Allows states to use a growth model in calculating whether students are making adequately yearly progress (AYP) toward state academic performance standards if the state plan ensures their attainment of proficiency within certain periods of time.

Gives schools which are identified as needing improvement an extra year to make AYP before being required to allow student transfers. Limits the transfer option to students who do not meet proficiency standards.

Permits local educational agencies (LEAs) identified as needing improvement to provide supplemental educational services themselves.

Allows schools identified as needing improvement due to an underperforming disabled or limited English proficient (LEP) student subgroup to limit their improvement plan to such failing subgroup. Eliminates the requirement that schools be restructured and LEAs face corrective action because of such a subgroup's underperformance, if AYP can be shown using a growth model that counts students who are on track to attain proficiency by their final year in secondary school.

Requires AYP measurements of certain schools providing Native language instruction to kindergarten through second grade children in states with no AYP assessment in such language to exclude grade three results and employ a growth model requiring progress toward proficiency by seventh grade.

Allows partnerships receiving subgrants for preparing, recruiting, and training teachers and principals to include parent teacher organizations and use funds for activities enhancing parental involvement.