL PROVISIONS

§ -AA Definitions. As used in this chapter unless the context otherwise requires:

"Commission" means the education standards and accountability commission.

"Local school board" means a local school board established under section -A.

PART II. EDUCATION STANDARDS AND ACCOUNTABILITY COMMISSION

§ -BB Education standards and accountability commission; membership. (a) The education standards and accountability commission shall consist of seven members. The house speaker and senate president shall nominate seven members of the education standards and accountability commission no later than thirty days after the ratification of a constitutional amendment establishing the education standards and accountability commission. No more than one member of the commission shall be nominated and serve from each of the school districts.

The governor shall have thirty days to confirm the nomination by the house speaker and senate president. If the governor fails to confirm a nominee, the house speaker and senate president shall make another nomination no later than fifteen days after the governor denies confirmation. In no instance shall a nominee who has failed to be confirmed be nominated again during the same term of service.

If the house speaker or senate president fail to make a nomination within the time frames specified in this section, the governor shall make an interim appointment.

(b) One of the initial appointments to the commission shall be appointed to a term ending on June 30, 2005, as determined by the house speaker and senate president. Two of the initial appointments to the commission shall be appointed to a term ending on June 30, 2006, as determined by the house speaker and senate president. Two of the initial appointments to the commission shall be appointed to a term ending on June 30, 2007, as determined by the house speaker and senate president. Two of the initial appointments to the commission shall be appointed to a term ending on June 30, 2008, as determined by the house speaker and senate president.

(c) Notwithstanding subsection (b), the term of office of members of the commission shall be for four years. Members of the commission shall serve staggered terms. Members of the commission may be reappointed without restriction as to the number of terms.

(d) If a vacancy occurs in the commission, the vacancy shall be filled for the unexpired term in the same manner as the office was previously filled.

(e) The members of the commission shall select their own chairperson and other officers from the commission's membership.

(f) The members of the commission shall serve without compensation, but may be reimbursed for all necessary expenses incurred during the performance of their duties.

§ -CC Powers. The commission shall have all of the powers necessary to carry out its purposes, which shall include but not be limited to:

(1) Establishing and maintaining standards that apply to all school districts within the statewide public education system;

(2) Ensuring that the school districts operate in an open manner;

(3) Publishing annual report cards on each school district's financial management and overall performance and ensuring that the school districts publish annual report cards on each school within each school district;

(4) Ensuring that all state and federal mandates are fulfilled;

(5) Establishing a formula for distributing general funds for school operations to all public schools and charter schools based on the number and type of students enrolled at each school;

(6) Establishing a formula for the distribution of capital improvement project funds to the school districts; and

(7) Administering programs that the school districts cannot administer alone.

§ -DD Funding formula for school operations; facilities formula for charter schools. (a) The commission shall adopt a weighted student formula to determine the allocation of funds to all schools, including new century charter schools. The formula shall consider factors such as types and numbers of regular and special education students, socioeconomic conditions of the students, and other factors deemed relevant by the commission.

(b) In determining the weighted student formula, the commission shall exclude all federal funds. Other non-general fund revenues, such as existing fees, grants, proceeds of fundraisers, and gifts, shall remain with the school or local school board that generated the non-general fund revenues.

(c) The commission shall develop the weighted student formula and procedures for the operation of and amendment to the formula in accordance with chapter 92.

(d) In addition to the weighted student formula for operations established by this section, the commission shall adopt a facilities formula to determine the allocation of funds for charter schools in each school district. The facilities formula shall provide non-conversion new century charter schools funding necessary to pay for facilities and related costs not usually applicable to public schools.

(e) By the 2006-2007 school year, of the total amount appropriated by the legislature each fiscal year for school operations pursuant to this section:

(1) At least ninety per cent shall be expended by the individual schools for school operations;

(2) No more than one per cent shall be expended by the commission; and

(3) No more than nine per cent shall be expended by all of the local school boards, collectively.

§ -EE Funding formula for school district capital improvement projects. (a) The commission shall adopt a formula to determine the allocation of funds for capital improvement projects to the school districts. The formula shall consider factors such as:

(1) The student population and enrollment in the school district;

(2) Type, age, condition, and number of educational facilities in the school district;

(3) Socioeconomic conditions of the students;

(4) The health and safety of students and staff; and

(5) Other factors deemed relevant by the commission.

(b) The commission shall develop the funding formula and procedures for the operation of and amendment to the formula in accordance with chapter 92.

§ -FF Statewide content and performance standards. (a) The commission shall establish statewide content and performance standards and the means to assess the standards.

(b) The commission shall establish procedures and guidelines for, and shall expand, its statewide assessment program to include norm-referenced testing in the same grades as required by federal law.

§ -GG Monitoring; tracking of data. The commission shall be responsible for setting the statewide requirements for collection of information from school districts including but not limited to the following:

(1) Graduation rates;

(2) Retention rates;

(3) State standards;

(4) Federal standards;

(5) Fiscal accountability; and

(6) Achievement results.

PART III. LOCAL SCHOOL BOARDS

§ -II Local school boards; duties; powers. (a) There shall be a local school board for each of the school districts established in section -A. Local school boards shall be agencies of the State and shall be administratively attached to the education standards and accountability commission. Each local school board shall be responsible for all issues of governance and operations of the school district. The local school boards shall have all of the powers necessary to carry out their purposes, which shall include but not be limited to:

(1) Formulating and implementing educational policies and objectives for the school districts not inconsistent with statewide educational standards;

(2) Appointing principals to manage the schools in their school districts;

(3) Appointing district superintendents to carry out each school district's policies;

(4) Administering programs that the schools are not able to administer alone;

(5) Establishing an open system that allows, as much as is practicable given each school's resources and capacity, the parents, guardians and caretakers of each public school student to select the school that the student will attend;

(6) Being responsible and accountable for the development of educational objectives and the delivery of general and special education within their respective school districts;

(7) Allocating funds to each of the schools in their respective school districts in accordance with the funding formulas established by the education standards and accountability commission; and

(8) Conducting public meetings subject to chapters 92 and 92F.

(b) Local school boards shall not have authority to:

(1) Impose taxes of any kind;

(2) Impose fees for basic educational services; or

(3) Borrow money.

(c) For any school year, based on sufficient and good reason, a local school board may petition the education standards and accountability commission to amend or alter the prescribed allocation formula for the schools in its school district.

§ -JJ Appointment of district superintendents. Each local school board shall appoint a district superintendent for its school district. District superintendents shall be responsible for implementing district-wide educational policies formulated by the local school boards.

§ -KK Transportation of school children. (a) The local school boards may provide suitable transportation to and from school and for educational field trips for all children in grades kindergarten to twelve and in special education classes. The local school boards shall adopt any policy, procedure, and program as deemed necessary to provide suitable transportation. In formulating the policy, procedure, and program, the local school board shall consider:

(1) The school district;

(2) The school attendance area in which a school child normally resides;

(3) The distance the school child lives from the school;

(4) The availability of public carriers or other means of transportation;

(5) The frequency, regularity, and availability of public transportation; and

(6) The grade level, physical handicap, or special learning disability of a school child.

The local school board may also consider conditions and circumstances unique or peculiar to a county or area.

(b) Students who attend schools or programs of choice, such as charter schools, magnet schools, or learning centers or schools outside of their home school attendance area, as determined by the student's legal residence, shall not be eligible for State subsidized transportation services unless the services are already available and could be provided without additional cost to the State; provided that this section shall not apply to the public school choice provisions of the federal No Child Left Behind Act of 2001.

(c) The local school boards shall adopt rules pursuant to chapter 91 governing the supervision and administration of the transportation of school children under this section.

§ -LL Rules; rulemaking; governing authority. Each local school board may adopt rules to implement this chapter and reflect commission priorities and direction in accordance with chapter 91.

PART IV. PRINCIPALS AND VICE PRINCIPALS

§ -MM Appointment of principals; performance-based contracts. (a) Effective July 1, 2006, each local school board shall appoint principals for the schools within its school district.

(b) Notwithstanding any other law to the contrary, including chapter 89, each local school board may negotiate and enter into a performance-based contract as provided for in this part, for the purpose of obtaining principals for schools within the local school board’s jurisdiction.

(c) Principals shall be appointed through performance-based contracts for a two-year term, with provision for a rollover two-year appointment at the end of each year of the performance-based contract.

(d) Each local school board shall be responsible for establishing performance standards for principals within its jurisdiction and shall incorporate the standards into the performance-based contract.

(e) If, at any time, the principal is not performing in accordance with the expected performance standards established by the educational standards and accountability commission, the local school board may terminate the principal, upon notice to the principal with an opportunity to be heard before the local school board. In lieu of termination, the local school board may provide additional time as the local school board deems appropriate for the principal to correct substandard performance or, in the alternative, the local school board may offer placement of the principal into another appropriate vacant position within the local school board’s jurisdiction for which the principal is qualified.

§ -NN Appointment of vice principals; performance-based contracts. (a) Effective July 1, 2006, each principal may appoint one or more vice principals for the principal's school.

(b) Notwithstanding any other law to the contrary, including chapter 89, each principal may negotiate and enter into a performance-based contract as provided for in this part, for the purpose of obtaining vice principals at the principal's school.

(c) Vice principals shall be appointed through performance-based contracts for a two-year term, with provision for a rollover two-year appointment at the end of each year of the performance-based contract.

(d) Each principal shall be responsible for establishing performance standards for vice principals at the principal's school and shall incorporate the standards into the performance-based contract.

(e) If, at any time, the vice principal is not performing in accordance with the expected performance standards established in the performance-based contract, the principal may terminate the vice principal, upon notice to the vice principal with an opportunity to be heard before the local school board.

§ -OO Salary increase. The initial performance-based contracts offered to principals pursuant to this part shall include placing the principal on a twelve-month salary schedule and a substantial salary increase to reflect the new demands and greater accountability placed upon principals as a result of the enactment of this part.

§ -PP Tenure. (a) Notwithstanding any other law to the contrary, including chapter 89, principals and vice principals shall retain any tenure they have earned as teachers but not tenure earned as principals and vice principals.

(b) Principals and vice principals may apply for a teaching position for which the principal or vice principal is qualified; provided that the position is vacant and no incumbent teacher is displaced as a result.

PART V. SCHOOLS

§ -QQ School choice. (a) All persons of school age may attend the school of their choice, upon request by a parent, guardian, or caretaker, notwithstanding the student's legal residence subject to space availability and subject to the following priority designations:

(1) First priority for:

(A) Students whose parents, guardians, or caretakers have a legal residence within the school attendance area;

(B) Students entitled to placement pursuant to state or federal law;

(C) Students placed by court order; and

(D) Those students currently enrolled through either a prior geographic exemption process or by choice;

(2) Second priority to be determined by each school upon taking into consideration factors including:

(A) The student has siblings who are currently enrolled and will continue enrollment in the receiving school in the subsequent school year;

(B) The student is a child of staff at the receiving school; and

(C) A specialized educational program that is appropriate for the student is offered exclusively or emphasized at the receiving school;

(3) Third priority for students participating in a chance selection process.

(b) Available space for school choice applications shall be based on the student capacity as determined by the district for each school.

(c) The school choice selection process, including the school capacity, number of applicants, and priority classification placements shall be open to the public; provided that confidential records shall be protected as provided by law.

(d) School choice enrollment shall be granted through the student's terminal year at the receiving school and school choice enrollees shall provide written notification to the receiving school if they intend to discontinue attendance at the receiving school.

§ -RR Reporting of crime-related incidents. Each local school board shall adopt rules pursuant to chapter 91 to:

(1) Require a report to appropriate authorities from a teacher, official, or other employee of the school district who knows or has reason to believe that an act has been committed or will be committed, which:

(A) Occurred or will occur on school property during school hours or during activities supervised by the school; and

(B) Involves crimes relating to arson, assault, burglary, disorderly conduct, dangerous weapons, dangerous drugs, harmful drugs, extortion, firearms, gambling, harassment, intoxicating drugs, marijuana or marijuana concentrate, murder, attempted murder, sexual offenses, rendering a false alarm, criminal property damage, robbery, terroristic threatening, theft, or trespass;

(2) Establish procedures for disposing of any incident reported; and

(3) Impose, in addition to any other powers or authority the district may have to discipline school officials, appropriate disciplinary action for failure to report these incidents, including probation, suspension, demotion, and discharge of school officials.

§ -SS Indemnity upon reporting. The State shall indemnify and hold harmless anyone participating in good faith in making a report pursuant to section -QQ from any civil liability that might otherwise be incurred or imposed by, or as a result of, the making of the report.

§ -TT Coverage for workers' compensation of an exceptional child. Whenever an exceptional child undertakes to perform work for a private employer as part of a school-approved work-based learning program, whether paid or unpaid, the State shall be deemed to be the responsible employer for the purposes of workers' compensation coverage.

As used in this section, "exceptional children" includes:

(1) Persons under twenty years of age who deviate from the so-called normal person in physical, mental, social, or emotional characteristics or abilities to such an extent that specialized training, techniques, and equipment are required to enable these persons to attain the maximum of their abilities or capacities; provided that "exceptional children" shall not include "gifted and talented children";

(2) Persons under twenty years of age who by reason of physical defects cannot attend the regular public school classes with normal children; and

(3) Persons under twenty years of age who are certified by a licensed physician eligible for membership in the state medical society as being emotionally maladjusted or intellectually incapable of profiting from ordinary instructional methods.

Chapter

NEW CENTURY CHARTER SCHOOLS

§ -AAA New century charter schools. (a) All schools previously designated as student-centered schools shall be designated as new century charter schools.

(b) For the purposes of this chapter:

"Chartering authority" means the board of regents of the University of Hawaii, the local school board in whose district the new century charter school is located, or any other public agency approved by the education standards and accountability commission.

§ -BBB New century charter schools; establishment. (a) Up to a total of forty-six schools may be established as new century charter schools. These new century charter schools may be established by:

(1) The creation of a new school; or

(2) The creation of a new school, comprising programs or sections of existing public school populations and using existing public school facilities, pursuant to subsection (b).

(b) Any person may submit a letter of intent to a chartering authority to form a new century charter school, establish a charter school board as its governing body, and develop a detailed implementation plan pursuant to subsection (c). In issuing charters after July 1, 2006, chartering authorities shall give the highest priority to those applications that would form a new century charter school with specific intent to provide an educational opportunity that is significantly different from opportunities provided in conventional public schools, such as:

(1) By primarily serving students who have been unable to thrive in conventional public schools;

(2) Focusing on native Hawaiian culture; or

(3) Offering vocational education.

(c) The new century charter school board shall formulate and develop a detailed implementation plan that meets the requirements of this subsection and section -CCC. The plan shall include the following:

(1) A description of employee rights, management issues, and a framework for addressing those issues that protect the rights of employees;

(2) A plan for identifying, recruiting, and selecting students that is not exclusive, elitist, or segregationist;

(3) The curriculum and instructional framework to be used to achieve student outcomes, including an assessment plan;

(4) A comprehensive plan for the assessment of student, administrative support, and teaching personnel performance, that:

(A) Recognizes the interests of the general public;

(B) Incorporates or exceeds state educational content and performance standards;

(C) Includes a system of faculty and staff accountability that holds faculty and staff both individually and collectively accountable for their performance, and that is at least equivalent to the accountability in public schools throughout the State; and

(D) Provides for program audits and annual financial audits;

(5) The governance structure of the school; and

(6) A plan for any necessary design, construction, renovation, and management of facilities that is consistent with the state facilities plan; provided that:

(A) If the facilities management plan includes use of existing school facilities, the new century charter school shall receive authorization from the administrator responsible for the facilities; and

(B) The final determination of use shall fall within the charter school board's discretion.

(d) Upon receipt of a completed implementation plan for a proposed new century charter school, a chartering authority shall have sixty work days to review the plan to ensure that it meets the requirements of subsection (c) and section -CCC. If the chartering authority determines that the implementation plan:

(1) Meets the requirements of subsection (c) and section -CCC, the chartering authority shall issue a charter, and the implementation plan shall be converted to a written performance contract between the school and the chartering authority; or

(2) Fails to meet the requirements of subsection (c) or section -CCC, the chartering authority:

(A) Shall notify the new century charter school board of the finding in writing to enable the new century charter school board to appropriately amend the plan to address the findings; and

(B) May issue a provisional approval for a charter if it determines that the applicant may reasonably be expected to expeditiously resolve any remaining findings impeding the issuance of a charter. The provisional approval shall be effective for one year. The chartering authority may extend the provisional approval beyond a period of one year. If a charter is subsequently issued, the amended implementation plan shall be converted to a written performance contract between the school and the chartering authority.

(e) An amended implementation plan shall be submitted within thirty work days of notification pursuant to subsection (d)(2)(A). The chartering authority may deny the issuance of a charter if the charter school board does not submit an amended implementation plan within the thirty work day period. The chartering authority shall have thirty work days to review the amended implementation plan. If the amended implementation plan:

(1) Meets the requirements of subsection (c) and section -CCC, the chartering authority shall, by the thirtieth work day, issue a charter to the proposed new century charter school. If a charter is issued, the amended implementation plan shall be converted to a written performance contract between the school and the chartering authority; or

(2) Fails to address the findings to the chartering authority's satisfaction the chartering authority shall deny issuance of a charter.

(f) A new century charter school board may file an appeal of the denial of an application for a charter with the chartering authority. Within thirty work days, the chartering authority shall issue a report of its findings and final determination to the charter school board. If the implementation plan is approved, the chartering authority shall issue a charter and the implementation plan shall be converted to a written performance contract between the school and the chartering authority.

(g) The State shall afford the charter school board of any new century charter school the same protections as the State affords to the chartering authority.

(h) Any new century conversion charter school may, prior to the beginning of the school year, enter into an annual contract with the school district in which it is located for services to be provided by that school district.

§ -CCC New century charter schools; exemptions. (a) Schools designated as new century charter schools shall be exempt from all applicable state laws, except those regarding:

(1) Collective bargaining under chapter 89; provided that:

(A) The exclusive representatives defined in chapter 89 may enter into agreements that contain cost and noncost items to facilitate decentralized decision-making;

(B) The exclusive representatives and the charter school board of the new century charter school may enter into agreements that contain cost and noncost items;

(C) The agreements shall be funded from the current allocation or other sources of revenue received by the new century charter school; and

(D) These agreements may differ from the master contracts;

(2) Discriminatory practices under section 378-2; and

(3) Health and safety requirements.

(b) New century charter schools shall be exempt from the state procurement code, chapter 103D, but shall develop internal policies and procedures for the procurement of goods, services, and construction, consistent with the goals of public accountability and public procurement practices. However, where possible, the new century charter school is encouraged to use the provisions of chapter 103D; provided that the use of one or more provisions of chapter 103D shall not constitute a waiver of the exemption of chapter 103D and shall not subject the new century charter school to any other provision of chapter 103D. New century charter schools shall account for funds expended for the procurement of goods and services, and this accounting shall be available to the public.

(c) Notwithstanding any law to the contrary,:

(1) Employees of new century charter schools shall be entitled to any benefit program generally applicable to officers and employees of the State;

(2) Civil service employees of a conversion charter school at the time of the conversion shall retain their civil service status and new employees of the conversion charter school may be designated civil service or exempt from civil service at the discretion of the conversion charter school board;

(3) Employees for start-up charter schools established pursuant to section -BBB shall be exempt from civil service; and

(4) New century public charter schools, as public schools and entities of the State, shall not bring suit against any other entity or agency of the State of Hawaii.

§ -DDD New century charter schools; funding. (a) Beginning with the 2006-2007 school year, new century charter schools shall be subject to the weighted student formula and facilities formula set forth in section -DD.

(b) All federal financial support for new century charter schools shall be no less than all other public schools; provided that if administrative services related to federal grants and subsidies are provided to the charter school by the chartering authority, the charter school shall reimburse the chartering authority for the actual costs of the administrative services in an amount that does not exceed six and one-half per cent of the charter school's federal grants and subsidies.

Any new century charter school shall be eligible to receive any supplementary financial grant or award for which any other public school may submit a proposal, or any supplemental federal grants limited to new century charter schools; provided that if administrative services, including funds management, budgetary, fiscal accounting, or other related services, are provided with respect to these supplementary grants, the charter school shall reimburse the chartering authority for the actual costs of the administrative services in an amount that does not exceed six and one-half per cent of the supplementary grant for which the services are used.

All additional funds that are generated by the charter school boards, not from a supplementary grant, shall be separate and apart from allotted funds and may be expended at the discretion of the charter school boards.

(c) The education standards and accountability commission shall provide appropriate transitional resources to a new century conversion charter school for its first year of operation.

(d) Neither a new century charter school nor a new century conversion charter school may assess tuition.

§ -EEE New century charter schools; accountability probationary status; revocation of charter. (a) Every new century charter school shall conduct annual self-evaluations that shall be submitted to the local school board within sixty work days after the completion of the school year. The self-evaluation process shall include but not be limited to:

(1) The identification and adoption of benchmarks to measure and evaluate administrative and instructional programs as provided in this section;

(2) The identification of any administrative and legal barriers to meeting the benchmarks, as adopted, and recommendations for improvements and modifications to address the barriers;

(3) The impact of the new century charter school upon student achievement within that school;

(4) A profile of the charter school's enrollment and community it serves, including a breakdown of regular education and special education students.

(b) The chartering authority shall initiate an annual independent evaluation of each new century charter school for the first two years after its establishment and every four years thereafter to assure organizational viability and compliance with applicable state laws, statewide student content and performance standards, and fiscal accountability. Upon a determination by the chartering authority that student achievement within a new century charter school does not meet the student performance standards, or that the new century charter school is not fiscally responsible, a new century charter school shall be placed on probationary status and shall have one year to bring student performance into compliance with statewide standards and improve the school's fiscal accountability. If a new century charter school fails to meet its probationary requirements, or fails to comply with any of the requirements of this section, the chartering authority, upon a two-thirds majority vote, may then revoke the charter of the new century charter school.

For the purposes of this subsection, "organizational viability" means that a new century charter school:

(1) Has been duly constituted in accordance with its charter;

(2) Has a charter school board established in accordance with law and its charter;

(3) Employs sufficient faculty and staff to provide the necessary educational program and support services and to operate the facility in accordance with its charter; and

(4) Maintains comprehensive records regarding students, employees, and complies with federal and state health and safety requirements.

(c) A chartering authority may adopt guidelines to supplement accountability measures incorporated in the written performance contracts required under section -BBB. A chartering authority may adopt guidelines under which new century charter schools shall be reviewed on an annual basis for the first two years upon their formation under section -BBB. The review guidelines may include:

(1) Minimum school size;

(2) Assurance that each school will be able to account for the funds allocated;

(3) Assurance that each school will be held accountable for student performance;

(4) Assurance that each school will meet legal standards for the expenditure of state and federal funds; and

(5) Assurance that each school will be in compliance with applicable state and federal laws.

(d) If, at any time, a new century charter school dissolves or the charter is revoked, the State of Hawaii shall have first right, at no cost to the State, to all the assets and facilities of the new century charter school, except as otherwise provided by law.

§ -FFF New century charter schools; responsibilities of school districts; special education services. (a) The school districts may collaborate with the charter schools to develop a system of technical assistance related to compliance with federal and state laws and access to federal and state funds. The school districts and the charter schools may collaborate to develop a list of services that the school districts may offer for purchase by a new century charter school at an annual cost to be negotiated between an individual new century charter school and the school district. The school district may enter into a contract with a new century charter school to provide these services, which shall be renegotiated on an annual basis.

(b) Any new century charter school that enrolls special education students or identifies one of its students as eligible for special education shall be responsible for providing the educational and related services required by a student's individualized education plan. The school districts may collaborate with the charter schools to develop guidelines related to the provision of special education services and resources to each charter school within each school district. In making the determination about the provision of services to a special education student enrolled in a charter school, the school district may review all of the current individualized education plans of special education students enrolled in a charter school, and may offer funding to the charter school based upon a per pupil weighted formula implemented by the school district and used to allocate resources for special education students in the public schools. The school district may also offer services to the special education student at a public school within district.

§ -GGG New century charter schools; sports. The school districts shall provide students at new century charter schools with the same opportunity to participate in athletics provided to students at other public schools. If a student at a new century charter school wishes to participate in a sport for which there is no program at the new century charter school, the school district shall allow that student to participate in a comparable program of any public school in the district.

§ -HHH New century conversion charter schools; conversion schools. (a) As used in this section:

"New century conversion charter school" means:

(1) Any existing public school that is managed and operated in accordance with subsection (d); or

(2) Any existing public school that is managed and operated by a nonprofit organization in accordance with this section, excluding subsection (d).

"Nonprofit organization" means a private, nonprofit, tax-exempt entity that:

(1) Is recognized as a tax exempt organization under section 501(c)(3) of the Internal Revenue Code of 1986, as amended;

(2) Is domiciled in this State; and

(3) Makes a minimum annual contribution of $1 per pupil toward the operation of a new century conversion charter school for every $4 per pupil in state funds provided for the operation of the charter school.

(b) A nonprofit organization may submit a letter of intent to a chartering authority to operate and manage an existing public school as a new century conversion charter school, establish a new century charter school board as its governing body, and develop a detailed implementation plan pursuant to section -BBB (c); provided that:

(1) The new century charter school board as the governing body of the new century conversion charter school shall be composed of the board of directors of the nonprofit organization and not the participants specified in subsection (d)(1). The nonprofit organization may also appoint advisory panels of community representatives for each school managed by the organization, with whom the organization may consult; provided that these panels shall not have governing authority over the school and shall serve only in an advisory capacity to the nonprofit organization;

(2) The detailed implementation plan for each new century conversion charter school to be operated by the nonprofit organization shall be formulated, developed, and submitted by the charter school board. The detailed implementation plan shall be approved by a majority of the votes cast by existing administrative, support, and teaching personnel, and parents; provided that the school personnel may request their bargaining unit representative to certify and conduct the elections for their respective bargaining units;

(3) After the detailed implementation plan for a new century conversion charter school operated and managed by the nonprofit organization has been approved by a chartering authority as provided in section -BBB (d) to (f), the chartering authority shall issue a charter, and the implementation plan shall be converted to a written performance contract between the nonprofit organization and the chartering authority, under which the new century conversion charter school shall be managed and operated as a division of the nonprofit organization;

(4) The board of directors of the nonprofit organization, as the governing body for the new century conversion charter school that it operates and manages, shall have the same protections that are afforded to the chartering authority;

(5) Any new century conversion charter school that is managed and operated by a nonprofit organization shall be eligible for the same federal and state funding as other public schools; provided that the nonprofit organization may allocate federal and state funds among two or more of the new century conversion charter schools that it operates and manages to the extent permitted by law; and

(6) If, at any time, the new century conversion charter school dissolves or the charter is revoked, the State of Hawaii shall have first right, at no cost to the State, to all the assets and facilities of the new century conversion charter school, except as provided in the detailed implementation plan.

(c) Any nonprofit organization that seeks to manage or operate a new century conversion charter school as provided in subsection (b) shall comply with the following at the time of application:

(1) Have bylaws or policies that describe the manner in which business is conducted and policies that relate to the management of potential conflict of interest situations;

(2) Have experience in the management and operation of public or private schools, or, to the extent necessary, agree to obtain appropriate services from another entity or entities possessing such experience;

(3) Comply with all applicable federal, state, and county laws, including being licensed and accredited, as applicable, in accordance with the requirements of federal, state, and county governments; and

(4) Comply with any other requirements prescribed by the school district to ensure adherence with applicable federal, state, and county laws and the purposes of this chapter.

(d) As an alternative to subsection (b), any public school or schools may submit a letter of intent to a chartering authority to form a new century conversion charter school, establish a charter school board as its governing body, and develop a detailed implementation plan pursuant to section –BBB (c); provided that:

(1) The charter school board as its governing body shall be composed of, at a minimum, one representative from each of the following participant groups:

(A) Principals;

(B) Instructional staff members selected by the school instructional staff;

(C) Support staff selected by the support staff of the school;

(D) Parents of students attending the school selected by the parents of the school;

(E) Student body representatives selected by the students of the school; and

(F) The community at-large; and

(2) The detailed implementation plan shall be approved by a majority of the votes cast by existing administrative, support, and teaching personnel, and parents; provided that the school personnel may request their bargaining unit representative to certify and conduct the elections for their respective bargaining units.

(e) Up to a total of fifty schools may be established as new century conversion charter schools. Any new century conversion charter school may, prior to the beginning of the school year, enter into an annual contract with its school district for services to be provided by the school district.

(f) This section does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun, before April 4, 2002.

(g) Unless otherwise provided in this section, the provisions in this chapter, as they relate to new century charter schools, shall apply to new century conversion charter schools. In the event of a conflict between the provisions in this section, as they relate to new century conversion charter schools, and the other provisions in this chapter, this section shall control."

SECTION 5. Section 11-157, Hawaii Revised Statutes, is amended to read as follows:

"§11-157 In case of tie. In case of the failure of an election by reason of the equality of vote between two or more candidates, the tie shall be decided by the chief election officer or county clerk in the case of county elections in accordance with the following procedure:

(1) In the case of an election involving a seat for the senate, house of representatives, [board of education,] local school board, or county council where only voters within a specified district are allowed to cast a vote, the winner shall be declared as follows:

(A) For each precinct in the affected district, an election rate point shall be calculated by dividing the total voter turnout in that precinct by the total voter turnout in the district. For the purpose of this subparagraph, the absentee votes cast for the affected district shall be treated as a precinct. The election rate point shall be calculated by dividing the total absentee votes cast for the affected district by the total voter turnout in that district. All election rate points shall be expressed as decimal fractions rounded to the nearest hundred thousandth.

(B) The candidate with the highest number of votes in a precinct shall be allocated the election rate point calculated under subparagraph (A) for that precinct. In the event that two or more persons are tied in receiving the highest number of votes for that precinct, the election rate point shall be equally apportioned among those candidates involved in that precinct tie.

(C) After the election rate points calculated under subparagraph (A) for all the precincts have been allocated as provided under subparagraph (B), the election rate points allocated to each candidate shall be tallied and the candidate with the highest election rate point total shall be declared the winner.

(D) If there is a tie between two or more candidates in the election rate point total, the candidate who is allocated the highest election rate points from the precinct with the largest voter turnout shall be declared the winner.

(2) In the case of an election involving a federal office or an elective office where the voters in the entire State or in an entire county are allowed to cast a vote, the winner shall be declared as follows:

(A) For each representative district in the State or county, as the case may be, an election rate point shall be calculated by dividing the total voter turnout in that representative district by the total voter turnout in the state, county, or federal office district, as the case may be; provided that for purposes of this subparagraph:

(i) The absentee votes cast for a statewide, countywide, or federal office shall be treated as a separate representative district and the election rate point shall be calculated by dividing the total absentee votes cast for the statewide, countywide, or federal office by the total voter turnout in the state, county, or federal office district, as the case may be.

(ii) The overseas votes cast for any election in the State for a federal office shall be treated as a separate representative district and the election rate point shall be calculated by dividing the total number of overseas votes cast for the affected federal office by the total voter turnout in the affected federal office district. The term "overseas votes" means those votes cast by absentee ballots for a presidential election as provided in section 15-3.

All election rate points shall be expressed as decimal fractions rounded to the nearest hundred thousandth.

(B) The candidate with the highest number of votes in a representative district shall be allocated the election rate point calculated under subparagraph (A) for that district. In the event that two or more persons are tied in receiving the highest number of votes for that district, the election rate point shall be equally apportioned among those candidates involved in that district tie.

(C) After the election rate points calculated under subparagraph (A) for all the precincts have been allocated as prescribed under subparagraph (B), the election rate points allocated to each candidate shall be tallied and the candidate with the election rate point total shall be declared the winner.

(D) If there is a tie between two or more candidates in the election rate point total, the candidate who is allocated the highest election rate points from the representative district with the largest voter turnout shall be declared the winner."

SECTION 6. Section 11-209, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) From January 1 of the year of any primary, special, or general election, the total expenditures for each election for candidates who voluntarily agree to limit their campaign expenditures, inclusive of all expenditures made or authorized by the candidate alone and all campaign treasurers and committees in the candidate's behalf, shall not exceed the following amounts expressed respectively multiplied by the number of voters in the last preceding general election registered to vote in each respective voting district:

(1) For the office of governor--$2.50;

(2) For the office of lieutenant governor--$1.40;

(3) For the office of mayor--$2.00;

(4) For the offices of state senator, state representative, county council member, and prosecuting attorney--$1.40; and

(5) For the offices of [the board of education] a local school board and all other offices--20 cents.

SECTION 7. Section 11-218, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

"(c) For [the board of education] a local school board and all other offices, the maximum amount of public funds available to a candidate shall not exceed $100 in any election year."

SECTION 8. Section 12-5, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Nomination papers for candidates for members of Congress, governor, lieutenant governor, and [the board of education] a local school board shall be signed by not [less] fewer than twenty-five registered voters of the State or of the Congressional district or local school [board] district from which the candidates are running in the case of candidates for the United States House of Representatives or for [the board of education.] a local school board."

SECTION 9. Section 17-6, Hawaii Revised Statutes, is amended to read as follows:

"§17-6 [Board of education] Local school board members. (a) The governor shall make an appointment to fill any vacancy in the membership of [the board of education] a local school board for the unexpired term of that vacancy whenever a vacancy occurs and the term of that vacancy ends at the time of the next succeeding general election.

(b) In the case of a vacancy, the term of which does not end at the next succeeding general election:

(1) If it occurs not later than on the sixtieth day prior to the next succeeding general election, the vacancy shall be filled for the unexpired term at the next succeeding general election. The chief election officer shall issue a proclamation designating the election for filling the vacancy. All candidates for the unexpired term shall file nomination papers not later than 4:30 p.m. on the fiftieth day prior to the general election (but if such day is a Saturday, Sunday, or holiday then not later than 4:30 p.m. on the first working day immediately preceding) and shall be elected in accordance with this title. Pending the election the governor shall make a temporary appointment to fill the vacancy and the person so appointed shall serve until the election of the person duly elected to fill such vacancy.

(2) If it occurs after the sixtieth day prior to the next succeeding general election, the governor shall make an appointment to fill the vacancy for the unexpired term.

(c) All appointments made by the governor under this section shall be made without consideration of the appointee's party affiliation or preference or nonpartisanship, however the persons so appointed shall meet the residency requirement specified in section [13-1.] -B."

SECTION 10. Section 26-4, Hawaii Revised Statutes, is amended to read as follows:

"§26-4 Structure of government. Under the supervision of the governor, all executive and administrative offices, departments, and instrumentalities of the state government and their respective functions, powers, and duties shall be allocated among and within the following principal departments that are hereby established:

(1) Department of human resources development (Section 26-5)

(2) Department of accounting and general services (Section 26-6)

(3) Department of the attorney general (Section 26-7)

(4) Department of budget and finance (Section 26-8)

(5) Department of commerce and consumer affairs (Section 26-9)

(6) Department of taxation (Section 26-10)

(7) University of Hawaii (Section 26-11)

(8) [Department of education] Public education system (Section 26-12)

(9) Department of health (Section 26-13)

(10) Department of human services (Section 26-14)

(11) Department of land and natural resources (Section 26-15)

(12) Department of agriculture (Section 26-16)

(13) Department of Hawaiian home lands (Section 26-17)

(14) Department of business, economic development, and tourism (Section 26-18)

(15) Department of transportation (Section 26-19)

(16) Department of labor and industrial relations (Section 26-20)

(17) Department of defense (Section 26-21)

(18) Department of public safety (Section 26-14.6)."

SECTION 11. Section 26-12, Hawaii Revised Statutes, is amended to read as follows:

"§26-12 [Department of education.] Public education system. The [department of education] public education system shall [be headed by an executive board to be known as the board of education.] not be headed by a single executive, but shall consist of the education standards and accountability commission, local school boards, and new century charter schools.

[Under policies established by the board, the superintendent] Subject to the constitutional powers and duties of the education standards and accountability commission, the local school boards shall administer programs of education and public instruction [throughout the State,] within their respective school districts, including education at the preschool, primary, and secondary school levels, adult education, school library services, health education and instruction (not including dental health treatment transferred to the department of health), and such other programs as may be established by law. The education standards and accountability commission and local school boards shall adopt rules pursuant to chapter 91 as necessary to establish a personnel system consistent with their respective responsibilities.

The education standards and accountability commission shall appoint the state librarian. The state librarian, under policies established by the [board of education,] education standards and accountability commission, shall be responsible for the administration of programs relating to public library services and transcribing services for the blind.

[The functions and authority heretofore exercised by the department of education (except dental health treatment transferred to the department of health), library of Hawaii, Hawaii county library, Maui county library, and the transcribing services program of the bureau of sight conservation and work with the blind, as heretofore constituted are transferred to the public library system established by this chapter.

The management contract between the board of supervisors of the county of Kauai and the Kauai public library association shall be terminated at the earliest time after November 25, 1959, permissible under the terms of the contract and the provisions of this paragraph shall constitute notice of termination, and the functions and authority heretofore exercised by the Kauai county library as heretofore constituted and the Kauai public library association over the public libraries in the county of Kauai shall thereupon be transferred to the public library system established by this chapter.

The management contracts between the trustees of the library of Hawaii and the Friends of the Library of Hawaii, and between the library of Hawaii and the Hilo library and reading room association, shall be terminated at the earliest time after November 25, 1959, permissible under the terms of the contracts, and the provisions of this paragraph shall constitute notice of termination.

Upon the termination of the contracts, the] The State or the counties shall not enter into any library management contracts with any private association; provided that in providing library services the [board of] education standards and accountability commission may enter into contracts approved by the governor for the use of lands, buildings, equipment, and facilities owned by any private association.

Notwithstanding any law to the contrary, the [board of] education standards and accountability commission may establish, specify the membership number and quorum requirements for, appoint members to, and disestablish a commission in each county to be known as the library advisory commission, which shall in each case sit in an advisory capacity to the [board of] education standards and accountability commission on matters relating to public library services in their respective county."

SECTION 12. Section 26-35.5, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) For purposes of this section, "member" means any person who is appointed, in accordance with the law, to serve on a temporary or permanent state board, including members of the [local] charter school board of any new century charter school established under section 302A-1182 or new century conversion charter school established under section 302A-1191, education standards and accountability commission, council, authority, committee, or commission, established by law or elected to the [board of education or the] board of trustees of the employees' retirement system under section 88-24; provided that "member" shall not include any person elected to serve on a board or commission in accordance with chapter 11 other than a person elected to serve on [the board of education.] a local school board."

SECTION 13. Section 26-52, Hawaii Revised Statutes, is amended to read as follows:

"§26-52 Department heads and executive officers. The salaries of the following state officers shall be as follows:

(1) [The salary of the superintendent of education shall be set by the board of education at a rate no greater than $150,000 a year;

(2)] The salary of the president of the University of Hawaii shall be set by the board of regents;

[(3)] (2) The salaries of all department heads or executive officers of the departments of accounting and general services, agriculture, attorney general, budget and finance, business, economic development, and tourism, commerce and consumer affairs, Hawaiian home lands, health, human resources development, human services, labor and industrial relations, land and natural resources, public safety, taxation, and transportation shall be $85,302 a year and, effective July 1, 2004, and every eight years thereafter, shall be as last recommended by the executive salary commission pursuant to section 26-55, unless rejected by the legislature; and

[(4)] (3) The salary of the adjutant general shall be $85,302 a year and, effective July 1, 2004, and every eight years thereafter, shall be as last recommended by the executive salary commission pursuant to section 26-55 unless rejected by the legislature, except that if the state salary is in conflict with the pay and allowance fixed by the tables of the regular army or air force of the United States, the latter shall prevail."

SECTION 14. Section 26-55, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) The commission shall review the salaries of the governor, the lieutenant governor, the administrative director of the State, and the department heads or executive officers of the departments of accounting and general services, agriculture, attorney general, budget and finance, business, economic development, and tourism, commerce and consumer affairs, Hawaiian home lands, health, human resources development, human services, labor and industrial relations, land and natural resources, public safety, taxation, and transportation. [The commission shall also review the salary of the deputy to the superintendent of education.] The commission shall recommend an appropriate salary for the governor, the lieutenant governor, and each department head or executive officer, and appropriate salary ranges for the deputy department heads. The commission may recommend different salaries for department heads and executive officers and different salary ranges for deputies or assistants to department heads; provided that the commission shall recommend the same salary range for deputies or assistants to department heads within the same department; provided further that the appointing official shall specify the salary for a particular position within the applicable range."

SECTION 15. Section 27-11, Hawaii Revised Statutes, is amended to read as follows:

"§27-11 Planning, construction, and improvements of public school facilities and grounds; custodial and janitorial services for public schools[; transportation of school children]. The following functions and services, heretofore performed by the several counties under contractual arrangements with the State, shall be directly administered and performed by the [department] local school boards or departments, or divisions of government designated by the governor:

(1) Planning, construction, and improvements of public school facilities and grounds; provided that [the department of education] a local school board shall add to its list of considerations in the planning and development of schools the role of the housing and community development corporation of Hawaii in developing housing projects and the resulting educational needs of those housing projects; and provided further that nothing in this section shall be construed to prohibit the housing and community development corporation of Hawaii from planning educational facilities and related infrastructure as a necessary and integral part of its housing projects; and

(2) Repair, maintenance, custodial, and janitorial services for public school facilities[; and

(3) Transportation of school children]."

SECTION 16. Section 29-25 , Hawaii Revised Statutes, is amended to read as follows:

"[[]§29-25[]] [Department of education;] Education standards and accountability commission; local school boards; federal funds; general fund offset. (a) Federal impact aid, U.S. Department of Defense funds, and federal indirect overhead reimbursements received by [the department of education] either a local school board or the education standards and accountability commission shall not be returned to the general fund.

(b) If the amount of federal impact aid and U.S. Department of Defense funds received by [the department of education] a local school board or the education standards and accountability commission exceeds the authorized appropriation in the general appropriations act or the supplemental appropriations act, then the governor shall:

(1) Allow the [department of education] local school board or education standards and accountability commission to increase the federal fund expenditure ceiling for all program identification numbers, each by an amount proportionate to its portion of the total general fund appropriation made by the legislature, and by the amount that the federal impact aid and U.S. Department of Defense funds received by the [department of education] local school board or education standards and accountability commission exceeds the authorized appropriation in the general appropriations act or the supplemental appropriations act; and

(2) Allow the [department of education] local school board or education standards and accountability commission to retain the full amount of the general fund offset created by increased impact aid receipts; provided that [the department] a local school board or education standards and accountability commission shall not use the general fund offset to create new programs or expand existing programs.

(c) The [department of education] local school boards, through the education standards and accountability commission, and the education standards and accountability commission, on its own behalf, shall submit a report to the legislature, not fewer than twenty days prior to the convening of each regular session, concerning the exact amount and specific nature of federal impact aid, U.S. Department of Defense funds, and federal indirect overhead reimbursements received under this section."

SECTION 17. Section 36-32, Hawaii Revised Statutes, is amended to read as follows:

"§36-32 State educational facilities improvement special fund. (a) There is created in the treasury of the State the state educational facilities improvement special fund, into which shall be deposited a portion of all general excise tax revenues collected by the department of taxation under section 237-31. The special fund shall be used solely to plan, design, acquire lands for and to construct public school facilities and to provide equipment and technology infrastructure to improve public schools and other facilities under the jurisdiction of the department of education, except public libraries. In addition, activities of the [department of education] public education system intended to eliminate the gap between the facility needs of schools and available resources shall be eligible for funding from the special fund. Expenditures from the special fund shall be limited to projects authorized by the legislature and shall be subject to sections 37-31, and 37-33 through 37-40. Appropriations or authorizations from the special fund shall be expended by the [comptroller.] local school boards.

(b) The [department of accounting and general services] education standards and accountability commission shall submit an annual report to the legislature, which shall include a financial statement of the special fund and the status of projects undertaken pursuant to this section, no later than twenty days prior to the convening of each regular session."

SECTION 18. Section 37-34.5, Hawaii Revised Statutes, is amended to read as follows.

"§37-34.5 [Department of education;] Public education system; allotment and expenditure plan; updates. The [department of education] public education system shall submit an annual allotment and expenditure plan[, including a separate description of all existing financing agreements of the department of education that require funding, together with a statement of the amount of funding required, and all proposed financing agreements of the department of education for the ensuing fiscal year, to the governor for each fiscal year]. The governor may require the [department of education] public education system to submit an update of the expenditure plan based on changing economic conditions."

SECTION 19. Section 76-11, Hawaii Revised Statutes, is amended by amending the definition of "employer" or "public employer" to read as follows:

""Employer" or "public employer" means the governor in the case of the State, the respective mayors in the case of the counties, the chief justice of the supreme court in the case of the judiciary, the [board of education in the case of the department of education,] public education system, the board of regents in the case of the University of Hawaii, the Hawaii health systems corporation board in the case of the Hawaii health systems corporation, and any individual who represents one of the employers or acts in their interest in dealing with public employees. In the case of the judiciary, the administrative director of the courts shall be the employer in lieu of the chief justice for purposes which the chief justice determines would be prudent or necessary to avoid conflict."

SECTION 20. Section 89-2, Hawaii Revised Statutes, is amended by amending the definition of "employer" or "public employer" to read as follows:

""Employer" or "public employer" means the governor in the case of the State, the respective mayors in the case of the counties, the chief justice of the supreme court in the case of the judiciary, the [board of education in the case of the department of education,] education standards and accountability commission, the local school boards, and the new century charter school boards in the case of the public education system, the board of regents in the case of the University of Hawaii, the Hawaii health systems corporation board in the case of the Hawaii health systems corporation, and any individual who represents one of these employers or acts in their interest in dealing with public employees. In the case of the judiciary, the administrative director of the courts shall be the employer in lieu of the chief justice for purposes which the chief justice determines would be prudent or necessary to avoid conflict."

SECTION 21. Section 89-6, Hawaii Revised Statutes, is amended as follows:

1. By amending subsection (a) to read:

"(a) All employees throughout the State within any of the following categories shall constitute an appropriate bargaining unit:

(1) Nonsupervisory employees in blue collar positions;

(2) Supervisory employees in blue collar positions;

(3) Nonsupervisory employees in white collar positions;

(4) Supervisory employees in white collar positions;

(5) Teachers and other personnel of the department of education under the same pay schedule, including part-time employees working less than twenty hours a week who are equal to one-half of a full-time equivalent;

(6) Educational officers and other personnel of the department of education, not including principals and vice principals, under the same pay schedule;

(7) Faculty of the University of Hawaii and the community college system;

(8) Personnel of the University of Hawaii and the community college system, other than faculty;

(9) Registered professional nurses;

(10) Institutional, health, and correctional workers;

(11) Firefighters;

(12) Police officers; and

(13) Professional and scientific employees, who cannot be included in any of the other bargaining units."

2. By amending subsections (f) and (g) to read:

"(f) The following individuals shall not be included in any appropriate bargaining unit or be entitled to coverage under this chapter:

(1) Elected or appointed official;

(2) Member of any board or commission;

(3) Top-level managerial and administrative personnel, including the department head, deputy or assistant to a department head, administrative officer, director, or chief of a state or county agency or major division, principal or vice principal of a public elementary, middle, intermediate, or high school, and legal counsel;

(4) Secretary to top-level managerial and administrative personnel under paragraph (3);

(5) Individual concerned with confidential matters affecting employee-employer relations;

(6) Part-time employee working less than twenty hours per week, except part-time employees included in unit (5);

(7) Temporary employee of three months' duration or less;

(8) Employee of the executive office of the governor or a household employee at Washington Place;

(9) Employee of the executive office of the lieutenant governor;

(10) Employee of the executive office of the mayor;

(11) Staff of the legislative branch of the State;

(12) Staff of the legislative branches of the counties, except employees of the clerks' offices of the counties;

(13) Any commissioned and enlisted personnel of the Hawaii national guard;

(14) Inmate, kokua, patient, ward or student of a state institution;

(15) Student help;

(16) Staff of the Hawaii labor relations board; or

(17) Employees of the Hawaii national guard youth challenge academy.

(g) Where any controversy arises under this section, the [board] director of labor and industrial relations or designated representative, shall, pursuant to chapter 91, make an investigation and, after a hearing upon due notice, make a final determination on the applicability of this section to specific individuals, employees, or positions."

SECTION 22. Section 89C-1.5, Hawaii Revised Statutes, is amended by amending the definition of "appropriate authority" to read as follows:

""Appropriate authority" means the governor, the respective mayors, the chief justice of the supreme court, the [board of education,] education standards and accountability commission, the local school boards, the board of regents, the Hawaii health system corporation board, the auditor, the ombudsman, and the director of the legislative reference bureau. These individuals or boards may make adjustments for their respective excluded employees."

SECTION 23. Section 103D-203, Hawaii Revised Statutes, is amended as follows:

1. By amending subsection (a) to read:

"(a) The chief procurement officer for each of the following state entities shall be:

(1) The judiciary--the administrative director of the courts;

(2) The senate--the president of the senate;

(3) The house of representatives--the speaker of the house of representatives;

(4) The office of Hawaiian affairs--the chairperson of the board;

(5) The [department of education, excluding the Hawaii public library system--the superintendent of education;] public education system--the district superintendent of a local school board; and

The remaining departments of the executive branch of the State and all governmental bodies administratively attached to them--the administrator of the state procurement office of the department of accounting and general services."

2. By amending subsection (c) to read:

"(c) For purposes of applying this chapter to the judiciary, houses of the legislature, office of Hawaiian affairs, [department of education,] public education system, remaining departments of the executive branch and all governmental bodies administratively attached to them, and the several counties, unless otherwise expressly provided, "State" shall mean "judiciary," "state senate," "state house of representatives," "office of Hawaiian affairs," ["department of education,"] "public education system," "executive branch," "county," and "board of water supply," or "department of water supply," respectively."

SECTION 24. Section 202-2, Hawaii Revised Statutes, is amended to read as follows:

"§202-2 Duties of council. The workforce development council shall:

(1) Prepare and update periodically a comprehensive state plan for workforce development with strategic goals and measurable outcomes. The comprehensive state plan shall include:

(A) Strategic goals of workforce development programs, including the identification of the desired number of highly skilled workers in the workforce, the number of placements of individuals into higher-skilled jobs, the identification of high-demand areas for job growth, the need for skilled workers in the next five and ten years, and the time frame for training and development;

(B) Methods to educate the private sector about state, federal, and private financial assistance available for workforce development;

(C) Methods to facilitate access to workforce development resources, including the reduction of regulatory burdens for employers and employees;

(D) The creation and improvement of educational opportunities for individuals to learn and develop new skills, including mentoring, project-based learning, and internships;

(E) Methods to facilitate the [department of education's] local school board's development of curriculum in the public schools to prepare students for employment in the private sector;

(F) Recommendations to change and improve existing state programs, including the elimination of ineffective programs and the creation of new programs to improve workforce development;

(G) The identification of resources required, obstacles to overcome, and best practice models to implement the comprehensive state strategic plan; and

(H) A detailed budget for the comprehensive state plan with a justification for each expenditure;

(2) Review and assess the coordination between the State's workforce development programs, including programs of the federal government operating in the State, and placements in higher-skilled jobs to expand economic development and diversification; and consider:

(A) The State's employment and training requirements and resources;

(B) Practices of employers and unions that impede or facilitate the mobility of workers; and

(C) The special problems of untrained and inexperienced youth, immigrants, persons with disabilities, welfare clients, single parents, disadvantaged minorities, and other groups facing barriers in the labor force;

(3) Serve as an information clearinghouse for all workforce development programs in the State, including workforce training and education programs;

(4) Analyze and interpret workforce information, particularly changes which are likely to occur during the next ten years; the specific industries, occupations, and geographic areas which are most likely to be involved; and the social and economic effects of these developments on the State's economy, labor force, communities, families, social structure, and human values;

(5) Define those areas of unmet workforce and economic development needs and describe how private and public agencies can coordinate their efforts and collaborate with each other to address those needs;

(6) Recommend to the governor and the legislature, state policies and funding priorities based on local community input that it believes should be adopted by the state government in meeting its workforce development responsibilities to:

(A) Establish a workforce development system in the State in which resources are pooled and programs are coordinated and streamlined;

(B) Establish reporting requirements for job placement results by category of occupations in high-demand and high-growth areas;

(C) Encourage a program of useful research into the State's workforce requirements, development, and utilization; and

(D) Support recommended workforce policies that promote economic development, diversification, and well-being of the people in this State;

provided that the duties and responsibilities of the workforce development council shall not impinge on the constitutional and statutory authority of the board of regents [and the board of education], the education standards and accountability commission, and the local school boards, and the statutory authority of the state board for career and technical education;

(7) Create public awareness and understanding of the State's workforce development plans, policies, programs, and activities, and promoting them as economic investments;

(8) Submit annual reports of its activities and recommendations to the governor and the legislature, and post the annual reports electronically on the Internet no later than twenty days before the convening of each regular session. Annual reports shall include:

(A) The status of the comprehensive state plan for workforce development; and

(B) Information regarding the workforce development programs offered throughout the State, the number of individuals placed in high-demand or high-growth employment through workforce development programs by departments, the type or category of employment garnered, and allocations of state, federal, and other funding to achieve placements into higher-skilled jobs;

(9) Evaluate the state workforce development plan in terms of how its purposes, goals, and objectives have been carried out throughout the State;

(10) Provide technical assistance to local workforce development boards and other similar organizations;

(11) Carry out required functions and duties related to workforce development of any advisory body required or made optional by federal legislation, including the Job Training Partnership Act of 1982, as amended, and the Wagner-Peyser Act of 1933, as amended;

(12) In accordance with the federal Workforce Investment Act of 1998, Public Law 105-220, assist the governor in the following functions:

(A) The development of the State's plan for the use of federal workforce investment funds, which is required under Public Law 105-220;

(B) The development and continuous improvement of the statewide and local workforce investment systems described in subtitle B of Public Law 105-220, and the one-stop delivery systems described in section 134(c) of Public Law 105-220, including:

(i) The development of linkages referred to in Public Law 105-220, to assure coordination and non-duplication among the programs and activities in section 121(b) of Public Law 105-220; and

(ii) The review of plans prepared by local workforce investment boards for the use of federal workforce investment funds which is required under Public Law 105-220;

(C) Commenting at least once annually on the measures taken pursuant to section 122(c)(16) of the Carl D. Perkins Vocational and Technical Education Amendments of 1998, Public Law 105-332;

(D) The designation of local areas as required in section 116 of Public Law 105-220;

(E) The development of allocation formulas for the distribution of funds for adult employment and training activities and youth activities to local areas as permitted under sections 128(b)(3)(B)(i) and 133(b)(3)(B)(i) of Public Law 105-220;

(F) The development and continuous improvement of comprehensive state performance measures, including state-adjusted levels of performance, to assess the effectiveness of the workforce investment activities in the State as required under section 136(b)(1) of Public Law 105-220;

(G) The preparation of the annual report to the United States Secretary of Labor described in section 136(d)(1) of Public Law 105-220;

(H) The development of the statewide employment statistics system described in section 15(e) of the Wagner-Peyser Act; and

(I) The development of an application for an incentive grant under section 503 of Public Law 105-220;

and

(13) Act as the designated state entity to conduct activities relating to occupational and employment information for vocational and technical education programs in compliance with section 118 of the Carl D. Perkins Vocational and Technical Education Amendments of 1998, Public Law 105-332."

SECTION 25. Section 205A-62, Hawaii Revised Statutes, is amended to read as follows:

"[[]§205A-62[]] Duties and responsibilities of the lead agency. The lead agency shall have the following duties and responsibilities:

(1) Coordinate overall implementation of the plan, giving special consideration to the plan's priority recommendations;

(2) Review and periodically update the plan;

(3) Coordinate the development of state agency work plans to implement the ocean resources management plan. The work plans shall be revised on a biennial basis and coordinated with the budget process. State agencies with responsibilities relating to marine and coastal zone management include but are not limited to:

(A) The department of agriculture;

(B) The department of business, economic development, and tourism;

(C) The department of defense;

(D) The [department of education;] public education system;

(E) The department of health;

(F) The department of land and natural resources;

(G) The department of public safety;

(H) The department of transportation; and

(I) The University of Hawaii;

(4) Ensure that state agency work plans are closely coordinated with the work plans of relevant federal and county agencies;

(5) Analyze, resolve conflicts between, and prioritize, in cooperation with relevant agencies and as part of the work plan development process, the sector-specific recommendations included in the plan;

(6) Coordinate exclusive economic zone and other marine- related issues with state and county agencies;

(7) Provide technical assistance to the agencies on policy and issue-related matters regarding marine and coastal resources management;

(8) Coordinate marine and coastal education activities; and

(9) Adopt rules pursuant to chapter 91 to carry out the purposes of this part."

SECTION 26. Section 302A-1182, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Up to a total of [twenty-three] forty-six schools may be established as new century charter schools. These new century charter schools may be established by:

(1) The creation of a new school; or

(2) The creation of a new school, comprising programs or sections of existing public school populations and using existing public school facilities, pursuant to subsection (b)."

SECTION 27. Section 302A-1184, Hawaii Revised Statutes, is amended to read as follows:

"§302A-1184 New century charter schools; exemptions. (a) Schools designated as new century charter schools shall be exempt from all applicable state laws, except those regarding:

(1) Collective bargaining under chapter 89; provided that:

(A) The exclusive representatives defined in chapter 89 may enter into agreements that contain cost and noncost items to facilitate decentralized decision-making;

(B) The exclusive representatives and the local school board of the new century charter school may enter into agreements that contain cost and noncost items;

(C) The agreements shall be funded from the current allocation or other sources of revenue received by the new century charter school; and

(D) These agreements may differ from the master contracts;

(2) Discriminatory practices under section 378-2; and

(3) Health and safety requirements.

(b) New century charter schools shall be exempt from the state procurement code, chapter 103D, but shall develop internal policies and procedures for the procurement of goods, services, and construction, consistent with the goals of public accountability and public procurement practices. However, where possible, the new century charter school is encouraged to use the provisions of chapter 103D; provided that the use of one or more provisions of chapter 103D shall not constitute a waiver of the exemption of chapter 103D and shall not subject the new century charter school to any other provision of chapter 103D. New century charter schools shall account for funds expended for the procurement of goods and services, and this accounting shall be available to the public. [In addition, notwithstanding]

(c) Notwithstanding any law to the contrary[, as public schools and entities of the State, new]:

(1) Employees of new century charter schools shall be entitled to any benefit program generally applicable to officers and employees of the State;

(2) For conversion charter schools, civil service employees at the time of the conversion shall retain their civil service status and new employees of the conversion charter school may be designated civil service or exempt from civil service at the discretion of the conversion charter school board;

(3) For start-up charter schools, employees of a start-up charter school shall be exempt from civil service; and

(4) New century public charter schools, as public schools and entities of the State, shall not bring suit against any other entity or agency of the State of Hawaii."

SECTION 28. Section 317-4, Hawaii Revised Statutes, is amended to read as follows:

"§317-4 Student conference advisory committee. There is created a student conference advisory committee to assist and advise the student conference committee in planning, coordinating, and evaluating the annual conference of students. The committee shall be composed of the chairperson of the education committee of both the house of representatives and the senate and [three members of the department of education appointed by the superintendent of education.] one member from each local school board to be appointed by that local school board."

SECTION 29. Section 317-6, Hawaii Revised Statutes, is amended to read as follows:

"§317-6 Evaluation report. The evaluation report shall be in the form of a report of conference proceedings, including specific recommendation for action by the [board of education] local school boards or the state legislature and copies shall be forwarded to the governor, the state legislature and [the board of education] each local school board within forty-five days after the conclusion of the conference."

SECTION 30. Section 321-52, Hawaii Revised Statutes, is amended to read as follows:

"§321-52 Powers, duties, and activities of the department. To carry out the purposes of this part, the department of health may:

(1) Establish and administer a program of services for children with special health needs, which shall provide for developing, extending, and improving services, especially in rural areas, for locating such children, and for providing for medical, surgical, corrective, and other services and care, and facilities for diagnosis, hospitalization, and after-care; extend and improve any such services; cooperate with medical, health, nursing, and welfare groups and organizations and with any agency of the State charged with the administration of laws providing for vocational rehabilitation of children with special health needs; and, cooperate with the [department of education] education standards and accountability commission and the local school boards for the education of such children;

(2) Formulate and administer a detailed plan for the purposes specified in paragraph (1) above; and adopt such rules pursuant to chapter 91 as may be necessary or desirable for the administration of the plan and of this part. Any plan shall include provisions for:

(A) Financial participation by the State in the funds appropriated by the Congress of the United States under applicable federal legislation;

(B) Administration of the plan by the department;

(C) Such methods of administration (other than those relating to selection, tenure of office, and compensation of personnel) as are necessary for the efficient operation of the plan;

(D) Maintenance of records and preparation of reports of services rendered as shall be directed by the Secretary of Health and Human Services of the United States;

(E) Carrying out the purposes specified in paragraph (1) above; and

(F) Cooperation with medical, health, nursing, and welfare groups and organizations and with any agency in the State charged with administering state laws providing for vocational rehabilitation of children with special needs;

(3) Cooperate with the federal government through its appropriate agency or instrumentality in developing, extending, and improving such services and receive and expend all funds made available to the department by the federal government, the State, or its political subdivisions, or from any other sources, including private donations, for such purposes; and

(4) Take all other actions necessary or desirable to carry out the purposes of this part."

SECTION 31. Section 321-101, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

"(c) The [departments] department of health and [education,] the local school boards, in cooperation with each other, may conduct classes and lectures in hearing and vision conservation and prevention of hearing loss and blindness for teachers, public health nurses, and others engaged in similar work. The [department] department of health and the local school boards shall also cooperate with public and private organizations and societies to educate the public in the importance of hearing and vision conservation."

SECTION 32. Section 321-111, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) The [department] department of health and [education] the local school boards shall cooperate with each other and other public and private authorities as they may deem advisable for the education of minors and members of the general public on sexually transmitted diseases and the prevention of sexually transmitted diseases. For the purpose of this section, "minor" means any person fourteen years of age or older and under the age of majority."

SECTION 33. Section 321-174, Hawaii Revised Statutes, is amended to read as follows:

"§321-174 Coordination of services with [department of education.] local school boards. The children's mental health services team shall cooperate with the schools located in their particular geographic region in identifying and referring for treatment such children or youths in need of mental health services. In conjunction with the children's mental health services team, the [department of education] local school boards and the department of health shall develop [a memorandum] memoranda of agreement which shall provide for a sharing of responsibilities for the affected agencies and shall include but not be limited to provisions for:

(1) Accepting referrals from the school counselors and diagnostic teams for evaluation and direct treatment of children and youth suffering from mental and emotional disorders;

(2) Providing consultation to enable teachers and other school personnel to aid in the identification and screening of children in need of professional mental health services and the services of psychologists, as defined in chapter 465;

(3) Providing training and education about emotional disturbances of children to teachers, school counselors, and parents;

(4) Assisting the [department of education] local school boards with mental health services and the services of psychologists, as defined in chapter 465 for handicapped children;

(5) Developing an ongoing mechanism to assess, document and report to the legislature and the governor unmet needs for mental health services for students in each geographic region; and

(6) Performing other related services for school personnel, children, and parents."

SECTION 34. Section 325-33, Hawaii Revised Statutes, is amended to read as follows:

"§325-33 Performance of vaccination and immunization. Vaccinations or immunizations required of any person under this chapter shall be performed by duly licensed physicians or paramedical personnel under their direction, advanced practice registered nurses, or by authorized representatives of the department of health. A record of the immunization shall be maintained by the physician or advanced practice registered nurse and shall be available to the [department of education] local school boards for school entry requirements and the department of health."

SECTION 35. Section 346-152, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Nothing in this part shall be construed to include:

(1) A person caring for children related to the caregiver by blood, marriage, or adoption;

(2) A person, group of persons, or facility caring for a child less than six hours a week;

(3) A kindergarten, school, or program licensed by the [department of education;] local school boards;

(4) A program that provides exclusively for a specialized training or skill development for children, including, but not limited to, programs providing such activities as athletic sports, foreign language, the Hawaiian language, dance, drama, music, or martial arts;

(5) A multiservice organization or community association, duly incorporated under the laws of the State, which operates for the purpose of promoting recreation, health, safety, or social group functions for eligible pupils in public and private schools through seventeen years of age;

(6) Programs for children four years of age and older, which operate for no more than two consecutive calendar weeks in a three-month period;

(7) A provider agency operating or managing a homeless facility or any other program for homeless persons authorized under part IV of chapter 201G;

(8) After-school, weekend, and summer recess programs conducted by [the department of education] local school boards [pursuant to section 302A-408];

(9) Child care programs for children five years of age and older conducted by counties [pursuant to section 302A-408]; provided that each county adopt rules for its programs;

(10) Any person who enters a home in a child caring capacity and only cares for children who are of that household; and

(11) A person caring for two or fewer children unrelated to the caregiver by blood, marriage, or adoption."

SECTION 36. Section 348-8, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There is established within the department a state rehabilitation council. The council shall consist of twenty-one members appointed by the governor as provided in section 26-34 and without regard to section 78-4. The members shall include:

(1) At least one representative of the statewide council on independent living;

(2) At least one representative of a parent training and information center;

(3) At least one representative of the client assistance program;

(4) At least one qualified vocational rehabilitation counselor with knowledge of and experience with vocational rehabilitation programs, who shall serve as an ex officio, nonvoting member if employed by the vocational rehabilitation division of the department;

(5) At least one representative of community rehabilitation program service providers;

(6) Four representatives of business, industry, and labor;

(7) Representatives of disability advocacy groups representing a cross section of individuals with physical, cognitive, sensory, and mental disabilities, and parents, family members, guardians, advocates, or authorized representatives of individuals with disabilities who have difficulty in representing themselves or are unable due to their disabilities to represent themselves;

(8) Current or former applicants for or recipients of vocational rehabilitation services;

(9) At least one representative [of the state educational agency responsible for the public education of students with disabilities;] from each local school board;

(10) At least one representative of the state workforce development council; and

(11) The administrator of the vocational rehabilitation division of the department, who shall be an ex officio, nonvoting member;

provided that the council shall include at least one member from each county; and provided further that a majority of the council members shall be persons who have disabilities and are not employed by the vocational rehabilitation division of the department. The council members shall elect a chairperson from the membership. Each member of the council shall serve a three-year term but may not serve more than two consecutive full terms. Any vacancy occurring in the council membership shall be filled in the same manner as the original appointment, except that the governor may delegate the authority to fill such a vacancy to the remaining members of the council after making the original appointment."

SECTION 37. Section 352D-9, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There shall be established a regional advisory board located in each county and they shall be called the Hawaii, Kauai, Maui, and Oahu regional advisory boards, respectively. The office shall provide staff support for each board. Each board shall elect annually from among its members a chairperson who shall preside at its regular meetings. Each board shall be composed of eleven voting members. Each board's membership shall include four lay persons, of which two shall possess knowledge of youth services, all appointed by the governor as provided in section 26-34.

The Oahu regional advisory board shall include [the superintendent of education,] a representative of each local school board located on Oahu, the public defender, the directors of human services and health, the police chief and the prosecuting attorney of the city and county of Honolulu, and the senior family court judge of the first circuit, or their designees.

The other regional advisory boards shall include the county's chief of police and prosecuting attorney, a deputy public defender, a family court judge, [and] one representative from each of the following departments of [education,] human services[,] and health, who shall be selected by their respective directors, or their designees[.] , and one representative from the local school board located within their respective county.

All board members shall be residents of the county in which the regional advisory board to which they are appointed is located, and shall serve without compensation, but shall be reimbursed for necessary expenses incurred during the performance of their duties."

SECTION 38. Section 707-716, Hawaii Revised Statutes, is amended by amending subsection (1) to read as follows:

"(1) A person commits the offense of terroristic threatening in the first degree if the person commits terroristic threatening:

(a) By threatening another person on more than one occasion for the same or a similar purpose; or

(b) By threats made in a common scheme against different persons; or

(c) Against a public servant, including but not limited to an educational worker, who for the purposes of this section shall mean an administrator, specialist, counselor, teacher, or other employee of the [department of education,] education standards and accountability commission, local school boards, or new century charter school boards, or a volunteer as defined by section 90-1, in a school program, activity, or function that is established, sanctioned, or approved by the [department of education,] education standards and accountability commission, local school boards, or new century charter school boards, or a person hired by the [department of education] education standards and accountability commission, local school boards, or new century charter school boards on a contractual basis and engaged in carrying out an educational function; or

(d) With the use of a dangerous instrument."

SECTION 39. Chapter 13, Hawaii Revised Statutes, is repealed.

SECTION 40. Section 37-41.5, Hawaii Revised Statutes, is repealed.

["§37-41.5 Department of education; carryover of funds. (a) The department of education may retain up to five 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. 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 retention of an appropriation shall not be used by the department as a basis for reducing a school's future budget requirements."]

SECTION 41. Chapter 302A, Hawaii Revised Statutes, is repealed.

SECTION 42. The legislature finds that the establishment of the education standards and accountability commission and local school boards will impact the functions and operations of existing educational programs and executive departments. Moreover, the orderly transfer of these functions and operations to the education standards and accountability commission and the local school boards is essential to promote education reform and ensure the educational welfare of students in the public schools.

This Act provides for a transition period during which:

(1) Requirements are set forth for the employment of public education staff; and

(2) Members of two transition teams shall:

(A) Review and assess the functions and operations currently performed by the board of education, department of education, and other affected executive departments;

(B) Determine the functions and operations that shall be transferred to the education standards and accountability commission and the local school boards and the functions and operations that shall be retained by the affected executive departments;

(C) Devise plans to effect the orderly transfer or retention of these functions and operations; and

(D) Implement all plans formulated.

SECTION 43. (a) School-level staffing. No later than January 1, 2006, the state superintendent of education shall cause to be compiled a listing, by school, of all officers and employees of the department of education who report directly to a school principal. No officer or employee of the State who reports to a school principal shall suffer any loss of salary, seniority, prior service credit, vacation or sick leave, or tenure at the school as a consequence of this Act. Notwithstanding any other law to the contrary, the officer or employee shall be appointed to a position in the school where the employee or officer currently reports without necessity of examination; provided that:

(1) The officer or employee possesses the minimum qualifications for the position to which appointed; and

(2) Subsequent changes in status shall be made pursuant to chapters 76 and 89, Hawaii Revised Statutes.

(b) All other staff. No later than January 1, 2006, the state superintendent of education shall cause to be compiled a listing of all officers and employees of the department who do not report directly to a school principal. This list shall separate employees by job function, with a brief description of the job duties, employment status, and the district or state unit in which the employee is employed. This list shall be circulated to the education standards and accountability commission and each local school board for employment consideration.

(c) Record of staff placements. It shall be the responsibility of the state superintendent of education to keep current the staff listing, and all attendant documentation, on the status of each employee of the department of education by separate list in subsections (a) and (b) as they transition to employment by the education standards and accountability commission and the local school boards.

(d) Placement of existing staff. Upon hiring by the education standards and accountability commission or a local school board, the employee may be transferred, at any agreed upon time but no later than July 1, 2006, to the respective local school board with no loss of salary, seniority, prior service credit, or vacation or sick leave.

No later than May 1, 2006, the state superintendent of education, assisted by a working group composed of the director of human resources development, the chief negotiator, the director of the office of human resources of the department of education, one representative from each local school board, one representative of the education standards and accountability commission, and such other staff as designated by the state superintendent of education, shall review and recommend the placement and distribution of all remaining persons who have not been selected for employment by the education standards and accountability commission or the local school boards.

Local school boards and the education standards and accountability commission shall, to the greatest extent practicable, take all steps necessary to make offers of employment in accordance with the recommendations set forth by the state superintendent of education. Upon hiring by a local school board or the education standards and accountability commission, the employee may be transferred to the local school board or the education standards and accountability commission with no loss of salary, seniority, prior service credit, or vacation or sick leave. If an employee declines an offer of placement pursuant to this section, the employee shall not be entitled to further consideration for placement or assignment pursuant to this section.

SECTION 44. Policy transition team. (a) There is established a policy transition team to formulate the policies needed to ensure a smooth transition during the period when the functions and operations of the department of education and board of education are transferred to the education standards and accountability commission and local school boards. The policy transition team shall consist of the following members:

(1) One member of the education standards and accountability commission, who shall serve as the chairperson of the policy transition team;

(2) One member from each of the local school boards;

(3) Two members of the board of education;

(4) One member designated by the Hawaii government employees' association;

(5) One member designated by the Hawaii state teachers association; and

(6) A principal from the department of education, as designated by the state superintendent of education.

(b) No later than thirty days following the confirmation of the education standards and accountability commission members by the governor and the election of local school boards, the policy transition team shall begin a review and assessment of the functions and operations currently performed by the board of education, department of education, and other affected executive departments. The policy transition team may request information and documents from and consult with representatives of the board of education, department of education, and other affected executive departments, as needed, to facilitate its review and assessment. Information requested by the policy transition team shall be provided by these agencies subject to any state and federal privacy law restrictions.

(c) No later than September 1, 2005, the policy transition team shall:

(1) Identify the functions and operations that shall be transferred to the education standards and accountability commission and local school boards and the functions and operations that shall be retained by affected executive departments;

(2) Formulate policies to achieve the transfer or retention of these functions and operations;

(3) Examine the need to retain or eliminate the department of education's special funds and revolving funds established in chapter 302A, Hawaii Revised Statutes;

(4) Formulate policies related to collective bargaining, including but not limited to determining the size of the bargaining units, composition of the bargaining units; and designation of parties involved in the negotiation;

(5) Prepare draft legislation, as needed, to facilitate the transfer or retention of functions and operations set forth in this Act; and

(6) Submit its policies to the implementation transition team as such policies are determined.

(d) Any matter not mutually agreed upon among members of the policy transition team shall be decided by a monitor who shall be selected by the governor.

(e) The policy transition team shall cease to exist on December 31, 2006.

SECTION 45. Implementation transition team. There is established the implementation transition team to effectuate the policies formulated by the policy transition team and to address any other implementation issues. The implementation transition team shall consist of the following members:

(1) One administrator or designee of the education standards and accountability commission, who shall serve as the chairperson of the implementation transition team;

(2) The district superintendent from each of the school districts or designees; and

(3) The state superintendent of education or designee.

(b) The members of the implementation transition team shall complete the process of implementing the policies determined by the policy transition team no later than June 30, 2006.

(c) Any matter not mutually agreed upon among members of the implementation transition team shall be decided by a monitor who shall be selected by the governor.

(d) The implementation transition team shall cease to exist on December 31, 2006.

SECTION 46. Transition activities; board of education, department of education, and affected executive departments. (a) Upon the ratification of a constitutional amendment establishing the education standards and accountability commission and the local school boards, the board of education, department of education, and other affected executive departments shall maintain all existing operations to provide educational services to students in the public schools through the 2004-2005 and 2005-2006 school years.

(b) Within sixty days of the ratification of a constitutional amendment establishing the education standards and accountability commission and the local school boards, the board of education, department of education, and other affected executive departments shall compile a list of their functions and related budgets, if any, for submission to the policy transition team.

(c) The board of education and the department of education shall provide to the education standards and accountability commission any and all information from the 2005-2006 school year, including student and financial information by school, as needed to develop a weighted student formula in time for implementation in the 2006-2007 school year.

(d) The board of education, department of education, and other affected executive departments shall cooperate with the policy transition team and implementation transition team and provide any and all information and documents requested by the policy transition team and implementation transition team, as necessary for the performance of the teams' functions, subject to any state and federal privacy law restrictions.

(e) No later than June 30, 2006, the board of education, department of education, and other affected executive departments shall cease to perform existing functions, except for those functions specifically retained by the affected executive departments; provided that the board of education, department of education, and other affected executive departments shall conclude any remaining administrative matters, as required by law, no later than December 31, 2006.

SECTION 47. Transition activities; education standards and accountability commission; local school boards. (a) Within fifteen days of the confirmation of all its members by the governor, the education standards and accountability commission shall meet and select its chairperson and representatives to the policy transition team and implementation transition team.

(b) As soon thereafter as is practicable, the education standards and accountability commission shall initiate the process to determine the weighted student formula applicable for the 2006-2007 school year.

(c) Upon taking office, and as soon thereafter as practicable, the members of each local school board shall meet and begin the process to hire staff, including the district superintendents and school principals, for the 2006-2007 school year; except as otherwise provided in section 35.

(d) On July 1, 2006, the education standards and accountability commission and the local school boards shall assume all responsibilities and functions performed by the board of education, department of education, and other affected executive departments; except for those functions specifically retained by other affected executive departments as determined by either the policy transition team or implementation transition team.

SECTION 48. (a) Prior to July 1, 2006, each local school board may adopt rules to replace statutory requirements in chapter 302A, Hawaii Revised Statutes, or existing department of education administrative rules in accordance with chapter 92, Hawaii Revised Statutes.

(b) Upon adoption of rules by a local school board that are intended to replace statutory requirements of chapter 302A, Hawaii Revised Statutes, and department of education administrative rules, the rules shall govern the respective local school board and school district and the statutory or rule requirements replaced shall not be applicable to the respective local school board or school district.

SECTION 49. In codifying the new sections added by sections 3 and 4 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 50. If any provision of this Act, or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 51. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 52. This Act shall take effect upon its approval and upon ratification of a constitutional amendment that reforms the existing public education system by eliminating the statewide board of education and replacing it with independent school districts each governed by a local school board; provided that sections 38 through 41 shall take effect on July 1, 2006.

INTRODUCED BY:

_____________________________

BY REQUEST