[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1590 Introduced in Senate (IS)]







105th CONGRESS
  2d Session
                                S. 1590

             To improve elementary and secondary education.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 29, 1998

Mr. Coverdell (for himself, Mr. Lott, Mr. Nickles, Mr. Mack, Mr. Craig, 
  Mr. McConnell, Mr. Gregg, Mr. Coats, Mr. Inhofe, Mr. Murkowski, Mr. 
Abraham, Mr. Kyl, and Mr. Warner) introduced the following bill; which 
        was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
             To improve elementary and secondary education.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Better Opportunities for Our Kids 
and Schools Act''.

          TITLE I--A+ ACCOUNTS FOR PUBLIC AND PRIVATE SCHOOLS

SEC. 101. SHORT TITLE.

    This title may be cited as the ``A+ Accounts for Public and Private 
Schools Act''.

SEC. 102. MODIFICATIONS TO EDUCATION INDIVIDUAL RETIREMENT ACCOUNTS.

    (a) Tax-Free Expenditures for Elementary and Secondary School 
Expenses.--
            (1) In general.--Section 530(b)(2) of the Internal Revenue 
        Code of 1986 is amended to read as follows:
            ``(2) Qualified education expenses.--
                    ``(A) In general.--The term `qualified education 
                expenses' means--
                            ``(i) qualified higher education expenses 
                        (as defined in section 529(e)(3)), and
                            ``(ii) qualified elementary and secondary 
                        education expenses (as defined in paragraph 
                        (4)).
                Such expenses shall be reduced as provided in section 
                25A(g)(2) but only with respect to amounts in the 
                account which are attributable to contributions for any 
                taxable year ending before January 1, 2003, and 
                earnings on such contributions.
                    ``(B) Qualified state tuition programs.--Such term 
                shall include amounts paid or incurred to purchase 
                tuition credits or certificates, or to make 
                contributions to an account, under a qualified State 
                tuition program (as defined in section 529(b)) for the 
                benefit of the beneficiary of the account.''.
            (2) Qualified elementary and secondary education 
        expenses.--Section 530(b) of such Code is amended by adding at 
        the end the following new paragraph:
            ``(4) Qualified elementary and secondary education 
        expenses.--
                    ``(A) In general.--The term `qualified elementary 
                and secondary education expenses' means tuition, fees, 
                tutoring, special needs services, books, supplies, 
                computer equipment (including related software and 
                services) and other equipment, transportation, and 
                supplementary expenses required for the enrollment or 
                attendance of the designated beneficiary of the trust 
                at a public, private, or religious school.
                    ``(B) Special rule for homeschooling.--Such term 
                shall include expenses described in subparagraph (A) 
                required for education provided for homeschooling if 
                the requirements of any applicable State or local law 
                are met with respect to such education.
                    ``(C) School.--The term `school' means any school 
                which provides elementary education or secondary 
                education (through grade 12), as determined under State 
                law.''.
            (3) Conforming amendments.--Subsections (b)(1) and (d)(2) 
        of section 530 of such Code are each amended by striking 
        ``higher'' each place it appears in the text and heading 
        thereof.
    (b) Temporary Increase in Maximum Annual Contributions.--
            (1) In general.--Section 530(b)(1)(A)(iii) of the Internal 
        Revenue Code of 1986 is amended by striking ``$500'' and 
        inserting ``the contribution limit for such taxable year''.
            (2) Contribution limit.--Section 530(b) of such Code is 
        amended by adding at the end the following new paragraph:
            ``(4) Contribution limit.--The term `contribution limit' 
        means $2,500 ($500 in the case of any taxable year ending after 
        December 31, 2002).''.
            (3) Conforming amendments.--
                    (A) Section 530(d)(4)(C) of such Code is amended by 
                striking ``$500'' and inserting ``the contribution 
                limit for such taxable year''.
                    (B) Section 4973(e)(1)(A) of such Code is amended 
                by striking ``$500'' and inserting ``the contribution 
                limit (as defined in section 530(b)(4)) for such 
                taxable year''.
    (c) Waiver of Age Limitations for Children With Special Needs.--
Paragraph (1) of section 530(b) of the Internal Revenue Code of 1986 is 
amended by adding at the end the following flush sentence:
        ``The age limitations in the preceding sentence shall not apply 
        to any designated beneficiary with special needs (as determined 
        under regulations prescribed by the Secretary).''.
    (d) Corporations Permitted To Contribute to Accounts.--Paragraph 
(1) of section 530(c) of the Internal Revenue Code of 1986 is amended 
by striking ``The maximum amount which a contributor'' and inserting 
``In the case of a contributor who is an individual, the maximum amount 
the contributor''.
    (e) Effective Date; References.--
            (1) Effective date.--The amendments made by this section 
        shall take effect as if included in the amendments made by 
        section 213 of the Taxpayer Relief Act of 1997.
            (2) References.--Any reference in this section to any 
        section of the Internal Revenue Code of 1986 shall be a 
        reference to such section as added by the Taxpayer Relief Act 
        of 1997.

                   TITLE II--DOLLARS TO THE CLASSROOM

SEC. 201. DIRECT AWARDS OF CERTAIN EDUCATION FUNDING TO STATES.

    (a) Direct Awards of Certain Education Funding.--
            (1) In general.--Notwithstanding any other provision of 
        law, for each fiscal year the Secretary shall award the total 
        amount of funds described in paragraph (2) directly to States 
        in accordance with this subsection.
            (2) Applicable funding.--The total amount of funds referred 
        to in paragraph (1) are all funds not used to carry out 
        paragraph (8)(B) for the fiscal year that are appropriated for 
        the Department of Education for the fiscal year to carry out 
        programs or activities under the following provisions of law:
                    (A) Title III of the Goals 2000: Educate America 
                Act (20 U.S.C. 5881 et seq.).
                    (B) Title IV of the Goals 2000: Educate America Act 
                (20 U.S.C. 5911 et seq.).
                    (C) Title VI of the Goals 2000: Educate America Act 
                (20 U.S.C. 5951).
                    (D) The Educational Research, Development, 
                Dissemination, and Improvement Act of 1994 (20 U.S.C. 
                6001 et seq.).
                    (E) Titles II, III, and IV of the School-to-Work 
                Opportunities Act of 1994 (20 U.S.C. 6121 et seq., 6171 
                et seq., and 6191 et seq.).
                    (F) Title II of the Elementary and Secondary 
                Education Act of 1965 (20 U.S.C. 6601 et seq.).
                    (G) Sections 3132 and 3136 of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 6842 and 
                6846).
                    (H) Part B of title III of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 6891 et 
                seq.).
                    (I) Part C of title III of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 6921 et 
                seq.).
                    (J) Part D of title III of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 6951 et 
                seq.).
                    (K) Subpart 1 of part A of title IV of the 
                Elementary and Secondary Education Act of 1965 (20 
                U.S.C. 7111 et seq.).
                    (L) Subpart 2 of part A of title IV of the 
                Elementary and Secondary Education Act of 1965 (20 
                U.S.C. 7131 et seq.).
                    (M) Part A of title V of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 7201 et 
                seq.).
                    (N) Part B of title V of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 7231 et 
                seq.).
                    (O) Title VI of the Elementary and Secondary 
                Education Act of 1965 (20 U.S.C. 7311 et seq.).
                    (P) Part A of title X of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 8001 et 
                seq.).
                    (Q) Part B of title X of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 8031 et 
                seq.).
                    (R) Part I of title X of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 8241 et 
                seq.).
                    (S) Part A of title XIII of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 8621 et 
                seq.).
                    (T) Part C of title XIII of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 8671 et 
                seq.).
            (3) Timelines.--
                    (A) Census determination.--
                            (i) In general.--Not later than 21 days 
                        after the beginning of an academic year, each 
                        State shall conduct a census to determine the 
                        number of children in kindergarten through 
                        grade 12 in the State for the academic year.
                            (ii) Submission.--Each State shall submit 
                        the number described in clause (i) to the 
                        Secretary not later than February 1 of the 
                        academic year.
                    (B) Publication.--The Secretary shall publish in 
                the Federal Register not later than March 15 of each 
                fiscal year the amount each State will receive under 
                this subsection for the succeeding fiscal year.
                    (C) Disbursal.--The Secretary shall disburse the 
                amount awarded to a State under this subsection for a 
                fiscal year not later than July 1 of the preceding 
                fiscal year.
            (4) Determination of amount.--The Secretary shall determine 
        the amount awarded to each State under paragraph (1) for a 
        fiscal year as follows:
                    (A) Per child amount.--First, the Secretary, using 
                the information provided under paragraph (3), shall 
                determine a per child amount for the fiscal year by 
                dividing the total amount of funds described in 
                paragraph (2) for the fiscal year, by the total number 
                of children in kindergarten through grade 12 in all 
                States for the academic year preceding the fiscal year.
                    (B) Baseline amount.--Second, the Secretary, using 
                the information provided under paragraph (3), shall 
                determine the baseline amount for each State for the 
                fiscal year by multiplying the per child amount 
                determined under subparagraph (A) for the fiscal year 
                by the number of children in kindergarten through grade 
                12 in the State for the academic year preceding the 
                fiscal year.
                    (C) Computation.--Lastly, the Secretary shall 
                compute the amount awarded to each State for the fiscal 
                year as follows:
                            (i) Multiply the baseline amount determined 
                        under subparagraph (B) for the fiscal year by a 
                        factor of 1.10 for States that are in the least 
                        wealthy quintile of all States as determined by 
                        the Secretary on the basis of the per capita 
                        income of individuals in the States.
                            (ii) Multiply the baseline amount by a 
                        factor of 1.05 for States that are in the 
                        second least wealthy such quintile.
                            (iii) Multiply the baseline amount by a 
                        factor of 1.00 for States that are in the third 
                        least wealthy such quintile.
                            (iv) Multiply the baseline amount by a 
                        factor of 0.95 for States that are in the 
                        fourth least wealthy such quintile.
                            (v) Multiply the baseline amount by a 
                        factor of 0.90 for States that are in the 
                        wealthiest such quintile.
                    (D) Incomes from certain areas excluded from 
                quintile determinations.--For the purpose of 
                determining the quintiles described in subparagraph (C) 
                the Secretary shall exclude the per capita incomes of 
                individuals in Alaska, Hawaii, the District of 
                Columbia, the Commonwealth of Puerto Rico, Guam, 
                American Samoa, the Commonwealth of the Northern 
                Mariana Islands, and the United States Virgin Islands.
                    (E) Special rule for alaska and hawaii.--
                Notwithstanding subparagraph (C), the Secretary shall 
                compute the amount awarded to the States of Alaska and 
                Hawaii under paragraph (1) by multiplying the baseline 
                amount determined under subparagraph (B) for Alaska and 
                Hawaii, respectively, by a factor of 1.00.
            (5) Ratable reduction.--If the total amount of funds 
        described in paragraph (2) that are made available to carry out 
        paragraph (1) for a fiscal year is insufficient to pay in full 
        all amounts awarded under this subsection for the fiscal year, 
        then the Secretary shall ratably reduce each such amount.
            (6) Ratable increase.--If the total amount of funds 
        described in paragraph (2) that are made available to carry out 
        paragraph (1) for a fiscal year exceeds the funding required to 
        pay in full all amounts awarded under this subsection for the 
        fiscal year, then the Secretary shall ratably increase each 
        such amount.
            (7) Penalty.--If the Secretary determines that a State has 
        knowingly submitted false information under paragraph (3) for 
        the purpose of gaining additional funds under paragraph (1), 
        then the State shall be fined an amount equal to twice the 
        difference between the amount the State received under this 
        subsection, and the correct amount the State would have 
        received if the State had submitted accurate information under 
        paragraph (3).
            (8) Hold harmless.--
                    (A) In general.--No State shall receive an award 
                under this subsection for a fiscal year in an amount 
                that is less than the amount the State would have 
                received to carry out programs or activities under the 
                provisions of law described in subparagraphs (A), (E), 
                (F), (G), (K), and (O) of paragraph (2) for the fiscal 
                year.
                    (B) Multiyear awards.--The Secretary shall use 
                funds appropriated to carry out the programs or 
                activities under the provisions of law described in 
                paragraph (2) (other than subparagraphs (A), (E), (F), 
                (G), (K), and (O) of paragraph (2)) to make payments to 
                eligible recipients under such provisions pursuant to 
                any multiyear award made under such provisions prior to 
                the date of enactment of this Act.
    (b) Payments and Availability.--
            (1) Payments.--Funds awarded to a State under this 
        subsection shall be paid to the Governor of the State.
            (2) Availability.--The Governor of the State shall make the 
        funds provided under this subsection available to the 
        individual or entity in the State that is responsible for the 
        State administration of Federal education funds pursuant to 
        State law.
    (c) Use of State Awards.--
            (1) In general.--From the amount made available to a State 
        under subsection (a) for a fiscal year, the State--
                    (A) shall use not more than 5 percent of the amount 
                to support programs or activities, for children in 
                kindergarten through grade 12, that the State 
                determines appropriate, of which the State shall 
                distribute 1 percent of the 5 percent to local 
                educational agencies in the State to pay the 
                administrative expenses of the local educational 
                agencies that are associated with the activities and 
                services assisted under this section; and
                    (B) shall distribute not less than 95 percent of 
                the amount to local educational agencies in the State 
                for the fiscal year to enable the local educational 
                agencies to pay the costs of activities or services, 
                for children in kindergarten through grade 12 
                (including such public and private school children), 
                that--
                            (i) the local educational agencies 
                        determine appropriate; and
                            (ii) are provided in the classroom.
            (2) Classroom activities and services.--For the purpose of 
        paragraph (1)(B), the costs of activities and services provided 
        in the classroom--
                    (A) exclude the administrative expenses associated 
                with the activities and services; and
                    (B) notwithstanding paragraph (1)(B)(i), include 
                nonadministrative expenses associated with statewide or 
                districtwide initiatives directly affecting classroom 
                learning.
    (d) Regulations.--
            (1) In general.--Subject to paragraph (2), no head of a 
        Federal department or agency other than the Secretary may 
        promulgate regulations under this section.
            (2) Special rule.--The Secretary shall not promulgate 
        regulations under this section regarding the types of 
        activities and services that may be assisted under this 
        section.

SEC. 202. TITLE I FUNDING.

    Section 1603 of the Elementary and Secondary Education Act of 1965 
(20 U.S.C. 6513) is amended by adding at the end the following:
    ``(d) Dollars to the Classroom.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, from the funds made available to a local educational 
        agency under this part for a fiscal year, not less than 95 
        percent of the funds shall be used for the costs of activities 
        and services provided in the classroom for the fiscal year.
            ``(2) Classroom activities and services.--For the purpose 
        of paragraph (1), the costs of activities and services provided 
        in the classroom--
                    ``(A) exclude the administrative expenses 
                associated with the activities and services; and
                    ``(B) include nonadministrative expenses associated 
                with statewide or districtwide initiatives directly 
                affecting classroom learning.
            ``(3) Plan.--Not later than 6 months after the date of 
        enactment of the Better Opportunities for Our Kids and Schools 
        Act, the Secretary shall--
                    ``(A) develop and implement a plan for streamlining 
                regulations and eliminating bureaucracy so that 95 
                percent of the funds made available to local 
                educational agencies under this part are used for the 
                costs of activities and services provided in the 
                classroom; and
                    ``(B) prepare and submit to Congress recommended 
                legislation containing changes to Federal law that are 
                needed for 95 percent of the funds to be so used.''.

SEC. 203. PARTICIPATION OF CHILDREN ENROLLED IN PRIVATE SCHOOLS.

    Each local educational agency that receives funds under section 201 
shall provide for the participation of children in private schools in 
the activities and services assisted under section 201 in the same 
manner as the children participate in activities and services under the 
Elementary and Secondary Education Act of 1965 (20 U.S.C. 6301 et seq.) 
pursuant to sections 14503, 14504, 14505, and 14506 of such Act (20 
U.S.C. 8893, 8894, 8895, and 8896).

SEC. 204. DEFINITIONS.

    In this title--
            (1) the term ``local educational agency'' has the meaning 
        given the term in section 14101 of the Elementary and Secondary 
        Education Act of 1965 (20 U.S.C. 8801);
            (2) the term ``Secretary'' means the Secretary of 
        Education; and
            (3) the term ``State'' means each of the several States of 
        the United States, the District of Columbia, the Commonwealth 
        of Puerto Rico, Guam, American Samoa, the Commonwealth of the 
        Northern Mariana Islands, and the United States Virgin Islands.

 TITLE III--EDUCATIONAL OPPORTUNITY AND SAFETY FOR LOW-INCOME CHILDREN

SEC. 301. FINDINGS AND PURPOSE.

    (a) Findings.--The Congress finds as follows:
            (1) Violence, crime, and illegal drug activity have 
        increased significantly in our Nation's public schools.
            (2) It is estimated that 3,000,000 violent acts or thefts 
        occur in or near schools, and that one in five public high 
        school students carries a weapon.
            (3) The incidence of violence, and criminal and illegal 
        drug activity within public elementary and secondary schools 
        threatens the school environment and interferes with the 
        learning process.
            (4) 2,000,000 more children are using drugs in 1997 than 
        were doing so in 1993. For the first time in the 1990s, over 
        half of our Nation's graduating high school seniors have 
        experimented with drugs and approximately 1 out of every 4 of 
        the students have used drugs in the past month.
            (5) After 11 years of declining marijuana use among 
        children aged 12 to 17, such use doubled between 1992 and 1995. 
        The number of 8th graders who have used marijuana in the past 
        month has more than tripled since 1991.
            (6) More of our Nation's school children are becoming 
        involved with hard core drugs at earlier ages, as use of heroin 
        and cocaine by 8th graders has more than doubled since 1991.
            (7) Students have a right to be safe and secure in their 
        persons while attending school.
            (8) Low-income families whose children attend high poverty 
        public schools generally lack the financial ability to enroll 
        their children in private schools or the opportunity to choose 
        to enroll their children in public schools less affected by 
        poverty, illegal drugs, or violence, while such alternatives 
        are typically available to more affluent families.
            (9) Numerous research studies, including the 1993 National 
        Assessment of the Chapter 1 Program, have concluded that 
        students attending high poverty public schools have much lower 
        levels of academic achievement than other students, regardless 
        of the income level of the family of such students.
            (10) Federally supported efforts to meet the educational 
        needs of disadvantaged children attending high poverty schools 
        have had little, if any, success in improving student 
        achievement, especially in the highest poverty schools and 
        school districts.
            (11) Evidence obtained from systematic evaluations of 
        school choice demonstration projects that involve public and 
        private, including religious, schools will make an important 
        contribution toward resolving debates over the most effective 
        means of improving the academic achievement of disadvantaged 
        children.
            (12) It is increasingly important that children from 
        families of all income levels meet high standards of academic 
        achievement, in order to exercise the responsibilities of 
citizenship and to compete in globally competitive markets.
    (b) Purpose.--It is the purpose of this title--
            (1) to provide children from low-income families who attend 
        unsafe schools with the option of attending safer schools;
            (2) to improve schools and academic programs by providing 
        certain low-income parents with increased consumer power and 
        dollars to choose safer and drug-free schools and programs that 
        such parents determine best fit the needs of their children;
            (3) to engage more fully certain low-income parents in 
        their children's schooling;
            (4) through families, to provide at the school site new 
        dollars that teachers and principals may use to help certain 
        children achieve high educational standards; and
            (5) to demonstrate, through a discretionary demonstration 
        grant program, the effects of projects that provide certain 
        low-income families with more of the same choices regarding all 
        schools, including public, private, or religious schools, that 
        wealthier families have.

SEC. 302. DEFINITIONS.

    In this title--
            (1) the term ``choice school'' means any public or private 
        school, including a private religious school or a public 
        charter school, that--
                    (A) is involved in a demonstration project assisted 
                under this title; and
                    (B) is not an unsafe school;
            (2) the term ``eligible child'' means a child in any of the 
        grades 1 through 12--
                    (A) whose family income does not exceed 185 percent 
                of the poverty line; and
                    (B) who would normally be assigned to attend an 
                unsafe school in the absence of--
                            (i) a demonstration project under this 
                        title; or
                            (ii) participation, prior to the date of 
                        enactment of this Act, in a school choice 
                        program;
            (3) the term ``eligible entity'' means a public agency, 
        institution, or organization, such as a State, a State 
        educational agency, a local educational agency, a consortium of 
        public agencies, or a consortium of public and private 
        nonprofit organizations, that can demonstrate, to the 
        satisfaction of the Secretary, its ability to--
                    (A) receive, disburse, and account for Federal 
                funds; and
                    (B) carry out the activities described in its 
                application under this title;
            (4) the term ``evaluating agency'' means any academic 
        institution, consortium of professionals, or private or 
        nonprofit organization, with demonstrated experience in 
        conducting evaluations, that is not an agency or 
        instrumentality of the Federal Government;
            (5) the term ``local educational agency'' has the same 
        meaning given such term in section 14101 of the Elementary and 
        Secondary Education Act of 1965 (20 U.S.C. 8801);
            (6) the term ``parent'' includes a legal guardian or other 
        individual acting in loco parentis;
            (7) the term ``poverty line'' means the poverty line (as 
        defined by the Office of Management and Budget, and revised 
        annually in accordance with section 673(2) of the Community 
        Services Block Grant Act (42 U.S.C. 9902(2))) applicable to a 
        family of the size involved;
            (8) the term ``school'' means a school that provides 
        elementary education or secondary education (through grade 12), 
        as determined under State law;
            (9) the term ``Secretary'' means the Secretary of 
        Education;
            (10) the term ``State'' means each of the 50 States of the 
        United States, the District of Columbia, and the Commonwealth 
        of Puerto Rico; and
            (11) the term ``unsafe school'' means a school that has 
        serious crime, violence, illegal drug, and discipline problems, 
        as indicated by conditions that may include high rates of--
                    (A) expulsions and suspensions of students from 
                school;
                    (B) referrals of students to alternative schools 
                for disciplinary reasons, to special programs or 
                schools for delinquent youth, or to juvenile court;
                    (C) victimization of students or teachers by 
                criminal acts, including robbery, assault and homicide;
                    (D) enrolled students who are under court 
                supervision for past criminal behavior;
                    (E) possession, use, sale or distribution of 
                illegal drugs;
                    (F) enrolled students who are attending school 
                while under the influence of illegal drugs;
                    (G) possession or use of guns or other weapons;
                    (H) participation in youth gangs; or
                    (I) crimes against property, such as theft or 
                vandalism.

SEC. 303. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated $75,000,000 for the fiscal 
year 1999, and such sums as may be necessary for each of the fiscal 
years 2000 through 2003, to carry out this title.

SEC. 304. PROGRAM AUTHORIZED.

    (a) Reservation.--From the amount appropriated pursuant to the 
authority of section 303 in any fiscal year, the Secretary shall 
reserve and make available to the Comptroller General of the United 
States 2 percent for evaluation of programs assisted under this title 
in accordance with section 313.
    (b) Grants.--
            (1) In general.--From the amount appropriated pursuant to 
        the authority of section 303 and not reserved under subsection 
        (a) for any fiscal year, the Secretary shall award grants to 
        eligible entities to enable such entities to carry out at least 
        20, but not more than 30, demonstration projects under which 
        low-income parents receive education certificates for the costs 
        of enrolling their eligible children in a choice school.
            (2) Amount.--The Secretary shall award grants under 
        paragraph (1) for fiscal year 1999 so that--
                    (A) not more than 2 grants are awarded in amounts 
                of $5,000,000 or less; and
                    (B) grants not described in subparagraph (A) are 
                awarded in amounts of $3,000,000 or less.
            (3) Continuing eligibility.--The Secretary shall continue a 
        demonstration project under this title by awarding a grant 
        under paragraph (1) to an eligible entity that received such a 
        grant for a fiscal year preceding the fiscal year for which the 
        determination is made, if the Secretary determines that such 
        eligible entity was in compliance with this title for such 
        preceding fiscal year.
            (4) Priority.--The Secretary shall give priority to 
        awarding a grant under paragraph (1) to an eligible entity 
        that--
                    (A) is conducting a school choice program, 
                involving public or private schools, on the date of 
                enactment of this Act; and
                    (B) operates a school choice program, involving 
                public and private schools, that is authorized by 
                Federal law.
    (c) Use of Grants.--Grants awarded under subsection (b) shall be 
used to pay the costs of--
            (1) providing education certificates to low-income parents 
        to enable such parents to pay the tuition, the fees, the 
        allowable costs of transportation, if any, and the costs of 
        complying with section 311(a), if any, for their eligible 
        children to attend a choice school; and
            (2) administration of the demonstration project, which 
        shall not exceed 15 percent of the amount received in the first 
        fiscal year for which the eligible entity provides education 
        certificates under this title or 10 percent in any subsequent 
        year, including--
                    (A) seeking the involvement of choice schools in 
                the demonstration project;
                    (B) providing information about the demonstration 
                project, and the schools involved in the demonstration 
                project, to parents of eligible children;
                    (C) making determinations of eligibility for 
                participation in the demonstration project for eligible 
                children;
                    (D) selecting students to participate in the 
                demonstration project;
                    (E) determining the amount of, and issuing, 
                education certificates;
                    (F) compiling and maintaining such financial and 
                programmatic records as the Secretary may prescribe; 
                and
                    (G) collecting such information about the effects 
                of the demonstration project as the evaluating agency 
                may need to conduct the evaluation described in section 
                313.
    (d) Supplement Not Supplant.--Each eligible entity receiving funds 
under this title shall use such funds to supplement and not supplant 
the amount of funds that would, in the absence of such Federal funds, 
be made available from other sources to carry out the activities 
assisted under this title.
    (e) Supplementation of Funding.--Each eligible entity receiving 
funds under this section is encouraged to supplement the funding 
received under this title with funding received from State, local, or 
private sources.
    (f) Education Certificates.--
            (1) Not school aid.--An education certificate provided 
        under this title shall be considered assistance to the student 
        and shall not be considered assistance to a choice school.
            (2) Taxes and determinations of eligibility for other 
        federal programs.--Education certificates provided under this 
        title shall not be considered as income to an eligible child or 
        the parent of such eligible child for Federal, State, or local 
        tax purposes or for determining eligibility for any other 
        Federal program.

SEC. 305. AUTHORIZED PROJECTS; PRIORITY.

    (a) Authorized Projects.--The Secretary may award a grant under 
this title only for a demonstration project that--
            (1) involves at least one local educational agency that--
                    (A) receives funds under section 1124A of the 
                Elementary and Secondary Education Act of 1965 (20 
                U.S.C. 6334); and
                    (B) is among the 20 percent of local educational 
                agencies receiving funds under section 1124A of such 
                Act (20 U.S.C. 6334) in the State and having the 
                highest number or greatest percentage of children 
                described in section 1124(c) of such Act (20 U.S.C. 
                6333(c)); and
            (2) includes the involvement of a sufficient number of 
        public and private choice schools, including religious schools, 
        to allow for a valid demonstration project.
    (b) Priority.--In awarding grants under this title, the Secretary 
shall give priority to demonstration projects--
            (1) in which choice schools offer an enrollment opportunity 
        to the broadest range of eligible children;
            (2) that involve diverse types of choice schools; and
            (3) that will contribute to the geographic diversity of 
        demonstration projects assisted under this title, including 
        awarding grants for demonstration projects in States that are 
        primarily rural and awarding grants for demonstration projects 
        in States that are primarily urban.

SEC. 306. CIVIL RIGHTS.

    (a) In General.--A choice school shall not discriminate on the 
basis of race, color, national origin, or sex in carrying out the 
provisions of this title.
    (b) Applicability and Construction With Respect to Discrimination 
on the Basis of Sex.--
            (1) Applicability.--With respect to discrimination on the 
        basis of sex, subsection (a) shall not apply to a choice school 
        that is controlled by a religious organization if the 
        application of subsection (a) is inconsistent with the 
        religious tenets of the choice school.
            (2) Construction.--With respect to discrimination on the 
        basis of sex, nothing in subsection (a) shall be construed to 
        require any person, or public or private entity to provide or 
        pay, or to prohibit any such person or entity from providing or 
        paying, for any benefit or service, including the use of 
        facilities, related to an abortion. Nothing in the preceding 
        sentence shall be construed to permit a penalty to be imposed 
        on any person or individual because such person or individual 
        is seeking or has received any benefit or service related to a 
        legal abortion.
            (3) Single-sex schools, classes, or activities.--With 
        respect to discrimination on the basis of sex, nothing in 
        subsection (a) shall be construed to prevent a parent from 
        choosing, or a choice school from offering, a single-sex 
        school, class, or activity.

SEC. 307. CHILDREN WITH DISABILITIES.

    Nothing in this title shall affect the rights of students, or the 
obligations of public schools, under the Individuals with Disabilities 
Education Act (20 U.S.C. 1400 et seq.).

SEC. 308. RULE OF CONSTRUCTION.

    (a) In General.--Nothing in this title shall be construed to 
prevent any choice school which is operated by, supervised by, 
controlled by, or connected to, a religious organization from 
employing, admitting, or giving preference to, persons of the same 
religion to the extent determined by the choice school to promote the 
religious purpose for which the choice school is established or 
maintained.
    (b) Sectarian Purposes.--Nothing in this title shall be construed 
to prohibit the use of funds made available under this title for 
sectarian educational purposes, or to require a choice school to remove 
religious art, icons, scripture, or other symbols.

SEC. 309. APPLICATIONS.

    (a) In General.--Any eligible entity that wishes to receive a grant 
under this title shall submit an application to the Secretary at such 
time and in such manner as the Secretary may prescribe.
    (b) Contents.--Each application described in subsection (a) shall 
contain--
            (1) information demonstrating the eligibility for 
        participation in the demonstration program of the eligible 
        entity;
            (2) a description of how the eligible entity will determine 
        a school to be a unsafe school in accordance with section 
        302(11);
            (3) with respect to choice schools--
                    (A) a description of the types of potential choice 
                schools that will be involved in the demonstration 
                project;
                    (B)(i) a description of the procedures used to 
                encourage public and private schools to be involved in 
                the demonstration project; and
                    (ii) a description of how the eligible entity will 
                annually determine the number of spaces available for 
                eligible children in each choice school;
                    (C) an assurance that each choice school will not 
                impose higher standards for admission or participation 
                in its programs and activities for eligible children 
                provided education certificates under this title than 
                the choice school does for other children;
                    (D) an assurance that the eligible entity will 
                terminate the involvement of any choice school that 
fails to comply with the conditions of its involvement in the 
demonstration project; and
                    (E) a description of the extent to which choice 
                schools will accept education certificates under this 
                title as full or partial payment for tuition and fees;
            (4) with respect to the participation in the demonstration 
        project of eligible children--
                    (A) a description of the procedures to be used to 
                make a determination of eligibility for participation 
                in the demonstration project for an eligible child;
                    (B) a description of the procedures to be used to 
                ensure that, in selecting eligible children to 
                participate in the demonstration project, the eligible 
                entity will--
                            (i) apply the same criteria to both public 
                        and private school eligible children; and
                            (ii) give priority to eligible children 
                        from the lowest income families;
                    (C) a description of the procedures to be used to 
                ensure maximum choice of schools for participating 
                eligible children; and
                    (D) a description of the procedures to be used to 
                ensure compliance with section 311(a), which may 
                include--
                            (i) the direct provision of services by a 
                        local educational agency; and
                            (ii) arrangements made by a local 
                        educational agency with other service 
                        providers;
            (5) with respect to the operation of the demonstration 
        project--
                    (A) a description of the procedures to be used for 
                the issuance and redemption of education certificates 
                under this title;
                    (B) a description of the procedures by which a 
                choice school will make a pro rata refund of the 
                education certificate under this title for any 
                participating eligible child who withdraws from the 
                school for any reason, before completing 75 percent of 
                the school attendance period for which the education 
                certificate was issued;
                    (C) a description of the procedures to be used to 
                provide the parental notification described in section 
                312;
                    (D) an assurance that the eligible entity will 
                place all funds received under this title into a 
                separate account, and that no other funds will be 
                placed in such account;
                    (E) an assurance that the eligible entity will 
                cooperate with the Comptroller General of the United 
                States and the evaluating agency in carrying out the 
                evaluations described in section 313; and
                    (F) an assurance that the eligible entity will--
                            (i) maintain such records as the Secretary 
                        may require; and
                            (ii) comply with reasonable requests from 
                        the Secretary for information; and
            (6) such other assurances and information as the Secretary 
        may require.

SEC. 310. EDUCATION CERTIFICATES.

    (a) Education Certificates.--
            (1) Amount.--The amount of an eligible child's education 
        certificate under this title shall be determined by the 
        eligible entity, but shall be an amount that provides to the 
        recipient of the education certificate the maximum degree of 
        choice in selecting the choice school the eligible child will 
        attend.
            (2) Considerations.--
                    (A) In general.--Subject to such regulations as the 
                Secretary shall prescribe, in determining the amount of 
                an education certificate under this title an eligible 
                entity shall consider--
                            (i) the additional reasonable costs of 
                        transportation directly attributable to the 
                        eligible child's participation in the 
                        demonstration project; and
                            (ii) the cost of complying with section 
                        311(a).
                    (B) Schools charging tuition.--If an eligible child 
                participating in a demonstration project under this 
                title was attending a public or private school that 
                charged tuition for the year preceding the first year 
                of such participation, then in determining the amount 
                of an education certificate for such eligible child 
                under this title the eligible entity shall consider--
                            (i) the tuition charged by such school for 
                        such eligible child in such preceding year; and
                            (ii) the amount of the education 
                        certificates under this title that are provided 
                        to other eligible children.
            (3) Special rule.--An eligible entity may provide an 
        education certificate under this title to the parent of an 
        eligible child who chooses to attend a school that does not 
        charge tuition or fees, to pay the additional reasonable costs 
        of transportation directly attributable to the eligible child's 
        participation in the demonstration project or the cost of 
        complying with section 311(a).
    (b) Adjustment.--The amount of the education certificate for a 
fiscal year may be adjusted in the second and third years of an 
eligible child's participation in a demonstration project under this 
title to reflect any increase or decrease in the tuition, fees, or 
transportation costs directly attributable to that eligible child's 
continued attendance at a choice school, but shall not be increased for 
this purpose by more than 10 percent of the amount of the education 
certificate for the fiscal year preceding the fiscal year for which the 
determination is made. The amount of the education certificate may also 
be adjusted in any fiscal year to comply with section 311(a).
    (c) Maximum Amount.--Notwithstanding any other provision of this 
section, the amount of an eligible child's education certificate shall 
not exceed the per pupil expenditure for elementary or secondary 
education, as appropriate, by the local educational agency in which the 
public school to which the eligible child would normally be assigned is 
located for the fiscal year preceding the fiscal year for which the 
determination is made.

SEC. 311. EFFECT ON OTHER PROGRAMS.

    (a) Effect on Other Programs.--An eligible child participating in a 
demonstration project under this title, who, in the absence of such a 
demonstration project, would have received services under part A of 
title I of the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 6311 et seq.) shall be provided such services.
    (b) Counting of Eligible Children.--Notwithstanding any other 
provision of law, any local educational agency participating in a 
demonstration project under this title may count eligible children who, 
in the absence of such a demonstration project, would attend the 
schools of such agency, for purposes of receiving funds under any 
program administered by the Secretary.

SEC. 312. PARENTAL NOTIFICATION.

    Each eligible entity receiving a grant under this title shall 
provide timely notice of the demonstration project to parents of 
eligible children residing in the area to be served by the 
demonstration project. At a minimum, such notice shall--
            (1) describe the demonstration project;
            (2) describe the eligibility requirements for participation 
        in the demonstration project;
            (3) describe the information needed to make a determination 
        of eligibility for participation in the demonstration project 
        for an eligible child;
            (4) describe the selection procedures to be used if the 
        number of eligible children seeking to participate in the 
        demonstration project exceeds the number that can be 
        accommodated in the demonstration project;
            (5) provide information about each choice school, including 
        information about any admission requirements or criteria for 
        each choice school participating in the demonstration project; 
        and
            (6) include the schedule for parents to apply for their 
        eligible children to participate in the demonstration project.

SEC. 313. EVALUATION.

    (a) Annual Evaluation.--
            (1) Contract.--The Comptroller General of the United States 
        shall enter into a contract, with an evaluating agency that has 
        demonstrated experience in conducting evaluations, for the 
        conduct of an ongoing rigorous evaluation of the demonstration 
        program under this title.
            (2) Annual evaluation requirement.--The contract described 
        in paragraph (1) shall require the evaluating agency entering 
        into such contract to annually evaluate each demonstration 
        project under this title in accordance with the evaluation 
        criteria described in subsection (b).
            (3) Transmission.--The contract described in paragraph (1) 
        shall require the evaluating agency entering into such contract 
        to transmit to the Comptroller General of the United States--
                    (A) the findings of each annual evaluation under 
                paragraph (1); and
                    (B) a copy of each report received pursuant to 
                section 314(a) for the applicable year.
    (b) Evaluation Criteria.--The Comptroller General of the United 
States, in consultation with the Secretary, shall establish minimum 
criteria for evaluating the demonstration program under this title. 
Such criteria shall provide for--
            (1) a description of the implementation of each 
        demonstration project under this title and the demonstration 
        project's effects on all participants, schools, and communities 
in the demonstration project area, with particular attention given to 
the effect of parent participation in the life of the school and the 
level of parental satisfaction with the demonstration program; and
            (2) a comparison of the educational achievement of, and the 
        incidences of violence and drug activity related to, all 
        students in the demonstration project area, including a 
        comparison of similar--
                    (A) students receiving education certificates under 
                this title; and
                    (B) students not receiving education certificates 
                under this title.

SEC. 314. REPORTS.

    (a) Report by Grant Recipient.--Each eligible entity receiving a 
grant under this title shall submit to the evaluating agency entering 
into the contract under section 313(a)(1) an annual report regarding 
the demonstration project under this title. Each such report shall be 
submitted at such time, in such manner, and accompanied by such 
information, as such evaluating agency may require.
    (b) Reports by Comptroller General.--
            (1) Annual reports.--The Comptroller General of the United 
        States shall report annually to the Congress on the findings of 
        the annual evaluation under section 313(a)(2) of each 
        demonstration project under this title. Each such report shall 
        contain a copy of--
                    (A) the annual evaluation under section 313(a)(2) 
                of each demonstration project under this title; and
                    (B) each report received under subsection (a) for 
                the applicable year.
            (2) Final report.--The Comptroller General shall submit a 
        final report to the Congress within 6 months after the 
        conclusion of the demonstration program under this title that 
        summarizes the findings of the annual evaluations conducted 
        pursuant to section 313(a)(2).

              TITLE IV--TESTING AND MERIT PAY FOR TEACHERS

SEC. 401. FINDINGS.

    Congress makes the following findings:
            (1) Students have a right to be taught by competent, 
        caring, and qualified teachers.
            (2) Students are better able to achieve high standards when 
        taught by teachers who are prepared to teach in new ways and 
        who are supported by schools that are prepared to reward high-
        quality teaching.
            (3) Studies show that the best teachers are teachers who 
        know their subject matter, understand how children learn, and 
        have mastered a wide range of teaching methods.
            (4) Few States require periodic assessment of teacher 
        performance. Yet States require continuing education, and in 
        some cases reassessment, for a number of other professions. 
        Continuing professional certification or licensing should be 
        granted to teachers only upon the positive completion of 
        performance assessments.
            (5) States should develop a performance assessment model 
        for their teachers and other instructional staff, and should 
        administer the assessment at least every 3 to 5 years.
            (6) Teaching is one of the most important and challenging 
        tasks one can undertake in adult life. However, salaries for 
        teachers lag behind other professions for which a college 
        degree is expected or required.
            (7) Existing career tracks and compensation in teaching 
        create a career path that places classroom teaching at the 
        bottom, provides teachers with little influence in making key 
        decisions, and requires a teacher to leave the classroom if the 
        teacher wants greater responsibility and higher pay.
            (8) Evaluating and rewarding teachers with a compensation 
        system that supports teachers who become increasingly expert in 
        a subject area, are proficient in meeting the needs of students 
        and schools, and demonstrate high levels of performance 
        measured against professional teaching standards--
                    (A) will encourage teachers to continue to learn 
                needed skills, and broaden the teachers' expertise; and
                    (B) will enhance education for students.

SEC. 402. TEACHER TESTING; MERIT PAY; HIRING OF TEACHERS.

    (a) In General.--Notwithstanding any other provision of law, a 
State may use Federal education funds--
            (1) to carry out an assessment of the performance of each 
        elementary school or secondary school teacher in the State;
            (2) to establish a merit pay program for the teachers; or
            (3) to hire elementary school or secondary school teachers 
        who are certified or licensed to teach in the State.
    (b) Definitions.--In this title, the terms ``elementary school'' 
and ``secondary school'' have the meanings given the terms in section 
14101 of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 
8801).

                      TITLE V--READING EXCELLENCE

SEC. 501. SHORT TITLE.

    This title may be cited as the ``Reading Excellence Act''.

                       Subtitle A--Reading Grants

SEC. 511. AMENDMENT TO ESEA FOR READING GRANTS.

    The Elementary and Secondary Education Act of 1965 (20 U.S.C. 6301 
et seq.) is amended by adding at the end the following:

                       ``TITLE XV--READING GRANTS

``SEC. 15101. PURPOSE.

    ``The purposes of this title are as follows:
            ``(1) To teach every child to read in their early childhood 
        years--
                    ``(A) as soon as they are ready to read; or
                    ``(B) as soon as possible once they enter school, 
                but not later than 3d grade.
            ``(2) To improve the reading skills of students, and the 
        in-service instructional practices for teachers who teach 
        reading, through the use of findings from reliable, replicable 
        research on reading, including phonics.
            ``(3) To expand the number of high-quality family literacy 
        programs.
            ``(4) To reduce the number of children who are 
        inappropriately referred to special education due to reading 
        difficulties.

``SEC. 15102. DEFINITIONS.

    ``For purposes of this title:
            ``(1) Eligible professional development provider.--The term 
        `eligible professional development provider' means a provider 
        of professional development in reading instruction to teachers 
        that is based on reliable, replicable research on reading.
            ``(2) Eligible research institution.--The term `eligible 
        research institution' means an institution of higher education 
        at which reliable, replicable research on reading has been 
        conducted.
            ``(3) Family literacy services.--The term `family literacy 
        services' means services provided to participants on a 
        voluntary basis that are of sufficient intensity in terms of 
        hours, and of sufficient duration, to make sustainable changes 
        in a family (such as eliminating or reducing welfare 
        dependency) and that integrate all of the following activities:
                    ``(A) Interactive literacy activities between 
                parents and their children.
                    ``(B) Equipping parents to partner with their 
                children in learning.
                    ``(C) Parent literacy training, including training 
                that contributes to economic self-sufficiency.
                    ``(D) Appropriate instruction for children of 
                parents receiving parent literacy services.
            ``(4) Reading.--The term `reading' means the process of 
        comprehending the meaning of written text by depending on--
                    ``(A) the ability to use phonics skills, that is, 
                knowledge of letters and sounds, to decode printed 
                words quickly and effortlessly, both silently and 
                aloud;
                    ``(B) the ability to use previously learned 
                strategies for reading comprehension; and
                    ``(C) the ability to think critically about the 
                meaning, message, and aesthetic value of the text.
            ``(5) Reading readiness.--The term `reading readiness' 
        means activities that--
                    ``(A) provide experience and opportunity for 
                language development;
                    ``(B) create appreciation of the written word;
                    ``(C) develop an awareness of printed language, the 
                alphabet, and phonemic awareness; and
                    ``(D) develop an understanding that spoken and 
                written language is made up of phonemes, syllables, and 
                words.
            ``(6) Reliable, replicable research.--The term `reliable, 
        replicable research' means objective, valid, scientific studies 
        that--
                    ``(A) include rigorously defined samples of 
                subjects that are sufficiently large and representative 
                to support the general conclusions drawn;
                    ``(B) rely on measurements that meet established 
                standards of reliability and validity;
                    ``(C) test competing theories, where multiple 
                theories exist;
                    ``(D) are subjected to peer review before their 
                results are published; and
                    ``(E) discover effective strategies for improving 
                reading skills.

``SEC. 15103. GRANTS TO READING AND LITERACY PARTNERSHIPS.

    ``(a) Program Authorized.--The Secretary may make grants on a 
competitive basis to reading and literacy partnerships for the purpose 
of permitting such partnerships to make subgrants under sections 15104 
and 15105.
    ``(b) Reading and Literacy Partnerships.--
            ``(1) Composition.--
                    ``(A) Required participants.--In order to receive a 
                grant under this section, a State shall establish a 
                reading and literacy partnership consisting of at least 
                the following participants:
                            ``(i) The Governor of the State.
                            ``(ii) The chief State school officer.
                            ``(iii) The chairman and the ranking member 
                        of each committee of the State legislature that 
                        is responsible for education policy.
                            ``(iv) A representative, selected jointly 
                        by the Governor and the chief State school 
                        officer, of at least 1 local educational agency 
                        that has at least 1 school that is identified 
                        for school improvement under section 1116(c) in 
                        the geographic area served by the agency.
                            ``(v) A representative, selected jointly by 
                        the Governor and the chief State school 
                        officer, of a community-based organization 
                        working with children to improve their reading 
                        skills, particularly a community-based 
                        organization using volunteers.
                    ``(B) Optional participants.--A reading and 
                literacy partnership may include additional 
                participants, who shall be selected jointly by the 
                Governor and the chief State school officer, which may 
                include--
                            ``(i) State directors of appropriate 
                        Federal or State programs with a strong reading 
                        component;
                            ``(ii) a parent of a public or private 
                        school student or a parent who educates their 
                        child or children in their home;
                            ``(iii) a teacher who teaches reading; or
                            ``(iv) a representative of (I) an 
                        institution of higher education operating a 
                        program of teacher preparation in the State; 
                        (II) a local educational agency; (III) an 
                        eligible research institution; (IV) a private 
                        nonprofit or for-profit eligible professional 
                        development provider providing instruction 
                        based on reliable, replicable research on 
                        reading; (V) a family literacy service 
                        provider; (VI) an adult education provider; 
                        (VII) a volunteer organization that is involved 
                        in reading programs; or (VIII) a school or a 
                        public library that offers reading or literacy 
                        programs for children or families.
            ``(2) Agreement.--The contractual agreement that 
        establishes a reading and literacy partnership--
                    ``(A) shall specify--
                            ``(i) the nature and extent of the 
                        association among the participants referred to 
                        in paragraph (1); and
                            ``(ii) the roles and duties of each such 
                        participant; and
                    ``(B) shall remain in effect during the entire 
                grant period proposed in the partnership's grant 
                application under subsection (e).
            ``(3) Functions.--Each reading and literacy partnership for 
        a State shall prepare and submit an application under 
        subsection (e) and, if the partnership receives a grant under 
        this section--
                    ``(A) shall solicit applications for, and award, 
                subgrants under sections 15104 and 15105;
                    ``(B) shall oversee the performance of the 
                subgrants and submit performance reports in accordance 
                with subsection (h);
                    ``(C) if sufficient grant funds are available under 
                this title--
                            ``(i) work to enhance the capacity of 
                        agencies in the State to disseminate reliable, 
                        replicable research on reading to schools, 
                        classrooms, and providers of early education 
                        and child care;
                            ``(ii) facilitate the provision of 
                        technical assistance to subgrantees under 
                        sections 15104 and 15105 by providing the 
                        subgrantees information about technical 
                        assistance providers; and
                            ``(iii) build on, and promote coordination 
                        among, literacy programs in the State, in order 
                        to increase their effectiveness and to avoid 
                        duplication of their efforts; and
                    ``(D) shall ensure that each local educational 
                agency to which the partnership makes a subgrant under 
                section 15104 makes available, upon request and in an 
                understandable and uniform format, to any parent of a 
                student attending any school selected under section 
                15104(a)(2) in the geographic area served by the 
                agency, information regarding the qualifications of the 
                student's classroom teacher to provide instruction in 
                reading.
            ``(4) Fiscal agent.--The State educational agency shall act 
        as the fiscal agent for the reading and literacy partnership 
        for the purposes of receipt of funds from the Secretary, 
        disbursement of funds to subgrantees under sections 15104 and 
        15105, and accounting for such funds.
    ``(c) Preexisting Partnership.--If, before the date of the 
enactment of the Reading Excellence Act, a State established a 
consortium, partnership, or any other similar body, that includes the 
Governor and the chief State school officer and has, as a central part 
of its mission, the promotion of literacy for children in their early 
childhood years through the 3d grade, but that does not satisfy the 
requirements of subsection (b)(1), the State may elect to treat that 
consortium, partnership, or body as the reading and literacy 
partnership for the State notwithstanding such subsection, and the 
consortium, partnership, or body shall be considered a reading and 
literacy partnership for purposes of the other provisions of this 
title.
    ``(d) Multi-State Partnership Arrangements.--A reading and literacy 
partnership that satisfies the requirements of subsection (b) may join 
with other such partnerships in other States to develop a single 
application that satisfies the requirements of subsection (e) and 
identifies which State educational agency, from among the States 
joining, shall act as the fiscal agent for the multi-State arrangement. 
For purposes of the other provisions of this title, any such multi-
State arrangement shall be considered to be a reading and literacy 
partnership.
    ``(e) Applications.--A reading and literacy partnership that 
desires to receive a grant under this section shall submit an 
application to the Secretary at such time, in such manner, and 
including such information as the Secretary may require. The 
application--
            ``(1) shall describe how the partnership will ensure that 
        95 percent of the grant funds are used to make subgrants under 
        sections 15104 and 15105;
            ``(2) shall be integrated, to the maximum extent possible, 
        with State plans and programs under this Act, the Individuals 
        with Disabilities Education Act (20 U.S.C. 1400 et seq.), and, 
        to the extent appropriate, the Adult Education Act (20 U.S.C. 
        1201 et seq.);
            ``(3) shall describe how the partnership will ensure that 
        professional development funds available at the State and local 
        levels are used effectively to improve instructional practices 
        for reading and are based on reliable, replicable research on 
        reading;
            ``(4) shall describe--
                    ``(A) the contractual agreement that establishes 
                the partnership, including at least the elements of the 
                agreement referred to in subsection (b)(2);
                    ``(B) how the partnership will assess, on a regular 
                basis, the extent to which the activities undertaken by 
                the partnership and the partnership's subgrantees under 
                this title have been effective in achieving the 
                purposes of this title;
                    ``(C) what evaluation instruments the partnership 
                will use to determine the success of local educational 
                agencies to whom subgrants under sections 15104 and 
                15105 are made in achieving the purposes of this title;
                    ``(D) how subgrants made by the partnership under 
                such sections will meet the requirements of this title, 
                including how the partnership will ensure that 
                subgrantees will use practices based on reliable, 
                replicable research on reading; and
                    ``(E) how the partnership will, to the extent 
                practicable, make grants to subgrantees in both rural 
                and urban areas;
            ``(5) shall include an assurance that each local 
        educational agency to whom the partnership makes a subgrant 
        under section 15104--
                    ``(A) will carry out family literacy programs based 
                on the Even Start family literacy model authorized 
                under part B of title I to enable parents to be their 
                child's first and most important teacher, and will make 
                payments for the receipt of technical assistance for 
                the development of such programs;
                    ``(B) will carry out programs to assist those 
                kindergarten students who are not ready for the 
                transition to 1st grade, particularly students 
                experiencing difficulty with reading skills;
                    ``(C) will use supervised individuals (including 
                tutors), who have been appropriately trained using 
                reliable, replicable research on reading, to provide 
                additional support, before school, after school, on 
                weekends, during non-instructional periods of the 
                school day, or during the summer, for students in 
                grades 1 through 3 who are experiencing difficulty 
                reading; and
                    ``(D) will carry out professional development for 
                the classroom teacher and other appropriate teaching 
                staff on the teaching of reading based on reliable, 
                replicable research on reading; and
            ``(6) shall describe how the partnership--
                    ``(A) will ensure that a portion of the grant funds 
                that the partnership receives in each fiscal year will 
                be used to make subgrants under section 15105; and
                    ``(B) will make local educational agencies 
                described in section 15105(a)(1) aware of the 
                availability of such subgrants.
    ``(f) Peer Review Panel.--
            ``(1) Composition of peer review panel.--
                    ``(A) In general.--The National Institute for 
                Literacy, in consultation with the National Research 
                Council of the National Academy of Sciences, the 
                National Institute of Child Health and Human 
                Development, and the Secretary, shall convene a panel 
                to evaluate applications under this section. At a 
                minimum the panel shall include representatives of the 
                National Institute for Literacy, the National Research 
                Council of the National Academy of Sciences, the 
                National Institute of Child Health and Human 
                Development, and the Secretary.
                    ``(B) Experts.--The panel shall include experts who 
                are competent, by virtue of their training, expertise, 
                or experience, to evaluate applications under this 
                section, and experts who provide professional 
                development to teachers of reading to children and 
                adults, based on reliable, replicable research on 
                reading.
                    ``(C) Limitation.--Not more than \1/3\ of the panel 
                may be composed of individuals who are employees of the 
                Federal Government.
            ``(2) Payment of fees and expenses of certain members.--The 
        Secretary shall use funds reserved under section 15110(b)(2) to 
        pay the expenses and fees of panel members who are not 
        employees of the Federal Government.
            ``(3) Duties of panel.--
                    ``(A) Model application forms.--The peer review 
                panel shall develop a model application form for 
                reading and literacy partnerships desiring to apply for 
a grant under this section. The peer review panel shall submit the 
model application form to the Secretary for final approval.
                    ``(B) Selection of applications.--
                            ``(i) Recommendations of panel.--
                                    ``(I) In general.--The Secretary 
                                shall receive grant applications from 
                                reading and literacy partnerships under 
                                this section and shall provide the 
                                applications to the peer review panel 
                                for evaluation. With respect to each 
                                application, the peer review panel 
                                shall initially recommend the 
                                application for funding or for 
                                disapproval.
                                    ``(II) Priority.--In recommending 
                                applications to the Secretary, the 
                                panel shall give priority to 
                                applications from States that have 
                                modified, are modifying, or provide an 
                                assurance that not later than 1 year 
                                after receiving a grant under this 
                                section the State will modify, State 
                                teacher certification in the area of 
                                reading to reflect reliable, replicable 
                                research, except that nothing in this 
                                title shall be construed to establish a 
                                national system of teacher 
                                certification.
                                    ``(III) Ranking of applications.--
                                With respect to each application 
                                recommended for funding, the panel 
                                shall assign the application a rank, 
                                relative to other recommended 
                                applications, based on the priority 
                                described in subclause (II), the extent 
                                to which the application furthers the 
                                purposes of this title, and the overall 
                                quality of the application.
                                    ``(IV) Recommendation of amount.--
                                With respect to each application 
                                recommended for funding, the panel 
                                shall make a recommendation to the 
                                Secretary with respect to the amount of 
                                the grant that should be made.
                            ``(ii) Secretarial selection.--
                                    ``(I) In general.--Subject to 
                                clause (iii), the Secretary shall 
                                determine, based on the peer review 
                                panel's recommendations, which 
                                applications from reading and literacy 
                                partnerships shall receive funding and 
                                the amounts of such grants. In 
                                determining grant amounts, the 
                                Secretary shall take into account the 
                                total amount of funds available for all 
                                grants under this section and the types 
                                of activities proposed to be carried 
                                out by the partnership.
                                    ``(II) Effect of ranking by 
                                panel.--In making grants under this 
                                section, the Secretary shall select 
                                applications according to the ranking 
                                of the applications by the peer review 
                                panel, except in cases where the 
                                Secretary determines, for good cause, 
                                that a variation from that order is 
                                appropriate.
                            ``(iii) Minimum grant amounts.--Each 
                        reading and literacy partnership selected to 
                        receive a grant under this section shall 
                        receive an amount for each fiscal year that is 
                        not less than $100,000.
    ``(g) Limitation on Administrative Expenses.--A reading and 
literacy partnership that receives a grant under this section may use 
not more than 3 percent of the grant funds for administrative costs.
    ``(h) Reporting.--
            ``(1) In general.--A reading and literacy partnership that 
        receives a grant under this section shall submit performance 
        reports to the Secretary pursuant to a schedule to be 
        determined by the Secretary, but not more frequently than 
        annually. Such reports shall include--
                    ``(A) the results of use of the evaluation 
                instruments referred to in subsection (e)(4)(C);
                    ``(B) the process used to select subgrantees;
                    ``(C) a description of the subgrantees receiving 
                funds under this title; and
                    ``(D) with respect to subgrants under section 
                15104, the model or models of reading instruction, 
                based on reliable, replicable research on reading, 
                selected by subgrantees.
            ``(2) Provision to peer review panel.--The Secretary shall 
        provide the reports submitted under paragraph (1) to the peer 
        review panel convened under subsection (f). The panel shall use 
        such reports in recommending applications for funding under 
        this section.

``SEC. 15104. LOCAL READING IMPROVEMENT SUBGRANTS.

    ``(a) In General.--
            ``(1) Subgrants.--A reading and literacy partnership that 
        receives a grant under section 15103 shall make subgrants, on a 
        competitive basis, to local educational agencies that have at 
        least 1 school that is identified for school improvement under 
        section 1116(c) in the geographic area served by the agency.
            ``(2) Role of local educational agencies.--A local 
        educational agency that receives a subgrant under this section 
        shall use the subgrant in a manner consistent with this section 
        to advance reform of reading instruction in any school selected 
        by the agency that--
                    ``(A) is identified for school improvement under 
                section 1116(c) at the time the agency receives the 
                subgrant; and
                    ``(B) has a contractual association with 1 or more 
                community-based organizations that have established a 
                record of effectiveness with respect to reading 
                readiness, reading instruction for children in 
                kindergarten through 3d grade, and early childhood 
                literacy.
    ``(b) Grant Period.--A subgrant under this section shall be for a 
period of 3 years and may not be revoked or terminated on the ground 
that a school ceases, during the grant period, to be identified for 
school improvement under section 1116(c).
    ``(c) Applications.--A local educational agency that desires to 
receive a subgrant under this section shall submit an application to 
the reading and literacy partnership at such time, in such manner, and 
including such information as the partnership may require. The 
application--
            ``(1) shall describe how the local educational agency will 
        work with schools selected by the agency under subsection 
        (a)(2) to select 1 or more models of reading instruction, 
        developed using reliable, replicable research on reading, as a 
        model for implementing and improving reading instruction by all 
        teachers and for all children in each of the schools selected 
        by the agency under such subsection and, where appropriate, 
        their parents;
            ``(2) shall select 1 or more models described in paragraph 
        (1), for the purpose described in such paragraph, and shall 
        describe each such selected model;
            ``(3) shall demonstrate that a person responsible for the 
        development of each such model, or a person with experience or 
        expertise about such model and its implementation, has agreed 
        to work with the applicant in connection with such 
        implementation and improvement efforts;
            ``(4) shall describe--
                    ``(A) how the applicant will ensure that funds 
                available under this title, and funds available for 
                reading for grades kindergarten through grade 6 from 
                other appropriate sources, are effectively coordinated 
                and, where appropriate, integrated, with funds under 
                this Act in order to improve existing activities in the 
                areas of reading instruction, professional development, 
                program improvement, parental involvement, technical 
                assistance, and other activities that can help meet the 
                purposes of this title; and
                    ``(B) the amount of funds available for reading for 
                grades kindergarten through grade 6 from appropriate 
                sources other than this title, including title I 
                (except that such description shall not be required to 
                include funds made available under part B of title I 
                unless the applicant has established a contractual 
                association in accordance with subsection (d)(2) with 
                an eligible entity under such part B), the Individuals 
                with Disabilities Education Act (20 U.S.C. 1400 et 
                seq.), and any other law providing Federal financial 
                assistance for professional development for teachers of 
                such grades who teach reading, which will be used to 
                help achieve the purposes of this title;
            ``(5) shall describe the amount and nature of funds from 
        any other public or private sources, including funds received 
        under this Act and the Individuals with Disabilities Education 
        Act (20 U.S.C. 1400 et seq.), that will be combined with funds 
        received under the subgrant;
            ``(6) shall include an assurance that the applicant--
                    ``(A) will carry out family literacy programs based 
                on the Even Start family literacy model authorized 
                under part B of title I to enable parents to be their 
                child's first and most important teacher, will make 
                payments for the receipt of technical assistance for 
                the development of such programs;
                    ``(B) will carry out programs to assist those 
                kindergarten students who are not ready for the 
                transition to 1st grade, particularly students 
                experiencing difficulty with reading skills;
                    ``(C) will use supervised individuals (including 
                tutors), who have been appropriately trained using 
                reliable, replicable research on reading, to provide 
                additional support, before school, after school, on 
                weekends, during non-instructional periods of the 
                school day, or during the summer, for students in 
                grades 1 through 3 who are experiencing difficulty 
                reading; and
                    ``(D) will carry out professional development for 
                the classroom teacher and other teaching staff on the 
                teaching of reading based on reliable, replicable 
                research on reading;
            ``(7) shall describe how the local educational agency 
        provides instruction in reading to children who have not been 
        determined to be a child with a disability (as defined in 
        section 602 of the Individuals with Disabilities Education Act 
        (20 U.S.C. 1401)), pursuant to section 614(b)(5) of such Act 
        (20 U.S.C. 1414(a)(5)), because of a lack of instruction in 
        reading; and
            ``(8) shall indicate the amount of the subgrant funds (if 
        any) that the applicant will use to carry out the duties 
        described in section 15105(b)(2).
    ``(d) Priority.--In approving applications under this section, a 
reading and literacy partnership shall give priority to an application 
submitted by an applicant who demonstrates that the applicant has 
established--
            ``(1) a contractual association with 1 or more Head Start 
        programs under the Head Start Act (42 U.S.C. 9801 et seq.) 
        under which--
                    ``(A) the Head Start program agrees to select the 
                same model or models of reading instruction, as a model 
                for implementing and improving the reading readiness of 
                children participating in the program, as was selected 
                by the applicant; and
                    ``(B) the applicant agrees--
                            ``(i) to share with the Head Start program 
                        an appropriate amount of the applicant's 
                        information resources with respect to the 
                        model, such as curricula materials; and
                            ``(ii) to train personnel from the Head 
                        Start program;
            ``(2) a contractual association with 1 or more State- or 
        federally-funded preschool programs, or family literacy 
        programs, under which--
                    ``(A) the program agrees to select the same model 
                or models of reading instruction, as a model for 
                implementing and improving reading instruction in the 
                program's activities, as was selected by the applicant; 
                and
                    ``(B) the applicant agrees to train personnel from 
                the program who work with children and parents in 
                schools selected under subsection (a)(2); or
            ``(3) a contractual association with 1 or more public 
        libraries providing reading or literacy services to preschool 
        children, or preschool children and their families, under 
        which--
                    ``(A) the library agrees to select the same model 
                or models of reading instruction, as a model for 
                implementing and improving reading instruction in the 
                library's reading or literacy programs, as was selected 
                by the applicant; and
                    ``(B) the applicant agrees to train personnel, 
                including volunteers, from such programs who work with 
                preschool children, or preschool children and their 
                families, in schools selected under subsection (a)(2).
    ``(e) Use of Funds.--
            ``(1) In general.--Subject to paragraph (2), an applicant 
        who receives a subgrant under this section may use the subgrant 
        funds to carry out activities that are authorized by this title 
        and described in the subgrant application, including the 
        following:
                    ``(A) Making reasonable payments for technical and 
                other assistance to a person responsible for the 
                development of a model of reading instruction, or a 
                person with experience or expertise about such model 
                and its implementation, who has agreed to work with the 
                recipient in connection with the implementation of the 
                model.
                    ``(B) Carrying out a contractual agreement 
                described in subsection (d).
                    ``(C) Professional development (including training 
                of volunteers), purchase of curricular and other 
                supporting materials, and technical assistance.
                    ``(D) Providing, on a voluntary basis, training to 
                parents of children enrolled in a school selected under 
                subsection (a)(2) on how to help their children with 
                school work, particularly in the development of reading 
                skills. Such training may be provided directly by 
the subgrant recipient, or through a grant or contract with another 
person. Such training shall be consistent with reading reforms taking 
place in the school setting.
                    ``(E) Carrying out family literacy programs based 
                on the Even Start family literacy model authorized 
                under part B of title I to enable parents to be their 
                child's first and most important teacher, and making 
                payments for the receipt of technical assistance for 
                the development of such programs.
                    ``(F) Providing instruction for parents of children 
                enrolled in a school selected under subsection (a)(2), 
                and others who volunteer to be reading tutors for such 
                children, in the instructional practices based on 
                reliable, replicable research on reading used by the 
                applicant.
                    ``(G) Programs to assist those kindergarten 
                students enrolled in a school selected under subsection 
                (a)(2) who are not ready for the transition to 1st 
                grade, particularly students experiencing difficulty 
                with reading skills.
                    ``(H) Providing, for students who are enrolled in 
                grades 1 through 3 in a school selected under 
                subsection (a)(2) and are experiencing difficulty 
                reading, additional support before school, after 
                school, on weekends, during non-instructional periods 
                of the school day, or during the summer, using 
                supervised individuals (including tutors) who have been 
                appropriately trained using reliable, replicable 
                research on reading.
                    ``(I) Carrying out the duties described in section 
                15105(b)(2) for children enrolled in a school selected 
                under subsection (a)(2).
                    ``(J) Providing reading assistance to children who 
                have not been determined to be a child with a 
                disability (as defined in section 602 of the 
                Individuals with Disabilities Education Act (20 U.S.C. 
                1401)), pursuant to section 614(b)(5) of such Act (20 
                U.S.C. 1414(b)(5)), because of a lack of instruction in 
                reading.
            ``(2) Limitation on administrative expenses.--A recipient 
        of a subgrant under this section may use not more than 3 
        percent of the subgrant funds for administrative costs.
    ``(f) Training Nonrecipients.--A recipient of a subgrant under this 
section may train, on a fee-for-service basis, personnel who are from 
schools, or local educational agencies, that are not receiving such a 
subgrant in the instructional practices based on reliable, replicable 
research on reading used by the recipient. Such a non-recipient school 
may use funds received under title I, and other appropriate Federal 
funds used for reading instruction, to pay for such training, to the 
extent consistent with the law under which such funds were received.

``SEC. 15105. TUTORIAL ASSISTANCE SUBGRANTS.

    ``(a) In General.--
            ``(1) Subgrants.--A reading and literacy partnership that 
        receives a grant under section 15103 shall make subgrants on a 
        competitive basis to--
                    ``(A) local educational agencies that have at least 
                1 school in the geographic area served by the agency 
                that--
                            ``(i) is located in an area designated as 
                        an empowerment zone under part I of subchapter 
                        U of chapter 1 of the Internal Revenue Code of 
                        1986; or
                            ``(ii) is located in an area designated as 
                        an enterprise community under part I of 
                        subchapter U of chapter 1 of the Internal 
                        Revenue Code of 1986; or
                    ``(B) in the case of local educational agencies 
                that do not have any such empowerment zone or 
                enterprise community in the State in which the agency 
                is located, local educational agencies that have at 
                least 1 school that is identified for school 
                improvement under section 1116(c) in the geographic 
                area served by the agency.
            ``(2) Applications.--A local educational agency that 
        desires to receive a subgrant under this section shall submit 
        an application to the reading and literacy partnership at such 
        time, in such manner, and including such information as the 
        partnership may require. The application shall include an 
        assurance that the agency will use the subgrant funds to carry 
        out the duties described in subsection (b) for children 
        enrolled in 1 or more schools selected by the agency and 
        described in paragraph (1).
    ``(b) Use of Funds.--
            ``(1) In general.--A local educational agency that receives 
        a subgrant under this section shall carry out, using the funds 
        provided under the subgrant, each of the duties described in 
        paragraph (2).
            ``(2) Duties.--The duties described in this paragraph are 
        the provision of tutorial assistance in reading to children who 
        have difficulty reading, using instructional practices based on 
the principles of reliable, replicable research, through the following:
                    ``(A) The promulgation of a set of objective 
                criteria, pertaining to the ability of a tutorial 
                assistance provider successfully to provide tutorial 
                assistance in reading, that will be used to determine 
                in a uniform manner, at the beginning of each school 
                year, the eligibility of tutorial assistance providers, 
                subject to the succeeding subparagraphs of this 
                paragraph, to be included on the list described in 
                subparagraph (B) (and thereby be eligible to enter into 
                a contract pursuant to subparagraph (F)).
                    ``(B) The promulgation, maintenance, and approval 
                of a list of tutorial assistance providers eligible to 
                enter into a contract pursuant to subparagraph (F) 
                who--
                            ``(i) have established a record of 
                        effectiveness with respect to reading 
                        readiness, reading instruction for children in 
                        kindergarten through 3d grade, and early 
                        childhood literacy;
                            ``(ii) are located in a geographic area 
                        convenient to the school or schools attended by 
                        the children who will be receiving tutorial 
                        assistance from the providers; and
                            ``(iii) are capable of providing tutoring 
                        in reading to children who have difficulty 
                        reading, using instructional practices based on 
                        the principles of reliable, replicable research 
                        and consistent with the instructional methods 
                        used by the school the child attends.
                    ``(C) The development of procedures (i) for the 
                receipt of applications for tutorial assistance, from 
                parents who are seeking such assistance for their child 
                or children, that select a tutorial assistance provider 
                from the list described in subparagraph (B) with whom 
                the child or children will enroll, for tutoring in 
                reading; and (ii) for considering children for tutorial 
                assistance who are identified under subparagraph (D) 
                and for whom no application has been submitted, 
                provided that such procedures are in accordance with 
                this paragraph and give such parents the right to 
                select a tutorial assistance provider from the list 
                referred to in subparagraph (B), and shall permit a 
                local educational agency to recommend a tutorial 
                assistance provider from the list under subparagraph 
                (B) in a case where a parent asks for assistance in the 
                making of such selection.
                    ``(D) The development of a selection process for 
                providing tutorial assistance in accordance with this 
                paragraph that limits the provision of assistance to 
                children identified, by the school the child attends, 
                as having difficulty reading, including difficulty 
                mastering essential phonic, decoding, or vocabulary 
                skills. In the case of a child included in the 
                selection process for whom no application has been 
                submitted by a parent of the child, the child's 
                eligibility for receipt of tutorial assistance shall be 
                determined under the same procedures, timeframe, and 
                criteria for consideration as is used to determine the 
                eligibility of a child whose parent has submitted such 
                an application. Such local educational agency shall 
                apply the provisions of subparagraphs (F) and (G) to a 
                tutorial assistance provider selected for a child whose 
                parent has not submitted an application pursuant to 
                subparagraph (C)(i) in the same manner as the 
                provisions are applied to a provider selected in an 
                application submitted pursuant to subparagraph (C)(i).
                    ``(E) The development of procedures for selecting 
                children to receive tutorial assistance, to be used in 
                cases where insufficient funds are available to provide 
                assistance with respect to all children identified by a 
                school under subparagraph (D) that--
                            ``(i) gives priority to children who are 
                        determined, through State or local reading 
                        assessments, to be most in need of tutorial 
                        assistance; and
                            ``(ii) gives priority, in cases where 
                        children are determined, through State or local 
                        reading assessments, to be equally in need of 
                        tutorial assistance, based on a random 
                        selection principle.
                    ``(F) The development of a methodology by which 
                payments are made directly to tutorial assistance 
                providers who are identified and selected pursuant to 
                subparagraphs (C), (D), and (E). Such methodology shall 
                include the making of a contract, consistent with State 
                and local law, between the tutorial assistance 
provider and the local educational agency carrying out this paragraph. 
Such contract--
                            ``(i) shall contain specific goals and 
                        timetables with respect to the performance of 
                        the tutorial assistance provider;
                            ``(ii) shall require the tutorial 
                        assistance provider to report to the parent and 
                        the local educational agency on the provider's 
                        performance in meeting such goals and 
                        timetables; and
                            ``(iii) shall contain provisions with 
                        respect to the making of payments to the 
                        tutorial assistance provider by the local 
                        educational agency.
                    ``(G) The development of procedures under which the 
                local educational agency carrying out this paragraph--
                            ``(i) will ensure oversight of the quality 
                        and effectiveness of the tutorial assistance 
                        provided by each tutorial assistance provider 
                        that is selected for funding;
                            ``(ii) will remove from the list under 
                        subparagraph (B) ineffective and unsuccessful 
                        providers (as determined by the local 
                        educational agency based upon the performance 
                        of the provider with respect to the goals and 
                        timetables contained in the contract between 
                        the agency and the provider under subparagraph 
                        (F));
                            ``(iii) will provide to each parent of a 
                        child identified under subparagraph (D) who 
                        requests such information for the purpose of 
                        selecting a tutorial assistance provider for 
                        the child, in a comprehensible format, 
                        information with respect to the quality and 
                        effectiveness of the tutorial assistance 
                        referred to in clause (i); and
                            ``(iv) will ensure that each school 
                        identifying a child under subparagraph (D) will 
                        provide upon request, to a parent of the child, 
                        assistance in selecting, from among the 
                        tutorial assistance providers who are included 
                        on the list described in subparagraph (B), the 
                        provider who is best able to meet the needs of 
                        the child.
    ``(c) Definition.--For the purpose of this section the term 
`parent' includes a legal guardian.

``SEC. 15106. PROGRAM EVALUATION.

    ``(a) In General.--From funds reserved under section 15110(b)(1), 
the Secretary shall conduct a national assessment of the programs under 
this title. In developing the criteria for the assessment, the 
Secretary shall receive recommendations from the peer review panel 
convened under section 15103(f).
    ``(b) Submission to Peer Review Panel.--The Secretary shall submit 
the findings from the assessment under subsection (a) to the peer 
review panel convened under section 15103(f).

``SEC. 15107. INFORMATION DISSEMINATION.

    ``(a) In General.--From funds reserved under section 15110(b)(2), 
the National Institute for Literacy shall disseminate information on 
reliable, replicable research on reading and information on subgrantee 
projects under section 15104 or 15105 that have proven effective. At a 
minimum, the institute shall disseminate such information to all 
recipients of Federal financial assistance under titles I and VII, the 
Head Start Act (42 U.S.C. 9801 et seq.), the Individuals with 
Disabilities Education Act (20 U.S.C. 1400 et seq.), and the Adult 
Education Act (20 U.S.C. 1201 et seq.).
    ``(b) Coordination.--In carrying out this section, the National 
Institute for Literacy--
            ``(1) shall use, to the extent practicable, information 
        networks developed and maintained through other public and 
        private persons, including the Secretary, the National Center 
        for Family Literacy, and the Readline Program;
            ``(2) shall work in conjunction with any panel convened by 
        the National Institute of Child Health and Human Development 
        and the Secretary, and any panel convened by the Office of 
        Educational Research and Improvement to assess the current 
        status of research-based knowledge on reading development, 
        including the effectiveness of various approaches to teaching 
        children to read, with respect to determining the criteria by 
        which the National Institute for Literacy judges reliable, 
        replicable research and the design of strategies to disseminate 
        such information; and
            ``(3) shall assist any reading and literacy partnership 
        selected to receive a grant under section 15103, and that 
        requests such assistance--
                    ``(A) in determining whether applications for 
                subgrants submitted to the partnership meet the 
                requirements of this title relating to reliable, 
                replicable research on reading; and
                    ``(B) in the development of subgrant application 
                forms.

``SEC. 15108. STATE EVALUATIONS.

    ``(a) In General.--Each reading and literacy partnership that 
receives a grant under this title shall reserve not more than 2 percent 
of such grant funds for the purpose of evaluating the success of the 
partnership's subgrantees in meeting the purposes of this title. At a 
minimum, the evaluation shall measure the extent to which students who 
are the intended beneficiaries of the subgrants made by the partnership 
have improved their reading.
    ``(b) Contract.--A reading and literacy partnership shall carry out 
the evaluation under this section by entering into a contract with an 
eligible research institution under which the institution will perform 
the evaluation.
    ``(c) Submission.--A reading and literacy partnership shall submit 
the findings from the evaluation under this section to the Secretary 
and the peer review panel convened under section 15103(f). The 
Secretary and the peer review panel shall submit a summary of the 
findings from the evaluations under this subsection to the appropriate 
committees of the Congress, including the Education and the Workforce 
Committee of the House of Representatives.

``SEC. 15109. PARTICIPATION OF CHILDREN ENROLLED IN PRIVATE SCHOOLS.

    ``Each reading and literacy partnership that receives funds under 
this title shall provide for, or ensure that subgrantees provide for, 
the participation of children in private schools in the activities and 
services assisted under this title in the same manner as the children 
participate in activities and services pursuant to sections 14503, 
14504, 14505, and 14506.

``SEC. 15110. AUTHORIZATION OF APPROPRIATIONS; RESERVATIONS FROM 
              APPROPRIATIONS; SUNSET.

    ``(a) Authorization.--There are authorized to be appropriated to 
carry out this title $260,000,000 for fiscal years 1999, 2000, and 
2001.
    ``(b) Reservations.--From the amount appropriated under subsection 
(a) for each fiscal year, the Secretary--
            ``(1) shall reserve 1.5 percent to carry out section 
        15106(a);
            ``(2) shall reserve $5,075,000 to carry out sections 
        15103(f)(2) and 15107, of which $5,000,000 shall be reserved 
        for section 15107; and
            ``(3) shall reserve $10,000,000 to carry out section 
        1202(c).
    ``(c) Sunset.--Notwithstanding section 422(a) of the General 
Education Provisions Act (20 U.S.C. 1226a(a)), this title is repealed, 
effective September 30, 2001, and is not subject to extension under 
such section.''.

     Subtitle B--Amendments to Even Start Family Literacy Programs

SEC. 521. RESERVATION FOR GRANTS.

    Section 1202(c) of the Elementary and Secondary Education Act of 
1965 (20 U.S.C. 6362(c)) is amended to read as follows:
    ``(c) Reservation for Grants.--
            ``(1) Grants authorized.--From funds reserved under section 
        15109(b)(3), the Secretary shall award grants, on a competitive 
        basis, to States to enable such States to plan and implement, 
        statewide family literacy initiatives to coordinate and 
        integrate existing Federal, State, and local literacy resources 
        consistent with the purposes of this part. Such coordination 
        and integration shall include coordination and integration of 
        funds available under the Adult Education Act (20 U.S.C. 1201 
        et seq.), Head Start (42 U.S.C. 9801 et seq.), this part, part 
        A of this title, and part A of title IV of the Social Security 
        Act.
            ``(2) Consortia.--
                    ``(A) Establishment.--To receive a grant under this 
                subsection, a State shall establish a consortium of 
                State-level programs under the following laws:
                            ``(i) This title.
                            ``(ii) The Head Start Act.
                            ``(iii) The Adult Education Act.
                            ``(iv) All other State-funded preschool 
                        programs and programs providing literacy 
                        services to adults.
                    ``(B) Plan.--To receive a grant under this 
                subsection, the consortium established by a State shall 
                create a plan to use a portion of the State's 
                resources, derived from the programs referred to in 
                subparagraph (A), to strengthen and expand family 
                literacy services in such State.
                    ``(C) Coordination with title xv.--The consortium 
                shall coordinate its activities with the activities of 
                the reading and literacy partnership for the State 
                established under section 15103, if the State receives 
                a grant under such section.
            ``(3) Reading instruction.--Statewide family literacy 
        initiatives implemented under this subsection shall base 
reading instruction on reliable, replicable research on reading (as 
such terms are defined in section 15102).
            ``(4) Technical assistance.--The Secretary shall provide, 
        directly or through a grant or contract with an organization 
        with experience in the development and operation of successful 
        family literacy services, technical assistance to States 
        receiving a grant under this subsection.
            ``(5) Matching requirement.--The Secretary shall not make a 
        grant to a State under this subsection unless the State agrees 
        that, with respect to the costs to be incurred by the eligible 
        consortium in carrying out the activities for which the grant 
        was awarded, the State will make available non-Federal 
        contributions in an amount equal to not less than the Federal 
        funds provided under the grant.''.

SEC. 522. DEFINITIONS.

    Section 1202(e) of the Elementary and Secondary Education Act of 
1965 (20 U.S.C. 6362(e)) is amended--
            (1) by redesignating paragraphs (3) and (4) as paragraphs 
        (4) and (5), respectively; and
            (2) by inserting after paragraph (2) the following:
            ``(3) the term `family literacy services' means services 
        provided to participants on a voluntary basis that are of 
        sufficient intensity in terms of hours, and of sufficient 
        duration, to make sustainable changes in a family (such as 
        eliminating or reducing welfare dependency) and that integrate 
        all of the following activities:
                    ``(A) Interactive literacy activities between 
                parents and their children.
                    ``(B) Equipping parents to partner with their 
                children in learning.
                    ``(C) Parent literacy training, including training 
                that contributes to economic self-sufficiency.
                    ``(D) Appropriate instruction for children of 
                parents receiving parent literacy services.''.

SEC. 523. EVALUATION.

    Section 1209 of the Elementary and Secondary Education Act of 1965 
(20 U.S.C. 6369) is amended--
            (1) in paragraph (1), by striking ``and'' at the end;
            (2) in paragraph (2), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(3) to provide States and eligible entities receiving a 
        subgrant under this part, directly or through a grant or 
        contract with an organization with experience in the 
        development and operation of successful family literacy 
        services, technical assistance to ensure local evaluations 
        undertaken under section 1205(10) provide accurate information 
        on the effectiveness of programs assisted under this part.''.

SEC. 524. INDICATORS OF PROGRAM QUALITY.

    (a) In General.--The Elementary and Secondary Education Act of 1965 
(20 U.S.C. 6301 et seq.) is amended--
            (1) by redesignating section 1210 as section 1212; and
            (2) by inserting after section 1209 the following:

``SEC. 1210. INDICATORS OF PROGRAM QUALITY.

    ``Each State receiving funds under this part shall develop, based 
on the best available research and evaluation data, indicators of 
program quality for programs assisted under this part. Such indicators 
shall be used to monitor, evaluate, and improve such programs within 
the State. Such indicators shall include the following:
            ``(1) With respect to eligible participants in a program 
        who are adults--
                    ``(A) achievement in the areas of reading, writing, 
                English language acquisition, problem solving, and 
                numeracy;
                    ``(B) receipt of a secondary school diploma or its 
                recognized equivalent;
                    ``(C) entry into a postsecondary school, a job 
                retraining program, or employment or career 
                advancement, including the military; and
                    ``(D) such other indicators as the State may 
                develop.
            ``(2) With respect to eligible participants in a program 
        who are children--
                    ``(A) improvement in ability to read on grade level 
                or reading readiness;
                    ``(B) school attendance;
                    ``(C) grade retention and promotion; and
                    ``(D) such other indicators as the State may 
                develop.''.
    (b) State Level Activities.--Section 1203(a) of the Elementary and 
Secondary Education Act of 1965 (20 U.S.C. 6363(a)) is amended--
            (1) in paragraph (1), by striking ``and'' at the end;
            (2) in paragraph (2), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(3) carrying out section 1210.''.
    (c) Award of Subgrants.--Paragraphs (3) and (4) of section 1208(b) 
of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 6368) 
are amended to read as follows:
            ``(3) Continuing eligibility.--In awarding subgrant funds 
        to continue a program under this part for the second, third, or 
        fourth year, the State educational agency shall evaluate the 
        program based on the indicators of program quality developed by 
        the State under section 1210. Such evaluation shall take place 
        after the conclusion of the startup period, if any.
            ``(4) Insufficient progress.--The State educational agency 
        may refuse to award subgrant funds if such agency finds that 
        the eligible entity has not sufficiently improved the 
        performance of the program, as evaluated based on the 
        indicators of program quality developed by the State under 
        section 1210, after--
                    ``(A) providing technical assistance to the 
                eligible entity; and
                    ``(B) affording the eligible entity notice and an 
                opportunity for a hearing.''.

SEC. 525. RESEARCH.

    The Elementary and Secondary Education Act of 1965 (20 U.S.C. 6301 
et seq.), as amended by section 524 of this Act, is further amended by 
inserting after section 1210 the following:

``SEC. 1211. RESEARCH.

    ``(a) In General.--The Secretary shall carry out, through grant or 
contract, research into the components of successful family literacy 
services. The purpose of the research shall be--
            ``(1) to improve the quality of existing programs assisted 
        under this part or other family literacy programs carried out 
        under this Act or the Adult Education Act (20 U.S.C. 1201 et 
        seq.); and
            ``(2) to develop models for new programs to be carried out 
        under this Act or the Adult Education Act.
    ``(b) Dissemination.--The National Institute for Literacy shall 
disseminate, pursuant to section 15107, the results of the research 
described in subsection (a) to States and recipients of subgrants under 
this part.''.

                  TITLE VI--TEACHER AND STUDENT SAFETY

SEC. 601. FINDINGS.

    Congress finds that--
            (1) the continued presence in schools of violent students 
        who are a threat to both teachers and other students is 
        incompatible with a safe learning environment;
            (2) unsafe school environments place students who are 
        already at risk of school failure for other reasons in further 
        jeopardy;
            (3) recently, over one-fourth of high school students 
        surveyed reported being threatened at school;
            (4) 2,000,000 more children are using drugs in 1997 than 
        were doing so a few short years prior to 1997;
            (5) nearly 1 out of every 20 students in 6th through 12th 
        grade uses drugs on school grounds;
            (6) more of our children are becoming involved with hard 
        drugs at earlier ages, as use of heroin and cocaine by 8th 
        graders has more than doubled since 1991; and
            (7) greater cooperation between schools, parents, law 
        enforcement, the courts, and the community is essential to 
        making our schools safe from drugs and violence.

SEC. 602. PURPOSE.

    It is the purpose of this title--
            (1) to urge States, State educational agencies, and local 
        educational agencies to provide comprehensive services to 
        victims of and witnesses to school violence;
            (2) to urge States, State educational agencies, and local 
        educational agencies to remove violent and drug selling student 
        offenders from school premises;
            (3) to urge States, State educational agencies, and local 
        educational agencies to report violent crimes and drug dealing 
        on school grounds to appropriate law enforcement authorities;
            (4) to provide incentive grants for States, State 
        educational agencies, and local educational agencies to involve 
        parents and community volunteers in efforts to improve school 
        safety; and
            (5) to provide incentive grants to States, State 
        educational agencies, and local educational agencies to develop 
        innovative programs to improve the safety of our Nation's 
        schools and to better serve at-risk students.

              Subtitle A--Student Safety and Family Choice

SEC. 611. STUDENT SAFETY AND FAMILY SCHOOL CHOICE.

    Subpart 1 of part A of title I of the Elementary and Secondary 
Education Act of 1965 (20 U.S.C. 6311 et seq.) is amended by inserting 
after section 1115A of such Act (20 U.S.C. 6316) the following:

``SEC. 1115B. STUDENT SAFETY AND FAMILY SCHOOL CHOICE.

    ``(a) In General.--Notwithstanding any other provision of law, if a 
student is eligible to be served under section 1115(b), or attends a 
school eligible for a schoolwide program under section 1114, and 
becomes a victim of a violent criminal offense while in or on the 
grounds of a public elementary school or secondary school that the 
student attends and that receives assistance under this part, then the 
local educational agency may use funds provided under this part or 
under any other Federal education program to pay the supplementary 
costs for such student to attend another school. The agency may use the 
funds to pay for the supplementary costs of such student to attend any 
other public or private elementary school or secondary school, 
including a religious school, in the same State as the school where the 
criminal offense occurred, that is selected by the student's parent. 
The State educational agency shall determine what actions constitute a 
violent criminal offense for purposes of this section.
    ``(b) Supplementary Costs.--The supplementary costs referred to in 
subsection (a) shall not exceed--
            ``(1) in the case of a student for whom funds under this 
        section are used to enable the student to attend a public 
        elementary school or secondary school served by a local 
        educational agency that also serves the school where the 
        violent criminal offense occurred, the costs of supplementary 
        educational services and activities described in section 
        1114(b) or 1115(c) that are provided to the student;
            ``(2) in the case of a student for whom funds under this 
        section are used to enable the student to attend a public 
        elementary school or secondary school served by a local 
        educational agency that does not serve the school where the 
        violent criminal offense occurred but is located in the same 
        State--
                    ``(A) the costs of supplementary educational 
                services and activities described in section 1114(b) or 
                1115(c) that are provided to the student; and
                    ``(B) the reasonable costs of transportation for 
                the student to attend the school selected by the 
                student's parent; and
            ``(3) in the case of a student for whom funds under this 
        section are used to enable the student to attend a private 
        elementary school or secondary school, including a religious 
        school, the costs of tuition, required fees, and the reasonable 
        costs of such transportation.
    ``(c) Construction.--Nothing in this Act or any other Federal law 
shall be construed to prevent a parent assisted under this section from 
selecting the public or private, including religious, elementary school 
or secondary school that a child of the parent will attend within the 
State.
    ``(d) Consideration of Assistance.--Subject to subsection (h), 
assistance made available under this section that is used to pay the 
costs for a student to attend a private or religious school shall not 
be considered to be Federal aid to the school, and the Federal 
Government shall have no authority to influence or regulate the 
operations of a private or religious school as a result of assistance 
received under this section.
    ``(e) Continuing Eligibility.--A student assisted under this 
section shall remain eligible to continue receiving assistance under 
this section for at least 3 academic years without regard to whether 
the student is eligible for assistance under section 1114 or 1115(b).
    ``(f) Tuition Charges.--Assistance under this section may not be 
used to pay tuition or required fees at a private elementary school or 
secondary school in an amount that is greater than the tuition and 
required fees paid by students not assisted under this section at such 
school.
    ``(g) Special Rule.--Any school receiving assistance provided under 
this section shall comply with title VI of the Civil Rights Act of 1964 
(42 U.S.C. 2000d et seq.) and not discriminate on the basis of race, 
color, or national origin.
    ``(h) Assistance; Taxes and Other Federal Programs.--
            ``(1) Assistance to families, not schools.--Assistance 
        provided under this section shall be considered to be aid to 
        families, not schools. Use of such assistance at a school shall 
        not be construed to be Federal financial aid or assistance to 
        that school.
            ``(2) Taxes and determinations of eligibility for other 
        federal programs.--Assistance provided under this section to a 
        student shall not be considered to be income of the student or 
the parent of such student for Federal, State, or local tax purposes or 
for determining eligibility for any other Federal program.
    ``(i) Part B of the Individuals With Disabilities Education Act.--
Nothing in this section shall be construed to affect the requirements 
of part B of the Individuals with Disabilities Education Act (20 U.S.C. 
1411 et seq.).
    ``(j) Maximum Amount.--Notwithstanding any other provision of this 
section, the amount of assistance provided under this part for a 
student shall not exceed the per pupil expenditure for elementary or 
secondary education, as appropriate, by the local educational agency 
that serves the school where the criminal offense occurred for the 
fiscal year preceding the fiscal year for which the determination is 
made.''.

SEC. 612. TRANSFER OF REVENUES.

    (a) In General.--Notwithstanding any other provision of Federal 
law, a State, a State educational agency, or a local educational agency 
may transfer any non-Federal public funds associated with the education 
of a student who is a victim of a violent criminal offense while in or 
on the grounds of a public elementary school or secondary school served 
by a local educational agency to another local educational agency or to 
a private elementary school or secondary school, including a religious 
school.
    (b) Definitions.--For the purpose of subsection (a), the terms 
``elementary school'', ``secondary school'', ``local educational 
agency'', and ``State educational agency'' have the meanings given such 
terms in section 14101 of the Elementary and Secondary Education Act of 
1965 (20 U.S.C. 8801).

  Subtitle B--Victim and Witness Assistance Programs for Teachers and 
                                Students

SEC. 621. AMENDMENTS TO VICTIMS OF CRIME ACT OF 1984.

    (a) Victim Compensation.--Section 1403 of the Victims of Crime Act 
of 1984 (42 U.S.C. 10602) is amended by adding at the end the 
following:
    ``(f) Victims of School Violence.--Notwithstanding any other 
provision of law, an eligible crime victim compensation program may 
expend funds granted under this section to offer compensation to 
elementary and secondary school students or teachers who are victims of 
elementary and secondary school violence (as school violence is defined 
under applicable State law).''.
    (b) Victim and Witness Assistance.--Section 1404(c) of the Victims 
of Crime Act of 1984 (42 U.S.C. 10603(c)) is amended by adding at the 
end the following:
            ``(5) Assistance for victims of and witnesses to school 
        violence.--Notwithstanding any other provision of law, the 
        Director may make a grant under this section for a 
        demonstration project or for training and technical assistance 
        services to a program that--
                    ``(A) assists State educational agencies and local 
                educational agencies (as the terms are defined in 
                section 14101 of the Elementary and Secondary Education 
                Act of 1965 (20 U.S.C. 8801)) in developing, 
                establishing, and operating programs that are designed 
                to protect victims of and witnesses to incidents of 
                elementary and secondary school violence (as school 
                violence is defined under applicable State law), 
                including programs designed to protect witnesses 
                testifying in school disciplinary proceedings; or
                    ``(B) supports a student safety toll-free hotline 
                that provides students and teachers in elementary and 
                secondary schools with confidential assistance relating 
                to the issues of school crime, violence, drug dealing, 
                and threats to personal safety.''.

    Subtitle C--Innovative Programs To Protect Teachers and Students

SEC. 631. DEFINITIONS.

    In this subtitle:
            (1) Elementary school, local educational agency, secondary 
        school, and state educational agency.--The terms ``elementary 
        school'', ``local educational agency'', ``secondary school'', 
        and ``State educational agency'' have the meanings given the 
        terms in section 14101 of the Elementary and Secondary 
        Education Act of 1965 (20 U.S.C. 8801).
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of Education.

SEC. 632. AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated such sums as may be 
necessary to carry out this subtitle.

SEC. 633. AUTHORIZATION FOR REPORT CARDS ON SCHOOLS.

    (a) In General.--The Secretary is authorized to award grants to 
States, State educational agencies, and local educational agencies to 
develop, establish, or conduct innovative programs to improve unsafe 
elementary schools or secondary schools.
    (b) Priority.--The Secretary shall give priority to awarding grants 
under subsection (a) to--
            (1) programs that provide parent and teacher notification 
        about incidents of physical violence, weapon possession, or 
        drug activity on school grounds as soon after the incident as 
        practicable;
            (2) programs that provide to parents and teachers an annual 
        report regarding--
                    (A) the total number of incidents of physical 
                violence, weapon possession, and drug activity on 
                school grounds;
                    (B) the percentage of students missing 10 or fewer 
                days of school; and
                    (C) a comparison, if available, to previous annual 
                reports under this paragraph, which comparison shall 
                not involve a comparison of more than 5 such previous 
                annual reports; and
            (3) programs to enhance school security measures that may 
        include--
                    (A) equipping schools with fences, closed circuit 
                cameras, and other physical security measures;
                    (B) providing increased police patrols in and 
                around elementary schools and secondary schools, 
                including canine patrols; and
                    (C) mailings to parents at the beginning of the 
                school year stating that the possession of a gun or 
                other weapon, or the sale of drugs in school, will not 
                be tolerated by school authorities.

SEC. 634. APPLICATION.

    (a) In General.--Each State, State educational agency, or local 
educational agency desiring a grant under this subtitle shall submit an 
application to the Secretary at such time, in such manner, and 
accompanied by such information as the Secretary may require.
    (b) Contents.--Each application submitted under subsection (a) 
shall contain an assurance that the State or agency has implemented or 
will implement policies that--
            (1) provide protections for victims and witnesses to school 
        crime, including protections for attendance at school 
        disciplinary proceedings;
            (2) expel students who, on school grounds, sell drugs, or 
        who commit a violent offense that causes serious bodily injury 
        of another student or teacher; and
            (3) require referral to law enforcement authorities or 
        juvenile authorities of any student who on school grounds--
                    (A) commits a violent offense resulting in serious 
                bodily injury; or
                    (B) sells drugs.
    (c) Special Rule.--For purposes of paragraphs (2) and (3) of 
subsection (b), State law shall determine what constitutes a violent 
offense or serious bodily injury.

                  TITLE VII--CHARTER SCHOOL EXPANSION

SEC. 701. SHORT TITLE.

    This title may be cited as the ``Charter Schools Expansion Act of 
1998''.

SEC. 702. CHARTER SCHOOLS.

    Part C of title X of the Elementary and Secondary Education Act of 
1965 (20 U.S.C. 8061 et seq.) is amended to read as follows:

                    ``PART C--PUBLIC CHARTER SCHOOLS

``SEC. 10301. FINDINGS AND PURPOSE.

    ``(a) Findings.--The Congress finds that--
            ``(1) enhancement of parent and student choices among 
        public schools can assist in promoting comprehensive 
        educational reform and give more students the opportunity to 
        learn to challenging State content standards and challenging 
        State student performance standards, if sufficiently diverse 
        and high-quality choices, and genuine opportunities to take 
        advantage of such choices, are available to all students;
            ``(2) useful examples of such choices can come from States 
        and communities that experiment with methods of offering 
        teachers and other educators, parents, and other members of the 
        public the opportunity to design and implement new public 
        schools and to transform existing public schools;
            ``(3) charter schools are a mechanism for testing a variety 
        of educational approaches and should, therefore, be exempted 
        from restrictive rules and regulations if the leadership of 
        such schools commits to attaining specific and ambitious 
        educational results for educationally disadvantaged students 
        consistent with challenging State content standards and 
        challenging State student performance standards for all 
        students;
            ``(4) charter schools, as such schools have been 
        implemented in a few States, can embody the necessary mixture 
        of enhanced choice, exemption from restrictive regulations, and 
        a focus on learning gains;
            ``(5) charter schools, including charter schools that are 
        schools-within-schools, can help reduce school size, which can 
        have a significant effect on student achievement;
            ``(6) the Federal Government should test, evaluate, and 
        disseminate information on a variety of charter school models 
        in order to help demonstrate the benefits of this promising 
        educational reform; and
            ``(7) there is a strong documented need for cash-flow 
        assistance to charter schools that are starting up, because 
        State and local operating revenue streams are not immediately 
        available.
    ``(b) Purposes.--The purposes of this part are--
            ``(1) to provide financial assistance for the planning, 
        design, and initial implementation of charter schools;
            ``(2) to facilitate the ability of States and localities to 
        increase the number of charter schools in the Nation to not 
        less than 3,000 by the year 2000; and
            ``(3) to evaluate the effects of charter schools, including 
        the effects on students, student achievement, staff, and 
        parents.

``SEC. 10302. PROGRAM AUTHORIZED.

    ``(a) In General.--The Secretary may award grants to State 
educational agencies having applications approved pursuant to section 
10303 to enable such agencies to conduct a charter school grant program 
in accordance with this part.
    ``(b) Special Rule.--If a State educational agency elects not to 
participate in the program authorized by this part or does not have an 
application approved under section 10303, the Secretary may award a 
grant to an eligible applicant that serves such State and has an 
application approved pursuant to section 10303.
    ``(c) Program Periods.--
            ``(1) Grants to states.--Grants awarded to State 
        educational agencies under this part for planning, design, or 
        initial implementation of charter schools, shall be awarded for 
        a period of not more than 5 years.
            ``(2) Grants to eligible applicants.--Grants awarded by the 
        Secretary to eligible applicants or subgrants awarded by State 
        educational agencies to eligible applicants under this part 
        shall be awarded for planning, design, or initial 
        implementation of charter schools, for a period not to exceed 
        more than 5 years, of which the eligible applicant may use--
                    ``(A) not more than 30 months for planning and 
                program design; and
                    ``(B) not more than 4 years for the initial 
                implementation of a charter school.
            ``(3) Transition rules.--
                    ``(A) Existing grants.--The Secretary may use funds 
                appropriated under this part--
                            ``(i) to continue to make payments to a 
                        State educational agency or an eligible 
                        applicant pursuant to a multiyear award made 
                        under this part prior to the date of enactment 
                        of the Charter Schools Expansion Act of 1998 in 
                        accordance with this part (as in effect on the 
                        day prior to such date); and
                            ``(ii) subject to subparagraph (B), to make 
                        payments to the agency or applicant under this 
                        part (as in effect on the day after such date).
                    ``(B) Maximum period.--The total period for which a 
                State educational agency or an eligible applicant may 
                receive a payment described in clause (i) or (ii) of 
                subparagraph (A) shall not exceed 5 years.
    ``(d) Limitation.--Except as otherwise provided under subsection 
(c), the Secretary shall not award more than 1 grant, and State 
educational agencies shall not award more than 1 subgrant, under this 
part to support a particular charter school.
    ``(e) Priority and Requirements.--
            ``(1) Priority.--
                    ``(A) Fiscal years 1998, 1999, and 2000.--In 
                awarding grants under this part for any of the fiscal 
                years 1998, 1999, and 2000 from funds appropriated 
                under section 10310 that are in excess of $51,000,000 
                for the fiscal year, the Secretary shall give priority 
                to State educational agencies in accordance with 
                subparagraph (C).
                    ``(B) Succeeding fiscal years.--In awarding grants 
                under this part for fiscal year 2001 or any succeeding 
                fiscal year from any funds appropriated under section 
                10310, the Secretary shall consider the number of 
                charter schools in each State and shall give priority 
                to State educational agencies in accordance with 
                subparagraph (C).
                    ``(C) Priority order.--In awarding grants under 
                subparagraphs (A) and (B), the Secretary, in the order 
                listed, shall give priority to a State that--
                            ``(i) meets all requirements of paragraph 
                        (2);
                            ``(ii) meets 2 requirements of paragraph 
                        (2); and
                            ``(iii) meets 1 requirement of paragraph 
                        (2).
            ``(2) Requirements.--The requirements referred to in 
        paragraph (1)(C) are as follows:
                    ``(A) The State law regarding charter schools 
                ensures that each charter school has a high degree of 
                autonomy over its budgets and expenditures.
                    ``(B) The State law regarding charter schools 
                provides that not less than 1 authorized public 
                chartering agency in the State allows for an increase 
                in the number of charter schools from 1 year to the 
                next year.
                    ``(C) The State law regarding charter schools 
                provides for periodic review and evaluation by the 
                authorized public chartering agency of each charter 
                school to determine whether the school is meeting or 
                exceeding the academic performance requirements and 
                goals for charter schools as set forth under State law 
                or the school's charter.

``SEC. 10303. APPLICATIONS.

    ``(a) Applications From State Agencies.--Each State educational 
agency desiring a grant from the Secretary under this part shall submit 
to the Secretary an application at such time, in such manner, and 
containing or accompanied by such information as the Secretary may 
require.
    ``(b) Contents of a State Educational Agency Application.--Each 
application submitted pursuant to subsection (a) shall--
            ``(1) describe the objectives of the State educational 
        agency's charter school grant program and a description of how 
        such objectives will be fulfilled, including steps taken by the 
        State educational agency to inform teachers, parents, and 
        communities of the State educational agency's charter school 
        grant program;
            ``(2) describe how the State educational agency will inform 
        each charter school of available Federal programs and funds 
        that each such school is eligible to receive and ensure that 
        each such school receives the school's appropriate share of 
        Federal education funds allocated by formula; and
            ``(3) contain assurances that the State educational agency 
        will require each eligible applicant desiring to receive a 
        subgrant to submit an application to the State educational 
        agency containing--
                    ``(A) a description of the educational program to 
                be implemented by the proposed charter school, 
                including--
                            ``(i) how the program will enable all 
                        students to meet challenging State student 
                        performance standards;
                            ``(ii) the grade levels or ages of children 
                        to be served; and
                            ``(iii) the curriculum and instructional 
                        practices to be used;
                    ``(B) a description of how the charter school will 
                be managed;
                    ``(C) a description of--
                            ``(i) the objectives of the charter school; 
                        and
                            ``(ii) the methods by which the charter 
                        school will determine the school's progress 
                        toward achieving those objectives;
                    ``(D) a description of the administrative 
                relationship between the charter school and the 
                authorized public chartering agency;
                    ``(E) a description of how parents and other 
                members of the community will be involved in the design 
                and implementation of the charter school;
                    ``(F) a description of how the authorized public 
                chartering agency will provide for continued operation 
                of the school once the Federal grant has expired, if 
                such agency determines that the school has met the 
                objectives described in subparagraph (C)(i);
                    ``(G) a request and justification for waivers of 
                any Federal statutory or regulatory provisions that the 
                applicant believes are necessary for the successful 
                operation of the charter school, and a description of 
                any State or local rules, generally applicable to 
                public schools, that will be waived for, or otherwise 
                not apply to, the school;
                    ``(H) a description of how the subgrant funds or 
                grant funds, as appropriate, will be used, including a 
                description of how such funds will be used in 
                conjunction with other Federal programs administered by 
                the Secretary;
                    ``(I) a description of how students in the 
                community will be--
                            ``(i) informed about the charter school; 
                        and
                            ``(ii) given an equal opportunity to attend 
                        the charter school;
                    ``(J) an assurance that the eligible applicant will 
                annually provide the Secretary and the State 
                educational agency such information as may be required 
                to determine if the charter school is making 
                satisfactory progress toward achieving the objectives 
                described in subparagraph (C)(i);
                    ``(K) an assurance that the applicant will 
                cooperate with the Secretary and the State educational 
                agency in evaluating the program assisted under this 
                part;
                    ``(L) such other information and assurances as the 
                Secretary and the State educational agency may require; 
                and
            ``(4) describe how the State educational agency will 
        disseminate best or promising practices of charter schools in 
        such State to each local educational agency in the State.
    ``(c) Contents of Eligible Applicant Application.--Each eligible 
applicant desiring a grant pursuant to section 10302 shall submit an 
application to the State educational agency or Secretary, respectively, 
at such time, in such manner, and accompanied by such information as 
the State educational agency or Secretary, respectively, may reasonably 
require.
    ``(d) Contents of Application.--Each application submitted pursuant 
to subsection (c) shall contain--
            ``(1) the information and assurances described in 
        subparagraphs (A) through (L) of subsection (b)(3), except that 
        for purposes of this subsection subparagraphs (J), (K), and (L) 
        of such subsection shall be applied by striking `and the State 
        educational agency' each place such term appears; and
            ``(2) assurances that the State educational agency--
                    ``(A) will grant, or will obtain, waivers of State 
                statutory or regulatory requirements; and
                    ``(B) will assist each subgrantee in the State in 
                receiving a waiver under section 10304(e).

``SEC. 10304. ADMINISTRATION.

    ``(a) Selection Criteria for State Educational Agencies.--The 
Secretary shall award grants to State educational agencies under this 
part on the basis of the quality of the applications submitted under 
section 10303(b), after taking into consideration such factors as--
            ``(1) the contribution that the charter schools grant 
        program will make to assisting educationally disadvantaged and 
        other students to achieving State content standards and State 
        student performance standards and, in general, a State's 
        education improvement plan;
            ``(2) the degree of flexibility afforded by the State 
        educational agency to charter schools under the State's charter 
        schools law;
            ``(3) the ambitiousness of the objectives for the State 
        charter school grant program;
            ``(4) the quality of the strategy for assessing achievement 
        of those objectives;
            ``(5) the likelihood that the charter school grant program 
        will meet those objectives and improve educational results for 
        students; and
            ``(6) the number of charter schools created under this part 
        in the State.
    ``(b) Selection Criteria for Eligible Applicants.--The Secretary 
shall award grants to eligible applicants under this part on the basis 
of the quality of the applications submitted under section 10303(c), 
after taking into consideration such factors as--
            ``(1) the quality of the proposed curriculum and 
        instructional practices;
            ``(2) the degree of flexibility afforded by the State 
        educational agency and, if applicable, the local educational 
        agency to the charter school;
            ``(3) the extent of community support for the application;
            ``(4) the ambitiousness of the objectives for the charter 
        school;
            ``(5) the quality of the strategy for assessing achievement 
        of those objectives; and
            ``(6) the likelihood that the charter school will meet 
        those objectives and improve educational results for students.
    ``(c) Peer Review.--The Secretary, and each State educational 
agency receiving a grant under this part, shall use a peer review 
process to review applications for assistance under this part.
    ``(d) Diversity of Projects.--The Secretary and each State 
educational agency receiving a grant under this part, shall award 
subgrants under this part in a manner that, to the extent possible, 
ensures that such grants and subgrants--
            ``(1) are distributed throughout different areas of the 
        Nation and each State, including urban and rural areas; and
            ``(2) will assist charter schools representing a variety of 
        educational approaches, such as approaches designed to reduce 
        school size.
    ``(e) Waivers.--The Secretary may waive any statutory or regulatory 
requirement over which the Secretary exercises administrative authority 
except any such requirement relating to the elements of a charter 
school described in section 10309(1), if--
            ``(1) the waiver is requested in an approved application 
        under this part; and
            ``(2) the Secretary determines that granting such a waiver 
        will promote the purpose of this part.
    ``(f) Use of Funds.--
            ``(1) State educational agencies.--Each State educational 
        agency receiving a grant under this part shall use such grant 
        funds to award subgrants to 1 or more eligible applicants in 
        the State to enable such applicant to plan, design or initially 
        implement a charter school in accordance with this part.
            ``(2) Eligible applicants.--Each eligible applicant 
        receiving funds from the Secretary or a State educational 
        agency shall use such funds to plan, design or initially 
        implement a charter school in accordance with this part.
            ``(3) Allowable activities for grants.--An eligible 
        applicant receiving a grant or subgrant under section 10302(c) 
        may use the grant or subgrant funds only for--
                    ``(A) post-award planning or design of the 
                educational program, which may include--
                            ``(i) refinement of the desired educational 
                        results and of the methods for measuring 
                        progress toward achieving those results; and
                            ``(ii) professional development of teachers 
                        and other staff who will work in the charter 
                        school; and
                    ``(B) initial implementation of the charter school, 
                which may include--
                            ``(i) informing the community about the 
                        school;
                            ``(ii) acquiring necessary equipment and 
                        educational materials and supplies;
                            ``(iii) acquiring or developing curriculum 
                        materials; and
                            ``(iv) other initial operational costs that 
                        cannot be met from State or local sources.
            ``(4) Administrative expenses.--Each State educational 
        agency receiving a grant pursuant to this part may reserve not 
        more than 5 percent of such grant funds for administrative 
        expenses associated with the charter school grant program 
        assisted under this part.

``SEC. 10305. NATIONAL ACTIVITIES.

    ``(a) Reservation for National Activities.--The Secretary shall 
reserve for each fiscal year the lesser of 5 percent of the amount 
appropriated to carry out this part for the fiscal year or $5,000,000, 
to carry out the national activities described in subsection (c).
    ``(b) Priority.--The Secretary shall give the highest priority to 
carrying out the national activity described in subsection (c)(2).
    ``(c) National Activities.--The national activities referred to in 
subsection (a) are as follows:
            ``(1) To provide charter schools, either directly or 
        through the State educational agency, with information 
        regarding available education funds that such school is 
        eligible to receive, and assistance in applying for Federal 
        education funds which are allocated by formula, including 
        filing deadlines and submission of applications.
            ``(2) To provide, through 1 or more contracts using a 
        competitive bidding process--
                    ``(A) charter schools with assistance in accessing 
                private capital;
                    ``(B) pilot projects in a variety of States to 
                better understand and improve access to private capital 
                by charter schools; and
                    ``(C) collection on a nationwide basis, of 
                information regarding successful programs that access 
                private capital for charter schools and disseminate any 
                such relevant information and model descriptions to all 
                charter schools.
            ``(3) To provide for the completion of the 4-year national 
        study (which began in 1995) of charter schools and any related 
        evaluations or studies.
            ``(4) To provide--
                    ``(A) information to applicants for assistance 
                under this part;
                    ``(B) assistance, to applicants for assistance 
                under this part, with the preparation of applications 
                under section 10303;
                    ``(C) assistance in the planning and startup of 
                charter schools;
                    ``(D) ongoing training and technical assistance to 
                existing charter schools; and
                    ``(E) for the dissemination of best practices in 
                charter schools to other public schools.

``SEC. 10306. PART A, TITLE I ALLOCATION DURING FIRST YEAR AND FOR 
              SUCCESSIVE ENROLLMENT EXPANSIONS.

    ``For purposes of the allocation to schools by the States or their 
agencies of funds under part A of title I, or of any other Federal 
educational assistance funds, the Secretary and each State educational 
agency shall take such measures not later than 6 months after the date 
of the enactment of the Charter Schools Amendments of 1998 as are 
necessary to ensure that every charter school receives the Federal 
funding for which the charter school is eligible in the calendar year 
in which the charter school first opens, notwithstanding the fact that 
the identity and characteristics of the students enrolling in that 
school are not fully and completely determined until that school 
actually opens. These measures shall similarly ensure that every 
charter school expanding the charter school's enrollment in any 
subsequent year of operation receives the Federal funding for which the 
charter school is eligible during the calendar year of such expansion.

``SEC. 10307. RECORDS TRANSFER.

    ``State and local educational agencies, to the extent practicable, 
shall ensure that a student's records and if applicable a student's 
individualized education program as defined in section 602(11) of the 
Individuals with Disabilities Education Act (20 U.S.C. 1401(11)), are 
transferred to the charter school upon transfer of a student to a 
charter school in accordance with applicable State law.

``SEC. 10308. PAPERWORK REDUCTION.

    ``To the extent practicable, the Secretary and each authorized 
public chartering agency, shall ensure that implementation of this part 
results in a minimum of paperwork for any eligible applicant or charter 
school.

``SEC. 10309. DEFINITIONS.

    ``In this part:
            ``(1) Authorized public chartering agency.--The term 
        `authorized public chartering agency' means a State educational 
        agency, local educational agency, or other public entity that 
        has the authority pursuant to State law and approved by the 
        Secretary to authorize or approve a charter school.
            ``(2) Charter school.--The term `charter school' means a 
        public school that--
                    ``(A) in accordance with a specific State charter 
                school statute, is exempted from significant State or 
                local rules that inhibit the flexible operation and 
                management of public schools, but not from any rules 
                relating to the other requirements of this paragraph;
                    ``(B) is created by a developer as a public school, 
                or is adapted by a developer from an existing public 
                school, and is operated under public supervision and 
                direction;
                    ``(C) operates in pursuit of a specific set of 
                educational objectives determined by the school's 
                developer and agreed to by the authorized public 
                chartering agency;
                    ``(D) provides a program of elementary or secondary 
                education, or both;
                    ``(E) is nonsectarian in its programs, admissions 
                policies, employment practices, and all other 
                operations, and is not affiliated with a sectarian 
                school or religious institution;
                    ``(F) does not charge tuition;
                    ``(G) complies with the Age Discrimination Act of 
                1975, title VI of the Civil Rights Act of 1964, title 
                IX of the Education Amendments of 1972, section 504 of 
                the Rehabilitation Act of 1973, and part B of the 
                Individuals with Disabilities Education Act;
                    ``(H) is a school to which parents choose to send 
                their children, and that admits students on the basis 
                of a lottery, if more students apply for admission than 
                can be accommodated;
                    ``(I) agrees to comply with the same Federal and 
                State audit requirements as do other elementary and 
                secondary schools in the State, unless such 
                requirements are specifically waived for the purpose of 
                this program;
                    ``(J) meets all applicable Federal, State, and 
                local health and safety requirements;
                    ``(K) operates in accordance with State law; and
                    ``(L) has a written performance contract with the 
                authorized public chartering agency in the State.
            ``(3) Developer.--The term `developer' means an individual 
        or group of individuals (including a public or private 
        nonprofit organization), which may include teachers, 
        administrators and other school staff, parents, or other 
        members of the local community in which a charter school 
        project will be carried out.
            ``(4) Eligible applicant.--The term `eligible applicant' 
        means an authorized public chartering agency participating in a 
        partnership with a developer to establish a charter school in 
        accordance with this part.

``SEC. 10310. AUTHORIZATION OF APPROPRIATIONS.

    ``For the purpose of carrying out this part, there are authorized 
to be appropriated $100,000,000 for fiscal year 1998 and such sums as 
may be necessary for each of the 4 succeeding fiscal years.''.

      TITLE VIII--FULL FUNDING FOR PART B OF THE INDIVIDUALS WITH 
                       DISABILITIES EDUCATION ACT

SEC. 801. FULL FUNDING FOR PART B OF THE INDIVIDUALS WITH DISABILITIES 
              EDUCATION ACT.

    Section 611(j) of the Individuals with Disabilities Education Act 
(20 U.S.C. 1411(j)) is amended by striking ``such sums as may be 
necessary'' and inserting ``not less than $5,301,000,000 for fiscal 
year 1999, not less than $6,801,000,000 for fiscal year 2000, not less 
than $8,301,000,000 for fiscal year 2001, not less than $9,801,000,000 
for fiscal year 2002, not less than $11,301,000,000 for fiscal year 
2003, not less than $13,101,000,000 for fiscal year 2004, and such sums 
as may be necessary for each succeeding fiscal year''.
                                 <all>