    [Congressional Bills 107th Congress]
    [From the U.S. Government Publishing Office]
    [H.R. 1 Reported in House (RH)]

    107th CONGRESS
      1st Session
                                     H. R. 1

                          [Report No. 107-63, Part I]

      To close the achievement gap with accountability, flexibility, and
                    choice, so that no child is left behind.

    _______________________________________________________________________

                        IN THE HOUSE OF REPRESENTATIVES

                                 March 22, 2001

      Mr. Boehner (for himself, Mr. Castle, Mr. McKeon, Mr. Hastert, Mr.
    Armey, Mr. DeLay, Mr. Watts of Oklahoma, Ms. Pryce of Ohio, Mr. Dreier,
    Mr. Petri, Mr. Schaffer, Mr. Isakson, Mr. Ballenger, Mr. Sam Johnson of
    Texas, Mr. Greenwood, Mr. Graham, Mr. Norwood, Mr. Upton, Mr. Hilleary,
      Mr. Ehlers, Mr. Fletcher, Mr. DeMint, Mrs. Biggert, Mr. Tiberi, Mr.
     Keller, Mr. Osborne, Mr. Culberson, Mr. Oxley, Mr. Nussle, Mr. Wolf,
          Mr. Gekas, Mr. Combest, Mr. Kolbe, Mr. Baker, Mr. Weldon of
         Pennsylvania, Mr. Shays, Mr. Gillmor, Mr. Goss, Mr. Camp, Mr.
    Cunningham, Mr. Hobson, Mr. Bachus, Mr. Calvert, Mr. Collins, Mr. Deal
     of Georgia, Mr. Diaz-Balart, Mr. Horn, Mr. Kingston, Mr. Linder, Mr.
      McInnis, Mr. Miller of Florida, Mr. Royce, Mr. Portman, Mr. Barr of
     Georgia, Mr. Burr of North Carolina, Mr. Chambliss, Mr. Ehrlich, Mr.
    LaTourette, Mr. Radanovich, Mr. Cooksey, Mrs.  Northup, Mr. Peterson of
      Pennsylvania, Mr. Pickering, Mr. Shimkus, Mr. Sununu, Mr. Fossella,
       Mrs.  Bono, Mr. Green of Wisconsin, Mr. Hayes, Mr. Gary Miller of
     California, Mr. Ose, Mr. Sweeney, Mr. Crenshaw, Ms.  Hart, Mr. Issa,
     Mr. Putnam, and Mr. Schrock) introduced the following bill; which was
            referred to the Committee on Education and the Workforce

                                  May 14, 2001

      Additional sponsors: Ms. Granger, Mr. Frelinghuysen, Mr. Mica, Mr.
     Tiahrt, Mr. Bonilla, Mr. Traficant, Mr. Brown of South Carolina, and
                                  Mrs. Roukema

                                  May 14, 2001

        Reported with an amendment and referred to the Committee on the
        Judiciary for a period ending not later than May 15, 2001, for
      consideration of such provisions of the bill and amendment as fall
    within the jurisdiction of that committee pursuant to clause 1(k), rule
                          X, and ordered to be printed
     [Strike out all after the enacting clause and insert the part printed
                                   in italic]
     [For text of introduced bill, see copy of bill as introduced on March
                                   22, 2001]

    _______________________________________________________________________

                                     A BILL

      To close the achievement gap with accountability, flexibility, and
                    choice, so that no child is left behind.

        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 ``No Child Left Behind Act of 2001''.

    SEC. 2. REFERENCES.

        Except as otherwise specifically provided in this Act, whenever in
    this Act an amendment or repeal is expressed as the amendment or repeal
    of a section or other provision, the reference shall be considered to
    be made to a section or other provision of the Elementary and Secondary
    Education Act of 1965 (20 U.S.C. 6301 et seq.).

    SEC. 3. TRANSITION.

        Except as otherwise specifically provided in this Act, or any
    amendment made by this Act, any person or agency that was awarded a
    grant under the Elementary and Secondary Education Act of 1965 (20
    U.S.C. 6301 et seq.) prior to the date of the enactment of this Act
    shall continue to receive funds in accordance with the terms of such
    award, except that such funds may not be provided after the date that
    is one year after the effective date of this Act.

    SEC. 4. TABLE OF CONTENTS.

      The table of contents for this Act is as follows:

    Sec. 1. Short title.
    Sec. 2. References.
    Sec. 3. Transition.
    Sec. 4. Table of contents.
    Sec. 5. Effective date.

        TITLE I--IMPROVING THE ACADEMIC PERFORMANCE OF THE DISADVANTAGED

                             Part A--Basic Program

    Sec. 101. Disadvantaged children meet high academic standards.
    Sec. 102. Authorization of appropriations.
    Sec. 103. Reservation for school improvement.
    Sec. 104. Basic programs.
    Sec. 105. School choice.
    Sec. 106. Academic assessment and local educational agency and school
                                improvement.
    Sec. 107. State assistance for school support and improvement.
    Sec. 108. Academic achievement awards program.

               Part B--Student Reading Skills Improvement Grants

    Sec. 111. Reading first; early reading first.
    Sec. 112. Amendments to Even Start.
    Sec. 113. Inexpensive book distribution program.

                    Part C--Education of Migratory Children

    Sec. 121. State allocations.
    Sec. 122. State applications; services.
    Sec. 123. Authorized activities.
    Sec. 124. Coordination of migrant education activities.

                     Part D--Neglected or Delinquent Youth

    Sec. 131. Neglected or delinquent youth.
    Sec. 132. Findings.
    Sec. 133. Allocation of funds.
    Sec. 134. State plan and State agency applications.
    Sec. 135. Use of funds.
    Sec. 136. Transition services.
    Sec. 137. Purpose.
    Sec. 138. Programs operated by local educational agencies.
    Sec. 139. Local educational agency applications.
    Sec. 140. Uses of funds.
    Sec. 141. Program requirements.
    Sec. 142. Program evaluations.

                 Part E--Federal Evaluations and Demonstrations

    Sec. 151. Evaluations.
    Sec. 152. Demonstrations of innovative practices.
    Sec. 153. Ellender-close up fellowship program; dropout reporting.

                      Part F--Comprehensive School Reform

    Sec. 161. School reform.

               Part G--Rural Education Flexibility and Assistance

    Sec. 171. Rural education.

                     Part H--General Provisions of Title I

    Sec. 181. General provisions.

         TITLE II--PREPARING, TRAINING, AND RECRUITING QUALITY TEACHERS

    Sec. 201. Teacher quality training and recruiting fund.
    Sec. 202. National writing project.
    Sec. 203. Civic education; teacher liability protection.

       TITLE III--EDUCATION OF LIMITED ENGLISH PROFICIENT AND IMMIGRANT
                  CHILDREN; INDIAN AND ALASKA NATIVE EDUCATION

     Part A--Education of Limited English Proficient and Immigrant Children

    Sec. 301. Programs authorized.
    Sec. 302. Conforming amendment to Department of Education Organization
                                Act.

                   Part B--Indian and Alaska Native Education

    Sec. 311. Elementary and Secondary Education Act of 1965.
    Sec. 312. Alaska Native education.
    Sec. 313. Amendments to the education amendments of 1978.
    Sec. 314. Tribally Controlled Schools Act of 1988.

      TITLE IV--PROMOTING INFORMED PARENTAL CHOICE AND INNOVATIVE PROGRAMS

                          Part A--Innovative Programs

    Sec. 401. Promoting informed parental choice and innovative programs.
    Sec. 402. Continuation of awards.

                         Part B--Public Charter Schools

    Sec. 411. Public charter schools.
    Sec. 412. Continuation of awards.

         Part C--Magnet Schools Assistance; Women's Educational Equity

    Sec. 421. Magnet schools assistance.
    Sec. 422. Women's educational equity.
    Sec. 423. Continuation of awards.

                         TITLE V--21st CENTURY SCHOOLS

    Sec. 501. Safe schools.

                          TITLE VI--IMPACT AID PROGRAM

    Sec. 601. Payments under section 8002 with respect to fiscal years in
                                which insufficient funds are appropriated.
    Sec. 602. Calculation of payment under section 8003 for small local
                                educational agencies.
    Sec. 603. Construction.
    Sec. 604. State consideration of payments in providing State aid.
    Sec. 605. Authorization of appropriations.
    Sec. 606. Redesignation of program.

                           TITLE VII--ACCOUNTABILITY

    Sec. 701. Flexibility and accountability.

                         TITLE VIII--GENERAL PROVISIONS

    Sec. 801. General provisions.
    Sec. 802. Comprehensive regional assistance centers.
    Sec. 803. National diffusion network.
    Sec. 804. Eisenhower regional mathematics and science education
                                consortia.
    Sec. 805. Technology-based technical assistance.
    Sec. 806. Regional technical support and professional development.

                       TITLE IX--MISCELLANEOUS PROVISIONS

                        Part A--Amendments to Other Acts

                  subpart 1--national education statistics act
    Sec. 901. Amendment tsubpart 2--homeless education
    Sec. 911. Short title.
    Sec. 912. Findings.
    Sec. 913. Purpose.
    Sec. 914. Education for homeless children and youth.
    Sec. 915. Technical amendment.

                                Part B--Repeals

    Sec. 921. Repeals.

    SEC. 5. EFFECTIVE DATE.

        Except as otherwise specifically provided in this Act, this Act,
    and the amendments made by this Act, shall take effect on October 1,
    2001, or on the date of the enactment of this Act, whichever occurs
    later.

        TITLE I--IMPROVING THE ACADEMIC PERFORMANCE OF THE DISADVANTAGED

                             PART A--BASIC PROGRAM

    SEC. 101. DISADVANTAGED CHILDREN MEET HIGH ACADEMIC STANDARDS.

        Section 1001 is amended to read as follows:

    ``SEC. 1001. FINDINGS; STATEMENT OF PURPOSE; AND RECOGNITION OF NEED.

        ``(a) Findings.--Congress finds the following:
                ``(1) The Constitution of the United States reserves to the
            States and to the people the responsibility for the general
            supervision of public education in kindergarten through the
            twelfth grade.
                ``(2) States, local educational agencies and schools should
            be given maximum flexibility in exchange for greater academic
            accountability, and be given greater freedom to build upon
            existing innovative approaches for education reform.
                ``(3) The best education decisions are made by those who
            know the students and who are responsible for implementing the
            decisions.
                ``(4) Educators and parents should retain the right and
            responsibility to educate their pupils and children free of
            excessive regulation by the Federal Government.
                ``(5) The Supreme Court has regarded the right of parents
            to direct the upbringing of their children as a fundamental
            right implicit in the concept of ordered liberty within the
            14th Amendment to the Constitution, as specified in Meyer v.
            Nebraska, 262 U.S. 390 (1923), and Pierce v. Society of
            Sisters, 268 U.S. 510 (1925).
                ``(6) Schools that enroll high concentrations of children
            living in poverty face the greatest challenges, but effective
            educational strategies based on scientifically based research
            can succeed in educating children to high academic standards.
                ``(7) High-poverty schools are much more likely to be
            identified as failing to meet State academic standards for
            satisfactory progress. As a result, these schools are generally
            the most in need of additional resources and technical
            assistance to build the capacity of these schools to address
            the many needs of their students.
                ``(8) The educational progress of children participating in
            programs under this title is closely associated with their
            being taught by a highly qualified staff, particularly in
            schools with the highest concentrations of poverty, where
            paraprofessionals, uncertified teachers, and teachers teaching
            out of field frequently provide instructional services.
                ``(9) Congress and the public would benefit from additional
            data evaluating the efficacy of the Elementary and Secondary
            Education Act of 1965.
                ``(10) Schools operating programs assisted under this part
            must be held accountable for the educational achievement of
            their students, when those students fail to demonstrate
            progress in achieving high academic standards, local
            educational agencies and States must take significant actions
            to improve the educational opportunities available to them.
        ``(b) Purpose and Intent.--The purpose and intent of this title are
    to ensure that all children have a fair and equal opportunity to obtain
    a high-quality education.
        ``(c) Recognition of Need.--The Congress recognizes the following:
                ``(1) Educational needs are particularly great for low-
            achieving children in our Nation's highest-poverty schools,
            children with limited English proficiency, children of migrant
            workers, children with disabilities, Indian children, children
            who are neglected or delinquent, and young children who are in
            need of reading assistance and family literacy assistance.
                ``(2) Despite more than 3 decades of Federal assistance, a
            sizable achievement gap remains between minority and
            nonminority students, and between disadvantaged students and
            their more advantaged peers.
                ``(3) Too many students attend local schools that fail to
            provide them with a quality education, and are given no
            alternatives to enable them to receive a quality education.
                ``(4) States, local educational agencies, and schools need
            to be held accountable for improving the academic achievement
            of all students, and for identifying and turning around low-
            performing schools.
                ``(5) States and local educational agencies need to ensure
            that high quality academic assessments, accountability systems,
            teacher preparation and training, curriculum, and instructional
            materials are aligned with challenging State academic standards
            so that students, teachers, parents, and administrators can
            measure progress against common expectations for student
            academic achievement.
                ``(6) Federal education assistance is intended not only to
            increase pupil achievement overall, but also more specifically
            and importantly, to help ensure that all students, especially
            the disadvantaged, meet challenging academic achievement
            standards. It can only be determined if schools, local
            educational agencies, and States are reaching this goal if
            student achievement results are reported specifically by
            disadvantaged and minority status.''.

    SEC. 102. AUTHORIZATION OF APPROPRIATIONS.

        Section 1002 is amended to read as follows:

    ``SEC. 1002. AUTHORIZATION OF APPROPRIATIONS.

        ``(a) Local Educational Agency Grants.--For the purpose of carrying
    out part A, other than section 1120(e), there are authorized to be
    appropriated $11,500,000,000 for fiscal year 2002, $13,000,000,000 for
    fiscal year 2003, $14,500,000,000 for fiscal year 2004, $16,000,000,000
    for fiscal year 2005, and $17,200,000,000 for fiscal year 2006.
        ``(b) Student Reading Skills Improvement Grants.--
                ``(1) Reading first.--For the purpose of carrying out
            subpart 1 of part B, there are authorized to be appropriated
            $900,000,000 for fiscal year 2002 and such sums as may be
            necessary for each of the 4 succeeding fiscal years.
                ``(2) Early reading first.--For the purpose of carrying out
            subpart 2 of part B, there are authorized to be appropriated
            $75,000,000 for fiscal year 2002 and such sums as may be
            necessary for each of the 4 succeeding fiscal years.
                ``(3) Even start.--For the purpose of carrying out subpart
            3 of part B, there are authorized to be appropriated
            $275,000,000 for fiscal year 2002 and such sums as may be
            necessary for each of the 4 succeeding fiscal years.
                ``(4) Inexpensive book distribution program.--For the
            purpose of carrying out subpart 4 of part B, there are
            authorized to be appropriated such sums as may be necessary for
            fiscal year 2002 and each of the 4 succeeding fiscal years.
        ``(c) Education of Migratory Children.--For the purpose of carrying
    out part C, there are authorized to be appropriated $420,000,000 for
    fiscal year 2002 and such sums as may be necessary for each of the 4
    succeeding fiscal years.
        ``(d) Prevention and Intervention Programs for Youth Who Are
    Neglected, Delinquent, or at Risk of Dropping Out.--For the purpose of
    carrying out part D, there are authorized to be appropriated
    $50,000,000 for fiscal year 2002 and such sums as may be necessary for
    each of the 4 succeeding fiscal years.
        ``(e) Comprehensive School Reform.--For the purpose of carrying out
    part F, there are authorized to be appropriated $260,000,000 for fiscal
    year 2002 and such sums as may be necessary for each of the 4
    succeeding fiscal years.
        ``(f) Rural Education.--For the purpose of carrying out part G,
    there are authorized to be appropriated $300,000,000 for fiscal year
    2002 and such sums as may be necessary for each of 4 succeeding fiscal
    years to be distributed equally between subparts 1 and 2.
        ``(g) Capital Expenses.--For the purpose of carrying out section
    1120(e), there are authorized to be appropriated $6,000,000 for fiscal
    year 2002, and such sums as may be necessary for fiscal year 2003.
        ``(h) Federal Activities.--
                ``(1) Sections 1501 and 1502.--(A) For the purpose of
            carrying out section 1501, there are authorized to be
            appropriated $9,000,000 for fiscal year 2002 and such sums as
            may be necessary for each of the 4 succeeding fiscal years.
                ``(B) For the purpose of carrying out section 1502, there
            are authorized to be appropriated such sums as may be necessary
            for fiscal year 2002 and for each of the 4 succeeding fiscal
            years.
                ``(2) Section 1503.--For the purpose of carrying out
            section 1503, there are authorized to be appropriated such sums
            as may be necessary for fiscal year 2002 and for each of the 4
            succeeding fiscal years.
        ``(i) State Administration.--
                ``(1) State reservation.--Each State may reserve, from the
            sum of the amounts it receives under parts A, C, and D of this
            title, an amount equal to the greater of 1 percent of the
            amount it received under such parts for fiscal year 2001, or
            $400,000 ($50,000 for each outlying area), including any funds
            it receives under paragraph (2), to carry out administrative
            duties assigned under parts A, C, and D.
                ``(2) Authorization of appropriations.--There are
            authorized to be appropriated $10,000,000 for fiscal year 2002
            and such sums as may be necessary for each of the 4 succeeding
            fiscal years for additional State administration grants. Any
            such additional grants shall be allocated among the States in
            proportion to the sum of the amounts received by each State for
            that fiscal year under parts A, C, and D of this title.
                ``(3) Special rule.--The amount received by each State
            under paragraphs (1) and (2) may not exceed the amount of State
            funds expended by the State educational agency to administer
            elementary and secondary education programs in such State.
        ``(j) Assistance for Local School Improvement.--
                ``(1) Program authorized.--The Secretary shall award grants
            to States to provide subgrants to local educational agencies
            for the purpose of providing assistance for school improvement
            consistent with section 1116. Such grants shall be allocated
            among States, the Bureau of Indian Affairs, and the outlying
            areas, in proportion to the grants received by the State, the
            Bureau of Indian Affairs, and the outlying areas for the fiscal
            year under parts A, C, and D of this title. The Secretary shall
            expeditiously allocate a portion of such funds to States for
            the purpose of assisting local educational agencies and schools
            that were in school improvement status on the date preceding
            the date of the enactment of the No Child Left Behind Act of
            2001.
                ``(2) Reallocations.--If a State does not apply for funds
            under this subsection, the Secretary shall reallocate such
            funds to other States in the same proportion funds are
            allocated under paragraph (1).
                ``(3) State applications.--Each State educational agency
            that desires to receive funds under this subsection shall
            submit an application to the Secretary at such time, and
            containing such information as the Secretary shall reasonably
            require, except that such requirement shall be waived if a
            State educational agency has submitted such information as part
            of its State plan under this part. Each State plan shall
            describe how such funds will be allocated to ensure that the
            State educational agency and local educational agencies comply
            with school improvement, corrective action, and restructuring
            requirements of section 1116.
                ``(4) Local educational agency grants.--A grant to a local
            educational agency under this subsection shall be--
                        ``(A) of sufficient size and scope to support the
                    activities required under sections 1116 and 1117, but
                    not less than $50,000 and not more than $500,000 to
                    each participating school;
                        ``(B) integrated with funds awarded by the State
                    under this Act; and
                        ``(C) renewable for 2 additional 1-year periods if
                    schools are making yearly progress consistent with
                    State and local educational agency plans developed
                    under section 1116.
                ``(5) Priority.--The State, in awarding such grants, shall
            give priority to local educational agencies with the lowest
            achieving schools, that demonstrate the greatest need for such
            funds, and that demonstrate the strongest commitment to making
            sure such funds are used to provide adequate resources to
            enable the lowest achieving schools to meet the yearly progress
            goals under State and local school improvement, corrective
            action, and restructuring plans under section 1116.
                ``(6) Administrative costs.--A State educational agency
            that receives a grant award under this subsection may reserve
            not more than 5 percent of such award for administration,
            evaluation, and technical assistance expenses.
                ``(7) Local awards.--Each local educational agency that
            applies for assistance under this subsection shall describe how
            it will provide the lowest achieving schools the resources
            necessary to meet yearly progress goals under State and local
            school improvement, corrective action, and restructuring plans
            under section 1116.
                ``(8) Authorization of appropriations.--For the purpose of
            carrying out this subsection, there are authorized to be
            appropriated $500,000,000 for fiscal year 2002 and such sums as
            may be necessary for each of the 4 succeeding fiscal years.''.

    SEC. 103. RESERVATION FOR SCHOOL IMPROVEMENT.

        Section 1003 is amended to read as follows:

    ``SEC. 1003. RESERVATION FOR SCHOOL IMPROVEMENT.

        ``(a) State Reservations.--Each State shall reserve 1 percent of
    the amount it receives under subpart 2 of part A for fiscal years 2002
    and 2003, and 3 percent of the amount received under such subpart for
    fiscal years 2004 through 2006, to carry out subsection (b) and to
    carry out the State's responsibilities under sections 1116 and 1117,
    including carrying out the State educational agency's statewide system
    of technical assistance and support for local educational agencies.
        ``(b) Uses.--Of the amount reserved under subsection (a) for any
    fiscal year, the State educational agency shall allocate at least 95
    percent of that amount directly to local educational agencies for
    schools identified for school improvement, corrective action, and
    restructuring under section 1116(c) that have the greatest need for
    that assistance in amounts sufficient to have a significant impact in
    improving those schools.
        ``(c) Priority.--The State educational agency, in allocating funds
    to local educational agencies under this section, shall give priority
    to local educational agencies that--
                ``(1) have the lowest achieving schools;
                ``(2) demonstrate the greatest need for such funds; and
                ``(3) demonstrate the strongest commitment to ensuring that
            such funds are used to enable the lowest achieving schools to
            meet the yearly progress goals under section 1116(b)(3)(A)(v).
        ``(d) Unused Funds.--If, after consultation with local educational
    agencies in the State, the State educational agency determines that the
    amount of funds reserved to carry out subsection (b) is greater than
    the amount needed to provide the assistance described in that
    subsection, it may allocate the excess amount to local educational
    agencies in accordance with either or both--
                ``(1) the relative allocations it made to those agencies
            for that fiscal year under subpart 2 of part A; or
                ``(2) section 1126(c).
        ``(e) Special Rule.--Notwithstanding any other provision of this
    section, the amount of funds reserved by the State under subsection (a)
    in any given fiscal year shall not decrease the amount of State funds
    each local educational agency receives below the amount received by
    such agency under subpart 2 in the preceding fiscal year.''.

    SEC. 104. BASIC PROGRAMS.

        The heading for part A of title I and sections 1111 through 1115
    are amended to read as follows:

       ``PART A--IMPROVING BASIC PROGRAMS OPERATED BY LOCAL EDUCATIONAL
                                    AGENCIES

                    ``Subpart 1--Basic Program Requirements

    ``SEC. 1111. STATE PLANS.

        ``(a) Plans Required.--
                ``(1) In general.--Any State desiring to receive a grant
            under this part shall submit to the Secretary, by March 1,
            2002, a plan, developed in consultation with local educational
            agencies, teachers, principals, pupil services personnel,
            administrators (including administrators of programs described
            in other parts of this title), other staff, and parents, that
            satisfies the requirements of this section and that is
            coordinated with other programs under this Act, the Individuals
            with Disabilities Education Act (20 U.S.C. 1400 et seq.), the
            Carl D. Perkins Vocational and Technical Education Act of 1998
            (20 U.S.C. 2301 et seq.), the Head Start Act (42 U.S.C. 9831 et
            seq.), and the McKinney-Vento Homeless Assistance Act (42
            U.S.C. 11431 et seq.).
                ``(2) Consolidated plan.--A State plan submitted under
            paragraph (1) may be submitted as part of a consolidated plan
            under section 8302.
        ``(b) Academic Standards, Academic Assessments, and
    Accountability.--
                ``(1) Challenging academic standards.--
                        ``(A) Each State plan shall demonstrate that the
                    State has adopted challenging academic content
                    standards and challenging student academic achievement
                    standards that will be used by the State, its local
                    educational agencies, and its schools to carry out this
                    part, except that a State shall not be required to
                    submit such standards to the Secretary.
                        ``(B) The academic standards required by
                    subparagraph (A) shall be the same academic standards
                    that the State applies to all schools and children in
                    the State.
                        ``(C) The State shall have such academic standards
                    for all public elementary and secondary school
                    children, including children served under this part, in
                    subjects determined by the State, but including at
                    least mathematics, reading or language arts, and
                    science (beginning in the 2005-2006 school year), which
                    shall include the same knowledge, skills, and levels of
                    achievement expected of all children.
                        ``(D) Academic standards under this paragraph shall
                    include--
                                ``(i) challenging academic content
                            standards in academic subjects that--
                                        ``(I) specify what children are
                                    expected to know and be able to do;
                                        ``(II) contain coherent and
                                    rigorous content; and
                                        ``(III) encourage the teaching of
                                    advanced skills; and
                                ``(ii) challenging student academic
                            achievement standards that--
                                        ``(I) are aligned with the State's
                                    academic content standards;
                                        ``(II) describe 2 levels of high
                                    performance (proficient and advanced)
                                    that determine how well children are
                                    mastering the material in the State
                                    academic content standards; and
                                        ``(III) describe a third level of
                                    performance (basic) to provide complete
                                    information about the progress of the
                                    lower performing children toward
                                    achieving to the proficient and
                                    advanced levels of performance.
                        ``(E) For the subjects in which students will be
                    served under this part, but for which a State is not
                    required by subparagraphs (A), (B), and (C) to develop,
                    and has not otherwise developed such academic
                    standards, the State plan shall describe a strategy for
                    ensuring that students are taught the same knowledge
                    and skills in such subjects and held to the same
                    expectations as are all children.
                        ``(F) Nothing in this part shall prohibit a State
                    from revising any standard adopted under this part
                    before or after the date of enactment of the No Child
                    Left Behind Act of 2001.
                ``(2) Accountability.--
                        ``(A) In general.--Each State plan shall
                    demonstrate that the State has developed and is
                    implementing a statewide State accountability system
                    that has been or will be effective in ensuring that all
                    local educational agencies, public elementary schools,
                    and public secondary schools make adequate yearly
                    progress as defined under subparagraph (B). Each State
                    accountability system shall--
                                ``(i) be based on the academic standards
                            and academic assessments adopted under
                            paragraphs (1) and (4) and take into account
                            the performance of all public school students;
                                ``(ii) be the same as the accountability
                            system the State uses for all public schools or
                            all local educational agencies in the State,
                            except that public schools and local
                            educational agencies not participating under
                            this part are not subject to the requirements
                            of section 1116; and
                                ``(iii) include rewards and sanctions the
                            State will use to hold local educational
                            agencies and public schools accountable for
                            student achievement and for ensuring that they
                            make adequate yearly progress in accordance
                            with the State's definition under subparagraph
                            (B).
                        ``(B) Adequate yearly progress.--Each State plan
                    shall demonstrate, based on academic assessments
                    described under paragraph (4), what constitutes
                    adequate yearly progress of the State, and of public
                    schools and local educational agencies in the State,
                    toward enabling all public school students to meet the
                    State's student academic achievement standards, while
                    working toward the goal of narrowing the achievement
                    gaps in the State, local educational agency, and
                    school.
                        ``(C) Definition.--`Adequate yearly progress' shall
                    be defined by the State in a manner that--
                                ``(i) applies the same high academic
                            standards of academic performance to all public
                            school students in the State;
                                ``(ii) measures the progress of public
                            schools and local educational agencies based
                            primarily on the academic assessments described
                            in paragraph (4);
                                ``(iii) measures the student dropout rate,
                            as defined for the Common Core of Data
                            maintained by the National Center for Education
                            Statistics established under section 403 of the
                            National Education Statistics Act of 1994 (20
                            U.S.C. 9002);
                                ``(iv) includes separate annual numerical
                            objectives for continuing and significant
                            improvement in each of the following (except
                            that disaggregation of data under subclauses
                            (II) and (III) shall not be required in a case
                            in which the number of students in a category
                            is insufficient to yield statistically reliable
                            information or the results would reveal
                            individually identifiable information about an
                            individual student):
                                ``(I) The achievement of all public school
                            students.
                                ``(II) The achievement of--
                                                ``(aa) economically
                                            disadvantaged students;
                                                ``(bb) students from major
                                            racial and ethnic groups;
                                                ``(cc) students with
                                            disabilities; and
                                                ``(dd) students with
                                            limited English proficiency;
                                ``(III) solely for the purpose of
                            determining adequate yearly progress of the
                            State, the acquisition of English language
                            proficiency by children with limited English
                            proficiency;
                                ``(v) at the State's discretion, may also
                            include other academic measures such as
                            promotion, completion of college preparatory
                            courses, and high school completion (and for
                            individual local educational agencies and
                            schools, the acquisition of English language
                            proficiency by children with limited English
                            proficiency), except that inclusion of such
                            other measures may not change which schools or
                            local educational agencies would otherwise be
                            subject to improvement or corrective action
                            under section 1116 if the discretionary
                            indicators were not included; and
                                ``(vi) includes a timeline that--
                                        ``(I) uses as a baseline year the
                                    year following the date of enactment of
                                    the No Child Left Behind Act of 2001;
                                        ``(II) establishes a target year by
                                    which all members of each group of
                                    students described in subclauses (I)
                                    and (II) of clause (iii) shall meet or
                                    exceed the State's proficient level of
                                    academic performance on the State
                                    academic assessment used for the
                                    purposes of this section and section
                                    1116, except that the target year shall
                                    not be more than 12 years from the
                                    baseline year; and
                                        ``(III) for each year until and
                                    including the target year, establishes
                                    annual goals for the academic
                                    performance of each group of students
                                    described in subclauses (I) and (II) of
                                    clause (iii) on the State academic
                                    assessment that--
                                                ``(aa) indicates a minimum
                                            percentage of students who must
                                            meet the proficient level on
                                            the academic assessment, such
                                            that the minimum percentage is
                                            the same for each group of
                                            students described in
                                            subclauses (I) and (II) of
                                            clause (iii); or
                                                ``(bb) indicates an annual
                                            minimum amount by which the
                                            percentage of students who meet
                                            the proficient level among each
                                            group of students described in
                                            subclauses (I) and (II) of
                                            clause (iii) shall increase,
                                            such that the minimum increase
                                            for each group is equal to or
                                            greater than 100 percent minus
                                            the percentage of the group
                                            meeting the proficient level in
                                            the baseline year divided by
                                            the number of years from the
                                            baseline year to the target
                                            year established under clause
                                            (I).
                        ``(D) Annual improvement for schools.--For a school
                    to make adequate yearly progress under subparagraph
                    (A), not less than 95 percent of each group of students
                    described in subparagraph (C)(iii)(II) who are enrolled
                    in the school are required to take the academic
                    assessments, consistent with section 612(a)(17)(A) of
                    the Individuals with Disabilities Education Act (20
                    U.S.C. 1412(a)(17)(A)) and paragraph (4)(G)(ii), on
                    which adequate yearly progress is based.
                        ``(E) Public notice and comment.--Each State shall
                    ensure that in developing its plan, it diligently seeks
                    public comment from a range of institutions and
                    individuals in the State with an interest in improved
                    student achievement and that the State makes and will
                    continue to make a substantial effort to ensure that
                    information under this part is widely known and
                    understood by the public, parents, teachers, and school
                    administrators throughout the State. Such efforts shall
                    include, at a minimum, publication of such information
                    and explanatory text, broadly to the public through
                    such means as the Internet, the media, and public
                    agencies.
                ``(3) State authority.--If a State educational agency
            provides evidence, which is satisfactory to the Secretary, that
            neither the State educational agency nor any other State
            government official, agency, or entity has sufficient
            authority, under State law, to adopt curriculum content and
            student academic achievement standards, and academic
            assessments aligned with such academic standards, which will be
            applicable to all students enrolled in the State's public
            schools, then the State educational agency may meet the
            requirements of this subsection by--
                        ``(A) adopting academic standards and academic
                    assessments that meet the requirements of this
                    subsection, on a statewide basis, limiting their
                    applicability to students served under this part; or
                        ``(B) adopting and implementing policies that
                    ensure that each local educational agency in the State
                    which receives grants under this part will adopt
                    curriculum content and student academic achievement
                    standards, and academic assessments aligned with such
                    standards, which meet all of the criteria in this
                    subsection and any regulations regarding such standards
                    and assessments which the Secretary may publish, and
                    which are applicable to all students served by each
                    such local educational agency.
                ``(4) Academic Assessments.--Each State plan shall
            demonstrate that the State has implemented a set of high-
            quality, yearly student academic assessments that include, at a
            minimum, academic assessments in mathematics, and reading or
            language arts, that will be used as the primary means of
            determining the yearly performance of the State and of each
            local educational agency and school in enabling all children to
            meet the State's challenging student academic achievement
            standards. Such assessments shall--
                        ``(A) be the same academic assessments used to
                    measure the performance of all children;
                        ``(B) be aligned with the State's challenging
                    content and student academic achievement standards and
                    provide coherent information about student attainment
                    of such standards;
                        ``(C) be used for purposes for which such
                    assessments are valid and reliable, and be consistent
                    with relevant, recognized professional and technical
                    standards for such assessments;
                        ``(D) for the purposes of this part, be scored to
                    ensure the performance of each student is evaluated
                    solely against the State's challenging academic content
                    standards and not relative to the score of other
                    students;
                        ``(E) except as otherwise provided for grades 3
                    through 8 under subparagraph (G), measure the
                    proficiency of students in, at a minimum, mathematics
                    and reading or language arts, and be administered not
                    less than once during--
                                ``(i) grades 3 through 5;
                                ``(ii) grades 6 through 9; and
                                ``(iii) grades 10 through 12;
                        ``(F) involve multiple up-to-date measures of
                    student achievement, including measures that assess
                    critical thinking skills and understanding;
                        ``(G) beginning not later than school year 2004-
                    2005, measure the performance of students against the
                    challenging State content and student academic
                    achievement standards in each of grades 3 through 8 in,
                    at a minimum, mathematics, and reading or language
                    arts, except that the Secretary may provide the State 1
                    additional year if the State demonstrates that
                    exceptional or uncontrollable circumstances, such as a
                    natural disaster or a precipitous and unforeseen
                    decline in the financial resources of the State,
                    prevented full implementation of the academic
                    assessments by that deadline and that it will complete
                    implementation within the additional 1-year period;
                        ``(H) provide for--
                                ``(i) the participation in such assessments
                            of all students;
                                ``(ii) the reasonable adaptations and
                            accommodations for students with disabilities
                            defined under 602(3) of the Individuals with
                            Disabilities Education Act (20 U.S.C. 1401(3))
                            necessary to measure the achievement of such
                            students relative to State content and State
                            student academic achievement standards;
                                ``(iii) the inclusion of limited English
                            proficient students who shall be assessed, to
                            the extent practicable, in the language and
                            form most likely to yield accurate and reliable
                            information on what such students know and can
                            do in content areas;
                                ``(iv) notwithstanding clause (iii), the
                            academic assessment (using tests written in
                            English) of reading or language arts of any
                            student who has attended school in the United
                            States (not including Puerto Rico) for 3 or
                            more consecutive school years, except if the
                            local educational agency determines, on a case-
                            by-case individual basis, that academic
                            assessments in another language and form would
                            likely yield more accurate and reliable
                            information on what such students know and can
                            do, the local educational agency may assess
                            such students in the appropriate language other
                            than English for 1 additional year;
                        ``(I) include students who have attended schools in
                    a local educational agency for a full academic year but
                    have not attended a single school for a full academic
                    year, except that the performance of students who have
                    attended more than 1 school in the local educational
                    agency in any academic year shall be used only in
                    determining the progress of the local educational
                    agency;
                        ``(J) produce individual student reports to be
                    provided to parents, which include academic assessment
                    scores, or other information on the attainment of
                    student academic achievement standards; and
                        ``(K) enable results to be disaggregated within
                    each State, local educational agency, and school by
                    gender, by each major racial and ethnic group, by
                    English proficiency status, by migrant status, by
                    students with disabilities as compared to nondisabled
                    students, and by economically disadvantaged students as
                    compared to students who are not economically
                    disadvantaged.
                ``(5) Special rule.--Academic assessment measures in
            addition to those in paragraph (4) that do not meet the
            requirements of such paragraph may be included as additional
            measures, but may not be used in lieu of the academic
            assessments required in paragraph (4). Results on any
            additional measures under this paragraph shall not change which
            schools or local educational agencies would otherwise be
            subject to improvement or corrective action under section 1116
            if the additional measures were not included.
                ``(6) Language assessments.--Each State plan shall identify
            the languages other than English that are present in the
            participating student population and indicate the languages for
            which yearly student academic assessments are not available and
            are needed. The State shall make every effort to develop such
            assessments and may request assistance from the Secretary if
            linguistically accessible academic assessment measures are
            needed. Upon request, the Secretary shall assist with the
            identification of appropriate academic assessment measures in
            the needed languages, but shall not mandate a specific academic
            assessment or mode of instruction.
                ``(7) Academic assessments of english language
            proficiency.--Each State plan shall demonstrate that local
            educational agencies in the State will, beginning no later than
            school year 2002-2003, annually assess the English proficiency
            of all students with limited English proficiency in their
            schools.
                ``(8) Requirement.--Each State plan shall describe--
                        ``(A) how the State educational agency will assist
                    each local educational agency and school affected by
                    the State plan to develop the capacity to comply with
                    each of the requirements of sections 1112(c)(1)(D),
                    1114(c), and 1115(c) that is applicable to such agency
                    or school;
                        ``(B) how the State educational agency will assist
                    each local educational agency and school affected by
                    the State plan to provide additional educational
                    assistance to individual students assessed as needing
                    help to achieve the State's challenging academic
                    standards.
                        ``(C) such other factors as the State considers
                    appropriate to provide students an opportunity to
                    achieve the knowledge and skills described in the
                    challenging academic content standards adopted by the
                    State.
                ``(9) Use of academic assessment results to improve student
            achievement.--Each State plan shall describe how the State will
            ensure that the results of the State assessments described in
            paragraph (4)--
                        ``(A) will be provided promptly, but not later than
                    the end of the school year (consistent with 1116, to
                    local educational agencies, schools, and teachers in a
                    manner that is clear and easy to understand; and
                        ``(B) be used by those local educational agencies,
                    schools, and teachers to improve the educational
                    achievement of individual students.
                ``(10) Technical assistance on academic assessment
            requirements.--The Secretary shall provide technical assistance
            to interested States regarding how to meet the requirements of
            paragraph (4).
        ``(c) Other Provisions To Support Teaching and Learning.--Each
    State plan shall contain assurances that--
                ``(1) the State shall produce, beginning with the 2003-2004
            school year, the annual State report cards described in
            subsection (h)(1);
                ``(2) the State will participate, beginning in school year
            2002-2003, in annual academic assessments of 4th and 8th grade
            reading and mathematics under--
                        ``(A) the State National Assessment of Educational
                    Progress carried out under section 411(b)(2) of the
                    National Education Statistics Act of 1994 (20 U.S.C.
                    9010(b)(2)); or
                        ``(B) another academic assessment selected by the
                    State which meets the criteria of section
                    7101(b)(1)(B)(ii) of this Act;
                ``(3) the State educational agency shall work with other
            agencies, including educational service agencies or other local
            consortia, and institutions to provide technical assistance to
            local educational agencies and schools to carry out the State
            educational agency's responsibilities under this part,
            including technical assistance in providing professional
            development under section 1119A and technical assistance under
            section 1117; and
                ``(4)(A) where educational service agencies exist, the
            State educational agency shall consider providing professional
            development and technical assistance through such agencies; and
                ``(B) where educational service agencies do not exist, the
            State educational agency shall consider providing professional
            development and technical assistance through other cooperative
            agreements such as through a consortium of local educational
            agencies;
                ``(5) the State educational agency shall notify local
            educational agencies and the public of the content and student
            academic achievement standards and academic assessments
            developed under this section, and of the authority to operate
            schoolwide programs, and will fulfill the State educational
            agency's responsibilities regarding local educational agency
            improvement and school improvement under section 1116,
            including such corrective actions as are necessary;
                ``(6) the State educational agency shall provide the least
            restrictive and burdensome regulations for local educational
            agencies and individual schools participating in a program
            assisted under this part;
                ``(7) the State educational agency shall inform the
            Secretary and the public of how Federal laws, if at all, hinder
            the ability of States to hold local educational agencies and
            schools accountable for student academic performance;
                ``(8) the State educational agency will encourage schools
            to consolidate funds from other Federal, State, and local
            sources for schoolwide reform in schoolwide programs under
            section 1114;
                ``(9) the State educational agency shall modify or
            eliminate State fiscal and accounting barriers so that schools
            can easily consolidate funds from other Federal, State, and
            local sources for schoolwide programs under section 1114;
                ``(10) the State educational agency has involved the
            committee of practitioners established under section 1603(b) in
            developing the plan and monitoring its implementation;
                ``(11) the State educational agency shall inform local
            educational agencies of the local educational agency's
            authority to transfer funds under title VII, to obtain waivers
            under title VIII and, if the State is an Ed-Flex Partnership
            State, to obtain waivers under the Education Flexibility
            Partnership Act of 1999 (20 U.S.C. 5891a et seq.); and
                ``(12) the State educational agency shall encourage local
            educational agencies and individual schools participating in a
            program assisted under this part to offer family literacy
            services (using funds under this part), if the agency or school
            determines that a substantial number of students served under
            this part by the agency or school have parents who do not have
            a high school diploma or its recognized equivalent or who have
            low levels of literacy.
        ``(d) Peer Review and Secretarial Approval.--The Secretary shall--
                ``(1) establish a peer review process to assist in the
            review of State plans;
                ``(2) approve a State plan within 120 days of its
            submission unless the Secretary determines that the plan does
            not meet the requirements of this section;
                ``(3) if the Secretary determines that the State plan does
            not meet the requirements of subsection (a), (b), or (c),
            immediately notify the State of such determination and the
            reasons for such determination;
                ``(4) not decline to approve a State's plan before--
                        ``(A) offering the State an opportunity to revise
                    its plan;
                        ``(B) providing technical assistance in order to
                    assist the State to meet the requirements under
                    subsections (a), (b), and (c); and
                        ``(C) providing a hearing; and
                ``(5) have the authority to disapprove a State plan for not
            meeting the requirements of this part, but shall not have the
            authority to require a State, as a condition of approval of the
            State plan, to include in, or delete from, such plan 1 or more
            specific elements of the State's academic content standards or
            to use specific academic assessment instruments or items.
        ``(e) Duration of the Plan.--
                ``(1) In general.--Each State plan shall--
                        ``(A) be submitted for the first year for which
                    this part is in effect after the date of the enactment
                    of the No Child Left Behind Act of 2001;
                        ``(B) remain in effect for the duration of the
                    State's participation under this part; and
                        ``(C) be periodically reviewed and revised by the
                    State, as necessary, to reflect changes in the State's
                    strategies and programs under this part.
                ``(2) Additional information.--If the State makes
            significant changes in its plan, such as the adoption of new or
            revised State academic content standards and State student
            achievement standards, new academic assessments, or a new
            definition of adequate yearly progress, the State shall submit
            such information to the Secretary.
        ``(f) Limitation on Conditions.--Officers and employees of the
    Federal Government are prohibited from mandating, directing, or
    controlling a State, local educational agency, or school's specific
    instructional content or student academic achievement standards and
    academic assessments, curriculum, or program of instruction, as a
    condition of eligibility to receive funds under this part.
        ``(g) Penalties.--
                ``(1) Failure to meet deadlines enacted in 1994.--
                        ``(A) In general.--If a State fails to meet the
                    deadlines established by the Improving America's
                    Schools Act of 1994 (or under any waiver granted by the
                    Secretary or under any compliance agreement with the
                    Secretary) for demonstrating that it has in place
                    challenging academic content standards and student
                    achievement standards, and a system for measuring and
                    monitoring adequate yearly progress, the Secretary
                    shall withhold 25 percent of the funds that would
                    otherwise be available for State administration and
                    activities in each year until the Secretary determines
                    that the State meets those requirements;
                        ``(B) No extension.--The Secretary shall not grant
                    any additional waivers of, or enter into any additional
                    compliance agreements to extend, the deadlines
                    described in subparagraph (A) for any State.
                ``(2) Failure to meet requirements enacted in 2001.--If a
            State fails to meet any of the requirements of this section,
            other than the requirements described in paragraph (1), the
            Secretary may withhold funds for State administration until the
            Secretary determines that the State has fulfilled those
            requirements.
        ``(h) Reports.--
                ``(1) Annual state report card.--
                        ``(A) In general.--Not later than the beginning of
                    the 2003-2004 school year, a State that receives
                    assistance under this Act shall prepare and disseminate
                    an annual State report card.
                        ``(B) Implementation.--The State report card shall
                    be--
                                ``(i) concise; and
                                ``(ii) presented in a format and manner
                            that parents can understand, and which, to the
                            extent practicable, shall be in a language the
                            parents can understand.
                        ``(C) Public dissemination.--The State shall widely
                    disseminate the information described in subparagraph
                    (D) to all schools and local educational agencies in
                    the State and make the information broadly available
                    through public means, such as posting on the Internet,
                    distribution to the media, and distribution through
                    public agencies.
                        ``(D) Required information.--The State shall
                    include in its annual State report card--
                                ``(i) information, in the aggregate, on
                            student achievement at each proficiency level
                            on the State academic assessments described in
                            subsection (b)(4)(F) (disaggregated by race,
                            ethnicity, gender, disability status, migrant
                            status, English proficiency, and status as
                            economically disadvantaged, except that such
                            disaggregation shall not be required in a case
                            in which the number of students in a category
                            is insufficient to yield statistically reliable
                            information or the results would reveal
                            individually identifiable information about an
                            individual student);
                                ``(ii) the percentage of students not
                            tested (disaggregated by the same categories
                            and subject to the same exception described in
                            clause (i));
                                ``(iii) the percentage of students who
                            graduate from high school within 4 years of
                            starting high school;
                                ``(iv) the percentage of students who take
                            and complete advanced placement courses as
                            compared to the population of the students
                            eligible to take such courses, and the rate of
                            passing of advanced placement tests;
                                ``(v) the professional qualifications of
                            teachers in the aggregate, including the
                            percentage of teachers teaching with emergency
                            or provisional qualifications, and the
                            percentage of class sections not taught by
                            fully qualified teachers; and
                                ``(vi) such other information (such as
                            dropout and school attendance rates; and
                            average class size by grade level) as the State
                            believes will best provide parents, students,
                            and other members of the public with
                            information on the progress of each of the
                            State's public schools.
                ``(2) Content of local educational agency report cards.--
                        ``(A) Minimum requirements.--The State shall ensure
                    that each local educational agency collects appropriate
                    data and includes in its annual report for each of its
                    schools, at a minimum--
                                ``(i) the information described in
                            paragraph (1)(D) for each local educational
                            agency and school; and
                                ``(ii)(I) in the case of a local
                            educational agency--
                                        ``(aa) the number and percentage of
                                    schools identified for school
                                    improvement and how long they have been
                                    so identified, including schools
                                    identified under section 1116(c) of
                                    this Act; and
                                        ``(bb) information that shows how
                                    students in its schools perform on the
                                    statewide academic assessment compared
                                    to students in the State as a whole;
                                    and
                                ``(II) in the case of a school--
                                        ``(aa) whether it has been
                                    identified for school improvement; and
                                        ``(bb) information that shows how
                                    its students performed on the statewide
                                    academic assessment compared to
                                    students in the local educational
                                    agency and the State as a whole.
                        ``(B) Other information.--A local educational
                    agency may include in its annual reports any other
                    appropriate information whether or not such information
                    is included in the annual State report.
                        ``(C) Public dissemination.--The local educational
                    agency shall, not later than the beginning of the 2003-
                    2004 school year, publicly disseminate the information
                    described in this paragraph to all schools in the
                    district and to all parents of students attending those
                    schools (to the extent practicable, in a language they
                    can understand), and make the information broadly
                    available through public means, such as posting on the
                    Internet, distribution to the media, and distribution
                    through public agencies.
                ``(3) Pre-existing report cards.--A State or local
            educational agency that was providing public report cards on
            the performance of students, schools, local educational
            agencies, or the State prior to the enactment of the No Child
            Left Behind Act of 2001 may use those reports for the purpose
            of this subsection, so long as any such report is modified, as
            may be needed, to contain the information required by this
            subsection.
                ``(4) Annual state report to the secretary.--Each State
            receiving assistance under this Act shall report annually to
            the Secretary, and make widely available within the State--
                        ``(A) beginning with school year 2001-2002,
                    information on the State's progress in developing and
                    implementing the academic assessment system described
                    in subsection (b)(4);
                        ``(B) beginning not later than school year 2004-
                    2005, information on the achievement of students on the
                    academic assessments required by that subsection,
                    including the disaggregated results for the categories
                    of students identified in subsection
                    (b)(2)(C)(iii)(II);
                        ``(C) beginning not later than school year 2002-
                    2003, information on the acquisition of English
                    proficiency by children with limited English
                    proficiency; and
                        ``(D) in any year before the State begins to
                    provide the information described in subparagraph (B),
                    information on the results of student academic
                    assessments (including disaggregated results) required
                    under this section.
                ``(5) Parents right-to-know.--
                        ``(A) Qualifications.--At the beginning of each
                    school year, a local educational agency that receives
                    funds under this part shall notify the parents of each
                    student attending any school receiving funds under this
                    part that they may request, and shall provide the
                    parents upon request (and in a timely manner),
                    information regarding the professional qualifications
                    of the student's classroom teachers, including, at a
                    minimum, the following:
                                ``(i) Whether the teacher has met State
                            qualification and licensing criteria for the
                            grade levels and subject areas in which the
                            teacher provides instruction.
                                ``(ii) Whether the teacher is teaching
                            under emergency or other provisional status
                            through which State qualification or licensing
                            criteria have been waived.
                                ``(iii) The baccalaureate degree major of
                            the teacher and any other graduate
                            certification or degree held by the teacher,
                            and the field of discipline of the
                            certification or degree.
                                ``(iv) Whether the child is provided
                            services by paraprofessionals and if so, their
                            qualifications.
                        ``(B) Additional information.--In addition to the
                    information which parents may request under
                    subparagraph (A), a school which receives funds under
                    this part shall provide to each individual parent--
                                ``(i) information on the level of
                            performance of the individual student for whom
                            they are the parent in each of the State
                            academic assessments as required under this
                            part; and
                                ``(ii) timely notice that the student for
                            whom they are the parent has been assigned, or
                            has been taught for 4 or more consecutive weeks
                            by, a teacher who is not fully qualified.
                        ``(C) Format.--The notice and information provided
                    to parents under this paragraph shall be in an
                    understandable and uniform format and, to the extent
                    practicable, provided in a language that the parents
                    can understand.
                ``(6) Plan content.--A State shall include in its plan
            under subsection (b) an assurance that it has in effect a
            policy that meets the requirements of this section.
        ``(i) Privacy.--Information collected under this section shall be
    collected and disseminated in a manner that protects the privacy of
    individuals.

    ``SEC. 1112. LOCAL EDUCATIONAL AGENCY PLANS.

        ``(a) Plans Required.--
                ``(1) Subgrants.--A local educational agency may receive a
            subgrant under this part for any fiscal year only if such
            agency has on file with the State educational agency a plan,
            approved by the State educational agency, that is coordinated
            with other programs under this Act, the Individuals with
            Disabilities Education Act (20 U.S.C. 1400 et seq.), the Carl
            D. Perkins Vocational and Technical Education Act of 1998 (20
            U.S.C. 2301 et seq.), the Head Start Act (42 U.S.C. 9831 et
            seq.), the McKinney-Vento Homeless Assistance Act, and other
            Acts, as appropriate.
                ``(2) Consolidated application.--The plan may be submitted
            as part of a consolidated application under section 8305.
        ``(b) Plan Provisions.--In order to help low achieving children
    achieve high academic standards, each local educational agency plan
    shall include--
                ``(1) a description of additional high-quality student
            academic assessments, if any, other than the academic
            assessments described in the State plan under section 1111,
            that the local educational agency and schools served under this
            part will use to--
                        ``(A) determine the success of children served
                    under this part in meeting the State's student academic
                    achievement standards and provide information to
                    teachers, parents, and students on the progress being
                    made toward meeting the State student academic
                    achievement standards described in section
                    1111(b)(1)(D)(ii);
                        ``(B) assist in diagnosis, teaching, and learning
                    in the classroom in ways that best enable low-achieving
                    children served under this title to meet State academic
                    standards and do well in the local curriculum; and
                        ``(C) determine what revisions are needed to
                    projects under this title so that such children meet
                    the State's student academic achievement standards;
                ``(2) at the local educational agency's discretion, a
            description of any other indicators that will be used in
            addition to the academic assessments described in paragraph (1)
            for the uses described in such paragraph, except that results
            on any discretionary indicators shall not change which schools
            would otherwise be subject to improvement of corrective action
            under section 1118 if the additional measures are not included;
                ``(3) a description of how the local educational agency
            will provide additional educational assistance to individual
            students assessed as needing help to achieve the State's
            challenging academic standards;
                ``(4) a description of the strategy the local educational
            agency will use to provide professional development for
            teachers, and, if appropriate, pupil services personnel,
            administrators, parents and other staff, including local
            educational agency level staff in accordance with section
            1119A;
                ``(5) a description of how the local educational agency
            will coordinate and integrate services provided under this part
            with other educational services at the local educational agency
            or individual school level, such as--
                        ``(A) Even Start, Head Start, Reading First, Early
                    Reading First, and other preschool programs, including
                    plans for the transition of participants in such
                    programs to local elementary school programs; and
                        ``(B) services for children with limited English
                    proficiency or with disabilities, migratory children
                    served under part C, neglected or delinquent youth,
                    Indian children served under part B of title III,
                    homeless children, and immigrant children in order to
                    increase program effectiveness, eliminate duplication,
                    and reduce fragmentation of the instructional program;
                ``(6) an assurance that the local educational agency will
            participate, if selected, in the State National Assessment of
            Educational Progress in 4th and 8th grade reading and
            mathematics carried out under section 411(b)(2) of the
            Education Statistics Act of 1994 (20 U.S.C. 9010(b)(2)), or in
            another academic assessment pursuant to the State decision
            under section 7101(b)(1)(B)(ii);
                ``(7) a description of the poverty criteria that will be
            used to select school attendance areas under section 1113;
                ``(8) a description of how teachers, in consultation with
            parents, administrators, and pupil services personnel, in
            targeted assistance schools under section 1115, will identify
            the eligible children most in need of services under this part;
                ``(9) a general description of the nature of the programs
            to be conducted by such agency's schools under sections 1114
            and 1115 and, where appropriate, educational services outside
            such schools for children living in local institutions for
            neglected or delinquent children, for neglected and delinquent
            children in community day school programs, and for homeless
            children;
                ``(10) a description of how the local educational agency
            will ensure that migratory children and formerly migratory
            children who are eligible to receive services under this part
            are selected to receive such services on the same basis as
            other children who are selected to receive services under this
            part;
                ``(11) if appropriate, a description of how the local
            educational agency will use funds under this part to support
            preschool programs for children, particularly children
            participating in Early Reading First, or in a Head Start or
            Even Start program, which services may be provided directly by
            the local educational agency or through a subcontract with the
            local Head Start agency designated by the Secretary of Health
            and Human Services under section 641 of the Head Start Act (42
            U.S.C. 9836), agencies operating Even Start programs, Early
            Reading First, or another comparable public early childhood
            development program;
                ``(12) a description of the actions the local educational
            agency will take to assist its low-performing schools,
            including schools identified under section 1116 as in need of
            improvement;
                ``(13) a description of the actions the local educational
            agency will take to implement public school choice, consistent
            with the requirements of section 1116;
                ``(14) a description how the local educational agency will
            meet the requirements of section 1119(b)(1); and
                ``(15) a description of the services the local educational
            agency will provide homeless children, including services
            provided with funds reserved under section 1113(f)(3)(A).
        ``(c) Assurances.--
                ``(1) In general.--Each local educational agency plan shall
            provide assurances that the local educational agency will--
                        ``(A) inform eligible schools and parents of
                    schoolwide program authority and the ability of such
                    schools to consolidate funds from Federal, State, and
                    local sources;
                        ``(B) provide technical assistance and support to
                    schoolwide programs;
                        ``(C) work in consultation with schools as the
                    schools develop the schools' plans pursuant to section
                    1114 and assist schools as the schools implement such
                    plans or undertake activities pursuant to section 1115
                    so that each school can make adequate yearly progress
                    toward meeting the State student academic achievement
                    standards;
                        ``(D) fulfill such agency's school improvement
                    responsibilities under section 1116, including taking
                    corrective actions under paragraphs (6) and (7) of
                    section 1116(b);
                        ``(E) provide services to eligible children
                    attending private elementary and secondary schools in
                    accordance with section 1120, and timely and meaningful
                    consultation with private school officials regarding
                    such services;
                        ``(F) take into account the experience of model
                    programs for the educationally disadvantaged, and the
                    findings of relevant scientifically based research
                    indicating that services may be most effective if
                    focused on students in the earliest grades at schools
                    that receive funds under this part;
                        ``(G) in the case of a local educational agency
                    that chooses to use funds under this part to provide
                    early childhood development services to low-income
                    children below the age of compulsory school attendance,
                    ensure that such services comply with the academic
                    achievement standards established under section 641A(a)
                    of the Head Start Act (42 U.S.C. 9836a(a));
                        ``(H) comply with the requirements of section 1119
                    regarding the qualifications of teachers and
                    paraprofessionals;
                        ``(I) inform eligible schools of the local
                    educational agency's authority to obtain waivers on the
                    school's behalf under title VIII of this Act, and if
                    the State is an Ed-Flex Partnership State, to obtain
                    waivers under the Education Flexibility Partnership Act
                    of 1999; and
                        ``(J) coordinate and collaborate, to the extent
                    feasible and necessary as determined by the local
                    educational agency, with other agencies providing
                    services to children, youth, and families.
                ``(2) Special rule.--In carrying out subparagraph (G) of
            paragraph (1), the Secretary--
                        ``(A) shall consult with the Secretary of Health
                    and Human Services on the implementation of such
                    subparagraph and shall establish procedures (taking
                    into consideration existing State and local laws, and
                    local teacher contracts) to assist local educational
                    agencies to comply with such subparagraph; and
                        ``(B) shall disseminate to local educational
                    agencies the Head Start academic achievement standards
                    as in effect under section 641A(a) of the Head Start
                    Act (42 U.S.C. 9836a(a)), and such agencies affected by
                    such subparagraph shall plan for the implementation of
                    such subparagraph (taking into consideration existing
                    State and local laws, and local teacher contracts),
                    including pursuing the availability of other Federal,
                    State, and local funding sources to assist in
                    compliance with such subparagraph.
                ``(3) Inapplicability.--The provisions of this subsection
            shall not apply to preschool programs using the Even Start
            model or to Even Start programs which are expanded through the
            use of funds under this part.
        ``(d) Plan Development and Duration.--
                ``(1) Consultation.--Each local educational agency plan
            shall be developed in consultation with teachers, principals,
            administrators (including administrators of programs described
            in other parts of this title), and other appropriate school
            personnel, and with parents of children in schools served under
            this part.
                ``(2) Duration.--Each such plan shall be submitted for the
            first year for which this part is in effect following the date
            of the enactment of the No Child Left Behind Act of 2001 and
            shall remain in effect for the duration of the agency's
            participation under this part.
                ``(3) Review.--Each local educational agency shall
            periodically review, and as necessary, revise its plan.
        ``(e) State Approval.--
                ``(1) In general.--Each local educational agency plan shall
            be filed according to a schedule established by the State
            educational agency.
                ``(2) Approval.--The State educational agency shall approve
            a local educational agency's plan only if the State educational
            agency determines that the local educational agency's plan--
                        ``(A) enables schools served under this part to
                    substantially help children served under this part meet
                    the academic standards expected of all children
                    described in section 1111(b)(1); and
                        ``(B) meets the requirements of this section.
        ``(f) Program Responsibility.--The local educational agency plan
    shall reflect the shared responsibility of schools, teachers, and the
    local educational agency in making decisions regarding activities under
    sections 1114 and 1115.
        ``(g) Parental Notification and Consent for English Language
    Instruction.--
                ``(1) Notification.--If a local educational agency uses
            funds under this part to provide English language instruction
            to limited English proficient children, the agency shall inform
            a parent or the parents of a child participating in an English
            language instruction program for limited English proficient
            children assisted under this part of--
                        ``(A) the reasons for the identification of the
                    child as being in need of English language instruction;
                        ``(B) the child's level of English proficiency, how
                    such level was assessed, and the status of the child's
                    academic achievement;
                        ``(C) how the English language instruction program
                    will specifically help the child acquire English and
                    meet age-appropriate academic standards for grade
                    promotion and graduation;
                        ``(D) what the specific exit requirements are for
                    the program;
                        ``(E) the expected rate of transition from the
                    program into a classroom that is not tailored for
                    limited English proficient children; and
                        ``(F) the expected rate of graduation from high
                    school for students in the program if funds under this
                    part are used for children in secondary schools.
                ``(2) Consent.--
                        ``(A) Agency requirements.--
                                ``(i) Informed consent.--For a child who
                            has been identified as limited English
                            proficient prior to the beginning of a school
                            year, each local educational agency that
                            receives funds under this part shall make a
                            reasonable and substantial effort to obtain
                            informed parental consent prior to the
                            placement of a child in an English language
                            instruction program for limited English
                            proficient children funded under this part if
                            the program does not include classes which
                            exclusively or almost exclusively use the
                            English language in instruction.
                                ``(ii) Written consent not obtained.--If
                            written consent is not obtained, the local
                            educational agency shall maintain a written
                            record that includes the date and the manner in
                            which such informed consent was sought,
                            including the specific efforts made to obtain
                            such consent.
                                ``(iii) Proof of effort.--Notice, in an
                            understandable form, of specific efforts made
                            to obtain written consent and a copy of the
                            written record required in clause (ii) shall be
                            mailed or delivered in writing to a parent,
                            parents, or guardian of a child prior to
                            placing the child in a program described in
                            clause (i) and shall include a final request
                            for parental consent for such services. After
                            such notice has been mailed or delivered in
                            writing, the local educational agency shall
                            provide appropriate educational services.
                                ``(iv) Special rule applicable during
                            school year.--For those children who have not
                            been identified as limited English proficient
                            prior to the beginning of the school year, the
                            local educational agency shall make a
                            reasonable and substantial effort to obtain
                            parental consent under this clause. For such
                            children, the agency shall document, in
                            writing, its specific efforts made to obtain
                            such consent prior to placing the child in a
                            program described in clause (i). After such
                            documentation has been made, the local
                            educational agency shall provide appropriate
                            educational services to such child. The proof
                            of documentation shall be mailed or delivered
                            in writing to a parent or parents of the child
                            in a timely manner and shall include
                            information on how to have their child
                            immediately removed from the program upon their
                            request. Nothing in this clause shall be
                            construed as exempting a local educational
                            agency from complying with the notification
                            requirements of subsection (g)(1) and the
                            consent requirements of this paragraph.
                ``(3) Parental rights.--A parent or the parents of a child
            participating in an English language instruction program for
            limited English proficient children assisted under this part
            shall--
                        ``(A) select among methods of instruction, if more
                    than one method is offered in the program; and
                        ``(B) have the right to have their child
                    immediately removed from the program upon their
                    request.
                ``(4) Receipt of information.--A parent or the parents of a
            limited English proficient child who is identified for
            participation in an English language instruction program for
            limited English proficient children assisted under this part
            shall receive, in a manner and form understandable to the
            parent or parents, the information required by this subsection.
            At a minimum, the parent or parents shall receive--
                        ``(A) timely information about English language
                    instruction programs for limited English proficient
                    children assisted under this part;
                        ``(B) if a parent or parents of a participating
                    child so desires, notice of opportunities for regular
                    meetings for the purpose of formulating and responding
                    to recommendations from the parent or parents; and
                        ``(C) procedural information for removing a child
                    from a program for limited English proficient children.
                ``(5) Basis for admission or exclusion.--Students shall not
            be admitted to, or excluded from, any federally-assisted
            education program on the basis of a surname or language-
            minority status.

    ``SEC. 1113. ELIGIBLE SCHOOL ATTENDANCE AREAS.

        ``(a) Determination.--
                ``(1) In general.--A local educational agency shall use
            funds received under this part only in eligible school
            attendance areas.
                ``(2) Eligible school attendance areas.--For the purposes
            of this part--
                        ``(A) the term `school attendance area' means, in
                    relation to a particular school, the geographical area
                    in which the children who are normally served by that
                    school reside; and
                        ``(B) the term `eligible school attendance area'
                    means a school attendance area in which the percentage
                    of children from low-income families is at least as
                    high as the percentage of children from low-income
                    families in the local educational agency as a whole.
                ``(3) Local educational agency discretion.--
                        ``(A) In general.--Notwithstanding paragraph (2), a
                    local educational agency may--
                                ``(i) designate as eligible any school
                            attendance area or school in which at least 35
                            percent of the children are from low-income
                            families;
                                ``(ii) use funds received under this part
                            in a school that is not in an eligible school
                            attendance area, if the percentage of children
                            from low-income families enrolled in the school
                            is equal to or greater than the percentage of
                            such children in a participating school
                            attendance area of such agency;
                                ``(iii) designate and serve a school
                            attendance area or school that is not eligible
                            under subsection (b), but that was eligible and
                            that was served in the preceding fiscal year,
                            but only for 1 additional fiscal year; and
                                ``(iv) elect not to serve an eligible
                            school attendance area or eligible school that
                            has a higher percentage of children from low-
                            income families if--
                                        ``(I) the school meets the
                                    comparability requirements of section
                                    1120A(c);
                                        ``(II) the school is receiving
                                    supplemental funds from other State or
                                    local sources that are spent according
                                    to the requirements of section 1114 or
                                    1115; and
                                        ``(III) the funds expended from
                                    such other sources equal or exceed the
                                    amount that would be provided under
                                    this part.
                        ``(B) Special rule.--Notwithstanding subparagraph
                    (A)(iv), the number of children attending private
                    elementary and secondary schools who are to receive
                    services, and the assistance such children are to
                    receive under this part, shall be determined without
                    regard to whether the public school attendance area in
                    which such children reside is assisted under
                    subparagraph (A).
        ``(b) Ranking Order.--If funds allocated in accordance with
    subsection (f) are insufficient to serve all eligible school attendance
    areas, a local educational agency--
                ``(1) shall annually rank from highest to lowest according
            to the percentage of children from low-income families in each
            agency's eligible school attendance areas in the following
            order--
                        ``(A) eligible school attendance areas in which the
                    concentration of children from low-income families
                    exceeds 75 percent; and
                        ``(B) all remaining eligible school attendance
                    areas in which the concentration of children from low-
                    income families is 75 percent or lower either by grade
                    span or for the entire local educational agency;
                ``(2) shall, within each category listed in paragraph (1),
            serve schools in rank order from highest to lowest according to
            the ranking assigned under paragraph (1);
                ``(3) notwithstanding paragraph (2), may give priority,
            within each such category and in rank order from highest to
            lowest subject to paragraph (4), to eligible school attendance
            areas that serve children in elementary schools; and
                ``(4) not serve a school described in paragraph (1)(B)
            before serving a school described in paragraph (1)(A).
        ``(c) Low-Income Measures.--In determining the number of children
    ages 5 through 17 who are from low-income families, the local
    educational agency shall apply the measures described in paragraphs (1)
    and (2) of this subsection:
                ``(1) Allocation to public school attendance areas.--The
            local educational agency shall use the same measure of poverty,
            which measure shall be the number of children ages 5 through 17
            in poverty counted in the most recent census data approved by
            the Secretary, the number of children eligible for free and
            reduced priced lunches under the Richard B. Russell National
            School Lunch Act (42 U.S.C. 1751 et seq.), the number of
            children in families receiving assistance under the State
            program funded under part A of title IV of the Social Security
            Act, or the number of children eligible to receive medical
            assistance under the Medicaid program, or a composite of such
            indicators, with respect to all school attendance areas in the
            local educational agency--
                        ``(A) to identify eligible school attendance areas;
                        ``(B) to determine the ranking of each area; and
                        ``(C) to determine allocations under subsection
                    (f).
                ``(2) Allocation for equitable service to private school
            students.--
                        ``(A) Calculation.--A local educational agency
                    shall have the final authority, consistent with section
                    1120 to calculate the number of private school
                    children, ages 5 through 17, who are low-income by--
                                ``(i) using the same measure of low-income
                            used to count public school children;
                                ``(ii) using the results of a survey that,
                            to the extent possible, protects the identity
                            of families of private school students and
                            allowing such survey results to be extrapolated
                            if complete actual data are not available; or
                                ``(iii) applying the low-income percentage
                            of each participating public school attendance
                            area, determined pursuant to this section, to
                            the number of private school children who
                            reside in that attendance area.
                        ``(B) Complaint process.--Any dispute regarding
                    low-income data on private school students shall be
                    subject to the complaint process authorized in section
                    8505.
        ``(d) Exception.--This section (other than subsections (a)(3) and
    (f)) shall not apply to a local educational agency with a total
    enrollment of less than 1,500 children.
        ``(e) Waiver for Desegregation Plans.--The Secretary may approve a
    local educational agency's written request for a waiver of the
    requirements of subsections (a) and (f), and permit such agency to
    treat as eligible, and serve, any school that children attend under a
    desegregation plan ordered by a State or court or approved by the
    Secretary, or such a plan that the agency continues to implement after
    it has expired, if--
                ``(1) the number of economically disadvantaged children
            enrolled in the school is not less than 25 percent of the
            school's total enrollment; and
                ``(2) the Secretary determines on the basis of a written
            request from such agency and in accordance with such criteria
            as the Secretary establishes, that approval of that request
            would further the purposes of this part.
        ``(f) Allocations.--
                ``(1) In general.--A local educational agency shall
            allocate funds received under this part to eligible school
            attendance areas or eligible schools, identified under
            subsection (b) in rank order on the basis of the total number
            of children from low-income families in each area or school.
                ``(2) Special rule.--(A) Except as provided in subparagraph
            (B), the per-pupil amount of funds allocated to each school
            attendance area or school under paragraph (1) shall be at least
            125 percent of the per-pupil amount of funds a local
            educational agency received for that year under the poverty
            criteria described by the local educational agency in the plan
            submitted under section 1112, except that this paragraph shall
            not apply to a local educational agency that only serves
            schools in which the percentage of such children is 35 percent
            or greater.
                ``(B) A local educational agency may reduce the amount of
            funds allocated under subparagraph (A) for a school attendance
            area or school by the amount of any supplemental State and
            local funds expended in that school attendance area or school
            for programs that meet the requirements of section 1114 or
            1115.
                ``(3) Reservation.--A local educational agency shall
            reserve such funds as are necessary under this part to provide
            services comparable to those provided to children in schools
            funded under this part to serve--
                        ``(A) homeless children who do not attend
                    participating schools, including providing
                    educationally related support services to children in
                    shelters and other locations where children may live;
                        ``(B) children in local institutions for neglected
                    children; and
                        ``(C) if appropriate, children in local
                    institutions for delinquent children and neglected or
                    delinquent children in community day school programs.
                ``(4) School improvement reservation.--In addition to the
            funding a local educational agency receives under section
            1003(b), a local educational agency may reserve such funds as
            are necessary under this part to meet such agency's school
            improvement responsibilities under section 1116, including
            taking corrective actions under paragraphs (6) and (7) of
            section 1116(b).
                ``(5) Financial incentives and rewards reservation.--A
            local educational agency may reserve such funds as are
            necessary under this part to provide financial incentives and
            rewards to teachers who serve in schools eligible under
            subsection (b)(1)(A) and identified for improvement under
            section 1116(b)(1) for the purpose of attracting and retaining
            qualified and effective teachers.

    ``SEC. 1114. SCHOOLWIDE PROGRAMS.

        ``(a) Purpose.--The purpose of a schoolwide program under this
    section is--
                ``(1) to enable a local educational agency to consolidate
            funds under this part with other Federal, State, and local
            funds, to upgrade the entire educational program in a high
            poverty school; and
                ``(2) to help ensure that all children in such a school
            meet challenging State academic standards for student
            achievement, particularly those children who are most at-risk
            of not meeting those standards.
        ``(b) Use of Funds for Schoolwide Programs.--
                ``(1) In general.--A local educational agency may
            consolidate funds under this part, together with other Federal,
            State, and local funds, in order to upgrade the entire
            educational program of a school that serves an eligible school
            attendance area in which not less than 40 percent of the
            children are from low-income families, or not less than 40
            percent of the children enrolled in the school are from such
            families.
                ``(2) Identification of students not required.--
                        ``(A) In general.--No school participating in a
                    schoolwide program shall be required to identify
                    particular children under this part as eligible to
                    participate in a schoolwide program or to provide
                    supplemental services to such children.
                        ``(B) Supplement funds.--A school participating in
                    a schoolwide program shall use funds available to carry
                    out this section only to supplement the amount of funds
                    that would, in the absence of funds under this part, be
                    made available from non-Federal sources for the school,
                    including funds needed to provide services that are
                    required by law for children with disabilities and
                    children with limited English proficiency.
                ``(3) Exemption from statutory and regulatory
            requirements.--
                        ``(A) Exemption.--Except as provided in subsection
                    (c), the Secretary may, through publication of a notice
                    in the Federal Register, exempt schoolwide programs
                    under this section from statutory or regulatory
                    provisions of any other noncompetitive formula grant
                    program administered by the Secretary (other than
                    formula or discretionary grant programs under the
                    Individuals with Disabilities Education Act, except as
                    provided in section 613(a)(2)(D) of such Act), or any
                    discretionary grant program administered by the
                    Secretary, to support schoolwide programs if the intent
                    and purposes of such other programs are met.
                        ``(B) Requirements.--A school that chooses to use
                    funds from such other programs shall not be relieved of
                    the requirements relating to health, safety, civil
                    rights, student and parental participation and
                    involvement, services to private school children,
                    maintenance of effort, uses of Federal funds to
                    supplement, not supplant non-Federal funds, or the
                    distribution of funds to State or local educational
                    agencies that apply to the receipt of funds from such
                    programs.
                        ``(C) Records.--A school that consolidates funds
                    from different Federal programs under this section
                    shall not be required to maintain separate fiscal
                    accounting records, by program, that identify the
                    specific activities supported by those particular funds
                    as long as it maintains records that demonstrate that
                    the schoolwide program, considered as a whole addresses
                    the intent and purposes of each of the Federal programs
                    that were consolidated to support the schoolwide
                    program.
                ``(4) Professional development.--Each school receiving
            funds under this part for any fiscal year shall devote
            sufficient resources to effectively carry out the activities
            described in subsection (c)(1)(D) in accordance with section
            1119A for such fiscal year, except that a school may enter into
            a consortium with another school to carry out such activities.
        ``(c) Components of a Schoolwide Program.--
                ``(1) In general.--A schoolwide program shall include the
            following components:
                        ``(A) A comprehensive needs assessment of the
                    entire school (including taking into account the needs
                    of migratory children as defined in section 1309(2))
                    that is based on information which includes the
                    performance of children in relation to the State
                    academic content standards and the State student
                    academic achievement standards described in section
                    1111(b)(1).
                        ``(B) Schoolwide reform strategies that--
                                ``(i) provide opportunities for all
                            children to meet the State's proficient and
                            advanced levels of student achievement
                            described in section 1111(b)(1)(D);
                                ``(ii) use effective methods and
                            instructional strategies that are based upon
                            scientifically based research that--
                                        ``(I) strengthen the core academic
                                    program in the school;
                                        ``(II) increase the amount and
                                    quality of learning time, such as
                                    providing an extended school year and
                                    before- and after-school and summer
                                    programs and opportunities, and help
                                    provide an enriched and accelerated
                                    curriculum; and
                                        ``(III) include strategies for
                                    meeting the educational needs of
                                    historically underserved populations;
                                ``(iii)(I) address the needs of all
                            children in the school, but particularly the
                            needs of low-achieving children and those at
                            risk of not meeting the State student academic
                            achievement standards who are members of the
                            target population of any program that is
                            included in the schoolwide program; and
                                ``(II) address how the school will
                            determine if such needs have been met; and
                                ``(iv) are consistent with, and are
                            designed to implement, the State and local
                            improvement plans, if any.
                        ``(C) Instruction by fully qualified (as defined in
                    section 8101) teachers.
                        ``(D) In accordance with section 1119A and
                    subsection (b)(4), high quality and ongoing
                    professional development for teachers and
                    paraprofessionals, and, where appropriate, pupil
                    services personnel, parents, principals, and other
                    staff to enable all children in the school to meet the
                    State's student academic achievement standards.
                        ``(E) Strategies to attract high quality teachers
                    to high need schools, such as differential pay systems
                    or performance based pay.
                        ``(F) Strategies to increase parental involvement
                    in accordance with section 1118, such as family
                    literary services.
                        ``(G) Plans for assisting preschool children in the
                    transition from early childhood programs, such as Head
                    Start, Even Start, Early Reading First, or a State-run
                    preschool program, to local elementary school programs.
                        ``(H) Measures to include teachers in the decisions
                    regarding the use of academic assessments described in
                    section 1111(b)(4) in order to provide information on,
                    and to improve, the performance of individual students
                    and the overall instructional program.
                        ``(I) Activities to ensure that students who
                    experience difficulty mastering the proficient or
                    advanced levels of academic achievement standards
                    required by section 1111(b) shall be provided with
                    effective, timely additional assistance which shall
                    include measures to ensure that students' difficulties
                    are identified on a timely basis and to provide
                    sufficient information on which to base effective
                    assistance.
                ``(2) Plan.--Any eligible school that desires to operate a
            schoolwide program shall first develop (or amend a plan for
            such a program that was in existence on the day before the
            effective date of the No Child Left Behind Act of 2001), a
            comprehensive plan for reforming the total instructional
            program in the school that--
                        ``(A) incorporates the components described in
                    paragraph (1);
                        ``(B) describes how the school will use resources
                    under this part and from other sources to implement
                    those components; and
                        ``(C) includes a list of State and local
                    educational agency programs and other Federal programs
                    under subsection (b)(3) that will be consolidated in
                    the schoolwide program.
                ``(3) Plan development.--The comprehensive plan shall be--
                        ``(A) developed during a 1-year period, unless--
                                ``(i) the local educational agency
                            determines that less time is needed to develop
                            and implement the schoolwide program; or
                                ``(ii) the school operated a schoolwide
                            program on the day preceding the effective date
                            of the No Child Left Behind Act of 2001, in
                            which case such school may continue to operate
                            such program, but shall develop amendments to
                            its existing plan during the first year of
                            assistance after that date to reflect the
                            provisions of this section;
                        ``(B) developed with the involvement of parents and
                    other members of the community to be served and
                    individuals who will carry out such plan, including
                    teachers, principals, and administrators (including
                    administrators of programs described in other parts of
                    this title), and, if appropriate, pupil services
                    personnel, technical assistance providers, school
                    staff, and, if the plan relates to a secondary school,
                    students from such school;
                        ``(C) in effect for the duration of the school's
                    participation under this part and reviewed and revised,
                    as necessary, by the school;
                        ``(D) available to the local educational agency,
                    parents, and the public, and the information contained
                    in such plan shall be provided in a format, and to the
                    extent practicable, in a language that they can
                    understand; and
                        ``(E) if appropriate, developed in coordination
                    with programs under Reading First, Early Reading First,
                    Even Start, Carl D. Perkins Vocational and Technical
                    Education Act of 1998, and the Head Start Act.
        ``(d) Accountability.--A schoolwide program under this section
    shall be subject to the school improvement provisions of section 1116.
        ``(e) Prekindergarten Program.--A school that is eligible for a
    schoolwide program under this section may use funds made available
    under this title to establish or enhance prekindergarten programs for
    3-, 4-, and 5-year-old children, such as Even Start programs or Early
    Reading First programs.

    ``SEC. 1115. TARGETED ASSISTANCE SCHOOLS.

        ``(a) In General.--In all schools selected to receive funds under
    section 1113(f) that are ineligible for a schoolwide program under
    section 1114, or that choose not to operate such a schoolwide program,
    a local educational agency may use funds received under this part only
    for programs that provide services to eligible children under
    subsection (b) identified as having the greatest need for special
    assistance.
        ``(b) Eligible Children.--
                ``(1) Eligible population.--(A) The eligible population for
            services under this section is--
                        ``(i) children not older than age 21 who are
                    entitled to a free public education through grade 12;
                    and
                        ``(ii) children who are not yet at a grade level at
                    which the local educational agency provides a free
                    public education.
                ``(B) From the population described in subparagraph (A),
            eligible children are children identified by the school as
            failing, or most at risk of failing, to meet the State's
            challenging student academic achievement standards on the basis
            of academic assessments under this part, and, as appropriate,
            on the basis of multiple, educationally related, objective
            criteria established by the local educational agency and
            supplemented by the school, except that children from preschool
            through grade 2 may be selected solely on the basis of such
            criteria as teacher judgment, interviews with parents, and
            other appropriate measures.
                ``(2) Children included.--(A)(i) Children with
            disabilities, migrant children, and children with limited
            English proficiency are eligible for services under this part
            on the same basis as other children.
                ``(ii) Funds received under this part may not be used to
            provide services that are otherwise required by law to be made
            available to such children but may be used to coordinate or
            supplement such services.
                ``(B) A child who, at any time in the 2 years preceding the
            year for which the determination is made, participated in a
            Head Start, Even Start, or Early Reading First program, or in
            preschool services under this title, is eligible for services
            under this part.
                ``(C)(i) A child who, at any time in the 2 years preceding
            the year for which the determination is made, received services
            under part C is eligible for services under this part.
                ``(ii) A child in a local institution for neglected or
            delinquent children or attending a community day program for
            such children is eligible for services under this part.
                ``(D) A child who is homeless and attending any school in
            the local educational agency is eligible for services under
            this part.
        ``(c) Components of a Targeted Assistance School Program.--
                ``(1) In general.--To assist targeted assistance schools
            and local educational agencies to meet their responsibility to
            provide for all their students served under this title the
            opportunity to meet the State's challenging student academic
            achievement standards in subjects as determined by the State,
            each targeted assistance program under this section shall--
                        ``(A) use such program's resources under this part
                    to help participating children meet such State's
                    challenging student academic achievement standards
                    expected for all children;
                        ``(B) ensure that planning for students served
                    under this part is incorporated into existing school
                    planning;
                        ``(C) use effective methods and instructional
                    strategies that are based upon scientifically based
                    research that strengthens the core academic program of
                    the school and that--
                                ``(i) give primary consideration to
                            providing extended learning time such as an
                            extended school year, before- and after-school,
                            and summer programs and opportunities;
                                ``(ii) help provide an accelerated, high-
                            quality curriculum, including applied learning;
                            and
                                ``(iii) minimize removing children from the
                            regular classroom during regular school hours
                            for instruction provided under this part;
                        ``(D) coordinate with and support the regular
                    education program, which may include services to assist
                    preschool children in the transition from early
                    childhood programs such as Head Start, Even Start,
                    Early Reading First or State-run preschool programs to
                    elementary school programs;
                        ``(E) provide instruction by fully qualified
                    teachers as defined in section 8101;
                        ``(F) in accordance with subsection (e)(3) and
                    section 1119A, provide opportunities for professional
                    development with resources provided under this part,
                    and, to the extent practicable, from other sources, for
                    teachers, principals, and administrators and other
                    school staff, including, if appropriate, pupil services
                    personnel, who work with participating children in
                    programs under this section or in the regular education
                    program; and
                        ``(G) provide strategies to increase parental
                    involvement in accordance with section 1118, such as
                    family literacy services.
                ``(2) Requirements.--Each school conducting a program under
            this section shall assist participating children selected in
            accordance with subsection (b) to meet the State's proficient
            and advanced levels of achievement by--
                        ``(A) the coordination of resources provided under
                    this part with other resources; and
                        ``(B) reviewing, on an ongoing basis, the progress
                    of participating children and revising the targeted
                    assistance program, if necessary, to provide additional
                    assistance to enable such children to meet the State's
                    challenging student academic achievement standards,
                    such as an extended school year, before- and after-
                    school, and summer programs and opportunities, training
                    for teachers regarding how to identify students that
                    require additional assistance, and training for
                    teachers regarding how to implement student academic
                    achievement standards in the classroom.
        ``(d) Integration of Professional Development.--To promote the
    integration of staff supported with funds under this part, public
    school personnel who are paid with funds received under this part may
    participate in general professional development and school planning
    activities.
        ``(e) Special Rules.--
                ``(1) Simultaneous service.--Nothing in this section shall
            be construed to prohibit a school from serving students served
            under this section simultaneously with students with similar
            educational needs, in the same educational settings where
            appropriate.
                ``(2) Comprehensive services.--If medical, nutrition, and
            other social services are not otherwise available to eligible
            children in a targeted assistance school and such school, if
            appropriate, has engaged in a comprehensive needs assessment
            and established a collaborative partnership with local service
            providers, and if funds are not reasonably available from other
            public or private sources to provide such services, then a
            portion of the funds provided under this part may be used as a
            last resort to provide such services, including--
                        ``(A) the provision of basic medical equipment,
                    such as eyeglasses and hearing aids; and
                        ``(B) professional development necessary to assist
                    teachers, pupil services personnel, other staff, and
                    parents in identifying and meeting the comprehensive
                    needs of eligible children.
                ``(3) Professional development.--Each school receiving
            funds under this part for any fiscal year shall devote
            sufficient resources to carry out effectively the professional
            development activities described in subparagraph (F) of
            subsection (c)(1) in accordance with section 1119A for such
            fiscal year, except that a school may enter into a consortium
            with another school to carry out such activities.''.

    SEC. 105. SCHOOL CHOICE.

        Section 1115A is amended to read as follows:

    ``SEC. 1115A. SCHOOL CHOICE.

        ``(a) Choice Programs.--A local educational agency may use funds
    under this part, in combination with State, local, and private funds,
    to develop and implement public school choice programs, for children
    eligible for assistance under this part, which permit parents to select
    the public school that their child will attend.
        ``(b) Choice Plan.--A local educational agency that chooses to
    implement a public school choice program shall first develop a plan
    that includes a description of how the local educational agency will
    use resources under this part and from other resources to implement the
    plan, and assurances that--
                ``(1) all eligible students across grade levels served
            under this part will have equal access to the program;
                ``(2) the plan will be developed with the involvement of
            parents and others in the community to be served and
            individuals who will carry out the plan, including
            administrators, teachers, principals, and other staff;
                ``(3) parents of eligible students in the local educational
            agency will be given prompt notice of the existence of the
            public school choice program and its availability to them, and
            a clear explanation of how the program will operate;
                ``(4) the program will include charter schools and any
            other public school and shall not include a school that is or
            has been identified as a school in school improvement or is or
            has been in corrective action for the past 2 consecutive years;
            and
                ``(5) such local educational agency will comply with the
            other requirements of this part.
        ``(c) Transportation.--Transportation services or the costs of
    transportation may be provided by the local educational agency, except
    that such agency may not use more than a total of 15 percent of its
    allocation under this part for such purposes.''.

    SEC. 106. ACADEMIC ASSESSMENT AND LOCAL EDUCATIONAL AGENCY AND SCHOOL
                  IMPROVEMENT.

        The section heading and subsections (a) through (d) of section 1116
    are amended to read as follows:

    ``SEC. 1116. ACADEMIC ASSESSMENT AND LOCAL EDUCATIONAL AGENCY AND
                  SCHOOL IMPROVEMENT.

        ``(a) Local Review.--Each local educational agency receiving funds
    under this part shall--
                ``(1) use the State academic assessments described in the
            State plan to review annually the progress of each school
            served under this part to determine whether the school is
            making adequate yearly progress as defined in section
            1111(b)(2)(B);
                ``(2) publicize and disseminate to teachers and other
            staff, parents, students, and the community, the results of the
            annual review under paragraph (2);
                ``(3) review the effectiveness of the actions and
            activities the schools are carrying out under this part with
            respect to parental involvement assisted under this Act.
        ``(b) School Improvement.--
                ``(1) In general.--
                        ``(A) Identification.--A local educational agency
                    shall identify for school improvement any elementary or
                    secondary school served under this part that--
                                ``(i) fails, for any year, to make adequate
                            yearly progress as defined in the State's plan
                            under section 1111(b)(2); or
                                ``(ii) was in school improvement status
                            under this section immediately before the
                            effective date of the No Child Left Behind Act
                            of 2001.
                        ``(B) Deadline.--The identification described in
                    subparagraph (A) shall take place not later than the
                    first day of the school year following such failure to
                    make adequate yearly progress.
                        ``(C) Application.--This paragraph does not apply
                    to a school if almost every student in the school is
                    meeting the State's advanced level of performance.
                        ``(D) Review.--To determine if an elementary school
                    or a secondary school that is conducting a targeted
                    assistance program under section 1115 should be
                    identified for school improvement under this
                    subsection, a local educational agency may choose to
                    review the progress of only the students in the school
                    who are served, or are eligible for services, under
                    this part.
                        ``(E) Public school choice.--In the case of a
                    school identified for school improvement under
                    subparagraph (A), the local educational agency shall,
                    not later than the first day of the school year
                    following identification, provide all students enrolled
                    in the school with the option to transfer to another
                    public school within the local educational agency,
                    including a public charter school, that has not been
                    identified for school improvement under subparagraph
                    (A), unless such an option is prohibited by State law.
                        ``(F) Transfer.--Students who use the option to
                    transfer under subparagraph (E) shall be enrolled in
                    classes and other activities in the public school to
                    which they transfer in the same manner as all other
                    children at the public school.
                ``(2) Opportunity to review and present evidence; time
            limit.--
                        ``(A) Before identifying an elementary school or a
                    secondary school for school improvement under paragraph
                    (1), for corrective action under paragraph (6), or for
                    restructuring under paragraph (7), the local
                    educational agency shall provide the school with an
                    opportunity to review the school-level data, including
                    academic assessment data, on which the proposed
                    identification is based.
                        ``(B) Evidence.--If the principal of a school
                    proposed for identification under paragraph (1), (6),
                    or (7) believes, or a majority of the parents of the
                    students enrolled in such school believe, that the
                    proposed identification is in error for statistical or
                    other substantive reasons, the principal may provide
                    supporting evidence to the local educational agency,
                    which shall consider that evidence before making a
                    final determination.
                        ``(C) Final determination.--Not later than 30 days
                    after a local educational agency provides the school
                    with the opportunity to review such school level data,
                    the local educational agency shall make public a final
                    determination on the status of the school.
                ``(3) School plan.--
                        ``(A) Revised plan.--After the resolution of a
                    review under paragraph (2), each school identified
                    under paragraph (1) for school improvement shall, not
                    later than 3 months after being so identified, develop
                    or revise a school plan, in consultation with parents,
                    school staff, the local educational agency serving the
                    school, the local school board, and other outside
                    experts, for approval by such local educational agency.
                    The school plan shall cover a 2-year period and--
                                ``(i) incorporate scientifically based
                            research strategies that strengthen the core
                            academic subjects in the school and address the
                            specific academic issues that caused the school
                            to be identified for school improvement;
                                ``(ii) adopt policies and practices
                            concerning the school's core academic subjects
                            that have the greatest likelihood of ensuring
                            that all groups of students specified in
                            section 1111(b)(2)(C)(iii)(I) and (II) and
                            enrolled in the school will meet the State's
                            proficient level of achievement on the State
                            academic assessment described in section
                            1111(b)(4) not later than 10 years after the
                            date of enactment of the No Child Left Behind
                            Act of 2001;
                                ``(iii) provide an assurance that the
                            school shall reserve not less than 10 percent
                            of the funds made available to the school under
                            this part for each fiscal year that the school
                            is in school improvement status, for the
                            purpose of providing to the school's teachers
                            and principal high-quality professional
                            development that--
                                        ``(I) directly addresses the
                                    academic performance problem that
                                    caused the school to be identified for
                                    school improvement;
                                        ``(II) meets the requirements for
                                    professional development activities
                                    under section 1119A; and
                                        ``(III) is provided in a manner
                                    that affords greater opportunity for
                                    participating in such professional
                                    development;
                                ``(iv) specify how the funds described in
                            clause (iii) will be used to remove the school
                            from school improvement status;
                                ``(v) establish specific annual, measurable
                            goals for continuous and significant progress
                            by each group of students specified in section
                            1111(b)(2)(C)(iii)(I) and (II) and enrolled in
                            the school that will ensure that all such
                            groups of students shall meet the State's
                            proficient level of achievement on the State
                            academic assessment described in section
                            1111(b)(4) not later than 10 years after the
                            date of enactment of the No Child Left Behind
                            Act of 2001;
                                ``(vi) identify how the school will provide
                            written notification about the identification
                            to parents of each student enrolled in such
                            school, in a format and, to the extent
                            practicable, in a language the parents can
                            understand;
                                ``(vii) specify the responsibilities of the
                            school, the local educational agency, and the
                            State educational agency serving the school
                            under the plan, including the technical
                            assistance to be provided by the local
                            educational agency under paragraph (4); and
                                ``(viii) incorporate, as appropriate,
                            extended learning time for students, such as
                            before school, after school, during the summer
                            and extension of the school year.
                        ``(B) Conditional approval.--The local educational
                    agency may condition approval of a school plan on--
                                ``(i) inclusion of 1 or more of the
                            corrective actions specified in paragraph
                            (6)(D)(ii); or
                                ``(ii) feedback on the school improvement
                            plan from parents and community leaders.
                        ``(C) Plan implementation.--Except as provided in
                    subparagraph (D), a school shall implement the school
                    plan (including a revised plan) expeditiously, but not
                    later than the beginning of the school year following
                    the school year in which the failure to make adequate
                    yearly progress took place.
                        ``(D) Notwithstanding subparagraph (C), in a case
                    in which a plan is not approved prior to the beginning
                    of a school year, such plan shall be implemented
                    immediately upon approval.
                        ``(E) Local educational agency approval.--The local
                    educational agency shall--
                                ``(i) establish a peer-review process to
                            assist with review of a school plan prepared by
                            a school served by the local educational
                            agency; and
                                ``(ii) promptly review the school plan,
                            work with the school as necessary, and approve
                            the school plan if it meets the requirements of
                            this paragraph.
                ``(4) Technical assistance.--
                        ``(A) In general.--For each school identified for
                    school improvement under paragraph (1), the local
                    educational agency serving the school shall provide
                    technical assistance as the school develops and
                    implements the school plan throughout the duration of
                    such plan.
                        ``(B) Specific assistance.--Such technical
                    assistance--
                                ``(i) shall include assistance in analyzing
                            data from the academic assessments required
                            under section 1111(b)(4), and other samples of
                            student work, to identify and address
                            instructional problems and solutions;
                                ``(ii) shall include assistance in
                            identifying and implementing professional
                            development, instructional strategies, and
                            methods of instruction that are based upon
                            scientifically based research and that have
                            proven effective in addressing the specific
                            instructional issues that caused the school to
                            be identified for school improvement;
                                ``(iii) shall include assistance in
                            analyzing and revising the school's budget so
                            that the school resources are more effectively
                            allocated for the activities most likely to
                            increase student achievement and to remove the
                            school from school improvement status; and
                                ``(iv) may be provided--
                                        ``(I) by the local educational
                                    agency, through mechanisms authorized
                                    under section 1117; or
                                        ``(II) by the State educational
                                    agency, an institution of higher
                                    education (in full compliance with all
                                    the reporting provisions of title II of
                                    the Higher Education Act of 1965), a
                                    private not-for-profit organization or
                                    for-profit organization, an educational
                                    service agency, or another entity with
                                    experience in helping schools improve
                                    performance.
                        ``(C) Scientifically based research.--Technical
                    assistance provided under this section by a local
                    educational agency or an entity approved by that agency
                    shall be based on scientifically based research.
                ``(5) Notification to parents.--A local educational agency
            shall promptly provide parents (in a format and, to the extent
            practicable, in a language they can understand) of each student
            in an elementary school or a secondary school identified for
            school improvement--
                        ``(A) an explanation of what the school improvement
                    identification means, and how the school identified for
                    school improvement compares in terms of academic
                    achievement to other elementary schools or secondary
                    schools served by the local educational agency and the
                    State educational agency involved;
                        ``(B) the reasons for the identification;
                        ``(C) an explanation of what the school identified
                    for school improvement is doing to address the problem
                    of low achievement;
                        ``(D) an explanation of what the local educational
                    agency or State educational agency is doing to help the
                    school address the achievement problem;
                        ``(E) an explanation of how parents described in
                    this paragraph can become involved in addressing the
                    academic issues that caused the school to be identified
                    for school improvement; and
                        ``(F) an explanation regarding the option of their
                    child to transfer to another public school, including a
                    public charter school.
                ``(6) Corrective action.--
                        ``(A) In general.--In this subsection, the term
                    `corrective action' means action, consistent with State
                    law, that--
                                ``(i) substantially and directly responds
                            to--
                                        ``(I) the consistent academic
                                    failure of a school that caused the
                                    local educational agency to take such
                                    action; and
                                        ``(II) any underlying staffing,
                                    curriculum, or other problems in the
                                    school; and
                                ``(ii) is designed to increase
                            substantially the likelihood that students
                            enrolled in the school identified for
                            corrective action will perform at the State's
                            proficient and advanced levels of achievement
                            on the State academic assessment described in
                            section 1111(b)(4).
                        ``(B) System.--In order to help students served
                    under this part meet challenging State academic
                    standards, each local educational agency shall
                    implement a system of corrective action in accordance
                    with subparagraphs (C) through (F) and paragraphs (7)
                    through (9).
                        ``(C) Role of local educational agency.--The local
                    educational agency--
                                ``(i) after providing public school choice
                            under paragraph (1)(E) and technical assistance
                            under paragraph (4), shall identify for
                            corrective action and take corrective action
                            with respect to any school served by the local
                            educational agency under this part that--
                                        ``(I) fails to make adequate yearly
                                    progress, as defined by the State under
                                    section 1111(b)(2), at the end of the
                                    first full school year following
                                    identification under paragraph (1); or
                                        ``(II) was in school-improvement
                                    status for 2 years or in corrective-
                                    action status under this subsection
                                    immediately before the effective date
                                    of the No Child Left Behind Act of
                                    2001; and
                                ``(ii) shall continue to provide technical
                            assistance consistent with paragraph (4) while
                            instituting any corrective action under clause
                            (i); and
                        ``(D) Requirements.--In the case of a school
                    described in subparagraph (C)(i), the local educational
                    agency shall both--
                                ``(i) continue to provide all students
                            enrolled in the school with the option to
                            transfer to another public school within the
                            local educational agency, including a public
                            charter school, that has not been identified
                            for school improvement under paragraph (1),
                            unless such an option is prohibited by State
                            law; and
                                ``(ii) take at least 1 of the following
                            corrective actions:
                                        ``(I) Replace the school staff
                                    which are relevant to the failure to
                                    make adequate yearly progress.
                                        ``(II) Institute and fully
                                    implement a new curriculum, including
                                    providing appropriate professional
                                    development for all relevant staff,
                                    that is based on scientifically based
                                    research and offers substantial promise
                                    of improving educational performance
                                    for low-performing students and the
                                    school meeting adequate yearly
                                    progress.
                                        ``(III) Significantly decrease
                                    management authority at the school
                                    level.
                                        ``(IV) Appoint an outside expert to
                                    advise the school on its progress
                                    toward meeting adequate yearly
                                    progress, based on its school plan
                                    under this subsection.
                                        ``(V) Extend the school year or
                                    school day.
                                        ``(VI) Restructure the internal
                                    organizational structure of the school.
                        ``(E) Delay.--A local educational agency may delay,
                    for a period not to exceed 1 year, implementation of
                    corrective action only if the school's failure to make
                    adequate yearly progress was justified due to
                    exceptional or uncontrollable circumstances, such as a
                    natural disaster or a precipitous and unforeseen
                    decline in the financial resources of the local
                    educational agency or school.
                        ``(F) Publication and dissemination.--The local
                    educational agency shall publish and disseminate
                    information regarding any corrective action the local
                    educational agency takes under this paragraph at a
                    school--
                                ``(i) to the public and to the parents of
                            each student enrolled in the school subject to
                            corrective action;
                                ``(ii) in a format and, to the extent
                            practicable, in a language that the parents can
                            understand; and
                                ``(iii) through such means as the Internet,
                            the media, and public agencies.
                ``(7) Restructuring.--
                        ``(A) Failure to make adequate yearly progress.--
                    If--
                                ``(i) a school is subject to corrective
                            action under paragraph (6) for one full school
                            year, and at the end of such year continues to
                            fail to make adequate yearly progress and
                            students in the school who are from
                            economically disadvantaged families are not
                            making statistically significant progress in
                            the subjects included in the State's definition
                            of adequate yearly progress; or
                                ``(ii) for 2 additional years a school
                            subject to corrective action under paragraph
                            (6) fails to make adequate yearly progress, the
                            local educational agency shall--
                                        ``(I) provide all students enrolled
                                    in the school with the option to
                                    transfer to another public school
                                    within the local educational agency,
                                    including a public charter school, that
                                    has not been identified for school
                                    improvement under paragraph (1), unless
                                    prohibited by State law;
                                        ``(II) make supplemental
                                    instructional services available,
                                    consistent with subsection (d)(1); and
                                        ``(III) prepare a plan and make
                                    necessary arrangements to carry out
                                    subparagraph (B).
                        ``(B) Alternative governance.--Not later than the
                    beginning of the school year following the year in
                    which the local educational agency implements
                    subparagraph (A), the local educational agency shall
                    implement 1 of the following alternative governance
                    arrangements for the school consistent with State law:
                                ``(i) Reopening the school as a public
                            charter school.
                                ``(ii) Replacing the principal and all or
                            most of the school staff that are relevant to
                            the failure to make adequate yearly progress.
                                ``(iii) Entering into a contract with an
                            entity, such as a private management company,
                            to operate the public school.
                                ``(iv) Turning the operation of the school
                            over to the State, if permitted under State law
                            and agreed to by the State.
                        ``(C) Available results.--The State educational
                    agency shall ensure that, for any school year in which
                    a school is subject to school improvement under this
                    subsection, the results of State academic assessments
                    for that school are available to the local educational
                    agency by the end of the school year in which the
                    academic assessments are administered.
                        ``(D) Prompt notice.--The local educational agency
                    shall provide prompt notice to teachers and parents
                    whenever subparagraph (A) or (B) applies, shall provide
                    them adequate opportunity to comment before taking any
                    action under those subparagraphs and to participate in
                    developing any plan under subparagraph (A)(iii), and
                    shall provide parents an explanation of the options
                    under subparagraph (A)(i) and (ii).
                ``(8) Transportation.--In any case described in paragraph
            (6)(D)(i) and (7)(A)(ii)(I) the local educational agency--
                        ``(A) shall provide, or shall pay for the provision
                    of, transportation for the student to the public school
                    the child attends; and
                        ``(B) may use not more than a total of 15 percent
                    of its allocation under this part for that purpose.
                ``(9) Cooperative agreement.--In any case described in
            paragraph (6)(D)(i) or (7)(A)(ii)(I), if all public schools in
            the local educational agency to which a child may transfer to,
            are identified for school improvement, the agency shall, to the
            extent practicable, establish a cooperative agreement with
            other local educational agencies in the area for a transfer.
                ``(10) Duration.--If any school identified for corrective
            action or restructuring--
                        ``(A) makes adequate yearly progress for 2
                    consecutive years, the local educational agency need no
                    longer subject it to corrective action or restructuring
                    nor identify it as in need of improvement; or
                        ``(B) fails to make adequate yearly progress, but
                    children from low-income families in the school make
                    statistically significant educational progress for 1
                    year, the local educational agency shall place or
                    continue as appropriate the school in corrective action
                    under paragraph (6).
                ``(11) State responsibilities.--The State shall--
                        ``(A) make technical assistance under section 1117
                    available to all schools identified for school
                    improvement and restructuring under this subsection;
                        ``(B) if it determines that a local educational
                    agency has failed to carry out its responsibilities
                    under this subsection, take such corrective actions as
                    the State finds appropriate and in compliance with
                    State law; and
                        ``(C) ensure that academic assessment results under
                    this part are provided to schools within the same
                    school year in which the assessment was given.
        ``(c) State Review and Local Educational Agency Improvement.--
                ``(1) In general.--A State shall--
                        ``(A) annually review the progress of each local
                    educational agency receiving funds under this part to
                    determine whether schools receiving assistance under
                    this part are making adequate yearly progress as
                    defined in section 1111(b)(2) toward meeting the
                    State's student academic achievement standards; and
                        ``(B) publicize and disseminate to local
                    educational agencies, teachers and other staff,
                    parents, students, and the community the results of the
                    State review consistent with section 1111, including
                    statistically sound disaggregated results, as required
                    by section 1111(b)(2).
                ``(2) Identification of local educational agency for
            improvement.--A State shall identify for improvement any local
            educational agency that--
                        ``(A) for 2 consecutive years failed to make
                    adequate yearly progress as defined in the State's plan
                    under section 1111(b)(2); or
                        ``(B) was in improvement status under this section
                    as this section was in effect on the day preceding the
                    date of the enactment of the No Child Left Behind Act
                    of 2001.
                ``(3) Transition.--The 2-year period described in paragraph
            (2)(A) shall include any continuous period of time immediately
            preceding the date of the enactment of the No Child Left Behind
            Act of 2001, during which a local educational agency did not
            make adequate yearly progress as defined in the State's plan,
            as such plan was in effect on the day preceding the date of
            such enactment.
                ``(4) Targeted assistance schools.--For purposes of
            targeted assistance schools in a local educational agency, a
            State educational agency may choose to review the progress of
            only the students in such schools who are served or are
            eligible for services under this part.
                ``(5) Opportunity to review and present evidence.--
                        ``(A) Review.--Before identifying a local
                    educational agency for improvement under paragraph (2),
                    a State educational agency shall provide the local
                    educational agency with an opportunity to review the
                    local educational agency data, including academic
                    assessment data, on which that proposed identification
                    is based.
                        ``(B) Supporting evidence.--If the local
                    educational agency believes that the proposed
                    identification is in error for statistical or other
                    substantive reasons, it may provide supporting evidence
                    to the State educational agency, which such agency
                    shall consider before making a final determination not
                    later than 30 days after the State educational agency
                    provides the local educational agency with the
                    opportunity to review such data under subparagraph (A).
                ``(6) Notification to parents.--The State educational
            agency shall promptly notify parents in a format, and to the
            extent practicable in a language they can understand, of each
            student enrolled in a school in a local educational agency
            identified for improvement, of the results of the review under
            paragraph (1) and, if the agency is identified as in need of
            improvement, the reasons for that identification and how
            parents can participate in upgrading the quality of the local
            educational agency.
                ``(7) Local educational agency revisions.--
                        ``(A) Plan.--Each local educational agency
                    identified under paragraph (2) shall, not later than 3
                    months after being so identified, develop or revise a
                    local educational agency plan, in consultation with
                    parents, school staff, and others. Such plan shall--
                                ``(i) incorporate scientifically based
                            research strategies that strengthen the core
                            academic program in the local educational
                            agency;
                                ``(ii) identify specific goals and
                            objectives the local educational agency will
                            undertake to make adequate yearly progress and
                            which--
                                        ``(I) have the greatest likelihood
                                    of improving the performance of
                                    participating children in meeting the
                                    State's student academic achievement
                                    standards;
                                        ``(II) address the professional
                                    development needs of staff; and
                                        ``(III) include specific measurable
                                    achievement goals and targets for each
                                    of the groups of students identified in
                                    the disaggregated data pursuant to
                                    section 1111(b)(2)(C)(iii)(I) and (II);
                                ``(iii) incorporate, as appropriate,
                            extended learning time for students such as
                            before school, after school, during the summer,
                            and extension of the school year.
                                ``(iv) identify how the local educational
                            agency will provide written notification to
                            parents in a format, and to the extent
                            practicable in a language, that they can
                            understand, pursuant to paragraph (6); and
                                ``(v) specify the responsibilities of the
                            State educational agency and the local
                            educational agency under the plan.
                        ``(B) Implementation.--The local educational agency
                    shall implement its plan or revised plan expeditiously,
                    but not later than the beginning of the school year
                    after which the school has been identified for
                    improvement.
                ``(8) State responsibility.--
                        ``(A) In general.--For each local educational
                    agency identified under paragraph (2), the State shall
                    provide technical or other assistance, if requested, as
                    authorized under section 1117, to better enable the
                    local educational agency--
                                ``(i) to develop and implement its revised
                            plan as approved by the State educational
                            agency consistent with the requirements of this
                            section; and
                                ``(ii) to work with schools needing
                            improvement.
                        ``(B) Technical assistance.--Technical assistance
                    provided under this section by the State educational
                    agency or an entity authorized by such agency shall be
                    based upon scientifically based research.
                ``(9) Corrective action.--In order to help students served
            under this part meet challenging State academic standards, each
            State shall implement a system of corrective action in
            accordance with the following:
                        ``(A) In general.--After providing technical
                    assistance under paragraph (8) and subject to
                    subparagraph (D), the State--
                                ``(i) may take corrective action at any
                            time with respect to a local educational agency
                            that has been identified under paragraph (2);
                                ``(ii) shall take corrective action with
                            respect to any local educational agency that
                            fails to make adequate yearly progress, as
                            defined by the State, after the end of the
                            second year following its identification under
                            paragraph (2); and
                                ``(iii) shall continue to provide technical
                            assistance while instituting any corrective
                            action under clause (i) or (ii).
                        ``(B) Definition.--As used in this paragraph, the
                    term `corrective action' means action, consistent with
                    State law, that--
                                ``(i) substantially and directly responds
                            to the consistent academic failure that caused
                            the State to take such action and to any
                            underlying staffing, curricular, or other
                            problems in the school; and
                                ``(ii) is designed to meet the goal of
                            having all students served under this part
                            perform at the proficient and advanced
                            performance levels.
                        ``(C) Certain local educational agencies.--In the
                    case of a local educational agency described in this
                    paragraph, the State educational agency shall take not
                    less than 1 of the following corrective actions:
                                ``(i) Withhold funds from the local
                            educational agency.
                                ``(ii) Replace the school district
                            personnel who are relevant to the failure to
                            make adequate year progress.
                                ``(iii) Remove particular schools from the
                            jurisdiction of the local educational agency
                            and establish alternative arrangements for
                            public governance and supervision of such
                            schools.
                                ``(iv) Appoint, through the State
                            educational agency, a receiver or trustee to
                            administer the affairs of the local educational
                            agency in place of the superintendent and
                            school board.
                                ``(v) Abolish or restructure the local
                            educational agency.
                                ``(vi) Authorize students to transfer from
                            a school operated by a local educational agency
                            to a higher performing public school operated
                            by another local educational agency, or to a
                            public charter school and provide such students
                            transportation (or the costs of transportation
                            to such schools), in conjunction with not less
                            than 1 additional action described under this
                            paragraph.
                        ``(D) Hearing.--Prior to implementing any
                    corrective action, the State educational agency shall
                    provide due process and a hearing to the affected local
                    educational agency, if State law provides for such
                    process and hearing.
                        ``(E) Publication.--The State educational agency
                    shall publish, and disseminate to parents and the
                    public any corrective action it takes under this
                    paragraph through such means as the Internet, the
                    media, and public agencies.
                        ``(F) Delay.--A local educational agency may delay,
                    for a period not to exceed 1 year, implementation of
                    corrective action if the failure to make adequate
                    yearly progress was justified due to exceptional or
                    uncontrollable circumstances such as a natural disaster
                    or a precipitous and unforeseen decline in the
                    financial resources of the local educational agency or
                    school.
                ``(10) Special rule.--A local educational agency, that, for
            at least 2 of the 3 years following identification under
            paragraph (2), makes adequate yearly progress shall no longer
            be identified for improvement.
        ``(d) Parental Options.--
                ``(1) In any case described in subsection
            (b)(7)(A)(ii)(II), the local educational agency shall permit
            the parents of each eligible child to obtain supplemental
            educational services for such child from a provider, as
            approved by the State educational agency in accordance with
            reasonable criteria that it shall adopt. Such criteria shall
            require a provider to demonstrate a record of effectiveness, or
            the potential of effectiveness, in providing supplemental
            instructional services to children, consistent with the
            instructional program of the local educational agency and the
            academic standards described under section 1111.
                ``(2) Selection.--In obtaining services under this
            paragraph, a parent shall select a provider that meets the
            criteria described under paragraph (1). The local educational
            agency shall provide assistance, upon request, to parents in
            the selection of a provider to provide supplemental
            instructional services.
                ``(3) Contract.--In the case of the selection of a provider
            under paragraph (2) by a parent, the local educational agency
            shall enter into a contract with such provider. Such contract
            shall--
                        ``(A) require the local educational agency to
                    develop, with parents (and the provider they have
                    chosen), a statement of specific performance goals for
                    the student, how the student's progress will be
                    measured, and a timetable for improving achievement;
                        ``(B) provide for the termination of such contract
                    with a provider that is unable to meet such goals and
                    timetables; and
                        ``(C) contain provisions with respect to the making
                    of payments to the provider by the local educational
                    agency.
                ``(4) Additional local educational agency
            responsibilities.--Each local educational agency subject to
            this paragraph shall provide annual notice to parents (if
            feasible, in the parents' language) of the availability of
            services under this paragraph and the eligible providers of
            those services.
                ``(5) State educational agency responsibilities.--Each
            State educational agency shall--
                        ``(A) consult with local educational agencies and
                    promote maximum participation by providers to ensure,
                    to the extent practicable, that parents have as many
                    choices of those providers as possible;
                        ``(B) develop criteria consistent with paragraph
                    (6) and apply such criteria to potential providers to
                    determine which, based on the quality and effectiveness
                    of their services, are eligible to participate;
                        ``(C) maintain an updated list of approved
                    providers across the State, from which parents may
                    select;
                        ``(D) develop and implement standards and
                    techniques for monitoring the quality and effectiveness
                    of the services offered by providers, and withdraw
                    approval from those that fail to meet those standards
                    for two consecutive years;
                        ``(E) provide annual notice to potential providers
                    of supplemental services of the opportunity to provide
                    services under this paragraph and of the applicable
                    procedures for obtaining approval from the State
                    educational agency to be a provider of those services.
                ``(6) Criteria for providers.--In order for a provider to
            be included on the State list under paragraph (5)(c), a
            provider shall agree to the following:
                        ``(A) Provide parents of children receiving
                    supplemental instructional services under this
                    paragraph and the appropriate local educational agency
                    with information on the progress of their children in
                    increasing achievement, in a format and, to the extent
                    practicable, a language such parents can understand.
                        ``(B) Ensure that instruction and content used by
                    the provider is consistent with the instruction and
                    content used by the local educational agency and State.
                        ``(C) Require a provider to meet all applicable
                    Federal, State, and local health, safety and civil
                    rights laws.
                        ``(D) Ensure that all instruction and content under
                    this paragraph shall be secular, neutral, and
                    nonideological.
                ``(7) Costs.--
                        ``(A) The costs of administration of this paragraph
                    and the costs of providing such supplemental
                    instructional services shall be limited to the total of
                    40 percent of the per child allocation under subpart 2
                    of each school identified under subsection
                    (b)(7)(A)(ii)(II);
                        ``(B) Additional funds.--If the allocation under
                    subparagraph (A) is insufficient to provide services
                    for all eligible students that have selected a
                    provider, a local educational agency may use funds
                    under subpart 1 of part A of title IV to pay for
                    additional costs;
                        ``(C) Transportation costs.--A local educational
                    agency may use up to 15 percent of its allocation under
                    subpart 2 for transportation costs.
                ``(8) Funds provided by state educational agency.--Each
            State educational agency may use funds that it reserves under
            this part, and subpart 1 of part A of title IV to provide local
            educational agencies that do not have sufficient funds to
            provide services under this paragraph for all eligible students
            requesting such services.
                ``(9) Duration.--The local educational agency shall
            continue to provide supplemental instructional services to
            enrolled children receiving such services under this paragraph
            until the child completes the grade corresponding to the
            highest grade offered at the public school which was identified
            for restructuring under subsection (b)(7), or until such
            school, so long as the child attends such school, is not
            identified under subsection (b)(1), (b)(6), or (b)(7),
            whichever comes earlier.
                ``(10) Definitions.--As used in this subsection, the term--
                        ``(A) `eligible child' means a child from a low-
                    income family, as determined by the local educational
                    agency for purposes of allocating funds to schools
                    under section 1113(c)(1);
                        ``(B) `supplemental instructional services' means
                    tutoring and other supplemental academic enrichment
                    services that are in addition to instruction provided
                    during the school day and are specifically designed to
                    increase the academic achievement of eligible children
                    on the academic assessments required under section
                    1111; and
                        ``(C) `provider' means a non-profit or a for-profit
                    entity which has a demonstrated record of effectiveness
                    or the potential of effectiveness--
                                ``(i) in providing supplemental
                            instructional services that are consistent with
                            the instructional program of the local
                            educational agency and the academic standards
                            described under section 1111; and
                                ``(ii) in sound fiscal management;
                        ``(D) `per child allocation' means an amount that
                    is equal to at least--
                                ``(i) the amount of the school's allocation
                            under subpart 2; divided by
                                ``(ii) the number of children from low-
                            income families enrolled in the school.
                ``(11) Prohibition.--Nothing contained in this paragraph
            shall permit the making of any payment under this paragraph for
            religious worship or instruction.''.

    SEC. 107. STATE ASSISTANCE FOR SCHOOL SUPPORT AND IMPROVEMENT.

        Section 1117 is amended to read as follows:

    ``SEC. 1117. STATE ASSISTANCE FOR SCHOOL SUPPORT AND IMPROVEMENT.

        ``(a) System for Support.--Each State shall establish a statewide
    system of intensive and sustained support and improvement for local
    educational agencies and schools receiving funds under this part, in
    order to increase the opportunity for all students in those agencies
    and schools to meet the State's academic content standards and student
    academic achievement standards.
        ``(b) Priorities.--In carrying out this section, a State shall--
                ``(1) first, provide support and assistance to local
            educational agencies subject to corrective action under section
            1116 and assist schools, in accordance with section
            1116(b)(10), for which a local educational agency has failed to
            carry out its responsibilities under paragraphs (6) and (7) of
            section 1116(b);
                ``(2) second, provide support and assistance to other local
            educational agencies identified as in need of improvement under
            section 1116(b); and
                ``(3) third, provide support and assistance to other local
            educational agencies and schools participating under this part
            that need that support and assistance in order to achieve the
            purpose of this part.
        ``(c) Approaches.--In order to achieve the purpose described in
    subsection (a), each such system shall provide technical assistance and
    support through such approaches as--
                ``(1) school support teams, composed of individuals who are
            knowledgeable about scientifically based research and practice
            on teaching and learning, particularly about strategies for
            improving educational results for low-achieving children; and
                ``(2) the designation and use of ``Distinguished
            Educators'', chosen from schools served under this part that
            have been especially successful in improving academic
            achievement.
        ``(d) Funds.--Each State--
                ``(1) shall use funds reserved under section 1003(a); and
                ``(2) may use State administrative funds authorized under
            section 1002(i) for such purpose to establish a Statewide
            system of support.
        ``(e) Alternatives.--The State may devise additional approaches to
    providing the assistance described in paragraphs (1) and (2) of
    subsection (c), such as providing assistance through institutions of
    higher education and educational service agencies or other local
    consortia, and private providers of scientifically based technical
    assistance and the State may seek approval from the Secretary to use
    funds made available under section 1002(j) for such approaches as part
    of the State plan.''.

    SEC. 108. ACADEMIC ACHIEVEMENT AWARDS PROGRAM.

        Sections 1118 through 1127 are amended to read as follows:

    ``SEC. 1117A. ACADEMIC ACHIEVEMENT AWARDS PROGRAM.

        ``(a) Establishment of Academic Achievement Awards Program.--
                ``(1) In general.--Each State receiving a grant under this
            part may establish a program for making academic achievement
            awards to recognize and financially reward schools served under
            this part that have--
                        ``(A) significantly closed the achievement gap
                    between the groups of students defined in section
                    1111(b)(2); or
                        ``(B) exceeded their adequate yearly progress
                    goals, consistent with section 1111(b)(2), for 2 or
                    more consecutive years.
                ``(2) Awards to teachers.--A State program under paragraph
            (1) may also recognize and provide financial awards to teachers
            teaching in a school described in such paragraph whose students
            consistently make significant gains in academic achievement in
            the areas in which the teacher provides instruction.
        ``(b) Funding.--
                ``(1) Reservation of funds by state.--For the purpose of
            carrying out this section, each State receiving a grant under
            this part may reserve, from the amount (if any) by which the
            funds received by the State under this part for a fiscal year
            exceed the amount received by the State under this part for the
            preceding fiscal year, not more than 30 percent of such excess
            amount.
                ``(2) Use within 3 years.--Notwithstanding any other
            provision of law, the amount reserved under paragraph (1) by a
            State for each fiscal year shall remain available to the State
            until expended for a period not exceeding 3 years.
                ``(3) Special allocation rule for schools in high-poverty
            areas.--
                        ``(A) In general.--Each State receiving a grant
                    under this part shall distribute at least 75 percent of
                    the amount reserved under paragraph (1) for each fiscal
                    year to schools described in subparagraph (B), or to
                    teachers teaching in such schools.
                        ``(B) School described.--A school described in
                    subparagraph (A) is a school whose student population
                    is in the highest quartile of schools statewide in
                    terms of the percentage of children from low income
                    families.

    ``SEC. 1118. PARENTAL INVOLVEMENT.

        ``(a) Local Educational Agency Policy.--
                ``(1) In general.--A local educational agency may receive
            funds under this part only if such agency implements programs,
            activities, and procedures for the involvement of parents in
            programs assisted under this part consistent with the
            provisions of this section. Such activities shall be planned
            and implemented with meaningful consultation with parents of
            participating children.
                ``(2) Written policy.--Each local educational agency that
            receives funds under this part shall develop jointly with,
            agree upon with, and distribute to, parents of participating
            children a written parent involvement policy that is
            incorporated into the local educational agency's plan developed
            under section 1112, establishes the expectations for parent
            involvement, and describes how the local educational agency
            will--
                        ``(A) involve parents in the joint development of
                    the plan under section 1112, and the process of school
                    review and improvement under section 1116;
                        ``(B) provide the coordination, technical
                    assistance, and other support necessary to assist
                    participating schools in planning and implementing
                    effective parent involvement;
                        ``(C) build the schools' and parents' capacity for
                    strong parent involvement as described in subsection
                    (e);
                        ``(D) coordinate and integrate parental involvement
                    strategies under this part with parental involvement
                    strategies under other programs, such as Head Start,
                    Early Reading First, Reading First, Even Start, the
                    Parents as Teachers Program, the Home Instruction
                    Program for Preschool Youngsters, and State-run
                    preschool programs;
                        ``(E) conduct, with the involvement of parents, an
                    annual evaluation of the content and effectiveness of
                    the parental involvement policy in improving the
                    academic quality of the schools served under this part;
                    and
                        ``(F) involve parents in the activities of the
                    schools served under this part.
                ``(3) Reservation.--
                        ``(A) In general.--Each local educational agency
                    shall reserve not less than 1 percent of such agency's
                    allocation under this part to carry out this section,
                    including family literacy and parenting skills, except
                    that this paragraph shall not apply if 1 percent of
                    such agency's allocation under this part (other than
                    funds allocated under section 1002(g) for the fiscal
                    year for which the determination is made is $5,000 or
                    less.
                        ``(B) Parental input.--Parents of children
                    receiving services under this part shall be involved in
                    the decisions regarding how funds reserved under
                    subparagraph (A) are allotted for parental involvement
                    activities.
                        ``(C) Distribution of funds.--Not less than 95
                    percent of the funds reserved under subparagraph (A)
                    shall be distributed to schools served under this part.
        ``(b) School Parental Involvement Policy.--
                ``(1) In general.--Each school served under this part shall
            jointly develop with, and distribute to, parents of
            participating children a written parental involvement policy,
            agreed upon by such parents, that shall describe the means for
            carrying out the requirements of subsections (c) through (f).
            Parents shall be notified of the policy in a format, and to the
            extent practicable in a language they can understand. Such
            policy shall be updated periodically to meet the changing needs
            of parents and the school.
                ``(2) Special rule.--If the school has a parental
            involvement policy that applies to all parents, such school may
            amend that policy, if necessary, to meet the requirements of
            this subsection.
                ``(3) Amendment.--If the local educational agency has a
            school district-level parental involvement policy that applies
            to all parents, such agency may amend that policy, if
            necessary, to meet the requirements of this subsection.
                ``(4) Parental comments.--If the plan under section 1112 is
            not satisfactory to the parents of participating children, the
            local educational agency shall submit any parent comments with
            such plan when such local educational agency submits the plan
            to the State.
        ``(c) Policy Involvement.--Each school served under this part
    shall--
                ``(1) convene an annual meeting, at a convenient time, to
            which all parents of participating children shall be invited
            and encouraged to attend, to inform parents of their school's
            participation under this part and to explain this part, its
            requirements, and their right to be involved;
                ``(2) offer a flexible number of meetings, such as meetings
            in the morning or evening, and may provide, with funds provided
            under this part, transportation, child care, or home visits, as
            such services relate to parental involvement;
                ``(3) involve parents, in an organized, ongoing, and timely
            way, in the planning, review, and improvement of programs under
            this part, including the school parental involvement policy and
            the joint development of the schoolwide program plan under
            section 1114(c)(2) and (c)(3), except that if a school has in
            place a process for involving parents in the joint planning and
            design of its programs, the school may use that process, if
            such process includes an adequate representation of parents of
            participating children;
                ``(4) provide parents of participating children--
                        ``(A) timely information about programs under this
                    part;
                        ``(B) a description and explanation of the
                    curriculum in use at the school, the forms of academic
                    assessment used to measure student progress, and the
                    proficiency levels students are expected to meet; and
                ``(5) if the schoolwide program plan under section
            1114(c)(2) and (c)(3) is not satisfactory to the parents of
            participating children, submit any parent comments on the plan
            when the school makes the plan available to the local
            educational agency.
        ``(d) Shared Responsibilities for High Student Performance.--As a
    component of the school-level parental involvement policy developed
    under subsection (b), each school served under this part shall agree
    with parents of children served under this part regarding how parents,
    the entire school staff, and students will share the responsibility for
    improved student achievement and the means by which the school and
    parents will build and develop a partnership to help children achieve
    the State's high academic standards.
        ``(e) Building Capacity for Involvement.--To ensure effective
    involvement of parents and to support a partnership among the school,
    parents, and the community to improve student achievement, each school
    and local educational agency--
                ``(1) shall provide assistance to participating parents in
            such areas as understanding the State's academic content
            standards and State student academic achievement standards,
            State and local academic assessments, the requirements of this
            part, and how to monitor a child's progress and work with
            educators to improve the performance of their children;
                ``(2) shall provide materials and training to help parents
            to work with their children to improve their children's
            achievement;
                ``(3) shall educate teachers, pupil services personnel,
            principals and other staff, with the assistance of parents, in
            the value and utility of contributions of parents, and in how
            to reach out to, communicate with, and work with parents as
            equal partners, implement and coordinate parent programs, and
            build ties between parents and the school;
                ``(4) shall coordinate and integrate parent involvement
            programs and activities with Head Start, Reading First, Early
            Reading First, Even Start, the Home Instruction Programs for
            Preschool Youngsters, the Parents as Teachers Program, and
            public preschool programs and other programs, to the extent
            feasible and appropriate;
                ``(5) shall ensure, to the extent possible, that
            information related to school and parent programs, meetings,
            and other activities is sent to the parents of participating
            children in the language used by such parents;
                ``(6) may involve parents in the development of training
            for teachers, principals, and other educators to improve the
            effectiveness of such training in improving instruction and
            services to the children of such parents in a format, and to
            the extent practicable, in a language the parent can
            understand;
                ``(7) may provide necessary literacy training from funds
            received under this part if the local educational agency has
            exhausted all other reasonably available sources of funding for
            such activities;
                ``(8) may pay reasonable and necessary expenses associated
            with local parental involvement activities, including
            transportation and child care costs, to enable parents to
            participate in school-related meetings and training sessions;
                ``(9) may train parents to enhance the involvement of other
            parents;
                ``(10) may arrange for teachers or other educators, who
            work directly with participating children, to conduct in-home
            conferences with parents who are unable to attend such
            conferences at school;
                ``(11) may adopt and implement model approaches to
            improving parental involvement;
                ``(12) may establish a districtwide parent advisory council
            to provide advice on all matters related to parental
            involvement in programs supported under this part;
                ``(13) may develop appropriate roles for community-based
            organizations and businesses in parent involvement activities;
            and
                ``(14) may arrange for teachers or other educators, who
            work directly with participating children, to conduct in-home
            conferences with parents who are unable to attend such
            conferences at school.
        ``(f) Accessibility.--In carrying out the parental involvement
    requirements of this part, local educational agencies and schools, to
    the extent practicable, shall provide full opportunities for the
    participation of parents with limited English proficiency or with
    disabilities and parents of migratory children, including providing
    information and school reports required under section 1111 in a format,
    and to the extent practicable, in a language such parents understand.

    ``SEC. 1119. QUALIFICATIONS FOR TEACHERS AND PARAPROFESSIONALS.

        ``(a) Teachers.--
                ``(1) In general.--Each local educational agency receiving
            assistance under this part shall ensure that all teachers hired
            on or after the effective date of the No Child Left Behind Act
            of 2001 and teaching in a program supported with funds under
            this part are fully qualified.
                ``(2) Plan.--Each State receiving assistance under this
            part shall develop and submit to the Secretary a plan to ensure
            that all teachers teaching within the State are fully qualified
            not later than December 31, 2005. Such plan shall include an
            assurance that the State will require each local educational
            agency and school receiving funds under this part publicly to
            report their annual progress on the agency's and the school's
            performance in increasing the percentage of classes in core
            academic areas taught by fully qualified teachers.
        ``(b) New Paraprofessionals.--
                ``(1) In general.--Each local educational agency receiving
            assistance under this part shall ensure that all
            paraprofessionals hired 1 year or more after the effective date
            of the No Child Left Behind Act of 2001 and working in a
            program supported with funds under this part shall--
                        ``(A) have completed at least 2 years of study at
                    an institution of higher education;
                        ``(B) have obtained an associate's (or higher)
                    degree; or
                        ``(C) have met a rigorous standard of quality that
                    demonstrates, through a formal academic assessment--
                                ``(i) knowledge of, and the ability to
                            assist in instructing reading, writing, and
                            math; or
                                ``(ii) knowledge of, and the ability to
                            assist in instructing reading readiness,
                            writing readiness, and math readiness, as
                            appropriate.
                ``(2) Clarification.--For purposes of paragraph (1)(C), the
            receipt of a high school diploma (or its recognized equivalent)
            shall be necessary but not by itself sufficient to satisfy the
            requirements of such paragraph.
        ``(c) Existing Paraprofessionals.--Each local educational agency
    receiving assistance under this part shall ensure that all
    paraprofessionals hired before the date that is 1 year after the
    effective date of the No Child Left Behind Act of 2001 and working in a
    program supported with funds under this part shall, not later than 3
    years after such effective date, satisfy the requirements of subsection
    (b).
        ``(d) Exceptions for Translation and Parental Involvement
    Activities.--Subsections (b) and (c) shall not apply to a
    paraprofessional--
                ``(1) who is proficient in English and a language other
            than English and who provides services primarily to enhance the
            participation of children in programs under this part by acting
            as a translator; or
                ``(2) whose duties consist solely of conducting parental
            involvement activities consistent with section 1118.
        ``(e) General Requirement for All Paraprofessionals.--Each local
    educational agency receiving assistance under this part shall ensure
    that all paraprofessionals working in a program supported with funds
    under this part, regardless of the paraprofessional's hiring date,
    possess a high school diploma or its recognized equivalent.
        ``(f) Duties of Paraprofessionals.--
                ``(1) In general.--Each local educational agency receiving
            assistance under this part shall ensure that a paraprofessional
            working in a program supported with funds under this part is
            not assigned a duty inconsistent with this subsection.
                ``(2) Responsibilities paraprofessionals may be assigned.--
            A paraprofessional described in paragraph (1) may only be
            assigned--
                        ``(A) to provide one-on-one tutoring for eligible
                    students, if the tutoring is scheduled at a time when a
                    student would not otherwise receive instruction from a
                    teacher;
                        ``(B) to assist with classroom management, such as
                    organizing instructional and other materials;
                        ``(C) to provide assistance in a computer
                    laboratory;
                        ``(D) to conduct parental involvement activities;
                        ``(E) to provide support in a library or media
                    center;
                        ``(F) to act as a translator; or
                        ``(G) to provide instructional services to
                    students.
                ``(3) Additional limitations.--A paraprofessional described
            in paragraph (1)--
                        ``(A) may not provide any instructional service to
                    a student unless the paraprofessional is working under
                    the direct supervision of a fully qualified teacher;
                    and
                        ``(B) may not provide instructional services to
                    students in the area of reading, writing, or math
                    unless the paraprofessional has demonstrated, through a
                    State or local academic assessment, the ability to
                    effectively carry out reading, writing, or math
                    instruction.
        ``(g) Use of Funds.--
                ``(1) Professional development.--A local educational agency
            receiving funds under this part may use such funds to support
            ongoing training and professional development to assist
            teachers and paraprofessionals in satisfying the requirements
            of this section.
                ``(2) Limitation on use of funds for paraprofessionals.--
                        ``(A) In general.--Beginning on and after the
                    effective date of the No Child Left Behind Act of 2001,
                    a local educational agency may not use funds received
                    under this part to fund any paraprofessional hired
                    after such date unless the hiring is to fill a vacancy
                    created by the departure of another paraprofessional
                    funded under this part and such new paraprofessional
                    satisfies the requirements of subsection (b), except as
                    provided in subsection (d).
                        ``(B) Exception.--Subparagraph (A) shall not apply
                    for a fiscal year to a local educational agency that
                    can demonstrate to the State that all teachers under
                    the jurisdiction of the agency are fully qualified.
        ``(h) Verification of Compliance.--
                ``(1) In general.--In verifying compliance with this
            section, each local educational agency at a minimum shall
            require that the principal of each school operating a program
            under section 1114 or 1115 annually attest in writing as to
            whether such school is in compliance with the requirements of
            this section.
                ``(2) Availability of information.--Copies of attestations
            under paragraph (1)--
                        ``(A) shall be maintained at each school operating
                    a program under section 1114 or 1115 and at the main
                    office of the local educational agency; and
                        ``(B) shall be available to any member of the
                    general public upon request.

    ``SEC. 1119A. PROFESSIONAL DEVELOPMENT.

        ``(a) Purpose.--The purpose of this section is to assist each local
    educational agency receiving assistance under this part in increasing
    the academic achievement of children served under this part through
    improved teacher quality.
        ``(b) Professional Development Activities.--Professional
    development activities under this section shall--
                ``(1) give teachers, principals, and administrators the
            knowledge and skills to provide students with the opportunity
            to meet challenging State or local academic content standards
            and student academic achievement standards;
                ``(2) support the recruiting, hiring, and training of fully
            qualified teachers, including teachers fully qualified through
            State and local alternative routes;
                ``(3) advance teacher understanding of effective
            instructional strategies based on scientifically based research
            for improving student achievement, at a minimum, in reading or
            language arts and mathematics;
                ``(4) be directly related to the curriculum and content
            areas in which the teacher provides instruction, except this
            requirement does not apply to activities that instruct in
            methods of improving student behavior;
                ``(5) be designed to enhance the ability of a teacher to
            understand and use the State's academic standards for the
            subject area in which the teacher provides instruction;
                ``(6) be tied to scientifically based research
            demonstrating the effectiveness of such professional
            development activities or programs in increasing student
            achievement or substantially increasing the knowledge and
            teaching skills of teachers;
                ``(7) be of sufficient intensity and duration (not to
            include 1-day or short-term workshops and conferences) to have
            a positive and lasting impact on the teacher's performance in
            the classroom;
                ``(8) be developed with extensive participation of
            teachers, principals, parents, and administrators of schools to
            be served under this part;
                ``(9) be designed to give teachers of limited English
            proficient children, other teachers, and instructional staff
            the knowledge and skills to provide instruction and appropriate
            language and academic support services to such children,
            including the appropriate use of curriculum and academic
            assessments;
                ``(10) to the extent appropriate, provide training for
            teachers in the use of technology so that technology and its
            applications are effectively used in the classroom to improve
            teaching and learning in the curriculum and academic content
            areas in which the teachers provide instruction; and
                ``(11) as a whole, be regularly evaluated for their impact
            on increased teacher effectiveness and improved student
            achievement, with the findings of such evaluations used to
            improve the quality of professional development.
        ``(c) Additional Professional Development Activities.--Such
    professional development activities may include--
                ``(1) instruction in the use of data and academic
            assessments to inform and instruct classroom practice;
                ``(2) instruction in ways that teachers, principals, pupil
            services personnel, and school administrators may work more
            effectively with parents;
                ``(3) the forming of partnerships with institutions of
            higher education to establish school-based teacher training
            programs that provide prospective teachers and novice teachers
            with an opportunity to work under the guidance of experienced
            teachers and college faculty;
                ``(4) the creation of career ladder programs for
            paraprofessionals (assisting teachers under this part) to
            obtain the education necessary for such paraprofessionals to
            become licensed and certified teachers; and
                ``(5) instruction in ways to teach special needs children.
        ``(d) Program Participation.--Each local educational agency
    receiving assistance under this part may design professional
    development programs so that--
                ``(1) all school staff in schools participating in a
            schoolwide program under section 1114 can participate in
            professional development activities; and
                ``(2) all school staff in targeted assistance schools may
            participate in professional development activities if such
            participation will result in better addressing the needs of
            students served under this part.
        ``(e) Parental Participation.--Parents may participate in
    professional development activities under this part if the school
    determines that parental participation is appropriate.
        ``(f) Consortia.--In carrying out such professional development
    programs, local educational agencies may provide services through
    consortia arrangements with other local educational agencies,
    educational service agencies or other local consortia, institutions of
    higher education, or other public or private institutions or
    organizations.
        ``(g) Consolidation of Funds.--Funds provided under this part that
    are used for professional development purposes may be consolidated with
    funds provided under title II of this Act and other sources.
        ``(h) Special Rule.--No State educational agency shall require a
    school or a local educational agency to expend a specific amount of
    funds for professional development activities under this part, except
    that this paragraph shall not apply with respect to requirements under
    section 1116(b)(3)(A)(iii).

    ``SEC. 1120. PARTICIPATION OF CHILDREN ENROLLED IN PRIVATE SCHOOLS.

        ``(a) General Requirement.--
                ``(1) In general.--To the extent consistent with the number
            of eligible children identified under section 1115(b) in a
            local educational agency who are enrolled in private elementary
            and secondary schools, a local educational agency shall, after
            timely and meaningful consultation with appropriate private
            school officials, provide such children, on an equitable basis,
            special educational services or other benefits under this part
            (such as dual enrollment, educational radio and television,
            computer equipment and materials, other technology, and mobile
            educational services and equipment) that address their needs,
            and shall ensure that teachers and families of these students
            participate, on an equitable basis, in services and activities
            developed pursuant to sections 1118 and 1119A.
                ``(2) Secular, neutral, nonideological.--Such educational
            services or other benefits, including materials and equipment,
            shall be secular, neutral, and nonideological.
                ``(3) Equity.--Educational services and other benefits for
            such private school children shall be equitable in comparison
            to services and other benefits for public school children
            participating under this part, and shall be provided in a
            timely manner.
                ``(4) Expenditures.--Expenditures for educational services
            and other benefits to eligible private school children shall be
            equal to the proportion of funds allocated to participating
            school attendance areas based on the number of children from
            low-income families who attend private schools, which the local
            educational agency may determine each year or every 2 years.
                ``(5) Provision of services.--The local educational agency
            shall provide services under this section directly or through
            contracts with public and private agencies, organizations, and
            institutions.
        ``(b) Consultation.--
                ``(1) In general.--To ensure timely and meaningful
            consultation, a local educational agency shall consult with
            appropriate private school officials during the design and
            development of such agency's programs under this part, on
            issues such as--
                        ``(A) how the children's needs will be identified;
                        ``(B) what services will be offered;
                        ``(C) how, where, and by whom the services will be
                    provided;
                        ``(D) how the services will be academically
                    assessed and how the results of that assessment will be
                    used to improve those services;
                        ``(E) the size and scope of the equitable services
                    to be provided to the eligible private school children,
                    and the amount of funds generated by low-income private
                    school children in each participating attendance area;
                        ``(F) the method or sources of data that are used
                    under subsection (a)(4) and section 1113(c)(2) to
                    determine the number of children from low-income
                    families in participating school attendance areas who
                    attend private schools; and
                        ``(G) how and when the agency will make decisions
                    about the delivery of services to such children,
                    including a thorough consideration and analysis of the
                    views of the private school officials on the provision
                    of contract services through potential third party
                    providers.
            If the local educational agency disagrees with the views of the
            private school officials on the provision of services, through
            a contract, the local educational agency shall provide in
            writing to such private school officials, an analysis of the
            reasons why the local educational agency has chosen not to use
            a contractor.
                ``(2) Timing.--Such consultation shall include meetings of
            agency and private school officials and shall occur before the
            local educational agency makes any decision that affects the
            opportunities of eligible private school children to
            participate in programs under this part. Such meetings shall
            continue throughout implementation and assessment of services
            provided under this section.
                ``(3) Discussion.--Such consultation shall include a
            discussion of service delivery mechanisms a local educational
            agency can use to provide equitable services to eligible
            private school children.
                ``(4) Documentation.--Each local educational agency shall
            maintain in its records and provide to the State educational
            agency a written affirmation signed by officials of each
            participating private school that the consultation required by
            this section has occurred.
                ``(5) Compliance.--Private school officials shall have the
            right to appeal to the State as to whether the consultation
            provided for in this section was meaningful and timely, and
            that due consideration was given to the views of private school
            officials. If the private school wishes to appeal, the basis of
            the claim of noncompliance with this section by a local
            educational agency shall be provided to the State, and the
            local educational agency shall forward the documentation
            provided in subsection (b)(4) to the State.
        ``(c) Public Control of Funds.--
                ``(1) In general.--The control of funds provided under this
            part, and title to materials, equipment, and property purchased
            with such funds, shall be in a public agency, and a public
            agency shall administer such funds and property.
                ``(2) Provision of services.--(A) The provision of services
            under this section shall be provided--
                        ``(i) by employees of a public agency; or
                        ``(ii) through contract by such public agency with
                    an individual, association, agency, or organization.
                ``(B) In the provision of such services, such employee,
            person, association, agency, or organization shall be
            independent of such private school and of any religious
            organization, and such employment or contract shall be under
            the control and supervision of such public agency.
        ``(d) Standards for a Bypass.--If a local educational agency is
    prohibited by law from providing for the participation on an equitable
    basis of eligible children enrolled in private elementary and secondary
    schools or if the Secretary determines that a local educational agency
    has substantially failed or is unwilling to provide for such
    participation, as required by this section, the Secretary shall--
                ``(1) waive the requirements of this section for such local
            educational agency;
                ``(2) arrange for the provision of services to such
            children through arrangements that shall be subject to the
            requirements of this section and sections 8505 and 8506; and
                ``(3) in making the determination, consider 1 or more
            factors, including the quality, size, scope, and location of
            the program and the opportunity of eligible children to
            participate.
        ``(e) Capital Expenses.--
                ``(1) In general.--(A) From the amount appropriated for
            this subsection under section 1002(g) for any fiscal year, each
            State is eligible to receive an amount that bears the same
            ratio to the amount so appropriated as the number of private
            school children who received services under this part in the
            State in the most recent year for which data satisfactory to
            the Secretary are available bears to the number of such
            children in all States in that same year.
                ``(B) The Secretary shall reallocate any amounts allocated
            under subparagraph (A) that are not used by a State for the
            purpose of this subsection to other States on the basis of
            their respective needs, as determined by the Secretary.
                ``(2) Capital expenses.--(A) A local educational agency may
            apply to the State educational agency for payments for capital
            expenses consistent with this subsection.
                ``(B) State educational agencies shall distribute such
            funds under this subsection to local educational agencies based
            on the degree of need set forth in their respective
            applications for assistance under this subsection.
                ``(3) Uses of funds.--Any funds appropriated to carry out
            this subsection shall be used only for capital expenses
            incurred to provide equitable services for private school
            children under this section.

    ``SEC. 1120A. FISCAL REQUIREMENTS.

        ``(a) Maintenance of Effort.--A local educational agency may
    receive funds under this part for any fiscal year only if the State
    educational agency finds that the local educational agency has
    maintained its fiscal effort in accordance with section 8501 of this
    Act.
        ``(b) Federal Funds To Supplement, Not Supplant, Non-Federal
    Funds.--
                ``(1) In general.--A State or local educational agency
            shall use funds received under this part only to supplement the
            amount of funds that would, in the absence of such Federal
            funds, be made available from non-Federal sources for the
            education of pupils participating in programs assisted under
            this part, and not to supplant such funds.
                ``(2) Special rule.--No local educational agency shall be
            required to provide services under this part through a
            particular instructional method or in a particular
            instructional setting in order to demonstrate such agency's
            compliance with paragraph (1).
        ``(c) Comparability of Services.--
                ``(1) In general.--(A) Except as provided in paragraphs (4)
            and (5), a local educational agency may receive funds under
            this part only if State and local funds will be used in schools
            served under this part to provide services that, taken as a
            whole, are at least comparable to services in schools that are
            not receiving funds under this part.
                ``(B) If the local educational agency is serving all of
            such agency's schools under this part, such agency may receive
            funds under this part only if such agency will use State and
            local funds to provide services that, taken as a whole, are
            substantially comparable in each school.
                ``(C) A local educational agency may meet the requirements
            of subparagraphs (A) and (B) on a grade-span by grade-span
            basis or a school-by-school basis.
                ``(2) Written assurance.--(A) A local educational agency
            shall be considered to have met the requirements of paragraph
            (1) if such agency has filed with the State educational agency
            a written assurance that such agency has established and
            implemented--
                        ``(i) a local educational agency-wide salary
                    schedule;
                        ``(ii) a policy to ensure equivalence among schools
                    in teachers, administrators, and other staff; and
                        ``(iii) a policy to ensure equivalence among
                    schools in the provision of curriculum materials and
                    instructional supplies.
                ``(B) For the purpose of subparagraph (A), in the
            determination of expenditures per pupil from State and local
            funds, or instructional salaries per pupil from State and local
            funds, staff salary differentials for years of employment shall
            not be included in such determinations.
                ``(C) A local educational agency need not include
            unpredictable changes in student enrollment or personnel
            assignments that occur after the beginning of a school year in
            determining comparability of services under this subsection.
                ``(3) Procedures and records.--Each local educational
            agency assisted under this part shall--
                        ``(A) develop procedures for compliance with this
                    subsection; and
                        ``(B) maintain records that are updated biennially
                    documenting such agency's compliance with this
                    subsection.
                ``(4) Inapplicability.--This subsection shall not apply to
            a local educational agency that does not have more than 1
            building for each grade span.
                ``(5) Compliance.--For the purpose of determining
            compliance with paragraph (1), a local educational agency may
            exclude State and local funds expended for--
                        ``(A) English language instruction for children of
                    limited English proficiency; and
                        ``(B) excess costs of providing services to
                    children with disabilities as determined by the local
                    educational agency.
              ``(d) Exclusion of Funds.--For the purpose of complying with
    subsections (b) and (c), a State or local educational agency may
    exclude supplemental State or local funds expended in any school
    attendance area or school for programs that meet the intent and
    purposes of this part.

    ``SEC. 1120B. COORDINATION REQUIREMENTS.

        ``(a) In General.--Each local educational agency receiving
    assistance under this part shall carry out the activities described in
    subsection (b) with Head Start Agencies, and if feasible, other early
    childhood development programs such as Early Reading First.
        ``(b) Activities.--The activities referred to in subsection (a) are
    activities that increase coordination between the local educational
    agency and a Head Start agency, and, if feasible, other early childhood
    development programs, such as Early Reading First serving children who
    will attend the schools of such agency, including--
                ``(1) developing and implementing a systematic procedure
            for receiving records regarding such children transferred with
            parental consent from a Head Start program or, where
            applicable, other early childhood development programs such as
            Early Reading First;
                ``(2) establishing channels of communication between school
            staff and their counterparts in such Head Start agencies
            (including teachers, social workers, and health staff) or other
            early childhood development programs such as Early Reading
            First, as appropriate, to facilitate coordination of programs;
                ``(3) conducting meetings involving parents, kindergarten
            or elementary school teachers, and Head Start teachers or, if
            appropriate, teachers from other early childhood development
            programs such as Early Reading First, to discuss the
            developmental and other needs of individual children;
                ``(4) organizing and participating in joint transition
            related training of school staff, Head Start staff, Early
            Reading First staff and, where appropriate, other early
            childhood staff; and
                ``(5) linking the educational services provided in such
            local educational agency with the services provided in local
            Head Start agencies and Early Reading First programs.
        ``(c) Coordination of Regulations.--The Secretary shall work with
    the Secretary of Health and Human Services to coordinate regulations
    promulgated under this part with regulations promulgated under the Head
    Start Act.

                            ``Subpart 2--Allocations

    ``SEC. 1121. GRANTS FOR THE OUTLYING AREAS AND THE SECRETARY OF THE
                  INTERIOR.

        ``(a) Reservation of Funds.--From the amount appropriated for
    payments to States for any fiscal year under section 1002(a), the
    Secretary shall reserve a total of 1 percent to provide assistance to--
                ``(1) the outlying areas in the amount determined in
            accordance with subsection (b); and
                ``(2) the Secretary of the Interior in the amount necessary
            to make payments pursuant to subsection (d).
        ``(b) Assistance to Outlying Areas.--
                ``(1) Funds reserved.--From the amount made available for
            any fiscal year under subsection (a), the Secretary shall award
            grants to the outlying areas.
                ``(2) Competitive grants.--For each of fiscal years 2002
            and 2003, the Secretary shall carry out the competition
            described in paragraph (3), except that the amount reserved to
            carry out such competition shall not exceed the amount reserved
            under this section for the freely associated states for fiscal
            year 1999.
                ``(3) Limitation for competitive grants.--
                        ``(A) Competitive grants.--The Secretary shall use
                    funds described in paragraph (2) to award grants, on a
                    competitive basis, to the outlying areas and freely
                    associated States to carry out the purposes of this
                    part.
                        ``(B) Award basis.--The Secretary shall award
                    grants under subparagraph (A) on a competitive basis,
                    pursuant to the recommendations of the Pacific Region
                    Educational Laboratory in Honolulu, Hawaii.
                        ``(C) Administrative costs.--The Secretary may
                    provide not more than 5 percent of the amount reserved
                    for grants under this paragraph to pay the
                    administrative costs of the Pacific Region Educational
                    Laboratory under subparagraph (B).
                ``(4) Special rule.--The provisions of Public Law 95-134,
            permitting the consolidation of grants by the outlying areas,
            shall not apply to funds provided to the freely associated
            States under this section.
        ``(c) Definitions.--For the purposes of subsections (a) and (b)--
                ``(1) the term `freely associated States' means the
            Republic of the Marshall Islands, the Federated States of
            Micronesia, and the Republic of Palau; and
                ``(2) the term `outlying area' means the United States
            Virgin Islands, Guam, American Samoa, and the Commonwealth of
            the Northern Mariana Islands.
        ``(d) Allotment to the Secretary of the Interior.--
                ``(1) In general.--The amount allotted for payments to the
            Secretary of the Interior under subsection (a)(2) for any
            fiscal year shall be, as determined pursuant to criteria
            established by the Secretary, the amount necessary to meet the
            special educational needs of--
                        ``(A) Indian children on reservations served by
                    elementary and secondary schools for Indian children
                    operated or supported by the Department of the
                    Interior; and
                        ``(B) out-of-State Indian children in elementary
                    and secondary schools in local educational agencies
                    under special contracts with the Department of the
                    Interior.
                ``(2) Payments.--From the amount allotted for payments to
            the Secretary of the Interior under subsection (a)(2), the
            Secretary of the Interior shall make payments to local
            educational agencies, upon such terms as the Secretary
            determines will best carry out the purposes of this part, with
            respect to out-of-State Indian children described in paragraph
            (1). The amount of such payment may not exceed, for each such
            child, the greater of--
                        ``(A) 40 percent of the average per-pupil
                    expenditure in the State in which the agency is
                    located; or
                        ``(B) 48 percent of such expenditure in the United
                    States.

    ``SEC. 1122. AMOUNTS FOR BASIC GRANTS, CONCENTRATION GRANTS, AND
                  TARGETED GRANTS.

        ``(a) Allocation Formula.--Of the amount appropriated to carry out
    this part for each of fiscal years 2002 through 2006 (referred to in
    this subsection as the current fiscal year)--
                ``(1) an amount equal to the amount appropriated to carry
            out section 1124 for fiscal year 2001 shall be allocated in
            accordance with section 1124;
                ``(2) an amount equal to the amount appropriated to carry
            out section 1124A for fiscal year 2001 shall be allocated in
            accordance with section 1124A; and
                ``(3) an amount equal to 100 percent of the amount, if any,
            by which the amount appropriated under section 1002(a) for the
            current fiscal year exceeds the amount appropriated under such
            section for fiscal year 2001 shall be allocated in accordance
            with section 1125.
        ``(b) Adjustments Where Necessitated by Appropriations.--
                ``(1) In general.--If the sums available under this part
            for any fiscal year are insufficient to pay the full amounts
            that all local educational agencies in States are eligible to
            receive under sections 1124, 1124A, and 1125 for such year, the
            Secretary shall ratably reduce the allocations to such local
            educational agencies, subject to subsections (c) and (d) of
            this section.
                ``(2) Additional funds.--If additional funds become
            available for making payments under sections 1124, 1124A, and
            1125 for such fiscal year, allocations that were reduced under
            paragraph (1) shall be increased on the same basis as they were
            reduced.
        ``(c) Hold-Harmless Amounts.--
                ``(1) Amounts for sections 1124 and 1125.--For each fiscal
            year, the amount made available to each local educational
            agency under each of sections 1124 and 1125 shall be--
                        ``(A) not less than 95 percent of the amount made
                    available in the preceding fiscal year if the number of
                    children counted for grants under section 1124 is not
                    less than 30 percent of the total number of children
                    aged 5 to 17 years, inclusive, in the local educational
                    agency;
                        ``(B) not less than 90 percent of the amount made
                    available in the preceding fiscal year if the
                    percentage described in subparagraph (A) is between 15
                    percent and 30 percent; and
                        ``(C) not less than 85 percent of the amount made
                    available in the preceding fiscal year if the
                    percentage described in subparagraph (A) is below 15
                    percent.
                ``(2) Amount for section 1124a.--The amount made available
            to each local educational agency under section 1124A shall be
            not less than 85 percent of the amount made available in the
            preceding fiscal year.
                ``(3) Payments.--If sufficient funds are appropriated, the
            amounts described in paragraph (2) shall be paid to all local
            educational agencies that received grants under section 1124A
            for the preceding fiscal year, regardless of whether the local
            educational agency meets the minimum eligibility criteria for
            that fiscal year provided in section 1124A(a)(1)(A) except that
            a local educational agency that does not meet such minimum
            eligibility criteria for 4 consecutive years shall no longer be
            eligible to receive a hold harmless amount referred to in
            paragraph (2).
                ``(4) Population data.--In any fiscal year for which the
            Secretary calculates grants on the basis of population data for
            counties, the Secretary shall apply the hold harmless
            percentages in paragraphs (1) and (2) to counties, and if the
            Secretary's allocation for a county is not sufficient to meet
            the hold-harmless requirements of this subsection for every
            local educational agency within that county, the State
            educational agency shall reallocate funds proportionately from
            all other local educational agencies in the State that are
            receiving funds in excess of the hold harmless amounts
            specified in this subsection.
        ``(d) Ratable Reductions.--
                ``(1) In general.--If the sums made available under this
            part for any fiscal year are insufficient to pay the full
            amounts that all States are eligible to receive under
            subsection (c) for such year, the Secretary shall ratably
            reduce such amounts for such year.
                ``(2) Additional funds.--If additional funds become
            available for making payments under subsection (c) for such
            fiscal year, amounts that were reduced under paragraph (1)
            shall be increased on the same basis as such amounts were
            reduced.
        ``(e) Definition.--For the purpose of this section and sections
    1124, 1124A, and 1125, the term `State' means each of the 50 States,
    the District of Columbia, and the Commonwealth of Puerto Rico.

    ``SEC. 1124. BASIC GRANTS TO LOCAL EDUCATIONAL AGENCIES.

        ``(a) Amount of Grants.--
                ``(1) Grants for local educational agencies and puerto
            rico.--Except as provided in paragraph (4) and in section 1126,
            the grant that a local educational agency is eligible to
            receive under this section for a fiscal year is the amount
            determined by multiplying--
                        ``(A) the number of children counted under
                    subsection (c); and
                        ``(B) 40 percent of the average per-pupil
                    expenditure in the State, except that the amount
                    determined under this subparagraph shall not be less
                    than 32 percent or more than 48 percent, of the average
                    per-pupil expenditure in the United States.
                ``(2) Calculation of grants.--
                        ``(A) Allocations to local educational agencies.--
                    The Secretary shall calculate grants under this section
                    on the basis of the number of children counted under
                    subsection (c) for local educational agencies, unless
                    the Secretary and the Secretary of Commerce determine
                    that some or all of those data are unreliable or that
                    their use would be otherwise inappropriate, in which
                    case--
                                ``(i) the 2 Secretaries shall publicly
                            disclose the reasons for their determination in
                            detail; and
                                ``(ii) paragraph (3) shall apply.
                        ``(B) Allocations to large and small local
                    educational agencies.--(i) For any fiscal year in which
                    this paragraph applies, the Secretary shall calculate
                    grants under this section for each local educational
                    agency.
                        ``(ii) The amount of a grant under this section for
                    each large local educational agency shall be the amount
                    determined under clause (i).
                        ``(iii) For small local educational agencies, the
                    State educational agency may either--
                                ``(I) distribute grants under this section
                            in amounts determined by the Secretary under
                            clause (i); or
                                ``(II) use an alternative method approved
                            by the Secretary to distribute the portion of
                            the State's total grants under this section
                            that is based on those small agencies.
                        ``(iv) An alternative method under clause (iii)(II)
                    shall be based on population data that the State
                    educational agency determines best reflect the current
                    distribution of children in poor families among the
                    State's small local educational agencies that meet the
                    eligibility criteria of subsection (b).
                        ``(v) If a small local educational agency is
                    dissatisfied with the determination of its grant by the
                    State educational agency under clause (iii)(II), it may
                    appeal that determination to the Secretary, who shall
                    respond not later than 45 days after receipt of such
                    appeal.
                        ``(vi) As used in this subparagraph--
                                ``(I) the term `large local educational
                            agency' means a local educational agency
                            serving an area with a total population of
                            20,000 or more; and
                                ``(II) the term `small local educational
                            agency' means a local educational agency
                            serving an area with a total population of less
                            than 20,000.
                ``(3) Allocations to counties.--
                        ``(A) Calculation.--For any fiscal year to which
                    this paragraph applies, the Secretary shall calculate
                    grants under this section on the basis of the number of
                    children counted under section 1124(c) for counties,
                    and State educational agencies shall suballocate county
                    amounts to local educational agencies, in accordance
                    with regulations issued by the Secretary.
                        ``(B) Direct allocations.--In any State in which a
                    large number of local educational agencies overlap
                    county boundaries, or for which the State believes it
                    has data that would better target funds than allocating
                    them by county, the State educational agency may apply
                    to the Secretary for authority to make the allocations
                    under this part for a particular fiscal year directly
                    to local educational agencies without regard to
                    counties.
                        ``(C) Assurances.--If the Secretary approves the
                    State educational agency's application under
                    subparagraph (B), the State educational agency shall
                    provide the Secretary an assurance that such
                    allocations shall be made--
                                ``(i) using precisely the same factors for
                            determining a grant as are used under this
                            part; or
                                ``(ii) using data that the State
                            educational agency submits to the Secretary for
                            approval that more accurately target poverty.
                        ``(D) Appeal.--The State educational agency shall
                    provide the Secretary an assurance that it shall
                    establish a procedure through which a local educational
                    agency that is dissatisfied with its determinations
                    under subparagraph (B) may appeal directly to the
                    Secretary for a final determination.
                ``(4) Puerto rico.--
                        ``(A) In general.--For each fiscal year, the grant
                    which the Commonwealth of Puerto Rico shall be eligible
                    to receive under this section shall be the amount
                    determined by multiplying the number of children
                    counted under subsection (c) for the Commonwealth of
                    Puerto Rico by the product of--
                                ``(i) the percentage which the average per-
                            pupil expenditure in the Commonwealth of Puerto
                            Rico is of the lowest average per-pupil
                            expenditure of any of the 50 States; and
                                ``(ii) 32 percent of the average per-pupil
                            expenditure in the United States.
                        ``(B) Minimum percentage.--The percentage in
                    subparagraph (A)(i) shall not be less than--
                                ``(i) for fiscal year 2002, 77.5 percent;
                                ``(ii) for fiscal year 2003, 80.0 percent;
                                ``(iii) for fiscal year 2004, 82.5 percent;
                            and
                                ``(iv) for fiscal year 2005 and succeeding
                            fiscal years, 85.0 percent.
                        ``(C) Limitation.--If the application of
                    subparagraph (B) would result in any of the 50 States
                    or the District of Columbia receiving less under this
                    part than it received under this part for the preceding
                    fiscal year, the percentage in subparagraph (A) shall
                    be the greater of the percentage in subparagraph (A)(i)
                    or the percentage used for the preceding fiscal year.
                ``(5) Definition.--For purposes of this subsection, the
            term `State' does not include Guam, American Samoa, the Virgin
            Islands, and the Northern Mariana Islands.
        ``(b) Minimum Number of Children To Qualify.--A local educational
    agency is eligible for a basic grant under this section for any fiscal
    year only if the number of children counted under subsection (c) for
    that agency is both--
                ``(1) 10 or more; and
                ``(2) more than 2 percent of the total school-age
            population in the agency's jurisdiction.
        ``(c) Children To Be Counted.--
                ``(1) Categories of children.--The number of children to be
            counted for purposes of this section is the aggregate of--
                        ``(A) the number of children aged 5 to 17,
                    inclusive, in the school district of the local
                    educational agency from families below the poverty
                    level as determined under paragraph (2);
                        ``(B) the number of children (determined under
                    paragraph (4) for either the preceding year as
                    described in that paragraph, or for the second
                    preceding year, as the Secretary finds appropriate)
                    aged 5 to 17, inclusive, in the school district of such
                    agency in institutions for neglected and delinquent
                    children (other than such institutions operated by the
                    United States), but not counted pursuant to subpart 1
                    of part D for the purposes of a grant to a State
                    agency, or being supported in foster homes with public
                    funds; and
                        ``(C) the number of children aged 5 to 17,
                    inclusive, in the school district of such agency from
                    families above the poverty level as determined under
                    paragraph (4).
                ``(2) Determination of number of children.--For the
            purposes of this section, the Secretary shall determine the
            number of children aged 5 to 17, inclusive, from families below
            the poverty level on the basis of the most recent satisfactory
            data, described in paragraph (3), available from the Department
            of Commerce. The District of Columbia and the Commonwealth of
            Puerto Rico shall be treated as individual local educational
            agencies. If a local educational agency contains 2 or more
            counties in their entirety, then each county will be treated as
            if such county were a separate local educational agency for
            purposes of calculating grants under this part. The total of
            grants for such counties shall be allocated to such a local
            educational agency, which local educational agency shall
            distribute to schools in each county within such agency a share
            of the local educational agency's total grant that is no less
            than the county's share of the population counts used to
            calculate the local educational agency's grant.
                ``(3) Population updates.--In fiscal year 2001 and every 2
            years thereafter, the Secretary shall use updated data on the
            number of children, aged 5 to 17, inclusive, from families
            below the poverty level for local educational agencies or
            counties, published by the Department of Commerce, unless the
            Secretary and the Secretary of Commerce determine that use of
            the updated population data would be inappropriate or
            unreliable. If the Secretary and the Secretary of Commerce
            determine that some or all of the data referred to in this
            paragraph are inappropriate or unreliable, they shall publicly
            disclose their reasons. In determining the families which are
            below the poverty level, the Secretary shall utilize the
            criteria of poverty used by the Bureau of the Census in
            compiling the most recent decennial census, in such form as
            those criteria have been updated by increases in the Consumer
            Price Index for all urban consumers, published by the Bureau of
            Labor Statistics.
                ``(4) Other children to be counted.--For the purposes of
            this section, the Secretary shall determine the number of
            children aged 5 to 17, inclusive, from families above the
            poverty level on the basis of the number of such children from
            families receiving an annual income, in excess of the current
            criteria of poverty, from payments under a State program funded
            under part A of title IV of the Social Security Act; and in
            making such determinations the Secretary shall utilize the
            criteria of poverty used by the Bureau of the Census in
            compiling the most recent decennial census for a family of 4 in
            such form as those criteria have been updated by increases in
            the Consumer Price Index for all urban consumers, published by
            the Bureau of Labor Statistics. The Secretary shall determine
            the number of such children and the number of children aged 5
            through 17 living in institutions for neglected or delinquent
            children, or being supported in foster homes with public funds,
            on the basis of the caseload data for the month of October of
            the preceding fiscal year (using, in the case of children
            described in the preceding sentence, the criteria of poverty
            and the form of such criteria required by such sentence which
            were determined for the calendar year preceding such month of
            October) or, to the extent that such data are not available to
            the Secretary before January of the calendar year in which the
            Secretary's determination is made, then on the basis of the
            most recent reliable data available to the Secretary at the
            time of such determination. The Secretary of Health and Human
            Services shall collect and transmit the information required by
            this subparagraph to the Secretary not later than January 1 of
            each year. For the purpose of this section, the Secretary shall
            consider all children who are in correctional institutions to
            be living in institutions for delinquent children.
                ``(5) Estimate.--When requested by the Secretary, the
            Secretary of Commerce shall make a special updated estimate of
            the number of children of such ages who are from families below
            the poverty level (as determined under subparagraph (A) of this
            paragraph) in each school district, and the Secretary is
            authorized to pay (either in advance or by way of
            reimbursement) the Secretary of Commerce the cost of making
            this special estimate. The Secretary of Commerce shall give
            consideration to any request of the chief executive of a State
            for the collection of additional census information.
        ``(d) State Minimum.--Notwithstanding section 1122, the aggregate
    amount allotted for all local educational agencies within a State may
    not be less than the lesser of--
                ``(1) 0.25 percent of total grants under this section; or
                ``(2) the average of--
                        ``(A) one-quarter of 1 percent of the total amount
                    available for such fiscal year under this section; and
                        ``(B) the number of children in such State counted
                    under subsection (c) in the fiscal year multiplied by
                    150 percent of the national average per-pupil payment
                    made with funds available under this section for that
                    year.

    ``SEC. 1124A. CONCENTRATION GRANTS TO LOCAL EDUCATIONAL AGENCIES.

        ``(a) Eligibility for and Amount of Grants.--
                ``(1) In general.--(A) Except as otherwise provided in this
            paragraph, each local educational agency, in a State other than
            Guam, American Samoa, the Virgin Islands, and the Commonwealth
            of the Northern Mariana Islands, which is eligible for a grant
            under section 1124 for any fiscal year is eligible for an
            additional grant under this section for that fiscal year if the
            number of children counted under section 1124(c) in the agency
            exceeds either--
                        ``(i) 6,500; or
                        ``(ii) 15 percent of the total number of children
                    aged 5 through 17 in the agency.
                ``(B) Notwithstanding section 1122, no State described in
            subparagraph (A) shall receive less than the lesser of--
                        ``(i) 0.25 percent of total grants; or
                        ``(ii) the average of--
                                ``(I) one-quarter of 1 percent of the sums
                            available to carry out this section for such
                            fiscal year; and
                                ``(II) the greater of--
                                        ``(aa) $340,000; or
                                        ``(bb) the number of children in
                                    such State counted for purposes of this
                                    section in that fiscal year multiplied
                                    by 150 percent of the national average
                                    per-pupil payment made with funds
                                    available under this section for that
                                    year.
                ``(2) Special rule.--For each county or local educational
            agency eligible to receive an additional grant under this
            section for any fiscal year the Secretary shall determine the
            product of--
                        ``(A) the number of children counted under section
                    1124(c) for that fiscal year; and
                        ``(B) the quotient resulting from the division of
                    the amount determined for those agencies under section
                    1124(a)(1) for the fiscal year for which the
                    determination is being made divided by the total number
                    of children counted under section 1124(c) for that
                    agency for that fiscal year.
                ``(3) Amount.--The amount of the additional grant for which
            an eligible local educational agency or county is eligible
            under this section for any fiscal year shall be an amount which
            bears the same ratio to the amount available to carry out this
            section for that fiscal year as the product determined under
            paragraph (2) for such local educational agency for that fiscal
            year bears to the sum of such products for all local
            educational agencies in the United States for that fiscal year.
                ``(4) Local allocations.--(A) Grant amounts under this
            section shall be determined in accordance with section
            1124(a)(2) and (3).
                ``(B) For any fiscal year for which the Secretary allocates
            funds under this section on the basis of counties, a State may
            reserve not more than 2 percent of its allocation under this
            section to make grants to local educational agencies that meet
            the criteria of paragraph (1)(A)(i) or (ii) and are in
            ineligible counties that do not meet these criteria.
        ``(b) States Receiving Minimum Grants.--In States that receive the
    minimum grant under subsection (a)(1)(B), the State educational agency
    shall allocate such funds among the local educational agencies in each
    State either--
                ``(1) in accordance with paragraphs (2) and (4) of
            subsection (a); or
                ``(2) based on their respective concentrations and numbers
            of children counted under section 1124(c), except that only
            those local educational agencies with concentrations or numbers
            of children counted under section 1124(c) that exceed the
            statewide average percentage of such children or the statewide
            average number of such children shall receive any funds on the
            basis of this paragraph.

    ``SEC. 1125. TARGETED GRANTS TO LOCAL EDUCATIONAL AGENCIES.

        ``(a) Eligibility of Local Educational Agencies.--A local
    educational agency in a State is eligible to receive a targeted grant
    under this section for any fiscal year if the number of children in the
    local educational agency counted under subsection 1124(c), before
    application of the weighting factor described in subsection (c), is at
    least 10, and if the number of children counted for grants under
    section 1124 is at least 5 percent of the total population aged 5 to 17
    years, inclusive, in the local educational agency. For each fiscal year
    for which the Secretary uses county population data to calculate
    grants, funds made available as a result of applying this subsection
    shall be reallocated by the State educational agency to other eligible
    local educational agencies in the State in proportion to the
    distribution of other funds under this section.
        ``(b) Grants for Local Educational Agencies, the District of
    Columbia, and Puerto Rico.--
                ``(1) In general.--The amount of the grant that a local
            educational agency in a State or that the District of Columbia
            is eligible to receive under this section for any fiscal year
            shall be the product of--
                        ``(A) the weighted child count determined under
                    subsection (c); and
                        ``(B) the amount in paragraph 1124(a)(1)(B).
                ``(2) Puerto rico.--For each fiscal year, the amount of the
            grant for which the Commonwealth of Puerto Rico is eligible
            under this section shall be equal to the number of children
            counted under subsection (c) for Puerto Rico, multiplied by the
            amount determined in subparagraph 1124(a)(4).
        ``(c) Weighted Child Count.--
                ``(1) Weights for allocations to counties.--
                        ``(A) In general.--For each fiscal year for which
                    the Secretary uses county population data to calculate
                    grants, the weighted child count used to determine a
                    county's allocation under this section is the larger of
                    the 2 amounts determined under clause (i) or (ii), as
                    follows:
                                ``(i) By percentage of children.--This
                            amount is determined by adding--
                                        ``(I) the number of children
                                    determined under section 1124(c) for
                                    that county constituting up to 15
                                    percent, inclusive, of the county's
                                    total population aged 5 to 17,
                                    inclusive, multiplied by 1.0;
                                        ``(II) the number of such children
                                    constituting more than 15 percent, but
                                    not more than 19 percent, of such
                                    population, multiplied by 1.75;
                                        ``(III) the number of such children
                                    constituting more than 19 percent, but
                                    not more than 24.20 percent, of such
                                    population, multiplied by 2.5;
                                        ``(IV) the number of such children
                                    constituting more than 24.20 percent,
                                    but not more than 29.20 percent, of
                                    such population, multiplied by 3.25;
                                    and
                                        ``(V) the number of such children
                                    constituting more than 29.20 percent of
                                    such population, multiplied by 4.0.
                                ``(ii) By number of children.--This amount
                            is determined by adding--
                                        ``(I) the number of children
                                    determined under section 1124(c)
                                    constituting up to 2,311, inclusive, of
                                    the county's total population aged 5 to
                                    17, inclusive, multiplied by 1.0;
                                        ``(II) the number of such children
                                    between 2,312 and 7,913, inclusive, in
                                    such population, multiplied by 1.5;
                                        ``(III) the number of such children
                                    between 7,914 and 23,917, inclusive, in
                                    such population, multiplied by 2.0;
                                        ``(IV) the number of such children
                                    between 23,918 and 93,810, inclusive,
                                    in such population, multiplied by 2.5;
                                    and
                                        ``(V) the number of such children
                                    in excess of 93,811 in such population,
                                    multiplied by 3.0.
                        ``(B) Puerto rico.--Notwithstanding subparagraph
                    (A), the weighted child count for Puerto Rico under
                    this paragraph shall not be greater than the total
                    number of children counted under subsection 1124(c)
                    multiplied by 1.72.
                ``(2) Weights for allocations to local educational
            agencies.--
                        ``(A) In general.--For each fiscal year for which
                    the Secretary uses local educational agency data, the
                    weighted child count used to determine a local
                    educational agency's grant under this section is the
                    larger of the 2 amounts determined under clauses (i)
                    and (ii), as follows:
                                ``(i) By percentage of children.--This
                            amount is determined by adding--
                                        ``(I) the number of children
                                    determined under section 1124(c) for
                                    that local educational agency
                                    constituting up to 15.233 percent,
                                    inclusive, of the agency's total
                                    population aged 5 to 17, inclusive,
                                    multiplied by 1.0;
                                        ``(II) the number of such children
                                    constituting more than 15.233 percent,
                                    but not more than 22.706 percent, of
                                    such population, multiplied by 1.75;
                                        ``(III) the number of such children
                                    constituting more than 22.706 percent,
                                    but not more than 32.213 percent, of
                                    such population, multiplied by 2.5;
                                        ``(IV) the number of such children
                                    constituting more than 32.213 percent,
                                    but not more than 41.452 percent, of
                                    such population, multiplied by 3.25;
                                    and
                                        ``(V) the number of such children
                                    constituting more than 41.452 percent
                                    of such population, multiplied by 4.0.
                                ``(ii) By number of children.--This amount
                            is determined by adding--
                                        ``(I) the number of children
                                    determined under section 1124(c)
                                    constituting up to 710, inclusive, of
                                    the agency's total population aged 5 to
                                    17, inclusive, multiplied by 1.0;
                                        ``(II) the number of such children
                                    between 711 and 2,384, inclusive, in
                                    such population, multiplied by 1.5;
                                        ``(III) the number of such children
                                    between 2,385 and 9,645, inclusive, in
                                    such population, multiplied by 2.0;
                                        ``(IV) the number of such children
                                    between 9,646 and 54,600, inclusive, in
                                    such population, multiplied by 2.5; and
                                        ``(V) the number of such children
                                    in excess of 54,601 in such population,
                                    multiplied by 3.0.
                        ``(B) Puerto rico.--Notwithstanding subparagraph
                    (A), the weighted child count for Puerto Rico under
                    this paragraph shall not be greater than the total
                    number of children counted under section 1124(c)
                    multiplied by 1.72.
        ``(d) Calculation of Grant Amounts.--Grants under this section
    shall be calculated in accordance with section 1124(a)(2) and (3).
        ``(e) State Minimum.--Notwithstanding any other provision of this
    section or section 1122, from the total amount available for any fiscal
    year to carry out this section, each State shall be allotted at least
    the lesser of--
                ``(1) 0.25 percent of total appropriations; or
                ``(2) the average of--
                        ``(A) one-quarter of 1 percent of the total amount
                    available to carry out this section; and
                        ``(B) 150 percent of the national average grant
                    under this section per child described in section
                    1124(c), without application of a weighting factor,
                    multiplied by the State's total number of children
                    described in section 1124(c), without application of a
                    weighting factor.

    ``SEC. 1126. SPECIAL ALLOCATION PROCEDURES.

        ``(a) Allocations for Neglected Children.--
                ``(1) In general.--If a State educational agency determines
            that a local educational agency in the State is unable or
            unwilling to provide for the special educational needs of
            children who are living in institutions for neglected children
            as described in subparagraph (B) of section 1124(c)(1), the
            State educational agency shall, if such agency assumes
            responsibility for the special educational needs of such
            children, receive the portion of such local educational
            agency's allocation under sections 1124, 1124A, and 1125 that
            is attributable to such children.
                ``(2) Special rule.--If the State educational agency does
            not assume such responsibility, any other State or local public
            agency that does assume such responsibility shall receive that
            portion of the local educational agency's allocation.
        ``(b) Allocations Among Local Educational Agencies.--The State
    educational agency may allocate the amounts of grants under sections
    1124, 1124A, and 1125 among the affected local educational agencies--
                ``(1) if 2 or more local educational agencies serve, in
            whole or in part, the same geographical area;
                ``(2) if a local educational agency provides free public
            education for children who reside in the school district of
            another local educational agency; or
                ``(3) to reflect the merger, creation, or change of
            boundaries of 1 or more local educational agencies.
        ``(c) Reallocation.--If a State educational agency determines that
    the amount of a grant a local educational agency would receive under
    sections 1124, 1124A, and 1125 is more than such local agency will use,
    the State educational agency shall make the excess amount available to
    other local educational agencies in the State that need additional
    funds in accordance with criteria established by the State educational
    agency.

    ``SEC. 1127. CARRYOVER AND WAIVER.

        ``(a) Limitation on Carryover.--Notwithstanding section 421 of the
    General Education Provisions Act or any other provision of law, not
    more than 15 percent of the funds allocated to a local educational
    agency for any fiscal year under this subpart (but not including funds
    received through any reallocation under this subpart) may remain
    available for obligation by such agency for 1 additional fiscal year.
        ``(b) Waiver.--A State educational agency may, once every 3 years,
    waive the percentage limitation in subsection (a) if--
                ``(1) the agency determines that the request of a local
            educational agency is reasonable and necessary; or
                ``(2) supplemental appropriations for this subpart become
            available.
        ``(c) Exclusion.--The percentage limitation under subsection (a)
    shall not apply to any local educational agency that receives less than
    $50,000 under this subpart for any fiscal year.

    ``SEC. 1128. SECULAR, NEUTRAL, AND NONIDEOLOGICAL.

        ``Any school that receives funds under this part shall ensure that
    educational services or other benefits provided under this part,
    including materials and equipment, shall be secular, neutral, and
    nonideological.''.

               PART B--STUDENT READING SKILLS IMPROVEMENT GRANTS

    SEC. 111. READING FIRST; EARLY READING FIRST.

        Part B of title I (20 U.S.C. 6361 et seq.) is amended--
                (1) by striking the part heading and inserting the
            following:

             ``PART B--STUDENT READING SKILLS IMPROVEMENT GRANTS'';

                (2) by redesignating sections 1201 through 1212 as sections
            1231 through 1242, respectively; and
                (3) by inserting after the part heading the following:

                           ``Subpart 1--Reading First

    ``SEC. 1201. FINDINGS.

        ``The Congress finds as follows:
                ``(1) The 2000 National Assessment of Educational Progress
            found that 68 percent of fourth grade students in the United
            States are reading below the proficient level.
                ``(2) According to the 2000 National Assessment of
            Educational Progress report on reading, 63 percent of African
            Americans, 58 percent of Hispanic Americans, 60 percent of
            children living in poverty, and 47 percent of children in urban
            schools scored `below basic' in reading.
                ``(3) More than \1/2\ of the students placed in special
            education classes are identified as learning disabled and, for
            as many as 80 percent of the students so identified, reading is
            the primary difficulty.
                ``(4) It is estimated that, at a minimum, 10,000,000
            children have difficulty learning to read. 10 to 15 percent of
            those children eventually drop out of high school, and only 2
            percent complete a 4-year program at an institution of higher
            education.
                ``(5) It is estimated that the number of children who are
            typically identified as poor readers can be significantly
            reduced through the implementation of early identification and
            prevention programs that are based on scientifically based
            reading research.
                ``(6) The report issued by the National Reading Panel in
            2000 found that the course of reading instruction that obtains
            maximum benefits for students includes explicit and systematic
            instruction in phonemic awareness, phonics, vocabulary
            development, reading fluency, and reading comprehension
            strategies.

    ``SEC. 1202. PURPOSES.

        ``The purposes of this subpart are as follows:
                ``(1) To provide assistance to States and local educational
            agencies in establishing reading programs for students in
            grades kindergarten through 3 that are based on scientifically
            based reading research, in order to ensure that every student
            can read at grade level or above not later than the end of the
            third grade.
                ``(2) To provide assistance to States and local educational
            agencies in preparing teachers, including special education
            teachers, through professional development and other support,
            so the teachers can identify specific reading barriers facing
            their students and so the teachers have the tools to
            effectively help their students learn to read.
                ``(3) To provide assistance to States and local educational
            agencies in selecting and administering rigorous diagnostic
            reading and screening assessment tools that are valid and
            reliable, document the effectiveness of this subpart in
            improving the reading skills of students, and improve classroom
            instruction.
                ``(4) To provide assistance to States and local educational
            agencies in selecting or developing effective classroom
            instructional materials, programs, and strategies to implement
            scientific research-based methods that have been proven to
            prevent or remediate reading failure.
                ``(5) To strengthen coordination among schools and early
            literacy programs in order to improve reading achievement for
            all children.

    ``SEC. 1203. FORMULA GRANTS TO STATES.

        ``(a) In General.--
                ``(1) Authorization to make grants.--In the case of each
            State that in accordance with section 1204 submits to the
            Secretary an application for a 5-year period, the Secretary,
            subject to the application's approval, shall make a grant to
            the State for the uses specified in subsections (c) and (d).
            For each fiscal year, the funds provided under the grant shall
            equal the allotment determined for the State under subsection
            (b).
                ``(2) Duration of grants.--
                        ``(A) In general.--Subject to subparagraph (B), a
                    grant under this section shall be awarded for a period
                    of not more than 5 years.
                        ``(B) Interim review.--
                                ``(i) Progress report.--
                                        ``(I) Submission.--Not later than
                                    60 days after the termination of the
                                    third year of the grant period, each
                                    State receiving a grant under this
                                    section shall submit a progress report
                                    to the Secretary.
                                        ``(II) Information included.--The
                                    progress report shall include
                                    information on the progress the State,
                                    and local educational agencies within
                                    the State, are making in reducing the
                                    number of students served under this
                                    subpart in the first and second grades
                                    who are reading below grade level, as
                                    demonstrated by such information as
                                    teacher reports and school evaluations
                                    of mastery of the essential components
                                    of reading instruction. The report
                                    shall also include evidence from the
                                    State and its local educational
                                    agencies that they have significantly
                                    increased the number of students
                                    reading at grade level or above,
                                    significantly increased the percentages
                                    of students in ethnic, racial, and low-
                                    income populations who are reading at
                                    grade level or above, and successfully
                                    implemented this subpart.
                                ``(ii) Peer review.--The progress report
                            described in clause (i) shall be reviewed by
                            the peer review panel convened under section
                            1204(c)(2).
                                ``(iii) Consequences of insufficient
                            progress.--After the submission of the progress
                            report described in clause (i), if the
                            Secretary determines that the State is not
                            making significant progress in meeting the
                            purposes of this subpart, the Secretary may
                            withhold from the State, in whole or in part,
                            further payments under this section in
                            accordance with section 455 of the General
                            Education Provisions Act (20 U.S.C. 1234d) or
                            take such other action authorized by law as the
                            Secretary deems necessary, including providing
                            technical assistance upon request of the State.
        ``(b) Determination of Amount of Allotments.--
                ``(1) Reservations from appropriations.--From the total
            amount made available under section 1002(b)(1) to carry out
            this subpart for a fiscal year, the Secretary--
                        ``(A) shall reserve \1/2\ of 1 percent for
                    allotments for the Virgin Islands, Guam, American
                    Samoa, and the Commonwealth of the Northern Mariana
                    Islands, to be distributed among these outlying areas
                    on the basis of their relative need, as determined by
                    the Secretary in accordance with the purposes of this
                    subpart;
                        ``(B) shall reserve \1/2\ of 1 percent for the
                    Secretary of the Interior for programs under this
                    subpart in schools operated or funded by the Bureau of
                    Indian Affairs;
                        ``(C) shall reserve not more than 3 percent or
                    $30,000,000, whichever is less, to carry out section
                    1206;
                        ``(D) may reserve not more than 1 percent to carry
                    out section 1207; and
                        ``(E) shall reserve $5,000,000 to carry out section
                    1208.
                ``(2) State allotments.--From the total amount made
            available under section 1002(b)(1) to carry out this subpart
            for a fiscal year and not reserved under paragraph (1), the
            Secretary shall allot 80 percent under this section among each
            of the 50 States, the District of Columbia, and the
            Commonwealth of Puerto Rico.
                ``(3) Determination of state allotment amounts.--
                        ``(A) In general.--Subject to subparagraph (B), the
                    Secretary shall allot the amount made available under
                    paragraph (2) for a fiscal year among the States
                    described in such paragraph in proportion to the number
                    of children, aged 5 to 17, who reside within the State
                    from families with incomes below 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
                    for the most recent fiscal year for which satisfactory
                    data are available, compared to the number of such
                    individuals who reside in all such States for that
                    fiscal year.
                        ``(B) Exceptions.--
                                ``(i) In general.--Subject to clause (ii),
                            no State receiving an allotment under
                            subparagraph (A) may receive less than \1/4\ of
                            1 percent of the total amount allotted under
                            such subparagraph.
                                ``(ii) Puerto rico.--The percentage of the
                            amount allotted under subparagraph (A) that is
                            allotted to the Commonwealth of Puerto Rico for
                            a fiscal year may not exceed the percentage
                            that was received by the Commonwealth of Puerto
                            Rico of the funds allocated to all States under
                            subpart 2 of part A for the preceding fiscal
                            year.
                ``(4) Reallotment.--If a State described in paragraph (2)
            does not apply for an allotment under this section for any
            fiscal year, or if the State's application is not approved, the
            Secretary shall reallot such amount to the remaining States in
            accordance with paragraph (3).
        ``(c) Subgrants to Local Educational Agencies.--
                ``(1) Distribution of subgrants.--The Secretary may make a
            grant to a State under this section only if the State agrees to
            expend at least 80 percent of the amount of the funds provided
            under the grant for the purpose of making, in accordance with
            this subsection, competitive subgrants to local educational
            agencies.
                ``(2) Notice.--A State receiving a grant under this section
            shall provide notice to all local educational agencies in the
            State of the availability of competitive subgrants under this
            subsection and of the requirements for applying for the
            subgrants.
                ``(3) Local applications.--To be eligible to receive a
            subgrant under this subsection, a local educational agency
            shall submit an application to the State at such time, in such
            manner, and containing such information as the State may
            reasonably require.
                ``(4) Limitation to certain local agencies.--A State
            receiving a grant under this section may award subgrants under
            this subsection only to local educational agencies--
                        ``(A) that have the highest percentages of students
                    in grades kindergarten through 3 reading below grade
                    level; and
                        ``(B) that--
                                ``(i) have jurisdiction over--
                                        ``(I) a geographic area that
                                    includes an area designated as an
                                    empowerment zone, or an enterprise
                                    community, under part I of subchapter U
                                    of chapter 1 of the Internal Revenue
                                    Code of 1986; or
                                        ``(II) a significant number of
                                    schools that are identified for school
                                    improvement under section 1116(b); or
                                ``(ii) are located in areas having the
                            greatest numbers or percentages of children
                            aged 5 through 17 from low-income families.
                ``(5) State requirement.--In distributing subgrant funds to
            local educational agencies under this subsection, a State shall
            provide funds in sufficient size and scope to enable local
            educational agencies to improve reading instruction, as
            determined by rigorous diagnostic reading and screening
            assessment tools.
                ``(6) Limitation to certain schools.--In distributing
            subgrant funds under this subsection, a local educational
            agency may provide funds only to schools--
                        ``(A) that have the highest percentages of students
                    in grades kindergarten through 3 reading below grade
                    level; and
                        ``(B) that--
                                ``(i) are identified for school improvement
                            under section 1116(b); or
                                ``(ii) have the greatest numbers or
                            percentages of children aged 5 through 17 from
                            low-income families.
                ``(7) Local uses of funds.--
                        ``(A) Required uses.--Subject to paragraph (8), a
                    local educational agency that receives a subgrant under
                    this subsection shall use the funds provided under the
                    subgrant to carry out the following activities:
                                ``(i) Selecting and administering rigorous
                            diagnostic reading and screening assessment
                            tools.
                                ``(ii) Selecting and implementing a program
                            or programs of classroom reading instruction
                            based on scientifically based reading research
                            that--
                                        ``(I) includes the essential
                                    components of reading instruction; and
                                        ``(II) provides such instruction to
                                    all children, including children who--
                                                ``(aa) may have reading
                                            difficulties;
                                                ``(bb) are at risk of being
                                            referred to special education
                                            based on these difficulties;
                                                ``(cc) have been evaluated
                                            under section 614 of the
                                            Individuals with Disabilities
                                            Education Act but, in
                                            accordance with section
                                            614(b)(5) of such Act, have not
                                            been identified as being a
                                            child with a disability (as
                                            defined in section 602 of such
                                            Act);
                                                ``(dd) are being served
                                            under such Act primarily due to
                                            being identified as being a
                                            child with a specific learning
                                            disability (as defined in
                                            section 602 of such Act)
                                            related to reading;
                                                ``(ee) are deficient in
                                            their phonemic awareness,
                                            phonics skills, vocabulary
                                            development, oral reading
                                            fluency, or comprehension
                                            strategies; or
                                                ``(ff) are identified as
                                            having limited English
                                            proficiency.
                                ``(iii) Procuring classroom instructional
                            materials based on scientifically based reading
                            research.
                                ``(iv) Providing professional development
                            for teachers of grades kindergarten through 3,
                            and special education teachers of grades
                            kindergarten through 12, that--
                                        ``(I) will prepare these teachers
                                    in all of the essential components of
                                    reading instruction;
                                        ``(II) shall include--
                                                ``(aa) information,
                                            instructional materials,
                                            programs, strategies, and
                                            approaches based on
                                            scientifically based reading
                                            research, including early
                                            intervention and classroom
                                            reading materials and remedial
                                            programs and approaches; and
                                                ``(bb) instruction in the
                                            use of rigorous diagnostic
                                            reading and screening
                                            assessment tools and other
                                            procedures that effectively
                                            identify students who may be at
                                            risk for reading failure or who
                                            are having difficulty reading;
                                        ``(III) shall be provided by
                                    eligible professional development
                                    providers; and
                                        ``(IV) will assist teachers in
                                    becoming fully qualified in accordance
                                    with the requirements of section 1119.
                        ``(B) Optional uses.--Subject to paragraph (8), a
                    local educational agency that receives a subgrant under
                    this subsection may use the funds provided under the
                    subgrant to carry out the following activities:
                                ``(i) Providing training to parents and
                            other individuals who volunteer to be reading
                            tutors in the essential components of reading
                            instruction.
                                ``(ii) Providing family literacy services,
                            especially to parents enrolled in participating
                            schools, through the use of library materials
                            and reading programs, strategies, and
                            approaches that are based on scientifically
                            based reading research, to encourage reading
                            and support their children's reading
                            development.
                ``(8) Local planning and administration.--A local
            educational agency that receives a subgrant under this
            subsection may use not more than 2 percent of the funds
            provided under the subgrant for planning and administration.
        ``(d) Other State Uses of Funds.--
                ``(1) Professional development.--
                        ``(A) In general.--A State that receives a grant
                    under this section may expend not more than 15 percent
                    of the amount of the funds provided under the grant--
                                ``(i) to develop and implement a program of
                            in-service professional development for
                            teachers of kindergarten through third grade,
                            and special education teachers of grades
                            kindergarten through 12, that--
                                        ``(I) will prepare these teachers
                                    in all of the essential components of
                                    reading instruction;
                                        ``(II) shall include--
                                                ``(aa) information on
                                            interventions, instructional
                                            materials, programs, and
                                            approaches based on
                                            scientifically based reading
                                            research, including early
                                            intervention and reading
                                            remediation materials,
                                            programs, and approaches; and
                                                ``(bb) instruction in the
                                            use of rigorous diagnostic
                                            reading and screening
                                            assessment tools and other
                                            procedures to improve
                                            instruction and effectively
                                            identify students who may be at
                                            risk for reading failure or who
                                            are having difficulty reading;
                                            and
                                        ``(III) shall be provided by
                                    eligible professional development
                                    providers;
                                ``(ii) to strengthen and enhance
                            professional development courses for students
                            preparing, at all public institutions of higher
                            education in the State, to teach kindergarten
                            through third grades by--
                                        ``(I) reviewing such courses to
                                    determine whether their content is
                                    consistent with the findings of the
                                    most current scientifically based
                                    reading research, including findings on
                                    the essential components of reading
                                    instruction;
                                        ``(II) following up such reviews
                                    with recommendations to ensure that
                                    such institutions offer courses that
                                    meet the highest standards; and
                                        ``(III) preparing a report on the
                                    results of such reviews, submitting it
                                    to the reading and literacy partnership
                                    for the State established under section
                                    1204(d), and making it available for
                                    public review via the Internet; and
                                ``(iii) to make recommendations on how the
                            State's licensure and certification standards
                            in the area of reading might be improved.
                        ``(B) Funds not used for professional
                    development.--Any portion of the funds described in
                    subparagraph (A) that a State does not expend in
                    accordance with such subparagraph shall be expended for
                    the purpose of making subgrants in accordance with
                    subsection (c).
                ``(2) Other state-level activities.--A State that receives
            a grant under this section may expend not more than 3 percent
            of the amount of the funds provided under the grant for one or
            more of the following authorized State activities:
                        ``(A) Assisting local educational agencies in
                    accomplishing the tasks required to design and
                    implement a classroom reading program under this
                    subpart, including--
                                ``(i) selecting and implementing a program
                            or programs of classroom reading instruction
                            based on scientifically based reading research;
                                ``(ii) selecting rigorous diagnostic
                            reading and screening assessment tools; and
                                ``(iii) identifying eligible professional
                            development providers to help prepare reading
                            teachers to teach students using the programs
                            and assessments described in clauses (i) and
                            (ii);
                        ``(B) Providing to students in kindergarten through
                    third grades, through appropriate providers, reading
                    instruction that includes--
                                ``(i) rigorous diagnostic reading and
                            screening assessment tools; and
                                ``(ii) as need is indicated by such
                            assessments, instruction based on
                            scientifically based reading research that
                            includes the essential components of reading
                            instruction.
                ``(3) Planning, administration, and reporting.--
                        ``(A) In general.--A State that receives a grant
                    under this section shall expend not more than 2 percent
                    of the amount of the funds provided under the grant for
                    the activities described in this paragraph.
                        ``(B) Planning and administration.--A State that
                    receives a grant under this section may expend funds
                    described in subparagraph (A) for--
                                ``(i) planning and administration relating
                            to the State uses of funds authorized under
                            this subpart, including administering the
                            distribution of competitive subgrants to local
                            educational agencies under this section and
                            section 1205; and
                                ``(ii) assessing and evaluating, on a
                            regular basis, local educational agency
                            activities assisted under this subpart, with
                            respect to whether they have been effective in
                            increasing the number of children in first and
                            second grades served under this subpart who can
                            read at or above grade level.
                        ``(C) Annual reporting.--
                                ``(i) In general.--A State that receives a
                            grant under this section shall expend funds
                            provided under the grant to provide the
                            Secretary annually with a report on the
                            implementation of this subpart. The report
                            shall include evidence that the State is
                            fulfilling its obligations under this subpart.
                            The report shall include a specific
                            identification of those schools and local
                            educational agencies that report the largest
                            gains in reading achievement.
                                ``(ii) Privacy protection.--Data in the
                            report shall be set forth in a manner that
                            protects the privacy of individuals.
                                ``(iii) Contract.--To the extent
                            practicable, a State shall enter into a
                            contract with an entity that conducts
                            scientifically based reading research, under
                            which contract the entity will produce the
                            reports required to be submitted under this
                            subparagraph.

    ``SEC. 1204. STATE FORMULA GRANT APPLICATIONS.

        ``(a) In General.--A State that desires to receive a grant under
    section 1203 shall submit an application to the Secretary at such time
    and in such form as the Secretary may require. The application shall
    contain the information described in subsection (b).
        ``(b) Contents.--An application under this section shall contain
    the following:
                ``(1) An assurance that the Governor of the State, in
            consultation with the State educational agency, has established
            a reading and literacy partnership described in subsection (d),
            and a description of how such partnership--
                        ``(A) coordinated the development of the
                    application; and
                        ``(B) will assist in the oversight and evaluation
                    of the State's activities under this subpart.
                ``(2) An assurance that the State will submit to the
            Secretary, at such time and in such manner as the Secretary may
            reasonably require, a State plan containing a description of a
            process--
                        ``(A) to evaluate programs carried out by local
                    educational agencies under this subpart;
                        ``(B) to assist local educational agencies in
                    identifying rigorous diagnostic reading and screening
                    assessment tools; and
                        ``(C) to assist local educational agencies in
                    identifying interventions, and instructional materials,
                    programs and approaches, based on scientifically based
                    reading research, including early intervention and
                    classroom reading materials and remedial programs and
                    approaches.
                ``(3) An assurance that the State, and local educational
            agencies in the State, will participate in all national
            evaluations under this subpart.
        ``(c) Approval of Applications.--
                ``(1) In general.--The Secretary, in consultation with the
            peer review panel convened under paragraph (2), shall approve
            an application of a State under this section if such
            application meets the requirements of this section.
                ``(2) Peer review.--
                        ``(A) In general.--The Secretary, in consultation
                    with the National Institute for Literacy, shall convene
                    a panel to evaluate applications under this section. At
                    a minimum, the panel shall include--
                                ``(i) 3 individuals selected by the
                            Secretary;
                                ``(ii) 3 individuals selected by the
                            National Institute for Literacy;
                                ``(iii) 3 individuals selected by the
                            National Research Council of the National
                            Academy of Sciences; and
                                ``(iv) 3 individuals selected by the
                            National Institute of Child Health and Human
                            Development.
                        ``(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, and experts who provide professional
                    development to other instructional staff, based on
                    scientifically based reading research.
                        ``(C) Recommendations.--The panel shall recommend
                    grant applications from States under this section to
                    the Secretary for funding or for disapproval.
        ``(d) Reading and Literacy Partnerships.--
                ``(1) In general.--In order for a State to receive a grant
            under section 1203, the Governor of the State, in consultation
            with the State educational agency, shall establish a reading
            and literacy partnership.
                ``(2) Required participants.--The reading and literacy
            partnership shall include the following participants:
                        ``(A) The Governor of the State.
                        ``(B) The chief State school officer.
                        ``(C) The chairman and the ranking member of each
                    committee of the State legislature that is responsible
                    for education policy.
                        ``(D) A representative, selected jointly by the
                    Governor and the chief State school officer, of at
                    least one local educational agency that is eligible to
                    receive a subgrant under section 1203.
                        ``(E) 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 tutors and scientifically
                    based reading research.
                        ``(F) State directors of appropriate Federal or
                    State programs with a strong reading component.
                        ``(G) A parent of a public or private school
                    student or a parent who educates their child or
                    children in their home, selected jointly by the
                    Governor and the chief State school officer.
                        ``(H) A teacher, who may be a special education
                    teacher, who successfully teaches reading and an
                    instructional staff member, selected jointly by the
                    Governor and the chief State school officer.
                        ``(I) A family literacy service provider selected
                    jointly by the Governor and the chief state school
                    officer.
                ``(3) Optional participants.--The reading and literacy
            partnership may include additional participants, who shall be
            selected jointly by the Governor and the chief State school
            officer, and who may include a representative of--
                        ``(A) an institution of higher education operating
                    a program of teacher preparation based on
                    scientifically based reading research in the State;
                        ``(B) a local educational agency;
                        ``(C) a private nonprofit or for-profit eligible
                    professional development provider providing instruction
                    based on scientifically based reading research;
                        ``(D) an adult education provider;
                        ``(E) a volunteer organization that is involved in
                    reading programs; or
                        ``(F) a school library or a public library that
                    offers reading or literacy programs for children or
                    families.

    ``SEC. 1205. DISCRETIONARY GRANTS TO STATES.

        ``(a) In General.--In the case of a State that, in accordance with
    sections 1203 and 1204, has received approval of an application for a
    5-year formula grant, the Secretary may make additional 2-year
    discretionary grants to the State for the use specified in (d). For
    each fiscal year, the funds provided under the discretionary grant
    shall equal the allotment determined for the State under subsection
    (b).
        ``(b) Determination of Amount of Allotments.--From the total amount
    made available under section 1002(b)(1) to carry out this subpart for a
    fiscal year and not reserved under paragraph (1), the Secretary, upon
    the recommendation of the peer review panel convened under section
    1204(c)(2), shall allot 20 percent under this section among the States
    described in subsection (a)--
                ``(1) for fiscal years 2002 and 2003, based upon a
            determination of such States' relative likelihood of
            effectively implementing a program under this subpart; and
                ``(2) for fiscal year 2004 and subsequent fiscal years,
            based upon such States' applications under subsection (c).
        ``(c) State Discretionary Grant Applications.--
                ``(1) In general.--A State that desires to receive a grant
            under this section for a grant period that includes any fiscal
            year after fiscal year 2003 shall submit the information
            described in paragraph (3) to the Secretary at such time and in
            such form as the Secretary may require.
                ``(2) Peer review.--The peer review panel convened under
            section 1204(c)(2) shall review the information submitted under
            this subsection. The panel shall recommend such applications to
            the Secretary for funding or for disapproval.
                ``(3) Information.--The information described in this
            paragraph is the following:
                        ``(A) An assurance that the State will award
                    competitive subgrants to local educational agencies
                    consistent with subsection (d)(4).
                        ``(B) An assurance that the State will ensure that
                    local educational agencies that receive a subgrant
                    under subsection (d) use the funds provided under the
                    subgrant in accordance with subsection (d)(5).
                        ``(C) Evidence that the State has increased
                    significantly the percentage of students reading at
                    grade level or above.
                        ``(D) Evidence that the State has been successful
                    in increasing the percentage of students in ethnic,
                    racial, and low-income populations who are reading at
                    grade level or above.
                        ``(E) Any additional evidence that demonstrates
                    success in the implementation of this subpart.
        ``(d) Subgrants to Local Educational Agencies.--
                ``(1) In general.--The Secretary may make a grant to a
            State under this section only if the State agrees to expend 100
            percent of the amount of the funds provided under the grant for
            the purpose of making competitive subgrants in accordance with
            this subsection to local educational agencies.
                ``(2) Notice.--A State receiving a grant under this section
            shall provide notice to all local educational agencies in the
            State of the availability of competitive subgrants under this
            subsection and of the requirements for applying for the
            subgrants.
                ``(3) Application.--To be eligible to receive a subgrant
            under this subsection, a local educational agency shall submit
            an application to the State at such time, in such manner, and
            containing such information as the State may reasonably
            require.
                ``(4) Distribution.--
                        ``(A) In general.--A State shall distribute
                    subgrants under this section through a competitive
                    process based on relative need and the evidence
                    described in this paragraph.
                        ``(B) Evidence used in all years.--For all fiscal
                    years, a State shall distribute subgrants under this
                    section based on evidence that a local educational
                    agency--
                                ``(i) satisfies the requirements of section
                            1203(c)(4);
                                ``(ii) will carry out its obligations under
                            this subpart, particularly paragraph (5); and
                                ``(iii) will work with other local
                            educational agencies in the State that have not
                            received a subgrant under this subsection to
                            assist such non-receiving agencies in
                            increasing the reading achievement of students.
                        ``(C) Evidence used in fiscal years after 2003.--
                    For fiscal year 2004 and subsequent fiscal years, a
                    State shall distribute subgrants under this section
                    based on the evidence described in subparagraph (B)
                    and, in addition, evidence that a local educational
                    agency--
                                ``(i) has significantly increased the
                            percentage of all students reading at grade
                            level or above;
                                ``(ii) has significantly increased the
                            percentage of students in ethnic, racial, and
                            low-income populations who are reading at grade
                            level or above; and
                                ``(iii) has demonstrated success in the
                            implementation of this subpart.
                ``(5) Local uses of funds.--A local educational agency that
            receives a subgrant under this subsection--
                        ``(A) shall use the funds provided under the
                    subgrant to carry out the activities described in
                    section 1203(c)(7)(A); and
                        ``(B) may use such funds to carry out the
                    activities described in section 1203(c)(7)(B).
        ``(e) Definition.--For purposes of this section, the term `State'
    means each of the 50 States, the District of Columbia, and the
    Commonwealth of Puerto Rico.

    ``SEC. 1206. EXTERNAL EVALUATION.

        ``(a) In General.--From funds reserved under section 1203(b)(1)(C),
    the Secretary shall contract with an independent outside organization
    for a 5-year, rigorous, scientifically valid, quantitative evaluation
    of this subpart.
        ``(b) Process.--Such evaluation shall be conducted by an
    organization outside of the Department that is capable of designing and
    carrying out an independent evaluation that identifies the effects of
    specific activities carried out by States and local educational
    agencies under this subpart on improving reading instruction. Such
    evaluation shall use only data relating to students served under this
    subpart and shall take into account factors influencing student
    performance that are not controlled by teachers or education
    administrators.
        ``(c) Analysis.--Such evaluation shall include the following:
                ``(1) An analysis of the relationship between each of the
            essential components of reading instruction and overall reading
            proficiency.
                ``(2) An analysis of whether assessment tools used by
            States and local educational agencies measure the essential
            components of reading instruction.
                ``(3) An analysis of how State reading standards correlate
            with the essential components of reading instruction.
                ``(4) An analysis of whether the receipt of a discretionary
            grant under section 1205 results in an increase in the number
            of children who read proficiently.
                ``(5) A measurement of the extent to which specific
            instructional materials improve reading proficiency.
                ``(6) A measurement of the extent to which specific
            rigorous diagnostic reading and screening assessment tools
            assist teachers in identifying specific reading deficiencies.
                ``(7) A measurement of the extent to which professional
            development programs implemented by States using funds received
            under this subpart improve reading instruction.
                ``(8) A measurement of how well students preparing to enter
            the teaching profession are prepared to teach the essential
            components of reading instruction.
                ``(9) An analysis of changes in students' interest in
            reading and time spent reading outside of school.
                ``(10) Any other analysis or measurement pertinent to this
            subpart that is determined to be appropriate by the Secretary.
        ``(d) Program Improvement.--The findings of the evaluation
    conducted under this section shall be provided to States and local
    educational agencies on a periodic basis for use in program
    improvement.

    ``SEC. 1207. NATIONAL ACTIVITIES.

        ``From funds reserved under section 1203(b)(1)(D), the Secretary
    may provide technical assistance in achieving the purposes of this
    subpart to States, local educational agencies, and schools requesting
    such assistance.

    ``SEC. 1208. INFORMATION DISSEMINATION.

        ``(a) In General.--From funds reserved under section 1203(b)(1)(E),
    the National Institute for Literacy, in collaboration with the
    Secretary of Education, the Secretary of Health and Human Services, and
    the Director of the National Institute for Child Health and Human
    Development--
                ``(1) shall disseminate information on scientifically based
            reading research pertaining to children, youth, and adults;
                ``(2) shall identify and disseminate information about
            schools, local educational agencies, and States that
            effectively developed and implemented classroom reading
            programs that meet the requirements of this subpart, including
            those effective States, local educational agencies, and schools
            identified through the evaluation and peer review provisions of
            this subpart; and
                ``(3) shall support the continued identification and
            dissemination of information on reading programs that contain
            the essential components of reading instruction as supported by
            scientifically based reading research, that can lead to
            improved reading outcomes for children, youth, and adults.
        ``(b) Dissemination.--
                ``(1) In general.--At a minimum, the National Institute for
            Literacy shall disseminate such information to--
                        ``(A) recipients of Federal financial assistance
                    under part A of this title, part A of title III, the
                    Head Start Act, the Individuals with Disabilities
                    Education Act, and the Adult Education and Family
                    Literacy Act; and
                        ``(B) each Bureau funded school (as defined in
                    section 1141(3) of the Education Amendments of 1978).
                ``(2) Use of existing networks.--In carrying out this
            section, the National Institute for Literacy shall, to the
            extent practicable, utilize existing information and
            dissemination networks developed and maintained through other
            public and private entities.

    ``SEC. 1209. DEFINITIONS.

        ``For purposes of this subpart:
                ``(1) Eligible professional development provider.--The term
            `eligible professional development provider' means a provider
            of professional development in reading instruction to teachers,
            including special education teachers, that is based on
            scientifically based reading research.
                ``(2) Essential components of reading instruction.--The
            term `essential components of reading instruction' means
            explicit and systematic instruction in--
                        ``(A) phonemic awareness;
                        ``(B) phonics;
                        ``(C) vocabulary development;
                        ``(D) oral reading fluency; and
                        ``(E) reading comprehension strategies.
                ``(3) Instructional staff.--The term `instructional
            staff'--
                        ``(A) means individuals who have responsibility for
                    teaching children to read; and
                        ``(B) includes principals, teachers, supervisors of
                    instruction, librarians, library school media
                    specialists, teachers of academic subjects other than
                    reading, and other individuals who have responsibility
                    for assisting children to learn to read.
                ``(4) Reading.--The term `reading' means a complex system
            of deriving meaning from print that requires all of the
            following:
                        ``(A) The skills and knowledge to understand how
                    phonemes, or speech sounds, are connected to print.
                        ``(B) The ability to decode unfamiliar words.
                        ``(C) The ability to read fluently.
                        ``(D) Sufficient background information and
                    vocabulary to foster reading comprehension.
                        ``(E) The development of appropriate active
                    strategies to construct meaning from print.
                        ``(F) The development and maintenance of a
                    motivation to read.
                ``(5) Rigorous diagnostic reading and screening assessment
            tools.--The term `rigorous diagnostic reading and screening
            assessment tools' means assessments that--
                        ``(A) are valid, reliable, and based on
                    scientifically based reading research;
                        ``(B) measure progress in developing phonemic
                    awareness and phonics skills, vocabulary, reading
                    fluency, and reading comprehension;
                        ``(C) identify students who may be at risk for
                    reading failure or who are having difficulty reading;
                    and
                        ``(D) are used to improve instruction.
                ``(6) Scientifically based reading research.--The term
            `scientifically based reading research'--
                        ``(A) means the application of rigorous,
                    systematic, and objective procedures to obtain valid
                    knowledge relevant to reading development, reading
                    instruction, and reading difficulties; and
                        ``(B) shall include research that--
                                ``(i) employs systematic, empirical methods
                            that draw on observation or experiment;
                                ``(ii) involves rigorous data analyses that
                            are adequate to test the stated hypotheses and
                            justify the general conclusions drawn;
                                ``(iii) relies on measurements or
                            observational methods that provide valid data
                            across evaluators and observers and across
                            multiple measurements and observations; and
                                ``(iv) has been accepted by a peer-reviewed
                            journal or approved by a panel of independent
                            experts through a comparably rigorous,
                            objective, and scientific review.

                        ``Subpart 2--Early Reading First

    ``SEC. 1221. PURPOSES.

        ``The purposes of this subpart are as follows:
                ``(1) To improve prereading skills in children aged 3
            through 5, particularly children from low-income families, in
            high-quality oral language and literature-rich environments.
                ``(2) To provide professional development for early
            childhood teachers that prepares them with scientific research-
            based knowledge of early reading development to assist in
            developing the children's--
                        ``(A) automatic recognition of the letters of the
                    alphabet;
                        ``(B) understanding that spoken words are made up
                    of small segments of speech sounds and that certain
                    letters regularly represent such speech sounds;
                        ``(C) spoken vocabulary and oral comprehension
                    abilities; and
                        ``(D) understanding of semiotic concepts.
                ``(3) To use scientific research-based screening tools or
            other appropriate measures to determine whether preschool
            children are developing the skills identified in this section.
                ``(4) To identify and provide scientific research-based
            prereading language and literacy activities and instructional
            materials that can be used to assist in the development of
            prereading skills in children.
                ``(5) To integrate such scientific research-based
            instructional materials and literacy activities with existing
            programs of preschools, child care agencies, and Head Start
            centers, and with family literacy services.

    ``SEC. 1222. LOCAL EARLY READING FIRST GRANTS.

        ``(a) Program Authorized.--From amounts appropriated under section
    1002(b)(2), the Secretary shall make awards, on a competitive basis and
    for periods of not more than 5 years, to eligible applicants to enable
    such applicants to carry out activities that are consistent with the
    purposes of this subpart.
        ``(b) Definition of Eligible Applicant.--In this subpart, the term
    `eligible applicant' means--
                ``(1) a local educational agency;
                ``(2) one or more public or private organizations, acting
            on behalf of one or more programs that serve children aged 3
            through 5 (such as a program at a child care agency or Head
            Start center or a family literacy program), which organizations
            shall be located in a community served by a local educational
            agency; or
                ``(3) one or more local educational agencies in
            collaboration with one or more organizations described in
            paragraph (2).
        ``(c) Applications.--An eligible applicant that desires to receive
    a grant under this subpart shall submit an application to the
    Secretary, which shall include a description of--
                ``(1) the programs to be served by the proposed project,
            including general demographic and socioeconomic information on
            the communities in which the proposed project will be
            administered;
                ``(2) how the proposed project will enhance the school
            readiness of children aged 3 through 5 in high-quality oral
            language and literature-rich environments;
                ``(3) how the proposed project will provide early childhood
            teachers with scientific research-based knowledge of early
            reading development and assist such teachers in developing the
            children's prereading skills;
                ``(4) how the proposed project will provide services and
            utilize instructional materials that are based on
            scientifically based reading research on early language
            acquisition, prereading activities, and the development of
            spoken vocabulary skills;
                ``(5) how the proposed project will integrate such
            instructional materials and literacy activities with existing
            preschool programs and family literacy services;
                ``(6) how the proposed project will help staff in the
            programs to meet the diverse needs of children in the
            community, including children with limited English proficiency
            and children with learning disabilities;
                ``(7) how the proposed project will help children,
            particularly children experiencing difficulty with spoken
            language, prereading, and early reading skills, to make the
            transition from preschool to formal classroom instruction in
            school;
                ``(8) how the activities conducted under this subpart will
            be coordinated with the eligible applicant's activities under
            subpart 1, if the applicant has received a subgrant under such
            subpart, at the kindergarten through third grade levels;
                ``(9) how the proposed project will evaluate the success of
            the activities supported under this subpart in enhancing the
            early language and reading development of children served by
            the project; and
                ``(10) such other information as the Secretary may require.
        ``(d) Approval of Local Applications.--The Secretary shall select
    applicants for funding under this subpart based on the quality of the
    applications and the recommendations of the peer review panel convened
    under section 1204(c)(2).
        ``(e) Local Uses of Funds.--
                ``(1) Required activities.--An eligible applicant that
            receives a grant under this subpart shall use the funds
            provided under the grant to carry out the following activities:
                        ``(A) Providing children aged 3 through 5 with
                    high-quality oral language and literature-rich
                    environments in which to acquire prereading skills.
                        ``(B) Providing professional development for early
                    childhood teachers that prepares them with scientific
                    research-based knowledge of early reading development
                    to assist in developing the children's--
                                ``(i) automatic recognition of the letters
                            of the alphabet;
                                ``(ii) understanding that spoken words are
                            made up of small segments of speech sounds and
                            that certain letters regularly represent such
                            speech sounds;
                                ``(iii) spoken vocabulary and oral
                            comprehension abilities; and
                                ``(iv) understanding of semiotic concepts.
                        ``(C) Identifying and providing scientific
                    research-based prereading language and literacy
                    activities and instructional materials for use in
                    developing the children's--
                                ``(i) automatic recognition of the letters
                            of the alphabet;
                                ``(ii) understanding that spoken words are
                            made up of small segments of speech sounds and
                            that certain letters regularly represent such
                            speech sounds;
                                ``(iii) spoken vocabulary and oral
                            comprehension abilities; and
                                ``(iv) understanding of semiotic concepts.
                ``(2) Optional activities.--An eligible applicant that
            receives a grant under this subpart may use the funds provided
            under the grant to carry out the following activities:
                        ``(A) Using scientific research-based screening
                    tools or other appropriate measures to determine
                    whether preschool children are developing the skills
                    identified in this subsection.
                        ``(B) Integrating such instructional materials and
                    literacy activities with programs of existing child
                    care agencies, preschools, and Head Start centers, and
                    with family literacy services.
        ``(f) Award Amounts.--The Secretary may establish a maximum award
    amount, or ranges of award amounts, for grants under this subpart.

    ``SEC. 1223. FEDERAL ADMINISTRATION.

        ``The Secretary shall consult with the Secretary of Health and
    Human Services in order to coordinate the activities undertaken under
    this subpart with programs under the Head Start Act (42 U.S.C. 9831 et
    seq.).

    ``SEC. 1224. REPORTING REQUIREMENTS.

        ``Each eligible applicant receiving a grant under this subpart
    shall report annually to the Secretary regarding the eligible
    applicant's progress in addressing the purposes of this subpart.

    ``SEC. 1225. EVALUATION.

        ``From the total amount made available under section 1002(b)(2) for
    the period beginning October 1, 2002, and ending September 30, 2006,
    the Secretary shall reserve not more than $1,000,000 to conduct an
    independent evaluation of the effectiveness of this subpart.

    ``SEC. 1226. ADDITIONAL RESEARCH.

        ``From the amount made available under section 1002(b)(2) for each
    of the fiscal years 2002 through 2006, the Secretary shall reserve not
    more than $3,000,000 to conduct, in consultation with the National
    Institute for Child Health and Human Development, the National
    Institute for Literacy, and the Department of Health and Human
    Services, additional research on language and literacy development for
    children aged 3 through 5.''.

    SEC. 112. AMENDMENTS TO EVEN START.

        Part B of title I (20 U.S.C. 6361 et seq.), as amended by section
    111, is further amended--
                (1) by inserting before section 1231 (as so redesignated by
            section 111) the following:

    ``Subpart 3--William F. Goodling Even Start Family Literacy Programs'';

                (2) in each of sections 1231 through 1242 (as so
            redesignated by section 111)--
                        (A) by striking ``this part'' each place such term
                    appears and inserting ``this subpart''; and
                        (B) by striking ``1002(b)'' each place such term
                    appears and inserting ``1002(b)(3)'';
                (3) in section 1231(4), by striking ``2252)'' and inserting
            ``1209)'';
                (4) in section 1232--
                        (A) in subsection (b)--
                                (i) in paragraph (1)(A), by striking
                            ``1209;'' and inserting ``1239;''; and
                                (ii) in paragraph (2), by striking
                            ``1211(b)'' each place such term appears and
                            inserting ``1241(b)''; and
                        (B) in subsection (c)--
                                (i) by amending paragraph (2)(C) to read as
                            follows:
                        ``(C) Coordination with subpart 1.--The consortium
                    shall coordinate its activities with the activities of
                    the reading and literacy partnership for the State
                    established under section 1204(d), if the State
                    receives a grant under section 1203.''; and
                                (ii) in paragraph (3), by striking
                            ``2252).'' and inserting ``1209).'';
                (5) in section 1233--
                        (A) by striking ``1202(d)(1)'' each place such term
                    appears and inserting ``1232(d)(1)''; and
                        (B) by striking ``1210.'' and inserting ``1240.'';
                (6) in section 1234--
                        (A) in subsection (b)--
                                (i) in paragraph (1)(A), by moving the
                            margins of clauses (v) and (vi) 2 ems to the
                            right; and
                                (ii) in paragraph (3), by striking
                            ``1202(a)(1)(C)'' and inserting
                            ``1232(a)(1)(C)''; and
                        (B) in subsection (c)--
                                (i) in paragraph (1)--
                                        (I) by striking ``1203(a),'' and
                                    inserting ``1233(a),''; and
                                        (II) by striking ``1203(b)'' and
                                    inserting ``1233(b)''; and
                                (ii) in paragraph (2), by striking
                            ``1210.'' and inserting ``1240.'';
                (7) in section 1235--
                        (A) in paragraph (10), by striking ``2252)'' and
                    inserting ``1209)'';
                        (B) in paragraph (12), by striking ``2252),'' and
                    inserting ``1209),''; and
                        (C) in paragraph (15), by striking ``program.'' and
                    inserting ``program to be used for program
                    improvement.'';
                (8) in section 1237--
                        (A) in subsection (c)(1)--
                                (i) in subparagraph (B), by striking
                            ``1205;'' and inserting ``1235;''; and
                                (ii) in subparagraph (F), by striking
                            ``14306;'' and inserting ``8306;''; and
                        (B) in subsection (d), by striking ``14302.'' and
                    inserting ``8302.'';
                (9) in section 1238--
                        (A) in subsection (a)(1)--
                                (i) in subparagraph (A)(ii), by striking
                            ``1205;'' and inserting ``1235;''; and
                                (ii) in subparagraph (F), by striking
                            ``1204(b);'' and inserting ``1234(b);''; and
                        (B) in subsection (b)--
                                (i) in paragraph (3)--
                                        (I) by striking ``1207(c)(1)(A)''
                                    and inserting ``1237(c)(1)(A)''; and
                                        (II) by striking ``1210.'' and
                                    inserting ``1240.'';
                                (ii) in paragraph (4), by striking
                            ``1210,'' and inserting ``1240,''; and
                                (iii) in paragraph (5)(B), by striking
                            ``1204(b).'' and inserting ``1234(b).'';
                (10) in section 1239--
                        (A) by striking ``1202(b)(1),'' and inserting
                    ``1232(b)(1),''; and
                        (B) by striking ``1205(10)'' and inserting
                    ``1235(10)''; and
                (11) in section 1241--
                        (A) in subsection (b)(1)--
                                (i) by striking ``1202(b)(2),'' and
                            inserting ``1232(b)(2),''; and
                                (ii) by striking ``2252);'' and inserting
                            ``1209);''; and
                        (B) in subsection (c), by striking ``2258,'' and
                    inserting ``1208,''.

    SEC. 113. INEXPENSIVE BOOK DISTRIBUTION PROGRAM.

        (a) Transfer and Redesignation.--Part E of title X (20 U.S.C. 8131)
    is transferred and redesignated as subpart 4 of part B of title I.
    Section 10501 is redesignated as section 1251.
        (b) Purpose.--Section 1251 (as so redesignated) is amended--
                (1) by striking subsection (e);
                (2) by redesignating subsection (d) as subsection (g);
                (3) by redesignating subsections (a) through (c) as
            subsections (b) through (d), respectively; and
                (4) by inserting before subsection (b) (as so redesignated)
            the following:
        ``(a) Purpose.--The purpose of this program is to establish and
    implement a model partnership between a governmental entity and a
    private entity, to help prepare young children for reading, and
    motivate older children to read, through the distribution of
    inexpensive books. Local reading motivation programs assisted under
    this section shall use such assistance to provide books, training for
    volunteers, motivational activities, and other essential literacy
    resources, and shall assign the highest priority to serving the
    youngest and neediest children in the United States.''.
        (c) Authorization.--Section 1251(b) (as so redesignated) is amended
    by striking ``books to students, that motivate children to read.'' and
    inserting ``books to young and school-aged children that motivate them
    to read.''.
        (d) Requirements of Contract.--Section 1251(c) (as so redesignated)
    is amended--
                (1) in the matter preceding paragraph (1), by striking
            ``subsection (a)'' and inserting ``subsection (b)''; and
                (2) in paragraph (4), by inserting ``training and'' before
            ``technical''.
        (e) Special Rules for Certain Subcontractors; Multi-year
    Contracts.--Section 1251 (as so redesignated) is amended by inserting
    after subsection (d) the following:
        ``(e) Special Rules for Certain Subcontractors.--
                ``(1) Funds from other federal sources.--Subcontractors
            operating programs under this section in low-income communities
            with a substantial number or percentage of children with
            special needs, as described in subsection (c)(3), may use funds
            from other Federal sources to pay the non-Federal share of the
            cost of the program, if those funds do not comprise more than
            50 percent of the non-Federal share of the funds used for the
            cost of acquiring and distributing books.
                ``(2) Waiver Authority.--Notwithstanding subsection (c),
            the contractor may waive, in whole or in part, the requirement
            in subsection (c)(1) for a subcontractor, if the subcontractor
            demonstrates that it would otherwise not be able to participate
            in the program, and enters into an agreement with the
            contractor with respect to the amount of the non-Federal share
            to which the waiver will apply. In a case in which such a
            waiver is granted, the requirement in subsection (c)(2) shall
            not apply.
        ``(f) Multi-year Contracts.--The contractor may enter into a multi-
    year subcontract under this section, if--
                ``(1) the contractor believes that such subcontract will
            provide the subcontractor with additional leverage in seeking
            local commitments; and
                ``(2) the subcontract does not undermine the finances of
            the national program.''.
        (f) Continuation of Awards.--Notwithstanding any other provision of
    this Act, any person or agency that was awarded a contract under part E
    of title X (20 U.S.C. 8131) prior to the date of the enactment of this
    Act shall continue to receive funds in accordance with the terms of
    such contract until the date on which the contract period terminates
    under such terms.

                    PART C--EDUCATION OF MIGRATORY CHILDREN

    SEC. 121. STATE ALLOCATIONS.

        Section 1303 (20 U.S.C. 6393) is amended--
                (1) by amending subsection (a) to read as follows:
        ``(a) State Allocations.--
                ``(1) Fiscal year 2002.--For fiscal year 2002, each State
            (other than the Commonwealth of Puerto Rico) is entitled to
            receive under this part an amount equal to--
                        ``(A) the sum of the estimated number of migratory
                    children aged three through 21 who reside in the State
                    full time and the full-time equivalent of the estimated
                    number of migratory children aged three through 21 who
                    reside in the State part time, as determined in
                    accordance with subsection (d); multiplied by
                        ``(B) 40 percent of the average per-pupil
                    expenditure in the State, except that the amount
                    determined under this paragraph shall not be less than
                    32 percent, nor more than 48 percent, of the average
                    expenditure per pupil in the United States.
                ``(2) Subsequent years.--
                        ``(A) Base amount.--
                                ``(i) In general.--Except as provided in
                            subsection (b) and clause (ii), each State
                            (other than the Commonwealth of Puerto Rico) is
                            entitled to receive under this part, for fiscal
                            year 2003 and succeeding fiscal years, an
                            amount equal to--
                                        ``(I) the amount that such State
                                    received under this part for fiscal
                                    year 2002; plus
                                        ``(II) the amount allocated to the
                                    State under subparagraph (B).
                                ``(ii) Nonparticipating states.--In the
                            case of a State (other than the Commonwealth of
                            Puerto Rico) that did not receive any funds for
                            fiscal year 2002 under this part, the State
                            shall receive, for fiscal year 2003 and
                            succeeding fiscal years, an amount equal to--
                                        ``(I) the amount that such State
                                    would have received under this part for
                                    fiscal year 2002 if its application
                                    under section 1304 for the year had
                                    been approved; plus
                                        ``(II) the amount allocated to the
                                    State under subparagraph (B).
                        ``(B) Allocation of additional amount.--For fiscal
                    year 2003 and succeeding fiscal years, the amount (if
                    any) by which the funds appropriated to carry out this
                    part for the year exceed such funds for fiscal year
                    2002 shall be allocated to a State (other than the
                    Commonwealth of Puerto Rico) so that the State receives
                    an amount equal to--
                                ``(i) the sum of--
                                        ``(I) the number of identified
                                    eligible migratory children, aged 3
                                    through 21, residing in the State
                                    during the previous year; and
                                        ``(II) the number of identified
                                    eligible migratory children, aged 3
                                    through 21, who received services under
                                    this part in summer or intersession
                                    programs provided by the State during
                                    such year; multiplied by
                                ``(ii) 40 percent of the average per-pupil
                            expenditure in the State, except that the
                            amount determined under this clause may not be
                            less than 32 percent, or more than 48 percent,
                            of the average per-pupil expenditure in the
                            United States.'';
                (2) by amending subsection (b) to read as follows:
        ``(b) Allocation to Puerto Rico.--
                ``(1) In general.--For each fiscal year, the grant which
            the Commonwealth of Puerto Rico shall be eligible to receive
            under this part shall be the amount determined by multiplying
            the number of children counted under subsection (a)(1)(A) for
            the Commonwealth of Puerto Rico by the product of--
                        ``(A) the percentage which the average per pupil
                    expenditure in the Commonwealth of Puerto Rico is of
                    the lowest average per pupil expenditure of any of the
                    50 States; and
                        ``(B) 32 percent of the average per pupil
                    expenditure in the United States.
                ``(2) Minimum percentage.--The percentage in paragraph
            (1)(A) shall not be less than--
                        ``(A) for fiscal year 2002, 77.5 percent;
                        ``(B) for fiscal year 2003, 80.0 percent;
                        ``(C) for fiscal year 2004, 82.5 percent; and
                        ``(D) for fiscal year 2005 and succeeding fiscal
                    years, 85.0 percent.
                ``(3) Limitation.--If the application of paragraph (2)
            would result in any of the 50 States or the District of
            Columbia receiving less under this part than it received under
            this part for the preceding fiscal year, the percentage in
            paragraph (1) shall be the greater of the percentage in
            paragraph (1)(A) or the percentage used for the preceding
            fiscal year.''; and
                (3) by striking subsection (d) and redesignating subsection
            (e) as subsection (d).

    SEC. 122. STATE APPLICATIONS; SERVICES.

        (a) Program Information.--Section 1304(b) (20 U.S.C. 6394(b)) is
    amended--
                (1) in paragraph (1), by striking ``addressed through'' and
            all that follows through the semicolon at the end and inserting
            the following:
            ``addressed through--
                        ``(A) the full range of services that are available
                    for migratory children from appropriate local, State,
                    and Federal educational programs;
                        ``(B) joint planning among local, State, and
                    Federal educational programs serving migrant children,
                    including programs under part A of title III;
                        ``(C) the integration of services available under
                    this part with services provided by those other
                    programs; and
                        ``(D) measurable program goals and outcomes;''; and
                (2) in paragraph (5), by striking ``the requirements of
            paragraph (1);'' and inserting ``the numbers and needs of
            migratory children, the requirements of subsection (d), and the
            availability of funds from other Federal, State, and local
            programs;''.
        (b) Assurances.--Section 1304(c) (20 U.S.C. 6394(c)) is amended--
                (1) in paragraph (1), by striking ``1306(b)(1);'' and
            inserting ``1306(a);'';
                (2) in paragraph (2), by striking ``part F;'' and inserting
            ``part H;''
                (3) in paragraph (3)--
                        (A) by striking ``appropriate'';
                        (B) by striking ``out, to the extent feasible,''
                    and inserting ``out''; and
                        (C) by striking ``1118;'' and inserting ``1118,
                    unless extraordinary circumstances make implementation
                    consistent with such section impractical;''; and
                (4) in paragraph (7), by striking ``section 1303(e)'' and
            inserting ``paragraphs (1)(A) and (2)(B)(i) of section
            1303(a)''.

    SEC. 123. AUTHORIZED ACTIVITIES.

        Section 1306 (20 U.S.C. 6396) is amended to read as follows:

    ``SEC. 1306. AUTHORIZED ACTIVITIES.

        ``(a) In General.--
                ``(1) Flexibility.--Each State educational agency, through
            its local educational agencies, shall have the flexibility to
            determine the activities to be provided with funds made
            available under this part, except that such funds shall first
            be used to meet the identified needs of migratory children that
            result from their migratory lifestyle, and to permit these
            children to participate effectively in school.
                ``(2) Unaddressed needs.--Funds provided under this part
            shall be used to address the needs of migratory children that
            are not addressed by services available from other Federal or
            non-Federal programs, except that migratory children who are
            eligible to receive services under part A of this title may
            receive those services through funds provided under that part,
            or through funds under this part that remain after the agency
            addresses the needs described in paragraph (1).
        ``(b) Construction.--Nothing in this part shall be construed to
    prohibit a local educational agency from serving migratory children
    simultaneously with students with similar educational needs in the same
    educational settings, where appropriate.
        ``(c) Special Rule.--Notwithstanding section 1114, a school that
    receives funds under this part shall continue to address the identified
    needs described in subsection (a)(1).''.

    SEC. 124. COORDINATION OF MIGRANT EDUCATION ACTIVITIES.

        (a) Duration.--Section 1308(a)(2) (20 U.S.C. 6398(a)(2)) is amended
    by striking ``subpart'' and inserting ``subsection''.
        (b) Student Records.--Section 1308(b) (20 U.S.C. 6398(b)) is
    amended to read as follows:
        ``(b) Student Records.--
                ``(1) Assistance.--The Secretary shall assist States in
            developing effective methods for the transfer of student
            records and in determining the number of migratory children in
            each State. The Secretary, in consultation with the States,
            shall determine the minimum data elements that each State
            receiving funds under this part shall collect and maintain. The
            Secretary shall assist States to implement a system of linking
            their student record transfer systems for the purpose of
            electronic records maintenance and transfer for migrant
            students.
                ``(2) No cost for certain transfers.--A State educational
            agency or local educational agency receiving assistance under
            this part shall make student records available to another State
            or local educational agency that requests the records at no
            cost to the requesting agency, if the request is made in order
            to meet the needs of a migratory child.''.
        (c) Availability of Funds.--Section 1308(c) (20 U.S.C. 6398(c)) is
    amended by striking ``$6,000,000'' and inserting ``$10,000,000''.
        (d) Incentive Grants.--Section 1308(d) (20 U.S.C. 6398(d)) is
    amended to read as follows:
        ``(d) Incentive Grants.--From the amounts made available to carry
    out this section for any fiscal year, the Secretary may reserve not
    more than $3,000,000 to award grants of not more than $250,000 on a
    competitive basis to State educational agencies that propose a
    consortium arrangement with another State or other appropriate entity
    that the Secretary determines, pursuant to criteria that the Secretary
    shall establish, will improve the delivery of services to migratory
    children whose education is interrupted.''.

                     PART D--NEGLECTED OR DELINQUENT YOUTH

    SEC. 131. NEGLECTED OR DELINQUENT YOUTH.

        The heading for part D of title I is amended to read as follows:

        ``PART D--PREVENTION AND INTERVENTION PROGRAMS FOR NEGLECTED OR
                        DELINQUENT CHILDREN AND YOUTH''.

    SEC. 132. FINDINGS.

        Section 1401(a) (20 U.S.C. 6421(a)) is amended by striking
    paragraphs (6) through (9) and inserting the following:
                ``(6) Youth returning from correctional facilities need to
            be involved in programs that provide them with high-level
            skills and other support to help them stay in school and
            complete their education.
                ``(7) Pregnant and parenting teenagers are a high-at-risk
            group for dropping out of school and should be targeted by
            dropout prevention programs.''.

    SEC. 133. ALLOCATION OF FUNDS.

        Section 1412(b) (20 U.S.C. 6432(b)) is amended to read as follows:
        ``(b) Subgrants to State Agencies in Puerto Rico.--
                ``(1) In general.--For each fiscal year, the amount of the
            subgrant which a State agency in the Commonwealth of Puerto
            Rico shall be eligible to receive under this part shall be the
            amount determined by multiplying the number of children counted
            under subparagraph (a)(1)(A) for the Commonwealth of Puerto
            Rico by the product of--
                        ``(A) the percentage which the average per-pupil
                    expenditure in the Commonwealth of Puerto Rico is of
                    the lowest average per-pupil expenditure of any of the
                    50 States; and
                        ``(B) 32 percent of the average per-pupil
                    expenditure in the United States.
                ``(2) Minimum percentage.--The percentage in paragraph
            (1)(A) shall not be less than--
                        ``(A) for fiscal year 2002, 77.5 percent;
                        ``(B) for fiscal year 2003, 80.0 percent;
                        ``(C) for fiscal year 2004, 82.5 percent; and
                        ``(D) for fiscal year 2005 and succeeding fiscal
                    years, 85.0 percent.
                ``(3) Limitation.--If the application of paragraph (2)
            would result in any of the 50 States or the District of
            Columbia receiving less under this part than it received under
            this part for the preceding fiscal year, the percentage in
            paragraph (1) shall be the greater of the percentage in
            paragraph (1)(A) or the percentage used for the preceding
            fiscal year.''.

    SEC. 134. STATE PLAN AND STATE AGENCY APPLICATIONS.

        Section 1414 (20 U.S.C. 6434) is amended to read as follows:

    ``SEC. 1414. STATE PLAN AND STATE AGENCY APPLICATIONS.

        ``(a) State Plan.--
                ``(1) In general.--Each State educational agency that
            desires to receive a grant under this part shall submit, for
            approval by the Secretary, a plan for meeting the educational
            needs of neglected and delinquent youth, for assisting in their
            transition from institutions to locally operated programs, and
            which is integrated with other programs under this Act or other
            Acts, as appropriate, consistent with section 8306.
                ``(2) Contents.--Each such State plan shall--
                        ``(A) describe the program goals, objectives, and
                    performance measures established by the State that will
                    be used to assess the effectiveness of the program in
                    improving academic and vocational and technical skills
                    of children in the program;
                        ``(B) provide that, to the extent feasible, such
                    children will have the same opportunities to learn as
                    such children would have if such children were in the
                    schools of local educational agencies in the State; and
                        ``(C) contain assurances that the State educational
                    agency will--
                                ``(i) ensure that programs assisted under
                            this part will be carried out in accordance
                            with the State plan described in this
                            subsection;
                                ``(ii) carry out the evaluation
                            requirements of section 1416;
                                ``(iii) ensure that the State agencies
                            receiving subgrants under this subpart comply
                            with all applicable statutory and regulatory
                            requirements; and
                                ``(iv) provide such other information as
                            the Secretary may reasonably require.
                ``(3) Duration of the plan.--Each such State plan shall--
                        ``(A) remain in effect for the duration of the
                    State's participation under this part; and
                        ``(B) be periodically reviewed and revised by the
                    State, as necessary, to reflect changes in the State's
                    strategies and programs under this part.
        ``(b) Secretarial Approval and Peer Review.--
                ``(1) Secretarial approval.--The Secretary shall approve
            each State plan that meets the requirements of this part.
                ``(2) Peer review.--The Secretary may review any State plan
            with the assistance and advice of individuals with relevant
            expertise.
        ``(c) State Agency Applications.--Any State agency that desires to
    receive funds to carry out a program under this part shall submit an
    application to the State educational agency that--
                ``(1) describes the procedures to be used, consistent with
            the State plan under section 1111, to assess the educational
            needs of the children to be served;
                ``(2) provides assurances that in making services available
            to youth in adult correctional facilities, priority will be
            given to such youth who are likely to complete incarceration
            within a 2-year period;
                ``(3) describes the program, including a budget for the
            first year of the program, with annual updates to be provided
            to the State educational agency;
                ``(4) describes how the program will meet the goals and
            objectives of the State plan under this subpart;
                ``(5) describes how the State agency will consult with
            experts and provide the necessary training for appropriate
            staff, to ensure that the planning and operation of
            institution-wide projects under section 1416 are of high
            quality;
                ``(6) describes how the agency will carry out the
            evaluation requirements of section 8651 and how the results of
            the most recent evaluation are used to plan and improve the
            program;
                ``(7) includes data showing that the agency has maintained
            fiscal effort required of a local educational agency, in
            accordance with section 8501;
                ``(8) describes how the programs will be coordinated with
            other appropriate State and Federal programs, such as job
            training programs, vocational and technical education programs,
            State and local dropout prevention programs, and special
            education programs;
                ``(9) describes how States will encourage correctional
            facilities receiving funds under this subpart to coordinate
            with local educational agencies or alternative education
            programs attended by incarcerated youth prior to their
            incarceration to ensure that student assessments and
            appropriate academic records are shared jointly between the
            correctional facility and the local educational agency or
            alternative education program;
                ``(10) describes how appropriate professional development
            will be provided to teachers and other staff;
                ``(11) designates an individual in each affected
            institution to be responsible for issues relating to the
            transition of children and youth from the institution to
            locally operated programs;
                ``(12) describes how the agency will endeavor to coordinate
            with businesses for training and mentoring for participating
            youth;
                ``(13) provides assurances that the agency will assist in
            locating alternative programs through which students can
            continue their education if students are not returning to
            school after leaving the correctional facility;
                ``(14) provides assurances that the agency will work with
            parents to secure parents' assistance in improving the
            educational achievement of their children and preventing their
            children's further involvement in delinquent activities;
                ``(15) provides assurances that the agency works with
            special education youth in order to meet an existing
            individualized education program and an assurance that the
            agency will notify the youth's local school if such youth--
                        ``(A) is identified as in need of special education
                    services while the youth is in the facility; and
                        ``(B) intends to return to the local school;
                ``(16) provides assurances that the agency will work with
            youth who dropped out of school before entering the facility to
            encourage the youth to reenter school once the term of
            incarceration has been completed or provide the youth with the
            skills necessary to gain employment, continue the education of
            the youth, or achieve a secondary school diploma or the
            recognized equivalent if the youth does not intend to return to
            school;
                ``(17) provides assurances that teachers and other
            qualified staff are also trained to work with children with
            disabilities and other students with special needs, taking into
            consideration the unique needs of such students;
                ``(18) describes any additional services to be provided to
            youth, such as career counseling, distance learning, and
            assistance in securing student loans and grants; and
                ``(19) provides assurances that the program under this
            subpart will be coordinated with any programs operated under
            the Juvenile Justice and Delinquency Prevention Act of 1974 (42
            U.S.C. 5601 et seq.) or other comparable programs, if
            applicable.''.

    SEC. 135. USE OF FUNDS.

        Section 1415(a) (20 U.S.C. 6435(a)) is amended--
                (1) in paragraph (1)(B), by inserting ``, vocational and
            technical training'' after ``secondary school completion'';
                (2) in paragraph (2)(B)--
                        (A) in clause (i), by inserting ``and'' after the
                    semicolon;
                        (B) in clause (ii), by striking ``; and'' and
                    inserting a semicolon; and
                        (C) by striking clause (iii);
                (3) in paragraph (2)(C), by striking ``part F of this
            title'' and inserting ``part H''; and
                (4) in paragraph (2)(D), by striking ``section 14701'' and
            inserting ``section 8651''.

    SEC. 136. TRANSITION SERVICES.

        Section 1418(a) (20 U.S.C. 6438(a)) is amended by striking ``10
    percent'' and inserting ``15 percent''.

    SEC. 137. PURPOSE.

        Section 1421(3) (20 U.S.C. 6451(3)) is amended to read as follows:
                ``(3) operate programs in local schools for youth returning
            from correctional facilities and programs which may also serve
            youth at risk of dropping out of school.''.

    SEC. 138. PROGRAMS OPERATED BY LOCAL EDUCATIONAL AGENCIES.

        Section 1422 (20 U.S.C. 6452) is amended--
                (1) in subsection (a), by striking ``retained'';
                (2) by amending subsection (b) to read as follows:
        ``(b) Special Rule.--A local educational agency which includes a
    correctional facility that operates a school is not required to operate
    a program of support for children returning from such school to a
    school not operated by a correctional agency but served by such local
    educational agency if more than 30 percent of the youth attending the
    school operated by the correctional facility will reside outside the
    boundaries of the local educational agency after leaving such
    facility.''; and
                (3) by adding at the end the following:
        ``(d) Transitional and Academic Services.--Transitional and
    supportive programs operated in local educational agencies under this
    subpart shall be designed primarily to meet the transitional and
    academic needs of students returning to local educational agencies or
    alternative education programs from correctional facilities. Services
    to students at risk of dropping out of school shall not have a negative
    impact on meeting the transitional and academic needs of the students
    returning from correctional facilities.''.

    SEC. 139. LOCAL EDUCATIONAL AGENCY APPLICATIONS.

        Section 1423 (20 U.S.C. 6453) is amended by striking paragraphs (4)
    through (9) and inserting the following:
                ``(4) a description of the program operated by
            participating schools for children returning from correctional
            facilities and the types of services that such schools will
            provide such youth and other at-risk youth;
                ``(5) a description of the characteristics (including
            learning difficulties, substance abuse problems, and other
            special needs) of the youth who will be returning from
            correctional facilities and, as appropriate, other at-risk
            youth expected to be served by the program and how the school
            will coordinate existing educational programs to meet the
            unique educational needs of such youth;
                ``(6) as appropriate, a description of how schools will
            coordinate with existing social, health, and other services to
            meet the needs of students returning from correctional
            facilities, students at risk of dropping out of school, and
            other participating students, including prenatal health care
            and nutrition services related to the health of the parent and
            child, parenting and child development classes, child care,
            targeted reentry and outreach programs, referrals to community
            resources, and scheduling flexibility;
                ``(7) as appropriate, a description of any partnerships
            with local businesses to develop training, curriculum-based
            youth entrepreneurship education, and mentoring services for
            participating students;
                ``(8) as appropriate, a description of how programs will
            involve parents in efforts to improve the educational
            achievement of their children, prevent the involvement of their
            children in delinquent activities, and encourage their children
            to remain in school and complete their education;
                ``(9) a description of how the program under this subpart
            will be coordinated with other Federal, State, and local
            programs, such as job training programs and vocational and
            technical education programs serving this at-risk population of
            youth.''.

    SEC. 140. USES OF FUNDS.

        Section 1424 (20 U.S.C. 6454) is amended by striking paragraphs (1)
    through (3) and inserting the following:
                ``(1) programs that serve youth returning from correctional
            facilities to local schools, to assist in the transition of
            such youth to the school environment and help them remain in
            school in order to complete their education;
                ``(2) providing assistance to other youth at risk of
            dropping out of school, including pregnant and parenting
            teenagers;
                ``(3) the coordination of social, health, and other
            services, including day care, for participating youth, if the
            provision of such services will improve the likelihood that
            such youth will complete their education;
                ``(4) special programs to meet the unique academic needs of
            participating youth, including vocational and technical
            education, special education, career counseling, curriculum-
            based youth entrepreneurship education, and assistance in
            securing student loans or grants for postsecondary education;
            and
                ``(5) programs providing mentoring and peer mediation.''.

    SEC. 141. PROGRAM REQUIREMENTS.

        Section 1425 (20 U.S.C. 6455) is amended--
                (1) in the section heading, by striking ``this section''
            and inserting ``this subpart'';
                (2) in the matter preceding paragraph (1), by striking
            ``this section'' and inserting ``this subpart'';
                (3) in paragraph (1), by striking ``where feasible, ensure
            educational programs'' and inserting ``to the extent
            practicable, ensure that educational programs'';
                (4) in paragraphs (3) and (8), by striking ``where
            feasible,'' and inserting ``to the extent practicable,'';
                (5) in paragraph (9)--
                        (A) by striking ``this program'' and inserting
                    ``this subpart'';
                        (B) by inserting ``and technical'' after
                    ``vocational''; and
                        (C) by striking ``title I of the Workforce
                    Investment Act of 1998'' and inserting ``other job
                    training programs'';
                (6) in paragraph (10), by inserting ``(42 U.S.C. 5601 et
            seq.)'' after ``Juvenile Justice and Delinquency Prevention Act
            of 1974''; and
                (7) by amending paragraph (11) to read as follows:
                ``(11) if appropriate, work with local businesses to
            develop training, curriculum-based youth entrepreneurship
            education, and mentoring programs for youth.''.

    SEC. 142. PROGRAM EVALUATIONS.

        Section 1431(a) (20 U.S.C. 6471(a)) is amended by striking ``sex,
    and if feasible,'' and inserting ``gender,''.

                 PART E--FEDERAL EVALUATIONS AND DEMONSTRATIONS

    SEC. 151. EVALUATIONS.

        Section 1501 (20 U.S.C. 6491) is amended to read as follows:

    ``SEC. 1501. EVALUATIONS.

        ``(a) National Assessment.--
                ``(1) In general.--In accordance with this section, the
            Secretary shall conduct a national assessment of programs
            assisted under this title.
                ``(2) Issues to be examined.--In conducting the assessment
            under this subsection, the Secretary shall examine--
                        ``(A) the implementation of programs assisted under
                    this title and the impact of such implementation on
                    increasing student academic achievement, particularly
                    schools with high concentrations of children living in
                    poverty;
                        ``(B) the implementation of State standards,
                    assessments, and accountability systems developed under
                    this title and the impact of such implementation on
                    educational programs and instruction at the local
                    level;
                        ``(C) the impact of schoolwide programs and
                    targeted assistance programs under this title on
                    improving student academic achievement;
                        ``(D) the extent to which varying models of
                    comprehensive school reform are funded under this
                    title, and the effect of the implementation of such
                    models on improving achievement of disadvantaged
                    students;
                        ``(E) the costs as compared to the benefits of the
                    activities assisted under this title;
                        ``(F) the impact of school choice options under
                    section 1116 on the academic achievement of
                    disadvantaged students, on schools in school
                    improvement, and on schools from which students have
                    transferred under such options;
                        ``(G) the extent to which actions authorized under
                    section 1116 of this title are employed by State and
                    local educational agencies to improve the academic
                    achievement of students in low-performing schools, and
                    the effectiveness of the implementation of such
                    actions;
                        ``(H) the extent to which technical assistance made
                    available under this title is used to improve the
                    achievement of students in low-performing schools, and
                    the impact of such assistance on such achievement;
                        ``(I) the extent to which State and local fiscal
                    accounting requirements under this title limit the
                    flexibility of schoolwide programs;
                        ``(J) the impact of the professional development
                    activities assisted under this title on instruction and
                    student performance;
                        ``(K) the extent to which the assistance made
                    available under this title is targeted to disadvantaged
                    students and schools that need them the most;
                        ``(L) the effectiveness of Federal administration
                    assistance made available under this title, including
                    monitoring and technical assistance; and
                        ``(M) such other issues as the Secretary considers
                    appropriate.
                ``(3) Sources of information.--In conducting the assessment
            under this subsection, the Secretary shall use information from
            a variety of sources, including the National Assessment of
            Educational Progress (carried out under section 411 of the
            National Education Statistics Act of 1994 (20 U.S.C. 9010)),
            state evaluations, and other research studies.
                ``(4) Coordination.--In carrying out this subsection, the
            Secretary shall--
                        ``(A) coordinate conducting the national assessment
                    with conducting the longitudinal study described in
                    subsection (c); and
                        ``(B) ensure that the independent review panel
                    described in subsection (d) participates in conducting
                    the national assessment, including planning for and
                    reviewing the assessment.
                ``(5) Reports.--
                        ``(A) Interim report.--Not later than 3 years after
                    the date of enactment of the Leave No Child Behind Act
                    of 2001, the Secretary shall transmit to the President
                    and the Congress an interim report on the national
                    assessment conducted under this subsection.
                        ``(B) Final report.--Not later than 4 years after
                    the date of enactment of the Leave No Child Behind Act
                    of 2001, the Secretary shall transmit to the President
                    and the Congress a final report on the national
                    assessment conducted under this subsection.
        ``(b) Studies and Data Collection.--
                ``(1) In general.--In addition to other activities
            described in this section, the Secretary may, directly or
            through the making of grants to or contracts with appropriate
            entities--
                        ``(A) conduct studies and evaluations of the need
                    for, and effectiveness of, each program authorized
                    under this title;
                        ``(B) collect the data necessary to comply with the
                    Government Performance and Results Act of 1993; and
                        ``(C) provide guidance and technical assistance to
                    State educational agencies and local educational
                    agencies in developing and maintaining management
                    information systems through which such agencies can
                    develop program performance indicators in order to
                    improve services and performance.
                ``(2) Minimum information.--Under this subsection, the
            Secretary shall collect, at a minimum, trend information on the
            effect of each program authorized under this title, which shall
            complement the data collected and reported under subsections
            (a) and (c).
        ``(c) National Longitudinal Study.--
                ``(1) In general.--The Secretary shall conduct a
            longitudinal study of schools receiving assistance under this
            title.
                ``(2) Issues to be examined.--In carrying out this
            subsection, the Secretary shall ensure that the study referred
            to in paragraph (1) provides the Congress and educators with
            each of the following:
                        ``(A) An accurate description and analysis of
                    short-term and long-term effectiveness of the
                    assistance made available under this title upon
                    academic performance.
                        ``(B) Information that can be used to improve the
                    effectiveness of the assistance made available under
                    this title in enabling students to meet challenging
                    achievement standards.
                        ``(C) An analysis of educational practices or model
                    programs that are effective in improving the
                    achievement of disadvantaged children.
                        ``(D) An analysis of the costs as compared to the
                    benefits of the assistance made available under this
                    title in improving the achievement of disadvantaged
                    children.
                        ``(E) An analysis of the effects of the
                    availability of school choice options under section
                    1116 on the academic achievement of disadvantaged
                    students, on schools in school improvement, and on
                    schools from which students have transferred under such
                    options.
                        ``(F) Such other information as the Secretary
                    considers appropriate.
                ``(3) Scope.--In conducting the study referred to in
            paragraph (1), the Secretary shall ensure that the study--
                        ``(A) bases its analysis on a nationally
                    representative sample of schools participating in
                    programs under this part;
                        ``(B) to the extent practicable, includes in its
                    analysis students who transfer to different schools
                    during the course of the study; and
                        ``(C) analyzes varying models or strategies for
                    delivering school services, including--
                                ``(i) schoolwide and targeted services; and
                                ``(ii) comprehensive school reform models.
        ``(d) Independent Review Panel.--
                ``(1) In general.--The Secretary shall establish an
            independent review panel (in this subsection referred to as the
            `Review Panel') to advise the Secretary on methodological and
            other issues that arise in carrying out subsections (a) and
            (c).
                ``(2) Appointment of members.--
                        ``(A) In general.--Subject to subparagraph (B), the
                    Secretary shall appoint members of the Review Panel
                    from among qualified individuals who are--
                                ``(i) specialists in statistics,
                            evaluation, research, and assessment;
                                ``(ii) education practitioners, including
                            teachers, principals, and local and State
                            superintendents; and
                                ``(iii) other individuals with technical
                            expertise who would contribute to the overall
                            rigor and quality of the program evaluation.
                        ``(B) Limitations.--In appointing members of the
                    Review Panel under this subparagraph (A), the Secretary
                    shall ensure that--
                                ``(i) in order to ensure diversity, a
                            majority of the number of individuals appointed
                            under subparagraph (A)(i) represent disciplines
                            or programs outside the field of education; and
                                ``(ii) the total number of the individuals
                            appointed under subparagraph (A)(ii) or
                            (A)(iii) does not exceed \1/3\ of the total
                            number of the individuals appointed under this
                            paragraph.
                ``(3) Functions.--The Review Panel shall consult with and
            advise the Secretary--
                        ``(A) to ensure that the assessment conducted under
                    subsection (a) and the study conducted under subsection
                    (c)--
                                ``(i) adhere to the highest possible
                            standards of quality with respect to research
                            design, statistical analysis, and the
                            dissemination of findings; and
                                ``(ii) use valid and reliable measures to
                            document program implementation and impacts;
                            and
                        ``(B) to ensure--
                                ``(i) that the final report described in
                            subsection (a)(5)(B) is reviewed not later than
                            120 days after its completion by not less than
                            2 independent experts in program evaluation;
                                ``(ii) that such experts evaluate and
                            comment on the degree to which the report
                            complies with subsection (a); and
                                ``(iii) that the comments of such experts
                            are transmitted with the report under
                            subsection (a)(5)(B).''.

    SEC. 152. DEMONSTRATIONS OF INNOVATIVE PRACTICES.

        (a) In General.--Section 1502 (20 U.S.C. 6492) is amended--
                (1) by redesignating subsection (b) as subsection (c);
                (2) by striking in subsection (a) ``(2) Evaluation.--The
            Secretary'' and inserting ``(b) Evaluation.--The Secretary''
            and by moving such subsection (b) 2 ems to the left;
                (3) by striking in subsection (a) ``Such projects shall
            include promising'' and all that follows through ``career
            guidance opportunities.'';
                (4) by striking ``student performance standards'' and
            inserting ``student achievement standards'';
                (5) by inserting ``academic'' after ``to meet challenging
            State''; and
                (6) by striking ``(a) Demonstration Programs'' and all that
            follows through ``In general.--From the'' and inserting ``(a)
            In General.--From the''.

    SEC. 153. ELLENDER-CLOSE UP FELLOWSHIP PROGRAM; DROPOUT REPORTING.

        (a) In General.--Part E of title I (20 U.S.C. 6491 et seq.) is
    further amended by adding at the end the following:

    ``SEC. 1503. ELLENDER-CLOSE UP FELLOWSHIP PROGRAM

        ``(a) Findings.--Congress finds the following:
                ``(1) It is a worthwhile goal to ensure that all students
            in America are prepared for responsible citizenship and that
            all students should have the opportunity to be involved in
            activities that promote and demonstrate good citizenship.
                ``(2) It is a worthwhile goal to ensure that America's
            educators have access to programs for the continued improvement
            of their professional skills.
                ``(3) Allen J. Ellender, a Senator from Louisiana and
            President pro tempore of the United States Senate, had a
            distinguished career in public service characterized by
            extraordinary energy and real concern for young people. Senator
            Ellender provided valuable support and encouragement to the
            Close Up Foundation, a nonpartisan, nonprofit foundation
            promoting knowledge and understanding of the Federal Government
            among young people and educators. Therefore, it is a fitting
            and appropriate tribute to Senator Ellender to provide
            fellowships in his name to students of limited economic means
            and the teachers who work with such students, so that such
            students and teachers may participate in the programs supported
            by the Close Up Foundation.
                ``(4) The Close Up Foundation is a nonpartisan, nonprofit,
            education foundation promoting civic responsibility and
            knowledge and understanding of the Federal Government among
            young people and educators. The Congress has consistently
            supported the Close Up Foundation's work with disadvantaged
            young people and their educators through the Allen J. Ellender
            Fellowship Program. Therefore, it is fitting and appropriate to
            continue support under the successor Ellender-Close Up
            Fellowship Program to students of limited economic means and
            the teachers who work with such students, so that such students
            and teachers may participate in the programs supported by the
            Close Up Foundation.
        ``(b) Program for Middle and Secondary School Students.--
                ``(1) Establishment.--
                        ``(A) General authority.--In accordance with this
                    subsection, the Secretary may make grants to the Close
                    Up Foundation of Washington, District of Columbia, a
                    nonpartisan, nonprofit foundation, for the purpose of
                    assisting the Close Up Foundation in carrying out its
                    programs of increasing civic responsibility and
                    understanding of the Federal Government among middle
                    and secondary school students.
                        ``(B) Use of funds.--Grants under this subsection
                    shall be used only to provide financial assistance to
                    economically disadvantaged students who participate in
                    the program described in subparagraph (A). Financial
                    assistance received pursuant to this subsection by such
                    students shall be known as Ellender-Close Up
                    fellowships.
                ``(2) Applications.--
                        ``(A) Application required.--No grant under this
                    subsection may be made except upon an application at
                    such time, in such manner, and accompanied by such
                    information as the Secretary may reasonably require.
                        ``(B) Contents of application.--Each application
                    submitted under this paragraph shall contain provisions
                    to assure--
                                ``(i) that fellowship grants are made to
                            economically disadvantaged middle and secondary
                            school students;
                                ``(ii) that every effort will be made to
                            ensure the participation of students from rural
                            and small town areas, as well as from urban
                            areas, and that in awarding fellowships to
                            economically disadvantaged students, special
                            consideration will be given to the
                            participation of students with special
                            educational needs, including students with
                            disabilities, ethnic minority students, recent
                            immigrants, and gifted and talented students;
                            and
                                ``(iii) the proper disbursement of the
                            funds received under this subsection.
        ``(c) Program for Middle and Secondary School Teachers.--
                ``(1) Establishment.--
                        ``(A) General authority.--In accordance with this
                    subsection, the Secretary may make grants to the Close
                    Up Foundation of Washington, District of Columbia, a
                    nonpartisan, nonprofit foundation, for the purpose of
                    assisting the Close Up Foundation in carrying out its
                    programs of professional development for middle and
                    secondary school teachers and to promote greater civic
                    understanding and responsibility among the students of
                    such teachers.
                        ``(B) Use of funds.--Grants under this subsection
                    shall be used only for financial assistance to teachers
                    who participate in the program described in
                    subparagraph (A). Financial assistance received
                    pursuant to this subpart by such individuals shall be
                    known as Ellender-Close Up fellowships.
                ``(2) Applications.--
                        ``(A) Application required.--No grant under this
                    subsection may be made except upon an application at
                    such time, in such manner, and accompanied by such
                    information as the Secretary may reasonably require.
                        ``(B) Contents of application.--Each application
                    submitted under this paragraph shall contain provisions
                    to assure--
                                ``(i) that fellowship grants are made only
                            to teachers who have worked with at least one
                            student from such teacher's school who
                            participates in the programs described in
                            subsection (b);
                                ``(ii) that no teacher in each school
                            participating in the programs assisted under
                            subsection (b) may receive more than one
                            fellowship in any fiscal year; and
                                ``(iii) the proper disbursement of the
                            funds received under this subsection.
        ``(d) Programs for Recent Immigrants and Students of Migrant
    Parents.--
                ``(1) Establishment.--
                        ``(A) General authority.--In accordance with this
                    subsection, the Secretary may make grants to the Close
                    Up Foundation of Washington, District of Columbia, a
                    nonpartisan, nonprofit foundation, for the purpose of
                    assisting the Close Up Foundation in carrying out its
                    programs of increasing understanding of the Federal
                    Government among economically disadvantaged recent
                    immigrants and students of migrant parents.
                        ``(B) Use of funds.--Grants under this subsection
                    shall be used for financial assistance to economically
                    disadvantaged older Americans, recent immigrants and
                    students of migrant parents who participate in the
                    program described in subsection (a). Financial
                    assistance received pursuant to this subpart by such
                    individuals shall be known as Ellender-Close Up
                    fellowships.
                ``(2) Applications.--
                        ``(A) Application Required.--No grant under this
                    subsection may be made except upon application at such
                    time, in such manner, and accompanied by such
                    information as the Secretary may reasonably require.
                        ``(B) Contents of Application.--Each application
                    submitted under this paragraph shall contain
                    provisions--
                                ``(i) to assure that fellowship grants are
                            made to economically disadvantaged recent
                            immigrants and students of migrant parents;
                                ``(ii) to assure that every effort will be
                            made to ensure the participation of recent
                            immigrants and students of migrant parents from
                            rural and small town areas, as well as from
                            urban areas, and that in awarding fellowships,
                            special consideration will be given to the
                            participation of recent immigrants and students
                            of migrant parents with special needs,
                            including individuals with disabilities, ethnic
                            minorities, and gifted and talented students;
                                ``(iii) that fully describe the activities
                            to be carried out with the proceeds of the
                            grant; and
                                ``(iv) to assure the proper disbursement of
                            the funds received under this subsection.
        ``(e) General Provisions.--
                ``(1) Administrative provisions.--
                        ``(A) General rule.--Payments under this section
                    may be made in installments, in advance, or by way of
                    reimbursement, with necessary adjustments on account of
                    underpayment or overpayment.
                        ``(B) Audit Rule.--The Comptroller General of the
                    United States or any of the Comptroller General's duly
                    authorized representatives shall have access for the
                    purpose of audit and examination to any books,
                    documents, papers, and records that are pertinent to
                    any grant under this section.
        ``(f) Limitation.--Of the funds appropriated to carry out this
    section under section 1002, the Secretary may use not more than 30
    percent to carry out subsection (c) of this section.

    ``SEC. 1504. DROPOUT REPORTING.

        ``State educational agencies receiving funds under this title shall
    annually report to the National Center on Education Statistics
    (established under section 403 of the National Education Statistics Act
    of 1994 (20 U.S.C. 9002)) on the dropout rate of students in the State,
    as defined for the Center's Common Core of Data.''.
        (b) Continuation of Awards.--Notwithstanding any other provision of
    this Act, any person or agency that was awarded a grant under part G of
    title X (20 U.S.C. 8161 et seq.) prior to the date of the enactment of
    this Act shall continue to receive funds in accordance with the terms
    of such award until the date on which the award period terminates under
    such terms.

                      PART F--COMPREHENSIVE SCHOOL REFORM

    SEC. 161. SCHOOL REFORM.

        Part F of title I is amended to read as follows:

                     ``PART F--COMPREHENSIVE SCHOOL REFORM

    ``SEC. 1601. COMPREHENSIVE SCHOOL REFORM.

        ``(a) Findings and Purpose.--
                ``(1) Findings.--Congress finds the following:
                        ``(A) A number of schools across the country have
                    shown impressive gains in student performance through
                    the use of comprehensive models for schoolwide change
                    that incorporate virtually all aspects of school
                    operations.
                        ``(B) No single comprehensive school reform model
                    may be suitable for every school, however, schools
                    should be encouraged to examine successful, externally
                    developed comprehensive school reform approaches as
                    they undertake comprehensive school reform.
                        ``(C) Comprehensive school reform is an important
                    means by which children are assisted in meeting
                    challenging State student academic achievement
                    standards.
                ``(2) Purpose.--The purpose of this section is to provide
            financial incentives for schools to develop comprehensive
            school reforms, based upon scientifically-based research and
            effective practices that include an emphasis on basic academics
            and parental involvement so that all children can meet
            challenging State content and academic achievement standards.
        ``(b) Program Authorized.--
                ``(1) In general.--The Secretary is authorized to provide
            grants to State educational agencies to provide subgrants to
            local educational agencies to carry out the purpose described
            in subsection (a)(2).
                ``(2) Allocation.--
                        ``(A) Reservation.--Of the amount appropriated
                    under this section, the Secretary may reserve--
                                ``(i) not more than 1 percent for schools
                            supported by the Bureau of Indian Affairs and
                            in the United States Virgin Islands, Guam,
                            American Samoa, and the Commonwealth of the
                            Northern Mariana Islands;
                                ``(ii) not more than 1 percent to conduct
                            national evaluation activities described under
                            subsection (e); and
                                ``(iii) not more than 2 percent of the
                            amount appropriated in fiscal year 2002 to
                            carry out this part, for quality initiatives
                            described under subsection (f).
                        ``(B) In general.--Of the amount of funds remaining
                    after the reservation under subparagraph (A), the
                    Secretary shall allocate to each State for a fiscal
                    year, an amount that bears the same ratio to the
                    remainder for that fiscal year as the amount made
                    available under section 1124 to the State for the
                    preceding fiscal year bears to the total amount
                    allocated under section 1124 to all States for that
                    year.
                        ``(C) Reallocation.--If a State does not apply for
                    funds under this section, the Secretary shall
                    reallocate such funds to other States that do apply in
                    proportion to the amount allocated to such States under
                    subparagraph (B).
        ``(c) State Awards.--
                ``(1) State application.--
                        ``(A) In general.--Each State educational agency
                    that desires to receive a grant under this section
                    shall submit an application to the Secretary at such
                    time, in such manner and containing such other
                    information as the Secretary may reasonably require.
                        ``(B) Contents.--Each State application shall also
                    describe--
                                ``(i) the process and selection criteria by
                            which the State educational agency, using
                            expert review, will select local educational
                            agencies to receive subgrants under this
                            section;
                                ``(ii) how the agency will ensure that
                            funds under this part are used only for
                            comprehensive school reform programs that--
                                        ``(I) include each of the
                                    components described in subsection
                                    (d)(2);
                                        ``(II) have the capacity to improve
                                    the academic achievement of all
                                    students in core academic subjects
                                    within participating schools; and
                                        ``(III) are supported by technical
                                    assistance providers that have a
                                    successful track record, financial
                                    stability, and the capacity to deliver
                                    high-quality materials and professional
                                    development for school personnel.
                                ``(iii) how the agency will disseminate
                            materials regarding information on
                            comprehensive school reforms that are based on
                            scientifically-based research and effective
                            practices;
                                ``(iv) how the agency will evaluate
                            annually the implementation of such reforms and
                            measure the extent to which the reforms
                            resulted in increased student academic
                            performance; and
                                ``(v) how the agency will provide,
                            technical assistance to the local educational
                            agency or consortia of local educational
                            agencies, and to participating schools, in
                            evaluating, developing, and implementing
                            comprehensive school reform.
                ``(2) Uses of funds.--
                        ``(A) In general.--Except as provided in
                    subparagraph (E), a State educational agency that
                    receives an award under this section shall use such
                    funds to provide competitive grants to local
                    educational agencies or consortia of local educational
                    agencies in the State receiving funds under part A to
                    support comprehensive school reforms in schools
                    eligible for funds under such part.
                        ``(B) Grant requirements.--A grant to a local
                    educational agency or consortium shall be--
                                ``(i) of sufficient size and scope to
                            support the initial costs of the comprehensive
                            school reforms selected or designed by each
                            school identified in the application of the
                            local educational agency or consortium;
                                ``(ii) in an amount not less than $50,000
                            to each participating school; and
                                ``(iii) renewable for two additional 1-year
                            periods after the initial 1-year grant is made
                            if schools are making substantial progress in
                            the implementation of their reforms.
                        ``(C) Priority.--The State, in awarding grants
                    under this paragraph, shall give priority to local
                    educational agencies that--
                                ``(i) plan to use the funds in schools
                            identified as being in need of improvement or
                            corrective action under section 1116(c); or
                                ``(ii) demonstrate a commitment to assist
                            schools with budget allocation, professional
                            development, and other strategies necessary to
                            ensure the comprehensive school reforms are
                            properly implemented and are sustained in the
                            future.
                        ``(D) Grant consideration.--In making subgrant
                    awards under this part, the State educational agency
                    shall take into account the equitable distribution of
                    awards to different geographic regions within the
                    State, including urban and rural areas, and to schools
                    serving elementary and secondary students.
                        ``(E) Administrative costs.--A State educational
                    agency that receives a grant award under this section
                    may reserve not more than 5 percent of such award for
                    administrative, evaluation, and technical assistance
                    expenses.
                        ``(F) Supplement.--Funds made available under this
                    section shall be used to supplement, not supplant, any
                    other Federal, State, or local funds that would
                    otherwise be available to carry out this section.
                ``(3) Reporting.--Each State educational agency that
            receives an award under this section shall provide to the
            Secretary such information as the Secretary may require,
            including the names of local educational agencies and schools
            selected to receive subgrant awards under this section, the
            amount of such award, a description of the comprehensive school
            reforms selected and in use and a copy of the State's annual
            evaluation of the implementation of comprehensive school
            reforms supported under this part and student achievement
            results.
        ``(d) Local Awards.--
                ``(1) In general.--Each local educational agency or
            consortium that applies for a subgrant under this section
            shall--
                        ``(A) identify which schools eligible for funds
                    under part A plan to implement a comprehensive school
                    reform program, including the projected costs of such a
                    program;
                        ``(B) describe the comprehensive school reforms
                    based on scientifically-based research and effective
                    practices that such schools will implement;
                        ``(C) describe how the agency or consortium will
                    provide technical assistance and support for the
                    effective implementation of the school reforms based on
                    scientifically-based research and effective practices
                    selected by such schools; and
                        ``(D) describe how the agency or consortium will
                    evaluate the implementation of such reforms and measure
                    the results achieved in improving student academic
                    performance.
                ``(2) Components of the program.--A local educational
            agency that receives a subgrant award under this section shall
            provide such funds to schools that implement a comprehensive
            school reform program that--
                        ``(A) employs proven strategies and proven methods
                    for student learning, teaching, and school management
                    that are based on scientifically-based research and
                    effective practices and have been replicated
                    successfully in similar schools;
                        ``(B) integrates a comprehensive design for
                    effective school functioning, including instruction,
                    assessment, classroom management, professional
                    development, parental involvement, and school
                    management, that aligns the school's curriculum,
                    technology, and professional development into a
                    comprehensive reform plan for schoolwide change
                    designed to enable all students to meet challenging
                    State content and challenging student performance
                    standards and addresses needs identified through a
                    school needs assessment;
                        ``(C) provides high-quality and continuous teacher
                    and staff professional development;
                        ``(D) includes measurable goals for student
                    performance and benchmarks for meeting such goals;
                        ``(E) is supported by teachers, principals,
                    administrators, and other professional staff;
                        ``(F) provides for the meaningful involvement of
                    parents and the local community in planning and
                    implementing school improvement activities;
                        ``(G) uses high quality external technical support
                    and assistance from an entity, which may be an
                    institution of higher education, with experience and
                    expertise in schoolwide reform and improvement;
                        ``(H) includes a plan for the annual evaluation of
                    the implementation of school reforms and the student
                    results achieved;
                        ``(I) identifies how other resources, including
                    Federal, State, local, and private resources, available
                    to the school will be used to coordinate services to
                    support and sustain the school reform effort; and
                        ``(J)(i) has been found, through rigorous field
                    experiments in multiple sites, to significantly improve
                    the academic performance of students participating in
                    such activity or program as compared to similar
                    students in similar schools, who have not participated
                    in such activity or program; or
                        ``(ii) has been found to have strong evidence that
                    such model will significantly improve the performance
                    of participating children.
                ``(3) Special rule.--A school that receives funds to
            develop a comprehensive school reform program shall not be
            limited to using nationally available approaches, but may
            develop its own comprehensive school reform program for
            schoolwide change that complies with paragraph (2).
        ``(e) Evaluation and Report.--
                ``(1) In general.--The Secretary shall develop a plan for a
            national evaluation of the programs developed pursuant to this
            section.
                ``(2) Evaluation.--This national evaluation shall evaluate
            the implementation and results achieved by schools after 3
            years of implementing comprehensive school reforms, and assess
            the effectiveness of comprehensive school reforms in schools
            with diverse characteristics.
                ``(3) Reports.--Prior to the completion of a national
            evaluation, the Secretary shall submit an interim report
            outlining first year implementation activities to the
            Committees on Education and the Workforce and Appropriations of
            the House of Representatives and the Committees on Health,
            Education, Labor, and Pensions and Appropriations of the
            Senate.
        ``(f) Quality Initiatives.--The Secretary, through grants or
    contracts, shall provide funds for the following activities:
                ``(1) Technical assistance.--A joint public and private
            partnership that receives matching funds from private
            organizations, in order to assist States, local educational
            agencies, and schools in making informed decisions when
            approving or selecting providers of comprehensive school
            reform, consistent with the requirements described in
            subsection (d)(3).
                ``(2) Other activities.--Other activities that--
                        ``(A) encourage the development of comprehensive
                    reform models;
                        ``(B) build the capacity of comprehensive school
                    reform providers to increase the number of schools the
                    providers can serve; and
                        ``(C) ensure that schools served receive high
                    quality services that meet the needs of their teachers
                    and students.''.

               PART G--RURAL EDUCATION FLEXIBILITY AND ASSISTANCE

    SEC. 171. RURAL EDUCATION.

        Title I is amended by adding at the end the following new part:

              ``PART G--RURAL EDUCATION FLEXIBILITY AND ASSISTANCE

    ``SEC. 1701. SHORT TITLE.

        ``This part may be cited as the `Rural Education Initiative Act'.

    ``SEC. 1702. FINDINGS.

        ``Congress finds the following:
                ``(1) While there are rural education initiatives
            identified at the State and local level, no Federal education
            policy focuses on the specific and unique needs of rural school
            districts and schools.
                ``(2) Small school districts often cannot use Federal grant
            funds distributed by formula because the formula allocation
            does not provide enough revenue to carry out the program the
            grant is intended to fund.
                ``(3) Rural schools often cannot compete for Federal
            funding distributed by competitive grants because the schools
            lack the personnel needed to prepare grant applications and the
            resources to hire specialists in the writing of Federal grant
            proposals.
                ``(4) A critical problem for rural school districts
            involves the hiring and retention of qualified administrators
            and certified teachers (especially in reading, science, and
            mathematics). As a result, teachers in rural schools are almost
            twice as likely to provide instruction in three or more subject
            areas than teachers in urban schools. Rural schools also face
            other tough challenges, such as shrinking local tax bases, high
            transportation costs, aging buildings, limited course
            offerings, and limited resources.

                    ``Subpart 1--Rural Education Flexibility

    ``SEC. 1711. FORMULA GRANT PROGRAM AUTHORIZED.

        ``(a) Alternative Uses.--
                ``(1) In general.--Notwithstanding any other provision of
            law, an eligible local educational agency may use the
            applicable funding, that the agency is eligible to receive from
            the State educational agency for a fiscal year, to carry out
            local activities authorized in part A of title I, part A of
            title II, part A of title III, part A of title IV, or part A or
            B of title V.
                ``(2) Notification.--An eligible local educational agency
            shall notify the State educational agency of the local
            educational agency's intention to use the applicable funding in
            accordance with paragraph (1) not later than a date that is
            established by the State educational agency for the
            notification.
        ``(b) Eligibility.--
                ``(1) In general.--A local educational agency shall be
            eligible to use the applicable funding in accordance with
            subsection (a) if--
                        ``(A)(i) the total number of students in average
                    daily attendance at all of the schools served by the
                    local educational agency is less than 600; and
                        ``(ii) all of the schools served by the local
                    educational agency are designated with a school locale
                    code of 7 or 8 as determined by the Secretary of
                    Education; or
                        ``(B) the agency meets the criteria established in
                    subparagraph (A)(i) and the Secretary, in accordance
                    with paragraph (2), grants the local educational
                    agency's request to waive the criteria described in
                    subparagraph (A)(ii).
                ``(2) Certification.--The Secretary shall determine whether
            or not to waive the criteria described in paragraph (1)(A)(ii)
            based on a demonstration by a local educational agency and
            concurrence by the State educational agency that the local
            educational agency is located in an area defined as rural by a
            governmental agency of the State.
        ``(c) Applicable Funding.--In this section, the term `applicable
    funding' means funds provided under part A of title II, section 3106,
    part A of title IV, part A of title V, and section 5212(2)(A).
        ``(d) Disbursement.--Each State educational agency that receives
    applicable funding for a fiscal year shall disburse the applicable
    funding to local educational agencies for alternative uses under this
    section for the fiscal year at the same time that the State educational
    agency disburses the applicable funding to local educational agencies
    that do not intend to use the applicable funding for such alternative
    uses for the fiscal year.
        ``(e) Supplement Not Supplant.--Funds used under this section shall
    be used to supplement and not supplant any other Federal, State, or
    local education funds that would otherwise be available for the purpose
    of this subpart.
        ``(f) Applicable Rule.--Except as otherwise provided in this
    subpart, funds transferred under this subpart are subject to each of
    the rules and requirements applicable to the funds allocated by the
    Secretary under the provision to which the transferred funds are
    transferred.

    ``SEC. 1712. PROGRAM AUTHORIZED.

        ``(a) In General.--The Secretary is authorized to award grants to
    eligible local educational agencies under section 1711(b) to enable the
    local educational agencies to support local or statewide education
    reform efforts intended to improve the academic achievement of
    elementary school and secondary school students and the quality of
    instruction provided for the students.
        ``(b) Allocation.--
                ``(1) In general.--Except as provided in paragraph (3), the
            Secretary shall award a grant to an eligible local educational
            agency under section 1711(b) for a fiscal year in an amount
            equal to the initial amount determined under paragraph (2) for
            the fiscal year minus the total amount received under the
            provisions of law described under section 1711(c) for the
            preceding fiscal year.
                ``(2) Determination of the initial amount.--The initial
            amount referred to in paragraph (1) is equal to $100 multiplied
            by the total number of students, over 50 students, in average
            daily attendance in such eligible agency plus $20,000, except
            that the initial amount may not exceed $60,000.
                ``(3) Ratable adjustment.--
                        ``(A) In general.--If the amount made available for
                    this subpart for any fiscal year is not sufficient to
                    pay in full the amounts that local educational agencies
                    are eligible to receive under paragraph (1) for such
                    year, the Secretary shall ratably reduce such amounts
                    for such year.
                        ``(B) Additional amounts.--If additional funds
                    become available for making payments under paragraph
                    (1) for such fiscal year, payments that were reduced
                    under subparagraph (A) shall be increased on the same
                    basis as such payments were reduced.
                ``(4) Census determination.--
                        ``(A) In general.--Each local educational agency
                    desiring a grant under this section shall conduct a
                    census not later than December 1 of each year to
                    determine the number of kindergarten through grade 12
                    students in average daily attendance at the schools
                    served by the local educational agency.
                        ``(B) Submission.--Each local educational agency
                    shall submit the number described in subparagraph (A)
                    to the Secretary not later than March 1 of each year.
        ``(c) Disbursal.--The Secretary shall disburse the funds awarded to
    a local educational agency under this section for a fiscal year not
    later than July 1 of that year.
        ``(d) Special Rule.--A local educational agency that is eligible to
    receive a grant under this subpart for a fiscal year shall be
    ineligible to receive funds for such fiscal year under subpart 2.
        ``(e) Supplement Not Supplant.--Funds made available under this
    section shall be used to supplement and not supplant any other Federal,
    State, or local education funds.

    ``SEC. 1713. ACCOUNTABILITY.

        ``(a) Academic Achievement.--
                ``(1) In general.--Each local educational agency that uses
            or receives funds under section 1711 or 1712 for a fiscal year
            shall administer an assessment consistent with section 1111.
                ``(2) Special rule.--Each local educational agency that
            uses or receives funds under section 1711 or 1712 shall use the
            same assessment described in paragraph (1) for each year of
            participation in the program under such section.
        ``(b) State Educational Agency Determination Regarding Continuing
    Participation.--Each State educational agency that receives funding
    under the provisions of law described in section 1711(c) shall--
                ``(1) after the second year that a local educational agency
            participates in a program under section 1711 or 1712 and on the
            basis of the results of the assessments described in subsection
            (a), determine whether the schools served by the local
            educational agency participating in the program performed in
            accordance with section 1111; and
                ``(2) only permit those local educational agencies that so
            participated and make adequate yearly progress, as described in
            section 1111(b)(2), to continue to so participate.

                    ``Subpart 2--Rural Education Assistance

    ``SEC. 1721. PROGRAM AUTHORIZED.

        ``(a) Reservations.--From amounts appropriated under section
    1002(f) for this subpart for a fiscal year, the Secretary shall reserve
    \1/2\ of 1 percent to make awards to elementary or secondary schools
    operated or supported by the Bureau of Indian Affairs to carry out the
    purpose of this subpart.
        ``(b) Grants to States.--
                ``(1) In general.--From amounts appropriated under section
            1002(f) for this subpart that are not reserved under subsection
            (a), the Secretary shall award grants for a fiscal year to
            State educational agencies that have applications approved
            under section 1723 to enable the State educational agencies to
            award subgrants to eligible local educational agencies for
            local authorized activities described in subsection (c)(2).
                ``(2) Allocation.--From amounts appropriated for this
            subpart, the Secretary shall allocate to each State educational
            agency for a fiscal year an amount that bears the same ratio to
            the amount of funds appropriated under section 1002(f) for this
            subpart that are not reserved under subsection (a) as the
            number of students in average daily attendance served by
            eligible local educational agencies in the State bears to the
            number of all such students served by eligible local
            educational agencies in all States for that fiscal year.
                ``(3) Direct awards to specially qualified agencies.--
                        ``(A) Nonparticipating state.--If a State
                    educational agency elects not to participate in the
                    program under this subpart or does not have an
                    application approved under section 1723 a specially
                    qualified agency in such State desiring a grant under
                    this subpart shall submit an application under such
                    section directly to the Secretary to receive an award
                    under this subpart.
                        ``(B) Direct awards to specially qualified
                    agencies.--The Secretary may award, on a competitive
                    basis, the amount the State educational agency is
                    eligible to receive under paragraph (2) directly to
                    specially qualified agencies in the State.
        ``(c) Local Awards.--
                ``(1) Eligibility.--A local educational agency shall be
            eligible to receive funds under this subpart if--
                        ``(A) 20 percent or more of the children aged 5 to
                    17, inclusive, served by the local educational agency
                    are from families with incomes below the poverty line;
                    and
                        ``(B) all of the schools served by the agency are
                    designated with a school code of 6, 7, or 8 as
                    determined by the Secretary of Education.
                ``(2) Uses of funds.--Grant funds awarded to local
            educational agencies or made available to schools under this
            subpart shall be used for--
                        ``(A) teacher recruitment and retention, including
                    the use of signing bonuses and other financial
                    incentives;
                        ``(B) teacher professional development, including
                    programs that train teachers to utilize technology to
                    improve teaching and to train special needs teachers;
                        ``(C) educational technology, including software
                    and hardware as described in part B of title V;
                        ``(D) parental involvement activities; or
                        ``(E) programs to improve student academic
                    achievement.

    ``SEC. 1722. STATE DISTRIBUTION OF FUNDS.

        ``(a) Award Basis.--A State educational agency shall award grants
    to eligible local educational agencies--
                ``(1) on a competitive basis; or
                ``(2) according to a formula based on the number of
            students in average daily attendance served by the eligible
            local educational agencies or schools (as appropriate) in the
            State, as determined by the State.
        ``(b) Administrative Costs.--A State educational agency receiving a
    grant under this subpart may not use more than 5 percent of the amount
    of the grant for State administrative costs.

    ``SEC. 1723. APPLICATIONS.

        ``Each State educational agency and specially qualified agency
    desiring to receive a grant under this subpart shall submit an
    application to the Secretary at such time, in such manner, and
    accompanied by such information as the Secretary may require. Such
    application shall include specific measurable goals and objectives
    relating to increased student academic achievement, decreased student
    dropout rates, or such other factors that the State educational agency
    or specially qualified agency may choose to measure.

    ``SEC. 1724. REPORTS.

        ``(a) State Reports.--Each State educational agency that receives a
    grant under this subpart shall provide an annual report to the
    Secretary. The report shall describe--
                ``(1) the method the State educational agency used to award
            grants to eligible local educational agencies and to provide
            assistance to schools under this subpart;
                ``(2) how local educational agencies and schools used funds
            provided under this subpart; and
                ``(3) the degree to which progress has been made toward
            meeting the goals and objectives described in the application
            submitted under section 1723.
        ``(b) Specially Qualified Agency Report.--Each specially qualified
    agency that receives a grant under this subpart shall provide an annual
    report to the Secretary. Such report shall describe--
                ``(1) how such agency uses funds provided under this
            subpart; and
                ``(2) the degree to which progress has been made toward
            meeting the goals and objectives described in the application
            submitted under section 1723.
        ``(c) Report to Congress.--The Secretary shall prepare and submit
    to the Committee on Education and the Workforce for the House of
    Representatives and the Committee on Health, Education, Labor, and
    Pensions for the Senate an annual report. The report shall describe--
                ``(1) the methods the State educational agency used to
            award grants to eligible local educational agencies and to
            provide assistance to schools under this subpart;
                ``(2) how eligible local educational agencies and schools
            used funds provided under this subpart; and
                ``(3) progress made in meeting specific measurable
            educational goals and objectives.

    ``SEC. 1725. PERFORMANCE REVIEW.

        ``Three years after a State educational agency or specially
    qualified agency receives funds under this part, the Secretary shall
    review the progress of such agency toward achieving the goals and
    objectives included in its application, to determine whether the agency
    has made progress toward meeting such goals and objectives. To review
    the performance of each agency, the Secretary shall--
                ``(1) review the use of funds of such agency under section
            1721(c)(2); and
                ``(2) deny the provision of additional funds in subsequent
            fiscal years to an agency only if the Secretary determines,
            after notice and an opportunity for a hearing, that the
            agency's use of funds has been inadequate to justify
            continuation of such funding.

    ``SEC. 1726. DEFINITIONS.

        ``In this subpart--
                ``(1) 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.
                ``(2) The term `specially qualified agency' means an
            eligible local educational agency, located in a State that does
            not participate in a program under this subpart in a fiscal
            year, that may apply directly to the Secretary for a grant in
            such year under section 1721(b)(3)(A).

                        ``Subpart 3--General Provisions

    ``SEC. 1731. DEFINITION.

        ``In this part, the term `State' means each of the 50 States, the
    District of Columbia, and the Commonwealth of Puerto Rico.''.

                     PART H--GENERAL PROVISIONS OF TITLE I

    SEC. 181. GENERAL PROVISIONS.

        Title I is amended further by adding at the end the following:

                          ``PART H--GENERAL PROVISIONS

    ``SEC. 1801. FEDERAL REGULATIONS.

        ``(a) In General.--The Secretary is authorized to issue such
    regulations as are necessary to ensure reasonable compliance with this
    title.
        ``(b) Negotiated Rulemaking Process.--
                ``(1) In general.--Prior to publishing in the Federal
            Register proposed regulations to carry out this title, the
            Secretary shall obtain the advice and recommendations of
            representatives of Federal, State, and local administrators,
            parents, teachers, paraprofessionals, and members of local
            boards of education involved with the implementation and
            operation of programs under this title.
                ``(2) Meetings and electronic exchange.--Such advice and
            recommendation may be obtained through such mechanisms as
            regional meetings and electronic exchanges of information.
                ``(3) Proposed regulations.--After obtaining such advice
            and recommendations, and prior to publishing proposed
            regulations, the Secretary shall--
                        ``(A) establish a negotiated rulemaking process on
                    a minimum of three key issues, including--
                                ``(i) accountability;
                                ``(ii) implementation of assessments; and
                                ``(iii) use of paraprofessionals;
                        ``(B) select individuals to participate in such
                    process from among individuals or groups which provided
                    advice and recommendations, including representation
                    from all geographic regions of the United States; and
                        ``(C) prepare a draft of proposed regulations that
                    shall be provided to the individuals selected by the
                    Secretary under subparagraph (B) not less than 15 days
                    prior to the first meeting under such process.
                ``(4) Process.--Such process--
                        ``(A) shall be conducted in a timely manner to
                    ensure that final regulations are issued by the
                    Secretary not later than 1 year after the date of the
                    enactment of the No Child Left Behind Act of 2001; and
                        ``(B) shall not be subject to the Federal Advisory
                    Committee Act but shall otherwise follow the provisions
                    of the Negotiated Rulemaking Act of 1990 (5 U.S.C. 561
                    et seq.).
                ``(5) Emergency situation.--In an emergency situation in
            which regulations to carry out this title must be issued within
            a very limited time to assist State and local educational
            agencies with the operation of a program under this title, the
            Secretary may issue proposed regulations without following such
            process but shall, immediately thereafter and prior to issuing
            final regulations, conduct regional meetings to review such
            proposed regulations.
        ``(c) Limitation.--Regulations to carry out this part may not
    require local programs to follow a particular instructional model, such
    as the provision of services outside the regular classroom or school
    program.

    ``SEC. 1802. AGREEMENTS AND RECORDS.

        ``(a) Agreements.--All published proposed regulations shall conform
    to agreements that result from negotiated rulemaking described in
    section 1801 unless the Secretary reopens the negotiated rulemaking
    process or provides a written explanation to the participants involved
    in the process explaining why the Secretary decided to depart from and
    not adhere to such agreements.
        ``(b) Records.--The Secretary shall ensure that an accurate and
    reliable record of agreements reached during the negotiations process
    is maintained.

    ``SEC. 1803. STATE ADMINISTRATION.

        ``(a) Rulemaking.--
                ``(1) In general.--Each State that receives funds under
            this title shall--
                        ``(A) ensure that any State rules, regulations, and
                    policies relating to this title conform to the purposes
                    of this title and provide any such proposed rules,
                    regulations, and policies to the committee of
                    practitioners under subsection (b) for their review and
                    comment;
                        ``(B) minimize such rules, regulations, and
                    policies to which their local educational agencies and
                    schools are subject;
                        ``(C) eliminate or modify State and local fiscal
                    accounting requirements in order to facilitate the
                    ability of schools to consolidate funds under
                    schoolwide programs; and
                        ``(D) identify any such rule, regulation, or policy
                    as a State-imposed requirement.
                ``(2) Support and facilitation.--State rules, regulations,
            and policies under this title shall support and facilitate
            local educational agency and school-level systemic reform
            designed to enable all children to meet the challenging State
            student academic achievement standards.
        ``(b) Committee of Practitioners.--
                ``(1) In general.--Each State educational agency shall
            create a State committee of practitioners to advise the State
            in carrying out its responsibilities under this title.
                ``(2) Membership.--Each such committee shall include--
                        ``(A) as a majority of its members, representatives
                    from local educational agencies;
                        ``(B) administrators, including the administrators
                    of programs described in other parts of this title;
                        ``(C) teachers, including vocational educators;
                        ``(D) parents;
                        ``(E) members of local boards of education;
                        ``(F) representatives of private school children;
                    and
                        ``(G) pupil services personnel.
                ``(3) Duties.--The duties of such committee shall include a
            review, prior to publication, of any proposed or final State
            rule or regulation pursuant to this title. In an emergency
            situation where such rule or regulation must be issued within a
            very limited time to assist local educational agencies with the
            operation of the program under this title, the State
            educational agency may issue a regulation without prior
            consultation, but shall immediately thereafter convene the
            State committee of practitioners to review the emergency
            regulation prior to issuance in final form.

    ``SEC. 1804. LOCAL ADMINISTRATIVE COST LIMITATION.

        ``(a) Local Administrative Cost Limitation.--Each local educational
    agency may use not more than 4 percent of funds received under part A
    for administrative expenses.
        ``(b) Regulations.--The Secretary, after consulting with State and
    local officials and other experts in school finance, shall develop and
    issue regulations that define the term administrative cost for purposes
    of this title. Such definition shall be consistent with generally
    accepted accounting principles. The Secretary shall publish final
    regulations on this section not later than 1 year after the date of the
    enactment of the No Child Left Behind Act of 2001.

    ``SEC. 1805. APPLICABILITY.

        ``Nothing in this title shall be construed to affect home schools
    nor shall any home schooled student be required to participate in any
    assessment referenced in this title.

    ``SEC. 1806. PRIVATE SCHOOLS.

        ``Nothing in this title shall be construed to affect any private
    school that does not receive funds or services under this title, nor
    shall any student who attends a private school that does not receive
    funds or services under this title be required to participate in any
    assessment referenced in this title.

    ``SEC. 1807. PRIVACY OF ASSESSMENT RESULTS.

        ``Any results from individual assessments referenced in this title
    which become part of the education records of the student shall have
    the protections as provided in section 444 of the General Education
    Provisions Act.''.

         TITLE II--PREPARING, TRAINING, AND RECRUITING QUALITY TEACHERS

    SEC. 201. TEACHER QUALITY TRAINING AND RECRUITING FUND.

        Title II (20 U.S.C. 6601 et seq.) is amended to read as follows:

        ``TITLE II--PREPARING, TRAINING, AND RECRUITING QUALITY TEACHERS

             ``PART A--TEACHER QUALITY TRAINING AND RECRUITING FUND

    ``SEC. 2001. PURPOSE.

        ``The purpose of this part is to provide grants to States and local
    educational agencies in order to assist their efforts to increase
    student academic achievement through such strategies as improving
    teacher and principal quality and increasing the number of highly
    qualified teachers in the classroom.

    ``Subpart 1--Grants to States to Prepare, Train, and Recruit Qualified
                                    Teachers

    ``SEC. 2011. FORMULA GRANTS TO STATES.

        ``(a) In General.--In the case of each State that in accordance
    with section 2013 submits to the Secretary an application for a fiscal
    year, the Secretary shall make a grant for the year to the State for
    the uses specified in section 2012. The grant shall consist of the
    allotment determined for the State under subsection (b).
        ``(b) Determination of Amount of Allotments.--
                ``(1) Reservation of funds.--From the amount made available
            to carry out this subpart for any fiscal year, the Secretary
            shall reserve--
                        ``(A) \1/2\ of 1 percent for allotments for the
                    Virgin Islands, Guam, American Samoa, and the
                    Commonwealth of the Northern Mariana Islands, to be
                    distributed among these outlying areas on the basis of
                    their relative need, as determined by the Secretary in
                    accordance with the purpose of this part; and
                        ``(B) \1/2\ of 1 percent for the Secretary of the
                    Interior for programs under this subpart for
                    professional development activities for teachers, other
                    staff, and administrators in schools operated or funded
                    by the Bureau of Indian Affairs.
                ``(2) State allotments.--
                        ``(A) Hold harmless.--
                                ``(i) In general.--Subject to subparagraph
                            (B), from the total amount made available to
                            carry out this subpart for any fiscal year and
                            not reserved under paragraph (1), the Secretary
                            shall allot to each of the 50 States, the
                            District of Columbia, and the Commonwealth of
                            Puerto Rico an amount equal to the total amount
                            that such State received for fiscal year 2001
                            under--
                                        ``(I) section 2202(b) of this Act
                                    (as in effect on the day before the
                                    date of the enactment of the No Child
                                    Left Behind Act of 2001); and
                                        ``(II) section 306 of the
                                    Department of Education Appropriations
                                    Act, 2001 (as enacted into law by
                                    section 1(a)(1) of Public Law 106-554).
                                ``(ii) Nonparticipating states.--In the
                            case of a State that did not receive any funds
                            for fiscal year 2001 under one or both of the
                            provisions referred to in subclauses (I) and
                            (II) of clause (i), the amount allotted to the
                            State under such clause shall be the total
                            amount that the State would have received for
                            fiscal year 2001 if it had elected to
                            participate in all of the programs for which it
                            was eligible under each of the provisions
                            referred to in such subclauses.
                                ``(iii) Ratable reduction.--If the total
                            amount made available to carry out this subpart
                            for any fiscal year and not reserved under
                            paragraph (1) is insufficient to pay the full
                            amounts that all States are eligible to receive
                            under clause (i) for any fiscal year, the
                            Secretary shall ratably reduce such amounts for
                            such fiscal year.
                        ``(B) Allotment of additional funds.--
                                ``(i) In general.--Subject to clause (ii),
                            for any fiscal year for which the total amount
                            made available to carry out this subpart and
                            not reserved under paragraph (1) exceeds the
                            total amount required to make allotments under
                            subparagraph (A), the Secretary shall allot
                            such excess amount among the 50 States, the
                            District of Columbia, and the Commonwealth of
                            Puerto Rico as follows:
                                        ``(I) 50 percent of such excess
                                    amount shall be allotted among such
                                    States on the basis of their relative
                                    populations of individuals aged 5
                                    through 17, as determined by the
                                    Secretary on the basis of the most
                                    recent satisfactory data.
                                        ``(II) 50 percent of such excess
                                    amount shall be allotted among such
                                    States in proportion to the number of
                                    children, aged 5 to 17, who reside
                                    within the State from families with
                                    incomes below 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 for the most
                                    recent fiscal year for which
                                    satisfactory data are available,
                                    compared to the number of such
                                    individuals who reside in all such
                                    States for that fiscal year.
                                ``(ii) Exception.--No State receiving an
                            allotment under clause (i) may receive less
                            than \1/2\ of 1 percent of the total excess
                            amount allotted under such clause.
                ``(3) Reallotment.--If any State does not apply for an
            allotment under this subsection for any fiscal year, the
            Secretary shall reallot such amount to the remaining States in
            accordance with this subsection.

    ``SEC. 2012. WITHIN-STATE ALLOCATIONS.

        ``(a) Use of Funds.--Each State receiving a grant under this
    subpart shall use the funds provided under the grant in accordance with
    this section to carry out activities for the improvement of teaching
    and learning.
        ``(b) Reservation of Funds.--
                ``(1) In general.--A State that receives a grant under this
            subpart may reserve not more than 5 percent of the amount of
            the funds provided under the grant for--
                        ``(A) one or more of the authorized State
                    activities described in subsection (e); and
                        ``(B) planning and administration related to
                    carrying out such activities and making subgrants to
                    local educational agencies under subparts 2 and 3.
                ``(2) Limitation on administrative costs.--The amount
            reserved by a State under paragraph (1)(B) may not exceed 1
            percent of the amount of the funds provided under the grant.
        ``(c) Subgrants to Local Educational Agencies.--
                ``(1) In general.--The Secretary may make a grant to a
            State under this subpart only if the State agrees to distribute
            the funds described in this subsection as subgrants to local
            educational agencies under subpart 3.
                ``(2) Hold harmless.--
                        ``(A) In general.--From the funds that a State
                    receives under this subpart for any fiscal year that
                    are not reserved under subsection (b), the State shall
                    allot to each local educational agency an amount equal
                    to the total amount that such agency received for
                    fiscal year 2001 under--
                                ``(i) section 2203(1)(B) of this Act (as in
                            effect on the day before the date of the
                            enactment of the No Child Left Behind Act of
                            2001); and
                                ``(ii) section 306 of the Department of
                            Education Appropriations Act, 2001 (as enacted
                            into law by section 1(a)(1) of Public Law 106-
                            554).
                        ``(B) Nonparticipating agencies.--In the case of a
                    local educational agency that did not receive any funds
                    for fiscal year 2001 under one or both of the
                    provisions referred to in clauses (i) and (ii) of
                    subparagraph (A), the amount allotted to the agency
                    under such subparagraph shall be the total amount that
                    the agency would have received for fiscal year 2001 if
                    it had elected to participate in all of the programs
                    for which it was eligible under each of the provisions
                    referred to in such clauses.
                        ``(C) Ratable reduction.--If the funds described in
                    subparagraph (A) are insufficient to pay the full
                    amounts that all local educational agencies are
                    eligible to receive under such subparagraph for any
                    fiscal year, the State shall ratably reduce such
                    amounts for such fiscal year.
                ``(3) Allotment of Additional Funds.--
                        ``(A) In general.--For any fiscal year for which
                    the funds that a State receives under this subpart that
                    are not reserved under subsection (b) exceed the total
                    amount required to make allotments under paragraph (2),
                    the State shall distribute the amount described in
                    subparagraph (B) through a formula under which--
                                ``(i) 20 percent is allocated to local
                            educational agencies in accordance with the
                            relative enrollment in public and private
                            nonprofit elementary and secondary schools
                            within the boundaries of such agencies; and
                                ``(ii) 80 percent is allocated to local
                            educational agencies in proportion to the
                            number of children, aged 5 to 17, who reside
                            within the geographic area served by such
                            agency from families with incomes below 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 for
                            the most recent fiscal year for which
                            satisfactory data are available, compared to
                            the number of such individuals who reside in
                            the geographic areas served by all the local
                            educational agencies in the State for that
                            fiscal year.
                        ``(B) Calculation of amount.--
                                ``(i) In general.--The amount described in
                            this subparagraph for a State for any fiscal
                            year is the base amount for such State and
                            year, plus any additional amount for such State
                            and year.
                                ``(ii) Base amount.--For purposes of this
                            subparagraph, the term `base amount' means 50
                            percent of the funds that remain to a State
                            after a State makes the reservations described
                            in subsection (b) and the allotments described
                            in paragraph (2).
                                ``(iii) Additional amount.--For purposes of
                            this subparagraph, the term `additional amount'
                            means the amount (if any) by which the base
                            amount for a State exceeds the maximum amount
                            described in subsection (d)(2)(B).
        ``(d) Math and Science Partnerships.--
                ``(1) In general.--The Secretary may make a grant to a
            State under this subpart only if the State agrees to distribute
            the amount described in paragraph (2) through a competitive
            subgrant process in accordance with subpart 2.
                ``(2) Amount described.--
                        ``(A) In general.--The amount described in this
                    paragraph for a State for any fiscal year is 50 percent
                    of the funds that the State receives under this subpart
                    for the year that remain after the State makes the
                    reservations described in subsection (b) and the
                    allotments described in subsection (c)(2).
                        ``(B) Limitation.--In no case may the amount
                    described in this paragraph exceed a maximum amount
                    calculated by multiplying the total amount of the funds
                    that a State receives under this subpart for a fiscal
                    year that the State does not reserve under subsection
                    (b) by a percentage, selected by the State, that shall
                    be not less than 15 nor more than 20 percent.
        ``(e) Authorized State Activities.--The authorized State activities
    referred to in subsection (b)(1)(A) are the following:
                ``(1) Reforming teacher certification, recertification, or
            licensure requirements to ensure that--
                        ``(A) teachers have the necessary teaching skills
                    and academic content knowledge in the subject areas in
                    which they are assigned to teach;
                        ``(B) teacher certification, recertification, or
                    licensure requirements are aligned with the State's
                    challenging State academic content standards; and
                        ``(C) teachers have the knowledge and skills
                    necessary to help students meet challenging State
                    student achievement standards.
                ``(2) Carrying out programs that--
                        ``(A) include support during the initial teaching
                    or leadership experience, such as mentoring programs
                    that--
                                ``(i) provide--
                                        ``(I) mentoring to beginning
                                    teachers from veteran teachers with
                                    expertise in the same subject matter
                                    that the beginning teachers will be
                                    teaching; or
                                        ``(II) similar mentoring to
                                    principals or superintendents;
                                ``(ii) provide mentors time for activities
                            such as coaching, observing, and assisting the
                            teachers or school leaders who are mentored;
                            and
                                ``(iii) use standards or assessments for
                            guiding beginning teachers that are consistent
                            with the State's student achievement standards
                            and with the requirements for professional
                            development activities under section 2033; and
                        ``(B) establish, expand, or improve alternative
                    routes to State certification of teachers, especially
                    in the areas of mathematics and science, for highly
                    qualified individuals with a baccalaureate degree,
                    including mid-career professionals from other
                    occupations, paraprofessionals, former military
                    personnel, and recent college or university graduates
                    with records of academic distinction who demonstrate
                    the potential to become highly effective teachers.
                ``(3) Developing and implementing effective mechanisms to
            assist local educational agencies and schools in effectively
            recruiting and retaining highly qualified and effective
            teachers and principals.
                ``(4) Reforming tenure systems and implementing teacher
            testing and other procedures to expeditiously remove
            ineffective teachers from the classroom.
                ``(5) Developing enhanced performance systems to measure
            the effectiveness of specific professional development programs
            and strategies.
                ``(6) Providing technical assistance to local educational
            agencies consistent with this part.
                ``(7) Funding projects to promote reciprocity of teacher
            certification or licensure between or among States, except that
            no reciprocity agreement developed under this paragraph or
            developed using funds provided under this part may lead to the
            weakening of any State teaching certification or licensing
            requirement.
                ``(8) Developing or assisting local educational agencies in
            the development and utilization of proven, innovative
            strategies to deliver intensive professional development
            programs that are both cost-effective and easily accessible,
            such as through the use of technology and distance learning.
                ``(9) Providing assistance to local educational agencies
            for the development and implementation of innovative
            professional development programs that train teachers to use
            technology to improve teaching and learning and are consistent
            with the requirements of section 2033.
                ``(10) Developing or assisting local educational agencies
            in developing merit-based performance systems, rigorous
            assessments for teachers, and strategies which provide
            differential and bonus pay for teachers in high-need subject
            areas such as reading, math, and science and in high-poverty
            schools and districts.
                ``(11) Providing assistance to local educational agencies
            for the development and implementation of professional
            development programs for principals that enable them to be
            effective school leaders and prepare all students to achieve
            challenging State content and student achievement standards,
            including the development and support of school leadership
            academies to help exceptionally talented aspiring or current
            principals and superintendents become outstanding managers and
            educational leaders.
                ``(12) Developing, or assisting local educational agencies
            in developing, teacher advancement initiatives that promote
            professional growth and emphasize multiple career paths, such
            as career teacher, mentor teacher, and master teacher career
            paths, with pay differentiation.
        ``(f) Coordination.--States receiving grants under section 202 of
    the Higher Education Act of 1965 shall coordinate the use of such funds
    with activities carried out under this section.

    ``SEC. 2013. APPLICATIONS BY STATES.

        ``(a) In General.--To be eligible to receive a grant under this
    subpart, a State shall submit an application to the Secretary at such
    time, in such manner, and containing such information as the Secretary
    may reasonably require.
        ``(b) Contents.--Each application under this section shall include
    the following:
                ``(1) A description of how the State will ensure that a
            local educational agency receiving a subgrant under subpart 3
            will comply with the requirements of such subpart.
                ``(2) A description of how the State will use funds under
            this part to meet the requirements of section 1119(a)(2).
                ``(3) A description of how the State will coordinate
            professional development activities authorized under this part
            with professional development activities provided under other
            Federal, State, and local programs, including those authorized
            under title I, part A of title III, parts A and B of title V,
            and (where applicable) the Individuals with Disabilities
            Education Act and the Carl D. Perkins Vocational and Technical
            Education Act. The application shall also describe the
            comprehensive strategy that the State will take as part of such
            coordination effort, to ensure that teachers are trained in the
            utilization of technology so that technology and its
            applications are effectively used in the classroom to improve
            teaching and learning in all curriculum and content areas, as
            appropriate.
                ``(4) A description of how the State will encourage the
            development of proven, innovative strategies to deliver
            intensive professional development programs that are both cost-
            effective and easily accessible, such as through the use of
            technology and distance learning.
                ``(5) A description of how the State will ensure that local
            educational agencies will comply with the requirements under
            section 2033, especially with respect to ensuring the
            participation of teachers, principals, and parents.
        ``(c) Application Approval.--A State application submitted to the
    Secretary under this section shall be deemed approved by the Secretary
    unless the Secretary makes a written determination, within 90 days
    after receiving the application, that the application is in violation
    of the provisions of this subpart. The Secretary shall not finally
    disapprove a State application except after giving the State notice and
    opportunity for a hearing.

                   ``Subpart 2--Math and Science Partnerships

    ``SEC. 2021. PURPOSE.

        ``The purpose of this subpart is to improve the achievement of
    students in the areas of mathematics and science by encouraging States,
    institutions of higher education, and local educational agencies to
    participate in programs that--
                ``(1) focus on education and training of mathematics and
            science teachers that improves teachers' knowledge and skills
            and encourages intellectual growth;
                ``(2) improve mathematics and science teaching by
            encouraging institutions of higher education to assume greater
            responsibility for improving mathematics and science teacher
            education through the establishment of a comprehensive,
            integrated system of recruiting, training, and advising such
            teachers; and
                ``(3) bring mathematics and science teachers in elementary
            and secondary schools together with scientists, mathematicians,
            and engineers to increase the subject matter knowledge of
            teachers and improve their teaching skills through the use of
            sophisticated laboratory equipment and work space, computing
            facilities, libraries, and other resources that institutions of
            higher education are better able to provide than the schools.

    ``SEC. 2022. APPLICATION REQUIREMENTS.

        ``(a) In General.--An eligible partnership seeking to receive a
    subgrant from a State under this subpart shall submit an application to
    the State at such time, in such manner, and accompanied by such
    information as the State may require.
        ``(b) Partnership Application Contents.--Each such application
    shall include--
                ``(1) an assessment of the teacher quality and professional
            development of all the schools and agencies participating in
            the eligible partnership with respect to the teaching and
            learning of mathematics and science;
                ``(2) a description of how the activities to be carried out
            by the eligible partnership will be aligned with State academic
            content standards in mathematics and science and with other
            educational reform activities that promote student achievement
            in mathematics and science;
                ``(3) a description of how the activities to be carried out
            by the eligible partnership will be based on a review of
            relevant research, and an explanation of why the activities are
            expected to improve student achievement and to strengthen the
            quality of mathematics and science instructions; and
                ``(4) a description of--
                        ``(A) how the eligible partnership will carry out
                    the activities described in section 2023(c); and
                        ``(B) the eligible partnership's evaluation and
                    accountability plan described in section 2024.

    ``SEC. 2023. MATH AND SCIENCE PARTNERSHIP SUBGRANTS.

        ``(a) In General.--From the amount described in section 2012(d),
    the State educational agency, working in conjunction with the State
    agency for higher education (if such agencies are separate), shall
    award subgrants on a competitive basis to eligible partnerships to
    enable such partnerships to carry out activities described in
    subsection (c).
        ``(b) Duration.--The State shall award subgrants under this subpart
    for a period of not less than 2 and not more than 5 years.
        ``(c) Authorized Activities.--A recipient of funds provided under
    this subpart may use the funds for the following activities related to
    elementary or secondary schools:
                ``(1) Establishing and operating mathematics and science
            summer professional development workshops or institutes for
            elementary and secondary school teachers that--
                        ``(A) shall--
                                ``(i) directly relate to the curriculum and
                            content areas in which the teacher provides
                            instruction, and focus only secondarily on
                            pedagogy;
                                ``(ii) enhance the ability of a teacher to
                            understand and use the State's academic content
                            standards for mathematics and science and to
                            select appropriate curricula;
                                ``(iii) train teachers to use curricula
                            that are--
                                        ``(I) based on scientific research;
                                        ``(II) aligned with State academic
                                    content standards; and
                                        ``(III) object-centered,
                                    experiment-oriented, and concept- and
                                    content-based; and
                                ``(iv) provide supplemental assistance and
                            follow-up training during the school year for
                            summer institute graduates; and
                        ``(B) may include--
                                ``(i) programs that provide prospective
                            teachers and novice teachers opportunities to
                            work under the guidance of experienced teachers
                            and college faculty;
                                ``(ii) instruction in the use of data and
                            assessments to inform and instruct classroom
                            practice; and
                                ``(iii) professional development
                            activities, including supplemental and follow-
                            up activities, such as curriculum alignment,
                            distance learning, and activities that train
                            teachers to utilize technology in the
                            classroom.
                ``(2) Recruiting to the teaching profession--
                        ``(A) students studying mathematics, engineering,
                    and science; or
                        ``(B) mathematicians, engineers, and scientists
                    currently working in the field.
                ``(3) Establishing and operating programs to bring teachers
            into contact with working scientists, mathematicians, and
            engineers, to expand teacher content knowledge of and research
            in science and mathematics.
        ``(d) Priority.--In awarding subgrants under this subpart, States
    shall give priority to applications seeking funding for the activity
    described in subsection (c)(1).
        ``(e) Coordination.--Partnerships receiving grants under section
    203 of the Higher Education Act of 1965 (20 U.S.C. 1023) shall
    coordinate the use of such funds with any related activities carried
    out by such partnership with funds made available under this subpart.

    ``SEC. 2024. EVALUATION AND ACCOUNTABILITY PLAN.

        ``(a) In General.--Each eligible partnership receiving a subgrant
    under this subpart shall develop an evaluation and accountability plan
    for activities assisted under this subpart that includes rigorous
    performance objectives that measure the impact of activities funded
    under this subpart.
        ``(b) Contents.--The plan--
                ``(1) shall include measurable goals to increase the number
            of mathematics and science teachers who participate in content-
            based professional development activities; and
                ``(2) may include objectives and measures for--
                        ``(A) improved student achievement on State
                    mathematics and science assessments;
                        ``(B) increased participation by students in
                    advanced courses in mathematics and science;
                        ``(C) increased percentages of elementary school
                    teachers with academic majors or minors, or group
                    majors or minors, in mathematics, engineering, or the
                    sciences; and
                        ``(D) increased percentages of secondary school
                    classes in mathematics and science taught by teachers
                    with academic majors in mathematics and science,
                    respectively.

    ``SEC. 2025. REPORTS; REVOCATION OF SUBGRANTS.

        ``(a) Reports.--Each eligible partnership receiving a subgrant
    under this subpart annually shall report to the State regarding the
    eligible partnership's progress in meeting the performance objectives
    described in section 2024.
        ``(b) Revocation.--If the State determines that an eligible
    partnership that receives a subgrant under this subpart for 5 years is
    not making substantial progress in meeting the performance objectives
    described in section 2024 by the end of the third year of the subgrant,
    the subgrant payments shall not be made for the fourth and fifth years.

    ``SEC. 2026. DEFINITIONS.

        ``In this subpart:
                ``(1) Eligible partnership.--The term `eligible
            partnership' means a partnership that--
                        ``(A) shall include--
                                ``(i) a State educational agency;
                                ``(ii) a mathematics or science department
                            of a private independent institution of higher
                            education or a State-supported public
                            institution of higher education; and
                                ``(iii) a high need local educational
                            agency; and
                        ``(B) may include--
                                ``(i) another institution of higher
                            education or the teacher training department of
                            such an institution;
                                ``(ii) additional local educational
                            agencies, public charter schools, public or
                            private elementary or secondary schools, or a
                            consortium of such schools;
                                ``(iii) a business; or
                                ``(iv) a nonprofit organization of
                            demonstrated effectiveness, including a museum
                            or research institution.
                ``(2) Summer professional development workshop or
            institute.--The term `summer professional development workshop
            or institute' means a workshop or institute that--
                        ``(A) is conducted during a period of not less than
                    2 weeks;
                        ``(B) includes as a component a program that
                    provides direct interaction between students and
                    faculty; and
                        ``(C) provides for follow-up training during the
                    academic year that is conducted in the classroom for a
                    period of not less than 3 consecutive or nonconsecutive
                    days, except that--
                                ``(i) if the workshop or institute is
                            conducted during a two-week period, the follow-
                            up training shall be conducted for a period of
                            at least 4 days; and
                                ``(ii) if the follow-up training is for
                            teachers in rural school districts, it may be
                            conducted through distance learning.

              ``Subpart 3--Subgrants to Local Educational Agencies

    ``SEC. 2031. LOCAL USE OF FUNDS.

        ``(a) In General.--Subject to subsection (b), each local
    educational agency that receives a subgrant under this subpart may use
    the subgrant to carry out the following activities:
                ``(1) Initiatives to assist in recruiting and hiring fully
            qualified teachers who will be assigned teaching positions
            within their field, including--
                        ``(A) providing signing bonuses or other financial
                    incentives, such as differential pay, for teachers to
                    teach in academic subject areas in which there exists a
                    shortage of such fully qualified teachers within a
                    school or the local educational agency;
                        ``(B) establishing programs that--
                                ``(i) recruit professionals from other
                            fields and provide such professionals with
                            alternative routes to teacher certification;
                            and
                                ``(ii) provide increased opportunities for
                            minorities, individuals with disabilities, and
                            other individuals underrepresented in the
                            teaching profession; and
                        ``(C) implementing hiring policies that ensure
                    comprehensive recruitment efforts as a way to expand
                    the applicant pool, such as through identifying
                    teachers certified through alternative routes, coupled
                    with a system of intensive screening designed to hire
                    the most qualified applicant.
                ``(2) Initiatives to promote retention of highly qualified
            teachers and principals, particularly within elementary and
            secondary schools with a high percentage of low-achieving
            students, including programs that provide--
                        ``(A) mentoring to newly hired teachers, such as
                    from master teachers, or principals or superintendents;
                        ``(B) incentives, including financial incentives,
                    to retain teachers who have a record of success in
                    helping low-achieving students improve their academic
                    success; or
                        ``(C) incentives, including financial incentives,
                    to principals who have a record of improving the
                    performance of all students, but particularly students
                    from economically disadvantaged families and students
                    from racial and ethnic minority groups.
                ``(3) Programs and activities that are designed to improve
            the quality of the teacher force, such as--
                        ``(A) innovative professional development programs
                    (which may be through partnerships including
                    institutions of higher education), including programs
                    that train teachers and principals to utilize
                    technology to improve teaching and learning, are
                    consistent with the requirements of section 2033, and
                    are coordinated with part B of title V;
                        ``(B) development and utilization of proven, cost-
                    effective strategies for the implementation of
                    professional development activities, such as through
                    the utilization of technology and distance learning;
                        ``(C) tenure reform;
                        ``(D) merit pay;
                        ``(E) testing of elementary and secondary school
                    teachers in the subject areas taught by such teachers;
                        ``(F) professional development programs that
                    provide instruction in how to teach children with
                    different learning styles, particularly children with
                    disabilities and children with special learning needs
                    (including those who are gifted and talented); and
                        ``(G) professional development programs that
                    provide instruction in methods of improving student
                    behavior in the classroom and how to identify early and
                    appropriate interventions to help children described in
                    subparagraph (F) learn.
                ``(4) Teacher opportunity payments, consistent with section
            2034.
                ``(5) Professional activities designed to improve the
            quality of principals and superintendents, including the
            development and support of academies to help exceptionally
            talented aspiring or current principals and superintendents
            become outstanding managers and educational leaders.
                ``(6) Hiring fully qualified teachers, including teachers
            who become fully qualified through State and local alternative
            routes, and special education teachers, in order to reduce
            class size, particularly in the early grades.
                ``(7) Teacher advancement initiatives that promote
            professional growth and emphasize multiple career paths, such
            as career teacher, mentor teacher, and master teacher career
            paths, with pay differentiation.
        ``(b) Special Rule.--
                ``(1) In general.--For any fiscal year for which the amount
            described in section 2012(d)(2)(A) for a State is less than 15
            percent of the total amount of the funds that the State
            receives under this subpart for the year that the State does
            not reserve under section 2012(b), each local educational
            agency that receives a subgrant under this subpart from the
            State shall use the funds to comply with paragraph (2).
                ``(2) Requirement.--A local educational agency required to
            comply with this paragraph shall use not less than the amount
            expended by the agency under section 2206(b) of this Act (as in
            effect on the day before the date of the enactment of the No
            Child Left Behind Act of 2001), for the fiscal year preceding
            the year in which such enactment occurs, to carry out
            professional development activities in mathematics and science.

    ``SEC. 2032. LOCAL APPLICATIONS.

        ``(a) In General.--A local educational agency seeking to receive a
    subgrant from a State under this subpart shall submit an application to
    the State--
                ``(1) at such time as the State shall require; and
                ``(2) which is coordinated with other programs under this
            Act, or other Acts, as appropriate.
        ``(b) Local Application Contents.--The local application described
    in subsection (a), shall include, at a minimum, the following:
                ``(1) An assurance that the local educational agency will
            target funds to schools within the jurisdiction of the local
            educational agency that--
                        ``(A) have the lowest proportion of fully qualified
                    teachers;
                        ``(B) have the largest average class size; or
                        ``(C) are identified for school improvement under
                    section 1116(b).
                ``(2) A description of how the local educational agency
            will coordinate professional development activities authorized
            under this subpart with professional development activities
            provided through other Federal, State, and local programs,
            including those authorized under title I, part A of title III,
            parts A and B of title V, and (where applicable) the
            Individuals with Disabilities Education Act and the Carl D.
            Perkins Vocational and Technical Education Act.
                ``(3) A description of how the local educational agency
            will integrate funds under this subpart with funds received
            under part B of title V that are used for professional
            development to train teachers to utilize technology to improve
            teaching and learning.
                ``(4) A description of how the local educational agency has
            collaborated with teachers, principals, parents, and
            administrators in the preparation of the application.

    ``SEC. 2033. PROFESSIONAL DEVELOPMENT FOR TEACHERS.

        ``(a) Requirements for Professional Development Activities.--
    Professional development activities under this subpart shall--
                ``(1) meet the requirements of section 1119(a)(2);
                ``(2) support professional development activities that give
            teachers, principals, and administrators the knowledge and
            skills to provide students with the opportunity to meet
            challenging State academic content standards and student
            achievement standards;
                ``(3) support the recruiting, hiring, and training of fully
            qualified teachers, including teachers fully qualified through
            State and local alternative routes;
                ``(4) advance teacher understanding of effective
            instructional strategies based on scientifically based research
            for improving student achievement, at a minimum, in reading or
            language arts and mathematics;
                ``(5) be directly related to the curriculum and content
            areas in which the teacher provides instruction, except that
            this paragraph shall not apply to subparagraphs (F) and (G) of
            section 2031(3);
                ``(6) be designed to enhance the ability of a teacher to
            understand and use the State's standards for the subject area
            in which the teacher provides instruction;
                ``(7) be tied to scientifically based research
            demonstrating the effectiveness of such professional
            development activities or programs in increasing student
            achievement or substantially increasing the knowledge and
            teaching skills of teachers;
                ``(8) be of sufficient intensity and duration (not to
            include 1-day or short-term workshops and conferences) to have
            a positive and lasting impact on the teacher's performance in
            the classroom;
                ``(9) be developed with extensive participation of
            teachers, principals, parents, and administrators of schools to
            be served under this subpart;
                ``(10) be designed to give teachers of limited English
            proficient children, and other teachers and instructional
            staff, the knowledge and skills to provide instruction and
            appropriate language and academic support services to such
            children, including the appropriate use of curriculum and
            assessments;
                ``(11) to the extent appropriate, provide training for
            teachers and principals in the use of technology so that
            technology and its applications are effectively used in the
            classroom to improve teaching and learning in the curriculum
            and academic content areas in which the teachers provide
            instruction;
                ``(12) as a whole, be regularly evaluated for their impact
            on increased teacher effectiveness and improved student
            achievement, with the findings of such evaluations used to
            improve the quality of professional development; and
                ``(13) provide instruction in methods of teaching children
            with special needs.
        ``(b) Professional Development Activities.--Professional
    development activities under this subpart may include--
                ``(1) instruction in the use of data and assessments to
            inform and instruct classroom practice;
                ``(2) instruction in ways that teachers, principals, pupil
            services personnel, and school administrators may work more
            effectively with parents;
                ``(3) the forming of partnerships with institutions of
            higher education to establish school-based teacher training
            programs that provide prospective teachers and novice teachers
            with an opportunity to work under the guidance of experienced
            teachers and college faculty;
                ``(4) the creation of programs for paraprofessionals
            (assisting teachers employed by a local educational agency
            receiving assistance under this part) to obtain the education
            necessary for such paraprofessionals to become licensed and
            certified teachers; and
                ``(5) activities that provide follow-up training to
            teachers who have participated in professional development
            activities which are designed to ensure that the knowledge and
            skills learned by the teacher are implemented in the classroom.
        ``(c) Accountability.--
                ``(1) In general.--If, after any fiscal year, a State
            determines that the programs or activities funded by a local
            educational agency fail to meet the requirements of subsection
            (a), the State shall notify the agency that--
                        ``(A) it may be subject to paragraph (2); and
                        ``(B) technical assistance is available from the
                    State to help the agency meet those requirements.
                ``(2) Requirement to provide teacher opportunity
            payments.--A local educational agency that has been notified by
            a State for 2 consecutive years under paragraph (1) shall
            expend under section 2034 for the succeeding fiscal year a
            proportion of the amount the agency receives under this subpart
            that is equal to the proportion of the amount the agency
            received under this part for the preceding fiscal year that the
            agency used for professional development.

    ``SEC. 2034. TEACHER OPPORTUNITY PAYMENTS.

        ``(a) In General.--A local educational agency receiving funds under
    this subpart may (or, in the case of a local educational agency
    described in section 2033(c)(2), shall) provide funds directly to a
    teacher or a group of teachers seeking opportunities to participate in
    a professional development activity of their choice that meets the
    requirements of section 2033(a) and is selected in consultation with
    the principal in order to coordinate such professional development with
    other reform efforts at the school.
        ``(b) Notice to Teachers.--Local educational agencies distributing
    funds under this section shall establish and implement a timely process
    through which proper notice of availability of funds will be given to
    all teachers within schools identified by the agency and shall develop
    a process whereby teachers will have regular consultation with and be
    specifically recommended by principals to participate in such program
    by virtue of--
                ``(1) a teacher not being fully qualified to teach in the
            subject or subjects in which they teach; or
                ``(2) a teacher's need for additional assistance to ensure
            that the teacher's students make progress toward meeting
            challenging State academic content standards and student
            achievement standards.
        ``(c) Selection of Teachers.--If adequate funding is not available
    to provide payments under this section to all teachers seeking such
    assistance or identified as needing such assistance pursuant to
    subsection (b), a local educational agency shall establish procedures
    for selecting teachers that give priority to teachers described in
    paragraph (1) or (2) of subsection (b).

                ``Subpart 4--Mid-Career Transitions to Teaching

                    ``CHAPTER 1--TROOPS-TO-TEACHERS PROGRAM

    ``SEC. 2041. AUTHORIZATION OF TROOPS-TO-TEACHERS PROGRAM.

        ``(a) Program Authorized.--The Secretary may carry out a program
    (to be known as the `Troops-to-Teachers Program')--
                ``(1) to assist eligible members and former members of the
            Armed Forces described in section 2042 to obtain certification
            or licensure as fully qualified elementary school teachers,
            secondary school teachers, or vocational or technical teachers;
            and
                ``(2) to facilitate the employment of such members in
            elementary schools or secondary schools or as vocational or
            technical teachers.
        ``(b) Administration of Program.--The Secretary shall enter into a
    memorandum of agreement with the Secretary of Defense under which the
    Secretary of Defense, acting through the Defense Activity for Non-
    Traditional Education Support of the Department of Defense, will
    perform the actual administration of the Program, other than section
    2045. Using funds appropriated to the Secretary to carry out this
    chapter, the Secretary shall transfer to the Secretary of Defense such
    amounts as may be necessary to administer the Program pursuant to the
    memorandum of agreement.
        ``(c) Information Regarding Program.--The Secretary shall provide
    to the Secretary of Defense, for distribution as part of preseparation
    counseling provided under section 1142 of title 10, United States Code,
    to members of the Armed Forces described in section 2042, information
    regarding the Troops-to-Teachers Program and applications to
    participate in the program.
        ``(d) Placement Assistance and Referral Services.--As part of the
    Troops-to-Teachers Program, the Secretary may, with the agreement of
    the Secretary of Defense, provide placement assistance and referral
    services regarding employment opportunities with local educational
    agencies to members of the Armed Forces who are discharged or released
    from active duty under other than adverse conditions. Unless the member
    is also selected to participate in the Program under section 2042, a
    member receiving placement assistance and referral services under the
    authority of this subsection is not eligible for financial assistance
    under section 2043.

    ``SEC. 2042. RECRUITMENT AND SELECTION OF PROGRAM PARTICIPANTS.

        ``(a) Eligible Members.--The following members and former members
    of the Armed Forces are eligible for selection to participate in the
    Troops-to-Teachers Program:
                ``(1) Any member who--
                        ``(A) on or after October 1, 1999, becomes entitled
                    to retired or retainer pay in the manner provided in
                    title 10 or title 14, United States Code; or
                        ``(B) on or after the date of the enactment of the
                    No Child Left Behind Act of 2001, has an approved date
                    of voluntary retirement and, as of the date the member
                    submits an application to participate in the Program,
                    has one year or less of active duty remaining before
                    retirement.
                ``(2) Any member who, on or after the date of the enactment
            of the No Child Left Behind Act of 2001--
                        ``(A) is separated or released from active duty
                    after six or more years of continuous active duty
                    immediately before the separation or release; and
                        ``(B) executes a reserve commitment agreement for a
                    period of three years under subsection (e)(2).
                ``(3) Any member who, on or after the date of the enactment
            of the No Child Left Behind Act of 2001, is retired or
            separated for physical disability under chapter 61 of title 10,
            United States Code.
                ``(4) Any member who--
                        ``(A) during the period beginning on October 1,
                    1990, and ending on September 30, 1999, was
                    involuntarily discharged or released from active duty
                    for purposes of a reduction of force after six or more
                    years of continuous active duty immediately before the
                    discharge or release; or
                        ``(B) applied for the teacher placement program
                    administered under section 1151 of title 10, United
                    States Code, before its repeal, and who satisfied the
                    eligibility criteria specified in subsection (c) of
                    such section 1151.
        ``(b) Submission of Applications.--
                ``(1) Form and submission.--Selection of eligible members
            and former members of the Armed Forces to participate in the
            Troops-to-Teachers Program shall be made on the basis of
            applications submitted to the Secretary within the time periods
            specified in paragraph (2). An application shall be in such
            form and contain such information as the Secretary may require.
                ``(2) Time for submission.--An application shall be
            considered to be submitted on a timely basis under paragraph
            (1) if--
                        ``(A) in the case of a member or former member of
                    the Armed Forces described in paragraph (1), (2), or
                    (3) of subsection (a), the application is submitted not
                    later than four years after the date on which the
                    member is retired or separated or released from active
                    duty, whichever applies to the member; or
                        ``(B) in the case of a member or former member
                    described in subsection (a)(4), the application is
                    submitted not later than September 30, 2003.
        ``(c) Selection Criteria.--
                ``(1) Establishment.--Subject to paragraphs (2) and (3),
            the Secretary shall prescribe the criteria to be used to select
            eligible members and former members of the Armed Forces to
            participate in the Troops-to-Teachers Program.
                ``(2) Educational background.--If a member or former member
            of the Armed Forces described in paragraph (1), (2), or (3) of
            subsection (a) is applying for assistance for placement as an
            elementary or secondary school teacher, the Secretary shall
            require the member to have received a baccalaureate or advanced
            degree from an accredited institution of higher education. If
            such a member is applying for assistance for placement as a
            vocational or technical teacher, the Secretary shall require
            the member--
                        ``(A) to have received the equivalent of one year
                    of college from an accredited institution of higher
                    education and have six or more years of military
                    experience in a vocational or technical field; or
                        ``(B) to otherwise meet the certification or
                    licensure requirements for a vocational or technical
                    teacher in the State in which the member seeks
                    assistance for placement under the Program.
                ``(3) Honorable service.--A member or former member of the
            Armed Forces is eligible to participate in the Troops-to-
            Teachers Program only if the member's last period of service in
            the Armed Forces was characterized as honorable. If the member
            is selected to participate in the Program before the retirement
            of the member or the separation or release of the member from
            active duty, the member may continue to participate in the
            Program only if, upon the retirement or separation or release
            from active duty, the member's last period of service is
            characterized as honorable.
        ``(d) Selection Priorities.--In selecting eligible members and
    former members of the Armed Forces to receive assistance for placement
    as elementary or secondary school teachers or vocational or technical
    teachers, the Secretary shall give priority to members who have
    educational or military experience in science, mathematics, special
    education, or vocational or technical subjects and agree to seek
    employment as science, mathematics, or special education teachers in
    elementary or secondary schools or in other schools under the
    jurisdiction of a local educational agency.
        ``(e) Other Conditions on Selection.--
                ``(1) Selection subject to funding.--The Secretary may not
            select an eligible member or former member of the Armed Forces
            to participate in the Troops-to-Teachers Program under this
            section and receive financial assistance under section 2043
            unless the Secretary has sufficient appropriations for the
            Program available at the time of the selection to satisfy the
            obligations to be incurred by the United States under section
            2043 with respect to the member.
                ``(2) Reserve commitment agreement.--The Secretary may not
            select an eligible member or former member of the Armed Forces
            described in subsection (a)(2)(A) to participate in the Troops-
            to-Teachers Program under this section and receive financial
            assistance under section 2043 unless--
                        ``(A) the Secretary notifies the Secretary
                    concerned and the member that the Secretary has
                    reserved a full stipend or bonus under section 2043 for
                    the member; and
                        ``(B) the member executes a written agreement with
                    the Secretary concerned to serve as a member of the
                    Selected Reserve of a reserve component of the Armed
                    Forces for a period of three years (in addition to any
                    other reserve commitment the member may have).

    ``SEC. 2043. PARTICIPATION AGREEMENT AND FINANCIAL ASSISTANCE.

        ``(a) Participation Agreement.--An eligible member or former member
    of the Armed Forces selected to participate in the Troops-to-Teachers
    Program under section 2042 and receive financial assistance under this
    section shall be required to enter into an agreement with the Secretary
    in which the member agrees--
                ``(1) to obtain, within such time as the Secretary may
            require, certification or licensure as a fully qualified
            elementary school teacher, secondary school teacher, or
            vocational or technical teacher; and
                ``(2) to accept an offer of full-time employment as a fully
            qualified elementary school teacher, secondary school teacher,
            or vocational or technical teacher for not less than three
            school years with a local educational agency or public charter
            school, to begin the school year after obtaining that
            certification or licensure.
        ``(b) Violation of Participation Agreement; Exceptions.--A
    participant in the Troops-to-Teachers Program shall not be considered
    to be in violation of the participation agreement entered into under
    subsection (a) during any period in which the participant--
                ``(1) is pursuing a full-time course of study related to
            the field of teaching at an institution of higher education;
                ``(2) is serving on active duty as a member of the Armed
            Forces;
                ``(3) is temporarily totally disabled for a period of time
            not to exceed three years as established by sworn affidavit of
            a qualified physician;
                ``(4) is unable to secure employment for a period not to
            exceed 12 months by reason of the care required by a spouse who
            is disabled;
                ``(5) is seeking and unable to find full-time employment as
            a fully qualified teacher in an elementary or secondary school
            or as a vocational or technical teacher for a single period not
            to exceed 27 months; or
                ``(6) satisfies the provisions of additional reimbursement
            exceptions that may be prescribed by the Secretary.
        ``(c) Stipend for Participants.--
                ``(1) Stipend authorized.--Subject to paragraph (2), the
            Secretary may pay to a participant in the Troops-to-Teachers
            Program selected under section 2042 a stipend in an amount up
            to $5,000.
                ``(2) Limitation.--The total number of stipends that may be
            paid under paragraph (1) in any fiscal year may not exceed
            3,000.
        ``(d) Bonus for Participants.--
                ``(1) Bonus authorized.--Subject to paragraph (2), the
            Secretary may, in lieu of paying a stipend under subsection
            (c), pay a bonus of $10,000 to a participant in the Troops-to-
            Teachers Program selected under section 2042 who agrees in the
            participation agreement under subsection (a) to accept full-
            time employment as a fully qualified elementary school teacher,
            secondary school teacher, or vocational or technical teacher
            for not less than three years in a high need school.
                ``(2) Limitation.--The total number of bonuses that may be
            paid under paragraph (1) in any fiscal year may not exceed
            1,000.
                ``(3) High need school defined.--For purposes of this
            subsection, the term `high need school' means a public
            elementary school, public secondary school, or public charter
            school that meets one or more of the following criteria:
                        ``(A) At least 50 percent of the students enrolled
                    in the school were children counted under subsection
                    (c) of section 1124 for purposes of making grants under
                    such section to local educational agencies, when such
                    counting was most recently performed.
                        ``(B) The school has a large percentage of students
                    who qualify for assistance under part B of the
                    Individuals with Disabilities Education Act (20 U.S.C.
                    1411 et seq.).
                        ``(C) The school meets any other criteria
                    established by the Secretary in consultation with the
                    National Assessment Governing Board.
        ``(e) Treatment of Stipend and Bonus.--A stipend or bonus paid
    under this section to a participant in the Troops-to-Teachers Program
    shall be taken into account in determining the eligibility of the
    participant for Federal student financial assistance provided under
    title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.).
        ``(f) Reimbursement Under Certain Circumstances.--
                ``(1) Reimbursement required.--A participant in the Troops-
            to-Teachers Program who is paid a stipend or bonus under this
            section shall be required to repay the stipend or bonus under
            the following circumstances:
                        ``(A) The participant fails to obtain teacher
                    certification or licensure or employment as a fully
                    qualified elementary school teacher, secondary school
                    teacher, or vocational or technical teacher as required
                    by the participation agreement under subsection (a).
                        ``(B) The participant voluntarily leaves, or is
                    terminated for cause, from employment as an elementary
                    school teacher, secondary school teacher, or vocational
                    or technical teacher during the three years of required
                    service in violation of the participation agreement.
                        ``(C) The participant executed a written agreement
                    with the Secretary concerned under section 2042(e)(2)
                    to serve as a member of a reserve component of the
                    Armed Forces for a period of three years and fails to
                    complete the required term of service.
                ``(2) Amount of reimbursement.--A participant required to
            reimburse the Secretary for a stipend or bonus paid to the
            participant under this section shall pay an amount that bears
            the same ratio to the amount of the stipend or bonus as the
            unserved portion of required service bears to the three years
            of required service. Any amount owed by the participant shall
            bear interest at the rate equal to the highest rate being paid
            by the United States on the day on which the reimbursement is
            determined to be due for securities having maturities of ninety
            days or less and shall accrue from the day on which the
            participant is first notified of the amount due.
                ``(3) Treatment of obligation.--The obligation to reimburse
            the Secretary under this subsection is, for all purposes, a
            debt owing the United States. A discharge in bankruptcy under
            title 11, United States Code, shall not release a participant
            from the obligation to reimburse the Secretary.
                ``(4) Exceptions to reimbursement requirement.--A
            participant shall be excused from reimbursement under this
            subsection if the participant becomes permanently totally
            disabled as established by sworn affidavit of a qualified
            physician. The Secretary may also waive reimbursement in cases
            of extreme hardship to the participant, as determined by the
            Secretary.
        ``(g) Relationship to Educational Assistance Under Montgomery GI
    Bill.--The receipt by a participant in the Troops-to-Teachers Program
    of a stipend or bonus under this section shall not reduce or otherwise
    affect the entitlement of the participant to any benefits under chapter
    30 of title 38, United States Code, or chapter 1606 of title 10, United
    States Code.

    ``SEC. 2044. PARTICIPATION BY STATES.

        ``(a) Discharge of State Activities Through Consortia of States.--
    The Secretary may permit States participating in the Troops-to-Teachers
    Program to carry out activities authorized for such States under the
    Program through one or more consortia of such States.
        ``(b) Assistance to States.--
                ``(1) Grants authorized.--Subject to paragraph (2), the
            Secretary may make grants to States participating in the
            Troops-to-Teachers Program, or to consortia of such States, in
            order to permit such States or consortia of States to operate
            offices for purposes of recruiting eligible members and former
            members of the Armed Forces for participation in the Program
            and facilitating the employment of participants in the Program
            as elementary school teachers, secondary school teachers, and
            vocational or technical teachers.
                ``(2) Limitation.--The total amount of grants under
            paragraph (1) in any fiscal year may not exceed $4,000,000.

    ``SEC. 2045. SUPPORT OF INNOVATIVE PRERETIREMENT TEACHER CERTIFICATION
                  PROGRAMS.

        ``(a) Development, Implementation and Demonstration.--The Secretary
    may enter into a memorandum of agreement with a State, an institution
    of higher education, or a consortia of States or institutions of higher
    education, to develop, implement, and demonstrate teacher certification
    programs for members of the Armed Forces described in section
    2042(a)(1)(B) for the purpose of assisting such members to consider and
    prepare for a career as a fully qualified elementary school teacher,
    secondary school teacher, or vocational or technical teacher upon their
    retirement from the Armed Forces.
        ``(b) Program Elements.--A teacher certification program under
    subsection (a) must--
                ``(1) provide recognition of military experience and
            training as related to licensure or certification requirements;
                ``(2) provide courses of instruction that may be conducted
            on or near a military installation;
                ``(3) incorporate alternative approaches to achieve teacher
            certification, such as innovative methods to gaining field-
            based teaching experiences, and assessment of background and
            experience as related to skills, knowledge, and abilities
            required of elementary school teachers, secondary school
            teachers, or vocational or technical teachers;
                ``(4) provide for courses to also be delivered via distance
            education methods; and
                ``(5) address any additional requirements or specifications
            as established by the Secretary.
        ``(c) Application Procedures.--A State or institution of higher
    education (or a consortia of States or institutions of higher
    education) that has a program leading to State approved teacher
    certification programs may submit a proposal to the Secretary for
    consideration under subsection (a). The Secretary shall give preference
    to proposals that provide for a sharing of the costs to carry out the
    teacher certification program.
        ``(d) Continuation of Programs.--The purpose of this section is to
    provide funding to develop, implement, and demonstrate teacher
    certification programs under subsection (a). Upon successful completion
    of the demonstration phase, the continued operation of the teacher
    certification programs shall not be the responsibility of the
    Secretary.
        ``(e) Funding Limitation.--The total amount obligated by the
    Secretary under this section in any fiscal year may not exceed
    $5,000,000.

    ``SEC. 2046. REPORTING REQUIREMENTS.

        ``(a) Report Required.--Not later than March 31 of each year, the
    Secretary (in consultation with the Secretary of Defense and the
    Secretary of Transportation) and the Comptroller General shall each
    submit to Congress a report on the effectiveness of the Troops-to-
    Teachers Program in the recruitment and retention of qualified
    personnel by local educational agencies and public charter schools.
        ``(b) Elements of Report.--The report under subsection (a) shall
    include information on the following:
                ``(1) The number of participants in the Troops-to-Teachers
            Program.
                ``(2) The schools in which the participants are employed.
                ``(3) The grade levels at which the participants teach.
                ``(4) The subject matters taught by the participants.
                ``(5) The rates of retention of the participants by the
            local educational agencies and public charter schools employing
            the participants.
                ``(6) Such other matters as the Secretary or the
            Comptroller General, as the case may be, considers appropriate.
        ``(c) Recommendations.--The report of the Comptroller General under
    this section shall also include any recommendations of the Comptroller
    General regarding any means of improving the Troops-to-Teachers
    Program, including means of enhancing the recruitment and retention of
    participants in the Program.

    ``SEC. 2047. DEFINITIONS.

        ``For purposes of this chapter:
                ``(1) Armed forces.--The term `Armed Forces' means the
            Army, Navy, Air Force, Marine Corps, and Coast Guard.
                ``(2) Program.--The term `Program' means the Troops-to-
            Teachers Program authorized by this subpart.
                ``(3) Reserve component.--The term `reserve component'
            means--
                        ``(A) the Army National Guard of the United States;
                        ``(B) the Army Reserve;
                        ``(C) the Naval Reserve;
                        ``(D) the Marine Corps Reserve;
                        ``(E) the Air National Guard of the United States;
                        ``(F) the Air Force Reserve; and
                        ``(G) the Coast Guard Reserve.
                ``(4) Secretary concerned.--The term `Secretary concerned'
            means--
                        ``(A) the Secretary of the Army, with respect to
                    matters concerning a reserve component of the Army;
                        ``(B) the Secretary of the Navy, with respect to
                    matters concerning a reserve component of the Navy;
                        ``(C) the Secretary of the Air Force, with respect
                    to matters concerning a reserve component of the Air
                    Force; and
                        ``(D) the Secretary of Transportation, with respect
                    to matters concerning the Coast Guard Reserve.

                      ``CHAPTER 2--TRANSITION TO TEACHING

    ``SEC. 2048. PROFESSIONALS SEEKING TO CHANGE CAREERS.

        ``(a) Purpose.--The purpose of this section is to address the need
    of high-need local educational agencies for highly qualified teachers
    in particular subject areas, such as mathematics, science, foreign
    languages, bilingual education, and special education, needed by those
    agencies, following the model of the program under chapter 1, by
    recruiting, preparing, placing, and supporting career-changing
    professionals who have knowledge and experience that will help them
    become such teachers.
        ``(b) Program Authorized.--The Secretary may award grants,
    contracts, or cooperative agreements to institutions of higher
    education and public and private nonprofit agencies or organizations to
    carry out programs authorized by this section.
        ``(c) Application.--Each applicant that desires an award under
    subsection (b) shall submit an application to the Secretary containing
    such information as the Secretary requires, including--
                ``(1) a description of the target group of career-changing
            professionals upon which the applicant will focus its
            recruitment efforts in carrying out its program under this
            section, including a description of the characteristics of that
            target group that shows how the knowledge and experience of its
            members are relevant to meeting the purpose of this section;
                ``(2) a description of the training that program
            participants will receive and how that training will relate to
            their certification as teachers;
                ``(3) a description of how the applicant will collaborate,
            as needed, with other institutions, agencies, or organizations
            to recruit, train, place, support, and provide teacher
            induction programs to program participants under this section,
            including evidence of the commitment of those institutions,
            agencies, or organizations to the applicant's program;
                ``(4) a description of how the applicant will evaluate the
            progress and effectiveness of its program, including--
                        ``(A) the program's goals and objectives;
                        ``(B) the performance indicators the applicant will
                    use to measure the program's progress; and
                        ``(C) the outcome measures that will be used to
                    determine the program's effectiveness; and
                ``(5) such other information and assurances as the
            Secretary may require.
        ``(d) Uses of Funds and Period of Service.--
                ``(1) Authorized activities.--Funds under this section may
            be used for--
                        ``(A) recruiting program participants, including
                    informing them of opportunities under the program and
                    putting them in contact with other institutions,
                    agencies, or organizations that would train, place, and
                    support them;
                        ``(B) training stipends and other financial
                    incentives for program participants, not to exceed
                    $5,000 per participant;
                        ``(C) assisting institutions of higher education or
                    other providers of teacher training to tailor their
                    training to meet the particular needs of professionals
                    who are changing their careers to teaching;
                        ``(D) placement activities, including identifying
                    high-need local educational agencies with a need for
                    the particular skills and characteristics of the newly
                    trained program participants and assisting those
                    participants to obtain employment in those local
                    educational agencies; and
                        ``(E) post-placement induction or support
                    activities for program participants.
                ``(2) Period of service.--A program participant in a
            program under this section who completes his or her training
            shall serve in a high-need local educational agency for at
            least 3 years.
                ``(3) Repayment.--The Secretary shall establish such
            requirements as the Secretary determines appropriate to ensure
            that program participants who receive a training stipend or
            other financial incentive under paragraph (1)(B), but fail to
            complete their service obligation under paragraph (2), repay
            all or a portion of such stipend or other incentive.
        ``(e) Equitable Distribution.--To the extent practicable, the
    Secretary shall make awards under this section that support programs in
    different geographic regions of the United States.
        ``(f) Definition.--As used in this section, the term `program
    participants' means career-changing professionals who--
                ``(1) hold at least a baccalaureate degree;
                ``(2) demonstrate interest in, and commitment to, becoming
            a teacher; and
                ``(3) have knowledge and experience that are relevant to
            teaching a high-need subject area in a high-need local
            educational agency.

                              ``Subpart 5--Funding

    ``SEC. 2051. AUTHORIZATIONS OF APPROPRIATIONS.

        ``(a) In General.--For the purpose of carrying out this part, other
    than subpart 4, there are authorized to be appropriated $3,600,000,000
    for fiscal year 2002 and such sums as may be necessary for each of
    fiscal years 2003 through 2006.
        ``(b) Subpart 4.--For the purpose of carrying out subpart 4, there
    are authorized to be appropriated $50,000,000 for fiscal year 2002 and
    such sums as may be necessary for each of fiscal years 2003 through
    2006.

                        ``Subpart 6--General Provisions

    ``SEC. 2061. DEFINITIONS.

        ``For purposes of this part--
                ``(1) Arts and sciences.--The term `arts and sciences'
            means--
                        ``(A) when referring to an organizational unit of
                    an institution of higher education, any academic unit
                    that offers one or more academic majors in disciplines
                    or content areas corresponding to the academic subject
                    matter areas in which teachers provide instruction; and
                        ``(B) when referring to a specific academic subject
                    matter area, the disciplines or content areas in which
                    academic majors are offered by the arts and sciences
                    organizational unit.
                ``(2) Beginning teacher.--The term `beginning teacher'
            means an educator in a public school who has not yet been
            teaching 3 full school years.
                ``(3) Mentoring program.--The term `mentoring program'
            means to provide professional support and development,
            instruction, and guidance to beginning teachers, but does not
            include a teacher or individual who begins to work in a
            supervisory position.
                ``(4) Publicly report.--The term `publicly report', when
            used with respect to the dissemination of information, means
            that the information is made widely available to the public,
            including parents and students, through such means as the
            Internet and major print and broadcast media outlets.''.

    SEC. 202. NATIONAL WRITING PROJECT.

        (a) Transfer and Redesignation.--Part K of title X (20 U.S.C. 8331
    et seq.) is transferred and redesignated as part B of title II.
    Sections 10991 and 10992 are redesignated as sections 2101 and 2102,
    respectively.
        (b) Evaluation.--Section 2102(g) (as so redesignated) is amended--
                (1) in paragraph (1), by striking ``14701.'' and inserting
            ``8651.''; and
                (2) in paragraph (2), by striking ``1994'' and inserting
            ``2002''.
        (c) Reauthorization.--Section 2102(i) (as so redesignated) is
    amended by striking ``$4,000,000 for fiscal year 1995, and such sums as
    may be necessary for each of the four succeeding fiscal years,'' and
    inserting ``such sums as may be necessary for fiscal year 2002 and the
    four succeeding fiscal years,''.
        (d) Continuation of Awards.--Notwithstanding any other provision of
    this Act, any person or agency that was awarded a grant or contract
    under part K of title X (20 U.S.C. 8331 et seq.) prior to the date of
    the enactment of this Act shall continue to receive funds in accordance
    with the terms of such award until the date on which the award period
    terminates under such terms.

    SEC. 203. CIVIC EDUCATION; TEACHER LIABILITY PROTECTION.

        (a) In General.--Title II, as amended by sections 201 and 202, is
    further amended by adding at the end the following:

                           ``PART C--CIVIC EDUCATION

    ``SEC. 2201. SHORT TITLE.

        ``This part may be cited as the `Education for Democracy Act'.

    ``SEC. 2202. FINDINGS.

        ``The Congress finds that--
                ``(1) college freshmen surveyed in 1999 by the Higher
            Education Research Institute at the University of California at
            Los Angeles demonstrated higher levels of disengagement, both
            academically and politically, than any previous entering class
            of students;
                ``(2) college freshmen in 1999 demonstrated the lowest
            levels of political interest in the 20-year history of surveys
            conducted by the Higher Education Research Institute at the
            University of California at Los Angeles;
                ``(3) United States secondary school students expressed
            relatively low levels of interest in politics and economics in
            a 1999 Harris survey;
                ``(4) the 32d Annual Phi Delta Kappa/Gallup Poll of 2000
            indicated that preparing students to become responsible
            citizens was the most important purpose of public schools;
                ``(5) Americans surveyed by the Organization of Economic
            Cooperation and Development indicated that only 59 percent had
            confidence that schools have a major effect on the development
            of good citizenship;
                ``(6) teachers too often do not have sufficient expertise
            in the subjects that they teach, and 50 percent of all
            secondary school history students in America are being taught
            by teachers with neither a major nor a minor in history;
                ``(7) secondary school students correctly answered fewer
            than 50 percent of the questions on a national test of economic
            knowledge in a 1999 Harris survey;
                ``(8) the 1998 National Assessment of Educational Progress
            indicated that students have only superficial knowledge of, and
            lacked a depth of understanding regarding, civics;
                ``(9) civics and economic education are important not only
            to developing citizenship competencies in the United States but
            also are critical to supporting political stability and
            economic health in other democracies, particularly emerging
            democratic market economies;
                ``(10) more than 75 percent of Americans surveyed by the
            National Constitution Center in 1997 admitted that they knew
            only some or very little about the Constitution of the United
            States; and
                ``(11) the Constitution of the United States is too often
            viewed within the context of history and not as a living
            document that shapes current events.

    ``SEC. 2203. PURPOSE.

        ``It is the purpose of this part--
                ``(1) to improve the quality of civics and government
            education by educating students about the history and
            principles of the Constitution of the United States, including
            the Bill of Rights;
                ``(2) to foster civic competence and responsibility; and
                ``(3) to improve the quality of civic education and
            economic education through cooperative civic education and
            economic education exchange programs with emerging democracies.

    ``SEC. 2204. AUTHORITY.

        ``The Secretary may make grants to, or enter into contracts with--
                ``(1) the Center for Civic Education to carry out civic
            education activities in accordance with sections 2205 and 2206;
            and
                ``(2) the National Council on Economic Education to carry
            out economic education activities in accordance with section
            2206.

    ``SEC. 2205. WE THE PEOPLE PROGRAM.

        ``(a) Use of Funds.--The Center for Civic Education may use funds
    made available under grants or contracts under section 2204(1) only to
    carry out activities--
                ``(1) under the Citizen and the Constitution program in
            accordance with subsection (b); and
                ``(2) under the Project Citizen program in accordance with
            subsection (c).
        ``(b) Citizen and the Constitution Program.--
                ``(1) Educational activities.--The Center for Civic
            Education--
                        ``(A) shall use funds made available under grants
                    or contracts under section 2204(1)--
                                ``(i) to continue and expand the
                            educational activities of the program entitled
                            the `We the People... The Citizen and the
                            Constitution' administered by the Center for
                            Civic Education;
                                ``(ii) to carry out activities to enhance
                            student attainment of challenging academic
                            content standards in civics and government;
                                ``(iii) to provide a course of instruction
                            on the basic principles of the Nation's
                            constitutional democracy and the history of the
                            Constitution of the United States, including
                            the Bill of Rights;
                                ``(iv) to provide, at the request of a
                            participating school, school and community
                            simulated congressional hearings following the
                            course of instruction described in clause
                            (iii); and
                                ``(v) to provide an annual national
                            competition of simulated congressional hearings
                            for secondary school students who wish to
                            participate in such a program; and
                        ``(B) may use assistance made available under
                    section 2204(1)--
                                ``(i) to provide advanced sustained and
                            ongoing training of teachers about the
                            Constitution of the United States and the
                            political system of the United States;
                                ``(ii) to provide materials and methods of
                            instruction, including teacher training, that
                            utilize the latest advancements in educational
                            technology; and
                                ``(iii) to provide civic education
                            materials and services to address specific
                            problems such as the prevention of school
                            violence and the abuse of drugs and alcohol.
                ``(2) Availability of program.--As a condition of receipt
            of funds under grants or contracts under section 2204(1), the
            Secretary shall require the Center for Civic Education to make
            the education program authorized under this subsection
            available to public and private elementary schools and
            secondary schools, including Bureau-funded schools, in each of
            the 435 congressional districts, and in the District of
            Columbia, the Commonwealth of Puerto Rico, the Virgin Islands,
            Guam, American Samoa, and the Commonwealth of the Northern
            Mariana Islands.
        ``(c) Project Citizen.--
                ``(1) Educational activities.--The Center for Civic
            Education--
                        ``(A) shall use funds made available under grants
                    or contracts under section 2204(1)--
                                ``(i) to continue and expand the
                            educational activities of the program entitled
                            the `We the People... Project Citizen' program
                            administered by the Center;
                                ``(ii) to carry out activities to enhance
                            student attainment of challenging academic
                            content standards in civics and government;
                                ``(iii) to provide a course of instruction
                            at the middle school level on the roles of
                            State and local governments in the Federal
                            system established by the Constitution of the
                            United States; and
                                ``(iv) to provide an annual national
                            showcase or competition; and
                        ``(B) may use funds made available under grants or
                    contracts under section 2204(1)--
                                ``(i) to provide optional school and
                            community simulated State legislative hearings;
                                ``(ii) to provide advanced sustained and
                            ongoing training of teachers on the roles of
                            State and local governments in the Federal
                            system established by the Constitution of the
                            United States;
                                ``(iii) to provide materials and methods of
                            instruction, including teacher training, that
                            utilize the latest advancements in educational
                            technology; and
                                ``(iv) to provide civic education materials
                            and services to address specific problems such
                            as the prevention of school violence and the
                            abuse of drugs and alcohol.
                ``(2) Availability of program.--As a condition of receipt
            of funds under grants or contracts under section 2204(1), the
            Secretary shall require the Center for Civic Education to make
            the education program authorized under this subsection
            available to public and private middle schools, including
            Bureau-funded schools, in each of the 50 States, the District
            of Columbia, the Commonwealth of Puerto Rico, the Virgin
            Islands, Guam, American Samoa, and the Commonwealth of the
            Northern Mariana Islands.
        ``(d) Bureau-Funded School Defined.--In this section, the term
    `Bureau-funded school' has the meaning given such term in section 1146
    of the Education Amendments of 1978 (25 U.S.C. 2026).

    ``SEC. 2206. COOPERATIVE CIVIC EDUCATION AND ECONOMIC EDUCATION
                  EXCHANGE PROGRAMS.

        ``(a) Use of Funds.--The Center for Civic Education and the
    National Council on Economic Education may use funds made available
    under grants or contracts under section 2204(2) only to carry out
    cooperative education exchange programs that--
                ``(1) make available to educators from eligible countries
            exemplary curriculum and teacher training programs in civics
            and government education, and economics education, developed in
            the United States;
                ``(2) assist eligible countries in the adaptation,
            implementation, and institutionalization of programs described
            in paragraph (1);
                ``(3) create and implement programs for civics and
            government education, and economic education, for students that
            draw upon the experiences of the participating eligible
            countries;
                ``(4) provide means for the exchange of ideas and
            experiences in civics and government education, and economic
            education, among political, educational, governmental, and
            private sector leaders of participating eligible countries; and
                ``(5) provide support for--
                        ``(A) independent research and evaluation to
                    determine the effects of educational programs on
                    students' development of the knowledge, skills, and
                    traits of character essential for the preservation and
                    improvement of constitutional democracy; and
                        ``(B) effective participation in and the
                    preservation and improvement of an efficient market
                    economy.
        ``(b) Activities.--In carrying out the cooperative education
    exchange programs assisted under this section, the Center for Civic
    Education and the National Council on Economic Education shall--
                ``(1) provide to the participants from eligible countries--
                        ``(A) seminars on the basic principles of United
                    States constitutional democracy and economic system,
                    including seminars on the major governmental and
                    economic institutions and systems in the United States,
                    and visits to such institutions;
                        ``(B) visits to school systems, institutions of
                    higher education, and nonprofit organizations
                    conducting exemplary programs in civics and government
                    education, and economic education, in the United
                    States;
                        ``(C) translations and adaptations with respect to
                    United States civics and government education, and
                    economic education, curricular programs for students
                    and teachers, and in the case of training programs for
                    teachers translations and adaptations into forms useful
                    in schools in eligible countries, and joint research
                    projects in such areas; and
                        ``(D) independent research and evaluation
                    assistance--
                                ``(i) to determine the effects of the
                            cooperative education exchange programs on
                            students' development of the knowledge, skills,
                            and traits of character essential for the
                            preservation and improvement of constitutional
                            democracy; and
                                ``(ii) to identify effective participation
                            in and the preservation and improvement of an
                            efficient market economy;
                ``(2) provide to the participants from the United States--
                        ``(A) seminars on the histories, economies, and
                    systems of government of eligible countries;
                        ``(B) visits to school systems, institutions of
                    higher education, and organizations conducting
                    exemplary programs in civics and government education,
                    and economic education, located in eligible countries;
                        ``(C) assistance from educators and scholars in
                    eligible countries in the development of curricular
                    materials on the history, government, and economy of
                    such countries that are useful in United States
                    classrooms;
                        ``(D) opportunities to provide onsite
                    demonstrations of United States curricula and pedagogy
                    for educational leaders in eligible countries; and
                        ``(E) independent research and evaluation
                    assistance to determine--
                                ``(i) the effects of the cooperative
                            education exchange programs assisted under this
                            section on students' development of the
                            knowledge, skills, and traits of character
                            essential for the preservation and improvement
                            of constitutional democracy; and
                                ``(ii) effective participation in and
                            improvement of an efficient market economy; and
                ``(3) assist participants from eligible countries and the
            United States to participate in international conferences on
            civics and government education, and economic education, for
            educational leaders, teacher trainers, scholars in related
            disciplines, and educational policymakers.
        ``(c) Participants.--The primary participants in the cooperative
    education exchange programs assisted under this section shall be
    educational leaders in the areas of civics and government education,
    and economic education, including teachers, curriculum and teacher
    training specialists, scholars in relevant disciplines, and educational
    policymakers, and government and private sector leaders from the United
    States and eligible countries.
        ``(d) Consultation.--The Secretary may make a grant, or enter into
    a contract, under section 2204(2) only if the Secretary of State
    concurs with the Secretary that such grant, or contract, is consistent
    with the foreign policy of the United States.
        ``(e) Avoidance of Duplication.--With the concurrence of the
    Secretary of State, the Secretary shall ensure that--
                ``(1) the activities carried out under the programs
            assisted under this section are not duplicative of other
            activities conducted in eligible countries; and
                ``(2) any institutions in eligible countries, with which
            the Center for Civic Education or the National Council on
            Economic Education may work in conducting such activities, are
            creditable.
        ``(f) Eligible Country Defined.--In this section, the term
    `eligible country' means a Central European country, an Eastern
    European country, Lithuania, Latvia, Estonia, the independent states of
    the former Soviet Union as defined in section 3 of the FREEDOM Support
    Act (22 U.S.C. 5801), the Republic of Ireland, the province of Northern
    Ireland in the United Kingdom, and any developing country (as such term
    is defined in section 209(d) of the Education for the Deaf Act) if the
    Secretary, with the concurrence of the Secretary of State, determines
    that such developing country has a democratic form of government.

    ``SEC. 2207. FUNDING.

        ``(a) Authorization of Appropriations.--
                ``(1) We the people program.--There are authorized to be
            appropriated to carry out sections 2204(1) and 2205 such sums
            as may be necessary for each of fiscal years 2002 through 2006.
                ``(2) Cooperative civic education and economic education
            exchange programs.--There are authorized to be appropriated to
            carry out sections 2204(2) and 2206 such sums as may be
            necessary for each of fiscal years 2002 through 2006.
        ``(b) Limitation.--In each fiscal year, the Secretary may use not
    more than 50 percent of the amount appropriated under subsection (a)(2)
    for assistance for economic educational activities.

                     ``PART D--TEACHER LIABILITY PROTECTION

    ``SEC. 2301. TEACHER IMMUNITY.

        ``(a) Immunity.--Notwithstanding any other provision of law, no
    school board member of, or teacher or administrator in, a local
    educational agency that receives funds under this Act shall be liable
    for monetary damages in his or her personal capacity for an action that
    was taken in carrying out his or her official duties and intended to
    maintain school discipline, so long as that action was not prohibited
    under State or local law and did not constitute reckless or criminal
    misconduct.
        ``(b) Limitation.--The immunity established under subsection (a)
    shall apply only to liability arising under Federal law.''.
        (b) Continuation of Awards.--Notwithstanding any other provision of
    this Act, any person or agency that was awarded a grant under part F of
    title X (20 U.S.C. 8141 et seq.) prior to the date of the enactment of
    this Act shall continue to receive funds in accordance with the terms
    of such award until the date on which the award period terminates under
    such terms.

       TITLE III--EDUCATION OF LIMITED ENGLISH PROFICIENT AND IMMIGRANT
                  CHILDREN; INDIAN AND ALASKA NATIVE EDUCATION

     PART A--EDUCATION OF LIMITED ENGLISH PROFICIENT AND IMMIGRANT CHILDREN

    SEC. 301. PROGRAMS AUTHORIZED.

        (a) Title Heading.--The heading for title III is amended to read as
    follows:

      ``TITLE III--EDUCATION OF LIMITED ENGLISH PROFICIENT AND IMMIGRANT
                CHILDREN; INDIAN AND ALASKA NATIVE EDUCATION''.

        (b) Short Title.--Section 3101 (20 U.S.C. 6801) is repealed.
        (c) Limitation on Availability of Certain Funds for Schools.--
                (1) In general.--Section 3601 (20 U.S.C. 7001)--
                        (A) is transferred to part B of title V (as amended
                    by section 501) and inserted after section 5204 (as so
                    amended);
                        (B) is redesignated as section 5205; and
                        (C) is amended by striking ``this title'' each
                    place such term appears and inserting ``this part''.
                (2) Part heading repeal.--The part heading for part F of
            title III is repealed.
        (d) Limited English Proficient and Immigrant Children.--Parts A
    through E of title III (20 U.S.C. 6811 et seq.) are amended to read as
    follows:

        ``PART A--EDUCATION OF LIMITED ENGLISH PROFICIENT AND IMMIGRANT
                                    CHILDREN

       ``Subpart 1--English Language and Academic Instructional Programs

    ``SEC. 3101. SHORT TITLE.

        ``This subpart may be cited as the `English Language Proficiency
    and Academic Achievement Act'.

    ``SEC. 3102. FINDINGS AND PURPOSES.

        ``(a) Findings.--The Congress finds as follows:
                ``(1) English is the common language of the United States
            and every citizen and other person residing in the United
            States should have a command of the English language in order
            to develop to their full potential.
                ``(2) Limited English proficient children, including recent
            immigrant children, must overcome a number of challenges in
            receiving an education in order to participate fully in
            American society, including--
                        ``(A) segregated educational programs;
                        ``(B) disproportionate and improper placement in
                    special education and other special programs due to the
                    use of inappropriate evaluation procedures;
                        ``(C) the limited English proficiency of their
                    parents, which hinders the parents' ability to fully
                    participate in the education of their children; and
                        ``(D) a need for additional teachers and other
                    staff who are professionally trained and qualified to
                    serve such children.
                ``(3) States and local educational agencies need assistance
            in developing the capacity to provide programs of instruction
            that offer and provide an equal educational opportunity to
            children who need special assistance because English is not
            their dominant language.
                ``(4) Since 1979, the number of limited English proficient
            children attending school in the United States has more than
            doubled to greater than 4,000,000, and demographic trends
            indicate the population of limited English proficient children
            will continue to increase.
                ``(5) Native Americans, including native residents of the
            outlying areas, and Native American languages (as such terms
            are defined in section 103 of the Native American Languages
            Act) have a unique status under Federal law that requires
            special policies within the broad purposes of this part to
            serve the educational needs of language minority students in
            the United States.
                ``(6) Research, evaluation, and data collection
            capabilities in the field of instruction for limited English
            proficient children need to be strengthened so that educators
            and other staff teaching limited English proficient children in
            the classroom can better identify and promote programs, program
            implementation strategies, and instructional practices that
            result in the effective education of limited English proficient
            children.
                ``(7) The Federal Government has a special and continuing
            obligation to ensure that States and local educational agencies
            provide children of limited English proficiency the same
            educational opportunities afforded other children.
        ``(b) Purposes.--The purposes of this part are--
                ``(1) to help ensure that children who are limited English
            proficient, including recent immigrant children, attain English
            proficiency, develop high levels of academic attainment in
            English, and meet the same challenging State academic content
            standards and challenging State student academic achievement
            standards expected of all children;
                ``(2) to develop high-quality programs designed to assist
            local educational agencies in teaching limited English
            proficient children;
                ``(3) to assist local educational agencies to develop and
            enhance their capacity to provide high-quality instructional
            programs designed to prepare limited English proficient
            students, including recent immigrant students, to enter all-
            English instructional settings within 3 years; and
                ``(4) to provide State educational agencies and local
            educational agencies with the flexibility to implement
            instructional programs, tied to scientifically based reading
            research and sound research and theory on teaching limited
            English proficient children, that the agencies believe to be
            the most effective for teaching English.

    ``SEC. 3103. PARENTAL NOTIFICATION AND CONSENT FOR ENGLISH LANGUAGE
                  INSTRUCTION.

        ``(a) Notification.--If a local educational agency uses funds under
    this subpart to provide English language instruction to limited English
    proficient children, the agency shall inform a parent or the parents of
    a child participating in an English language instruction program for
    limited English proficient children assisted under this subpart of--
                ``(1) the reasons for the identification of the child as
            being in need of English language instruction;
                ``(2) the child's level of English proficiency, how such
            level was assessed, and the status of the child's academic
            achievement;
                ``(3) how the English language instruction program will
            specifically help the child acquire English and meet age-
            appropriate standards for grade promotion and graduation;
                ``(4) what the specific exit requirements are for the
            program;
                ``(5) the expected rate of transition from the program into
            a classroom that is not tailored for limited English proficient
            children; and
                ``(6) the expected rate of graduation from high school for
            the program if funds under this subpart are used for children
            in secondary schools.
        ``(b) Consent.--
                ``(1) Agency requirements.--
                        ``(A) Informed consent.--For a child who has been
                    identified as limited English proficient prior to the
                    beginning of the school year, each local educational
                    agency that receives funds under this subpart shall
                    make a reasonable and substantial effort to obtain
                    informed parental consent prior to the placement of a
                    child in an English language instruction program for
                    limited English proficient children funded under this
                    subpart, if the program does not include classes which
                    exclusively or almost exclusively use the English
                    language in instruction.
                        ``(B) Written consent not obtained.--
                                ``(i) In general.--If written consent is
                            not obtained, the local educational agency
                            shall maintain a written record that includes
                            the date and the manner in which such informed
                            consent was sought, including the specific
                            efforts made to obtain such consent.
                                ``(ii) Proof of effort.--Notice, in an
                            understandable form, of specific efforts made
                            to obtain written consent and a copy of the
                            written record described in clause (i) shall be
                            mailed or delivered in writing to a parent or
                            the parents of a child prior to placing the
                            child in a program described in subparagraph
                            (A), and shall include a final request for
                            parental consent for such services. After such
                            notice has been mailed or delivered in writing,
                            the local educational agency shall provide
                            appropriate educational services.
                                ``(iii) Special rule applicable during
                            school year.--For those children who have not
                            been identified as limited English proficient
                            prior to the beginning of the school year, the
                            local educational agency shall make a
                            reasonable and substantial effort to obtain
                            parental consent under this clause. For such
                            children, the agency shall document, in
                            writing, its specific efforts to obtain such
                            consent prior to placing the child in a program
                            described in subparagraph (A). After such
                            documentation has been made, the local
                            educational agency shall provide appropriate
                            educational services to such child. The proof
                            of documentation shall be mailed or delivered
                            in writing to a parent or the parents of the
                            child in a timely manner and shall include
                            information on how to have their child
                            immediately removed from the program upon their
                            request. Nothing in this clause shall be
                            construed as exempting a local educational
                            agency from complying with the notification
                            requirements of subsection (a) and the consent
                            requirements of this paragraph.
                ``(2) Parental rights.--A parent or the parents of a child
            participating in an English language instruction program for
            limited English proficient children assisted under this
            subpart--
                        ``(A) shall select among methods of instruction, if
                    more than one method is offered in the program; and
                        ``(B) shall have the right to have their child
                    immediately removed from the program upon their
                    request.
        ``(c) Receipt of Information.--A parent or the parents of a child
    identified for participation in an English language instruction program
    for limited English proficient children assisted under this subpart
    shall receive, in a manner and form understandable to the parent or
    parents, the information required by this subsection. At a minimum, the
    parent or parents shall receive--
                ``(1) timely information about English language instruction
            programs for limited English proficient children assisted under
            this part;
                ``(2) if a parent or the parents of a participating child
            so desire, notice of opportunities for regular meetings for the
            purpose of formulating and responding to recommendations from
            the parent or parents; and
                ``(3) procedural information for removing a child from a
            program for limited English proficient children.
        ``(d) Basis for Admission or Exclusion.--Students shall not be
    admitted to, or excluded from, any federally assisted education program
    on the basis of a surname or language-minority status.

    ``SEC. 3104. TESTING OF LIMITED ENGLISH PROFICIENT CHILDREN.

        ``(a) In General.--Assessments of limited English proficient
    children participating in programs funded under this subpart, to the
    extent practicable, shall be in the language and form most likely to
    yield accurate and reliable information on what such students know and
    can do in content areas.
        ``(b) Special Rule.--Notwithstanding subsection (a), in the case of
    an assessment of reading or language arts of any student who has
    attended school in the United States (excluding Puerto Rico) for 3 or
    more consecutive school years, the assessment shall be in the form of a
    test written in English, except that, if the entity administering the
    assessment determines, on a case-by-case individual basis, that
    assessments in another language or form would likely yield more
    accurate and reliable information on what such student knows and can
    do, the entity may assess such student in such language or form for 1
    additional year.

    ``SEC. 3105. FORMULA GRANTS TO STATES.

        ``(a) In General.--In the case of each State that in accordance
    with section 3107 submits to the Secretary an application for a fiscal
    year, the Secretary shall make a grant for the year to the State for
    the purposes specified in subsection (b). The grant shall consist of
    the allotment determined for the State under subsection (c).
        ``(b) Purposes of Grants.--
                ``(1) Required expenditures.--The Secretary may make a
            grant under subsection (a) only if the State involved agrees
            that the State will expend at least 95 percent of its allotment
            under subsection (c) for the purpose of making subgrants to
            eligible entities to provide assistance to limited English
            proficient children in accordance with sections 3108 and 3109.
                ``(2) Authorized expenditures.--Subject to paragraph (3), a
            State that receives a grant under subsection (a) may expend not
            more than 5 percent of its allotment under subsection (c) for
            one or more of the following purposes:
                        ``(A) Carrying out--
                                ``(i) professional development activities,
                            and other activities, that assist personnel in
                            meeting State and local certification
                            requirements for teaching limited English
                            proficient children; and
                                ``(ii) other activities that provide such
                            personnel with the skills and knowledge
                            necessary to educate limited English proficient
                            children.
                        ``(B) Providing scholarships and fellowships to
                    students who agree to teach limited English proficient
                    children once they graduate.
                        ``(C) Planning, administration, and interagency
                    coordination related to the subgrants referred to in
                    paragraph (1).
                        ``(D) Providing technical assistance and other
                    forms of assistance to local educational agencies
                    that--
                                ``(i) educate limited English proficient
                            children; and
                                ``(ii) are not receiving a subgrant from a
                            State under this subpart.
                        ``(E) Providing bonuses to subgrantees whose
                    performance has been exceptional in terms of the speed
                    with which children enrolled in the subgrantee's
                    programs and activities attain English language
                    proficiency and meet challenging State academic content
                    standards and challenging State student academic
                    achievement standards.
                ``(3) Limitation on administrative costs.--In carrying out
            paragraph (2), a State that receives a grant under subsection
            (a) may expend not more than 2 percent of its allotment under
            subsection (c) for the purposes described in paragraph (2)(C).
        ``(c) Determination of Allotment Amounts.--
                ``(1) Reservations.--From the amount appropriated under
            section 3110 to carry out this subpart for each fiscal year,
            the Secretary shall reserve--
                        ``(A) .5 percent of such amount for payments to
                    entities that are considered to be local educational
                    agencies under section 3106(a) for activities approved
                    by the Secretary;
                        ``(B) .5 percent of such amount for payments to
                    outlying areas, to be allotted in accordance with their
                    respective needs for assistance under this subpart, as
                    determined by the Secretary, for activities, approved
                    by the Secretary, consistent with this part; and
                        ``(C) \1/2\ of 1 percent of such amount for
                    evaluation of the programs under this part and for
                    dissemination of best practices.
                ``(2) Continuation awards.--Before making awards to States
            under paragraph (3) for any fiscal year, the Secretary shall
            make continuation awards to recipients of grants under subpart
            1 of part A of the Bilingual Education Act, as that Act was in
            effect on the day before the effective date of the No Child
            Left Behind Act of 2001, in order to allow such recipients to
            continue to receive funds in accordance with the terms of their
            grant until the date on which the grant period otherwise would
            have terminated if the No Child Left Behind Act of 2001 had not
            been enacted.
                ``(3) State allotments.--
                        ``(A) In general.--From the amount appropriated
                    under section 3110 to carry out this subpart for each
                    fiscal year that remains after carrying out paragraphs
                    (1) and (2), the Secretary shall allot to each of the
                    50 States, the District of Columbia, and the
                    Commonwealth of Puerto Rico an amount which bears the
                    same ratio to such amount as the total number of
                    children and youth who are limited English proficient
                    and who reside in such State bears to the total number
                    of such children and youth residing in all such States
                    that, in accordance with section 3107, submit to the
                    Secretary an application for the year.
                        ``(B) Reallotment.--
                                ``(i) In general.--If any State described
                            in subparagraph (A) does not submit to the
                            Secretary an application for a fiscal year, or
                            submits an application (or any modification to
                            an application) that the Secretary, after
                            reasonable notice and opportunity for a
                            hearing, determines does not satisfy the
                            requirements of this subpart, the Secretary--
                                        ``(I) shall endeavor to make the
                                    State's allotment available on a
                                    competitive basis to specially
                                    qualified agencies within the State
                                    that satisfy the requirements
                                    applicable to eligible entities under
                                    section 3108 and any additional
                                    requirements that may be imposed by the
                                    Secretary; and
                                        ``(II) shall reallot any portion of
                                    such allotment remaining after the
                                    application of subclause (I) to the
                                    remaining States in accordance with
                                    subparagraph (A).
                                ``(ii) Requirements on specially qualified
                            agencies.--If a specially qualified agency
                            receives funds under this subparagraph, the
                            requirements of subsection (b) shall not apply
                            to the agency. In lieu of those requirements,
                            the specially qualified agency shall expend the
                            funds for the authorized activities described
                            in section 3108(b) and otherwise shall satisfy
                            the requirements of section 3108.
                        ``(C) Special rule for puerto rico.--The total
                    amount allotted to Puerto Rico for any fiscal year
                    under subparagraph (A) shall not exceed .5 percent of
                    the total amount allotted to all States for that fiscal
                    year.
                ``(4) Use of data for determinations.--
                        ``(A) In general.--Except as provided in
                    subparagraph (B), for the purpose of determining the
                    number of children and youth who are limited English
                    proficient and reside in a State and in all States for
                    each fiscal year, the Secretary shall use the most
                    recent satisfactory data available from the Bureau of
                    the Census and the American Community Survey available
                    from the Department of Commerce.
                        ``(B) Exception.--If the data described in
                    subparagraph (A) are more than 4 years old or
                    unavailable, the Secretary shall use the most recent
                    satisfactory data provided by the States, such as
                    enrollment data and data that reflect the number of
                    students taking the English proficiency assessments in
                    the States.
                ``(5) No reduction permitted based on teaching method.--The
            Secretary may not reduce a State's allotment based on the
            State's selection of any method of instruction as its preferred
            method of teaching the English language to children who are
            limited English proficient.

    ``SEC. 3106. NATIVE AMERICAN AND ALASKA NATIVE CHILDREN IN SCHOOL.

        ``(a) Eligible Entities.--For the purpose of carrying out programs
    under this part for individuals served by elementary, secondary, and
    postsecondary schools operated predominately for Native American or
    Alaska Native children, the following shall be considered to be a local
    educational agency:
                ``(1) An Indian tribe.
                ``(2) A tribally sanctioned educational authority.
                ``(3) A Native Hawaiian or Native American Pacific Islander
            native language educational organization.
                ``(4) An elementary or secondary school that is operated or
            funded by the Bureau of Indian Affairs, or a consortium of such
            schools.
                ``(5) An elementary or secondary school operated under a
            contract with or grant from the Bureau of Indian Affairs, in
            consortium with another such school or a tribal or community
            organization.
                ``(6) An elementary or secondary school operated by the
            Bureau of Indian Affairs and an institution of higher
            education, in consortium with an elementary or secondary school
            operated under a contract with or grant from the Bureau of
            Indian Affairs or a tribal or community organization.
        ``(b) Submission of Applications for Assistance.--Notwithstanding
    any other provision of this part, an entity that is considered to be a
    local educational agency under subsection (a), and that desires to
    submit an application for Federal financial assistance under this
    subpart, shall submit the application to the Secretary. In all other
    respects, such an entity shall be eligible for a subgrant under this
    subpart on the same basis as any other local educational agency.

    ``SEC. 3107. APPLICATIONS BY STATES.

        ``For purposes of section 3105, an application submitted by a State
    for a grant under such section for a fiscal year is in accordance with
    this section if the application--
                ``(1) describes the process that the State will use in
            making competitive subgrants to eligible entities under section
            3109(c);
                ``(2) contains an agreement that, in carrying out this
            subpart, the State will address the needs of school systems of
            all sizes and in all geographic areas, including rural and
            urban schools;
                ``(3) contains an agreement that competitive subgrants to
            eligible entities under section 3109(c) shall be of sufficient
            size and scope to allow such entities to carry out high quality
            education programs for limited English proficient children;
                ``(4) contains an agreement that the State will coordinate
            its programs and activities under this subpart with its other
            programs and activities under this Act and other Acts, as
            appropriate;
                ``(5) contains an agreement that the State--
                        ``(A) shall monitor the progress of students
                    enrolled in programs and activities receiving
                    assistance under this subpart in attaining English
                    proficiency and in attaining challenging State academic
                    content standards and challenging State student
                    academic achievement standards;
                        ``(B) shall establish standards and benchmarks for
                    English language development that are aligned with
                    State academic content and achievement standards; and
                        ``(C) will ensure that eligible entities comply
                    with section 3104 to annually test children in English
                    who have been in the United States for 3 or more
                    consecutive years;
                ``(6) contains an assurance that the State will develop
            high-quality annual assessments to measure English language
            proficiency and require eligible entities receiving a subgrant
            under this subpart annually to assess the English proficiency
            of all children with limited English proficiency participating
            in a program funded under this subpart;
                ``(7) contains an agreement that the State will develop
            annual performance objectives for raising the level of English
            proficiency of each limited English proficient student, and
            that these objectives shall include percentage increases in
            performance on annual assessments in reading, writing,
            speaking, and listening comprehension as compared to the
            preceding school year; and
                ``(8) contains an agreement that the State will require
            eligible entities receiving a subgrant under this subpart to
            use the subgrant in ways that will build such recipient's
            capacity to continue to offer high-quality English language
            instruction and programs which assist limited English
            proficient children in attaining challenging State academic
            content standards and challenging State student academic
            achievement standards once assistance under this subpart is no
            longer available.

    ``SEC. 3108. SUBGRANTS TO ELIGIBLE ENTITIES.

        ``(a) Purposes of Subgrants.--A State may make a subgrant to an
    eligible entity from funds received by the State under this subpart
    only if the entity agrees to expend the funds to improve the education
    of limited English proficient children and their families, through the
    acquisition of English and the attainment of challenging State academic
    content standards and challenging State student academic achievement
    standards, using approaches and methodologies based on scientifically
    based reading research and sound research and theory on teaching
    limited English proficient children, by--
                ``(1) developing and implementing new English language and
            academic content instructional programs for children who are
            limited English proficient, including programs of early
            childhood education and kindergarten through 12th grade
            education;
                ``(2) carrying out highly focused, innovative, locally
            designed projects to expand or enhance existing English
            language and academic content instruction programs for limited
            English proficient children;
                ``(3) implementing, within an individual school, schoolwide
            programs for restructuring, reforming, and upgrading all
            relevant programs and operations relating to English language
            and academic content instruction for limited English proficient
            students; or
                ``(4) implementing, within the entire jurisdiction of a
            local educational agency, agencywide programs for
            restructuring, reforming, and upgrading all relevant programs
            and operations relating to English language and academic
            content instruction for limited English proficient students.
        ``(b) Authorized Subgrantee Activities.--
                ``(1) In general.--Subject to paragraph (2), a State may
            make a subgrant to an eligible entity from funds received by
            the State under this subpart in order that the eligible entity
            may achieve one of the purposes described in subsection (a) by
            undertaking one or more of the following activities to improve
            the understanding, and use, of the English language, based on a
            child's learning skills and attainment of challenging State
            academic content standards and challenging State student
            academic achievement standards:
                        ``(A) Upgrading program objectives and effective
                    instructional strategies.
                        ``(B) Improving the instruction program for limited
                    English proficient students by identifying, acquiring,
                    and upgrading curricula, instructional materials,
                    educational software, and assessment procedures.
                        ``(C) Providing--
                                ``(i) tutorials and academic or vocational
                            education for limited English proficient
                            children; and
                                ``(ii) intensified instruction.
                        ``(D) Developing and implementing elementary or
                    secondary school English language instructional
                    programs that are coordinated with other relevant
                    programs and services.
                        ``(E) Providing professional development to
                    classroom teachers, principals, administrators, and
                    other school or community-based organizational
                    personnel to improve the instruction and assessment of
                    children who are limited English proficient children.
                        ``(F) Improving the English language proficiency
                    and academic performance of limited English proficient
                    children.
                        ``(G) Improving the instruction of limited English
                    proficient children by providing for the acquisition or
                    development of education technology or instructional
                    materials, access to and participation in electronic
                    networks for materials, training and communications,
                    and incorporation of such resources in curricula and
                    programs, such as those funded under this subpart.
                        ``(H) Developing tutoring programs for limited
                    English proficient children that provide early
                    intervention and intensive instruction in order to
                    improve academic achievement, to increase graduation
                    rates among limited English proficient children, and to
                    prepare students for transition as soon as possible
                    into classrooms where instruction is not tailored for
                    limited English proficient children.
                        ``(I) Providing family literacy services and parent
                    outreach and training activities to limited English
                    proficient children and their families to improve their
                    English language skills and assist parents in helping
                    their children to improve their academic performance.
                        ``(J) Other activities that are consistent with the
                    purposes of this part.
                ``(2) Moving children out of specialized classrooms.--Any
            program or activity undertaken by an eligible entity using a
            subgrant from a State under this subpart shall be designed to
            assist students enrolled in the program or activity to attain
            English proficiency and meet challenging State academic content
            standards and challenging State student academic achievement
            standards as soon as possible, but not later than after 3
            consecutive years of attendance in United States schools
            (excluding schools in Puerto Rico), and to move into a
            classroom where instruction is not tailored for limited English
            proficient children.
        ``(c) Selection of Method of Instruction.--To receive a subgrant
    from a State under this subpart, an eligible entity shall select one or
    more methods or forms of instruction to be used in the programs and
    activities undertaken by the entity to assist limited English
    proficient children to attain English proficiency and meet challenging
    State academic content standards and challenging State student academic
    achievement standards. Such selection shall be consistent with sections
    3134 and 3135.
        ``(d) Duration of Subgrants.--The duration of a competitive
    subgrant made by a State under section 3109(c) shall be determined by
    the State in its discretion.
        ``(e) Applications by Eligible Entities.--
                ``(1) In general.--To receive a subgrant from a State under
            this subpart, an eligible entity shall submit an application to
            the State at such time, in such form, and containing such
            information as the State may require.
                ``(2) Required documentation.--The application shall--
                        ``(A) describe the programs and activities proposed
                    to be developed, implemented, and administered under
                    the subgrant;
                        ``(B) describe how the eligible entity will use the
                    subgrant funds to satisfy the requirement in subsection
                    (b)(2); and
                        ``(C) describe how the eligible entity, using the
                    disaggregated results of the student assessments
                    required under section 1111(b)(4) and other measures
                    available, will annually review the progress of
                    elementary and secondary schools within its
                    jurisdiction, or served by it, to determine if such
                    schools are making the adequate yearly progress
                    necessary to ensure that limited English proficient
                    students attending the schools will meet the State's
                    proficient level of performance on the State assessment
                    described in section 1111(b)(4), and will hold such
                    schools accountable for making such progress.
                ``(3) Requirements for approval.--The application shall
            contain assurances that--
                        ``(A) the eligible entity will use qualified
                    personnel who have appropriate training and
                    professional credentials in teaching English to
                    children who are limited English proficient, and who
                    are proficient in English, including written and oral
                    communication skills;
                        ``(B) if the eligible entity includes one or more
                    local educational agencies, each such agency is
                    complying with section 3103(b) prior to, and
                    throughout, each school year;
                        ``(C) the eligible entity annually will assess the
                    English proficiency of all children with limited
                    English proficiency participating in programs funded
                    under this subpart;
                        ``(D) the eligible entity has based its proposal on
                    scientifically based reading research and sound
                    research and theory on teaching limited English
                    proficient children;
                        ``(E) the eligible entity has described in the
                    application how students enrolled in the programs and
                    activities proposed in the application will be
                    proficient in English after 3 academic years of
                    enrollment;
                        ``(F) the eligible entity will ensure that programs
                    will enable children to speak, read, write, and
                    comprehend the English language and meet challenging
                    State academic content standards and challenging State
                    student academic achievement standards; and
                        ``(G) the eligible entity is not in violation of
                    any State law, including State constitutional law,
                    regarding the education of limited English proficient
                    children, consistent with sections 3134 and 3135.
                ``(4) Quality.--For the purposes of awarding competitive
            subgrants under section 3109(c), a State shall consider the
            quality of each application and ensure that it is of sufficient
            size and scope to meet the purposes of this subpart.

    ``SEC. 3109. DISTRIBUTION OF SUBGRANTS TO ELIGIBLE ENTITIES.

        ``(a) In General.--A State shall expend at least 95 percent of its
    allotment under section 3105(c) each fiscal year for the purpose of
    making subgrants to eligible entities within the State that have
    approved applications, in accordance with subsections (b) and (c).
        ``(b) Formula Subgrants.--
                ``(1) Reservation.--75 percent of the amount expended by a
            State for subgrants under this subpart shall be reserved for
            subgrants to eligible entities described in subsection (a) in
            which, during the fiscal year for which the subgrant is to be
            made, the number of limited English proficient children and
            youth who are enrolled in public and nonpublic elementary or
            secondary schools located in geographic areas under the
            jurisdiction of, or served by, such entities is equal to at
            least 500 students, or 3 percent of the total number of
            children and youth enrolled in such schools during such fiscal
            year, whichever is less.
                ``(2) Allotment.--From the amount reserved under paragraph
            (1), the State shall allot to each eligible entity described in
            such paragraph a percentage based on the ratio of--
                        ``(A) the number of limited English proficient
                    children and youth who are enrolled in public and
                    nonpublic elementary or secondary schools located in
                    geographic areas under the jurisdiction of, or served
                    by, such entity during the fiscal year for which the
                    allotment is to be made; to
                        ``(B) the number of such children and youth in all
                    such eligible entities.
                ``(3) Reallotment.--Whenever a State determines that an
            allotment made to an eligible entity under this subsection for
            a fiscal year will not be used by the entity for the purpose
            for which it was made, the State shall, in accordance with such
            rules as it deems appropriate, reallot such amount, consistent
            with paragraph (2), to other eligible entities in the State for
            carrying out that purpose.
        ``(c) Competitive Subgrants.--25 percent of the amount expended by
    a State for subgrants under this subpart shall be reserved for
    competitive subgrants to eligible entities described in subsection (a)
    that the State determines--
                ``(1) have experienced significant increases, as compared
            to the previous 2 years, in the percentage or number of
            children and youth with limited English proficiency, including
            recent immigrant children, that have enrolled in public and
            nonpublic elementary or secondary schools in the geographic
            areas under the jurisdiction of, or served by, such entities
            during the fiscal year for which the subgrant is to be made; or
                ``(2) do not satisfy the requirements of subsection (b)(1)
            but have significant needs for programs under this subpart.

    ``SEC. 3110. AUTHORIZATION OF APPROPRIATIONS.

        ``For the purpose of carrying out this subpart, there are
    authorized to be appropriated $750,000,000 for fiscal year 2002 and
    such sums as may be necessary for each of the 4 succeeding fiscal
    years.

                          ``Subpart 2--Administration

    ``SEC. 3121. EVALUATIONS.

        ``(a) In General.--Each eligible entity that receives a subgrant
    from a State under subpart 1 shall provide the State, at the conclusion
    of every second fiscal year during which the subgrant is received, with
    an evaluation, in a form prescribed by the State, of--
                ``(1) the programs and activities conducted by the entity
            with funds received under subpart 1 during the 2 immediately
            preceding fiscal years;
                ``(2) the progress made by students in learning the English
            language and meeting challenging State academic content
            standards and challenging State student academic achievement
            standards;
                ``(3) the number and percentage of students in the programs
            and activities attaining English language proficiency by the
            end of each school year, as determined by a valid and reliable
            assessment of English proficiency; and
                ``(4) the progress made by students in meeting challenging
            State academic content standards and challenging State student
            academic achievement standards for each of the 2 years after
            such students are no longer receiving services under this part.
        ``(b) Use of Evaluation.--An evaluation provided by an eligible
    entity under subsection (a) shall be used by the entity and the State--
                ``(1) for improvement of programs and activities;
                ``(2) to determine the effectiveness of programs and
            activities in assisting children who are limited English
            proficient to attain English proficiency (as measured
            consistent with subsection (d)) and meet challenging State
            academic content standards and challenging State student
            academic achievement standards; and
                ``(3) in determining whether or not to continue funding for
            specific programs or projects.
        ``(c) Evaluation Components.--An evaluation provided by an eligible
    entity under subsection (a) shall include--
                ``(1) an evaluation of whether students enrolling in a
            program or activity conducted by the entity with funds received
            under subpart 1--
                        ``(A) have attained English proficiency and are
                    meeting challenging State academic content academic and
                    challenging State student academic achievement
                    standards; and
                        ``(B) have achieved a working knowledge of the
                    English language that is sufficient to permit them to
                    perform, in English, in a classroom that is not
                    tailored to limited English proficient children; and
                ``(2) such other information as the State may require.
        ``(d) Evaluation Measures.--In prescribing the form of an
    evaluation provided by an entity under subsection (a), a State shall
    approve evaluation measures, as applicable, for use under subsection
    (c) that are designed to assess--
                ``(1) oral language proficiency in kindergarten;
                ``(2) oral language proficiency, including speaking and
            listening skills, in first grade;
                ``(3) both oral language proficiency, including speaking
            and listening skills, and reading and writing proficiency in
            grades 2 and higher; and
                ``(4) attainment of challenging State student academic
            achievement standards.

    ``SEC. 3122. REPORTING REQUIREMENTS.

        ``(a) States.--Based upon the evaluations provided to a State under
    section 3121, each State that receives a grant under subpart 1 shall
    prepare and submit every second year to the Secretary a report on
    programs and activities undertaken by the State under such subpart and
    the effectiveness of such programs and activities in improving the
    education provided to children who are limited English proficient.
        ``(b) Secretary.--Every second year, the Secretary shall prepare
    and submit to the Committee on Education and the Workforce of the House
    of Representatives and the Committee on Health, Education, Labor, and
    Pensions of the Senate a report on--
                ``(1) programs and activities undertaken by States under
            subpart 1 and the effectiveness of such programs and activities
            in improving the education provided to children who are limited
            English proficient;
                ``(2) the types of instructional programs used under
            subpart 1 to teach limited English proficient children;
                ``(3) the number of programs or projects, if any, that were
            terminated because they were not able to reach program goals;
                ``(4) the number of limited English proficient children
            served under subpart 1 who were transitioned out of special
            instructional programs funded under such subpart into
            classrooms where instruction is not tailored for limited
            English proficient children; and
                ``(5) other information gathered from the reports submitted
            under subsection (a).

    ``SEC. 3123. COORDINATION WITH RELATED PROGRAMS.

        ``In order to maximize Federal efforts aimed at serving the
    educational needs of children and youth of limited English proficiency,
    the Secretary shall coordinate and ensure close cooperation with other
    programs serving language-minority and limited English proficient
    students that are administered by the Department and other agencies.

                        ``Subpart 3--General Provisions

    ``SEC. 3131. DEFINITIONS.

        ``For purposes of this part:
                ``(1) Children and youth.--The term `children and youth'
            means individuals aged 3 through 21.
                ``(2) Community-based organization.--The term `community-
            based organization' means a private nonprofit organization of
            demonstrated effectiveness or Indian tribe or tribally
            sanctioned educational authority which is representative of a
            community or significant segments of a community and which
            provides educational or related services to individuals in the
            community. Such term includes a Native Hawaiian or Native
            American Pacific Islander native language educational
            organization.
                ``(3) Eligible entity.--The term `eligible entity' means--
                        ``(A) one or more local educational agencies; or
                        ``(B) one or more local educational agencies in
                    collaboration with an institution of higher education,
                    community-based organization, or State educational
                    agency.
                ``(4) Native hawaiian or native american pacific islander
            native language educational organization.--The term `Native
            Hawaiian or Native American Pacific Islander native language
            educational organization' means a nonprofit organization with a
            majority of its governing board and employees consisting of
            fluent speakers of the traditional Native American languages
            used in their educational programs and with not less than 5
            years successful experience in providing educational services
            in traditional Native American languages.
                ``(5) Native language.--The term `native language', when
            used with reference to an individual who is limited English
            proficient, means the language normally used by such
            individual.
                ``(6) Specially qualified agency.--The term `specially
            qualified agency', when used with respect to a fiscal year,
            means an eligible entity located in a State that, for that
            year--
                        ``(A) does not submit to the Secretary an
                    application under sections 3105(a) and 3107; or
                        ``(B) submits an application (or any modification
                    to an application) that the Secretary, after reasonable
                    notice and opportunity for a hearing, determines does
                    not satisfy the requirements of subpart 1.
                ``(7) Tribally sanctioned educational authority.--The term
            `tribally sanctioned educational authority' means--
                        ``(A) any department or division of education
                    operating within the administrative structure of the
                    duly constituted governing body of an Indian tribe; and
                        ``(B) any nonprofit institution or organization
                    that is--
                                ``(i) chartered by the governing body of an
                            Indian tribe to operate a school described in
                            section 3106(a) or otherwise to oversee the
                            delivery of educational services to members of
                            the tribe; and
                                ``(ii) approved by the Secretary for the
                            purpose of carrying out programs under subpart
                            1 for individuals served by a school described
                            in section 3106(a).

    ``SEC. 3132. RULES OF CONSTRUCTION.

        ``Nothing in subpart 1 shall be construed--
                ``(1) to prohibit a local educational agency from serving
            limited English proficient children and youth simultaneously
            with students with similar educational needs, in the same
            educational settings where appropriate;
                ``(2) to require a State or a local educational agency to
            establish, continue, or eliminate any particular type of
            instructional program for limited English proficient children;
            or
                ``(3) to limit the preservation or use of Native American
            languages as defined in the Native American Languages Act of
            1990.

    ``SEC. 3133. LIMITATION ON FEDERAL REGULATIONS.

        ``The Secretary shall issue regulations under this part only to the
    extent that such regulations are necessary to ensure compliance with
    the specific requirements of this part.

    ``SEC. 3134. LEGAL AUTHORITY UNDER STATE LAW.

        ``Nothing in this part shall be construed to negate or supersede
    State law, or the legal authority under State law of any State agency,
    State entity, or State public official, over programs that are under
    the jurisdiction of the State agency, entity, or official.

    ``SEC. 3135. CIVIL RIGHTS.

        ``Nothing in this part shall be construed in a manner inconsistent
    with any Federal law guaranteeing a civil right.

    ``SEC. 3136. PROGRAMS FOR NATIVE AMERICANS AND PUERTO RICO.

        ``Programs authorized under subpart 1 that serve Native American
    children, Native Pacific Island children, and children in the
    Commonwealth of Puerto Rico, notwithstanding any other provision of
    subpart 1, may include programs of instruction, teacher training,
    curriculum development, evaluation, and testing designed for Native
    American children learning and studying Native American languages and
    children of limited Spanish proficiency, except that a primary outcome
    of programs serving such children shall be increased English
    proficiency among such children.''.

    SEC. 302. CONFORMING AMENDMENT TO DEPARTMENT OF EDUCATION ORGANIZATION
                  ACT.

        (a) In General.--
                (1) Renaming of office.--The Department of Education
            Organization Act is amended by striking ``Office of Bilingual
            Education and Minority Languages Affairs'' each place such term
            appears in the text and inserting ``Office of Educational
            Services for Limited English Proficient Children''.
                (2) Conforming amendment.--Section 209 of the Department of
            Education Organization Act is amended by striking ``Director of
            Bilingual Education and Minority Languages Affairs,'' and
            inserting ``Director of Educational Services for Limited
            English Proficient Children,''.
        (b) Clerical Amendments.--
                (1) Section 209.--The section heading for section 209 of
            the Department of Education Organization Act is amended to read
            as follows:

        ``office of educational services for limited english proficient
                                  children''.

                (2) Section 216.--The section heading for section 216 of
            the Department of Education Organization Act is amended to read
            as follows:

    ``SEC. 216. OFFICE OF EDUCATIONAL SERVICES FOR LIMITED ENGLISH
                  PROFICIENT CHILDREN.''.

                (3) Table of contents.--
                        (A) Section 209.--The table of contents of the
                    Department of Education Organization Act is amended by
                    amending the item relating to section 209 to read as
                    follows:

    ``Sec. 209. Office of Educational Services for Limited English
                                Proficient Children.''.
                        (B) Section 216.--The table of contents of the
                    Department of Education Organization Act is amended by
                    amending the item relating to section 216 to read as
                    follows:

    ``Sec. 216. Office of Educational Services for Limited English
                                Proficient Children.''.

                   PART B--INDIAN AND ALASKA NATIVE EDUCATION

    SEC. 311. ELEMENTARY AND SECONDARY EDUCATION ACT OF 1965.

        (a) In General.--Title III (as amended by section 301 of this Act)
    is further amended by adding at the end the following new part:

                  ``PART B--INDIAN AND ALASKA NATIVE EDUCATION

                         ``Subpart 1--Indian Education

    ``SEC. 3201. FINDINGS.

        ``Congress finds that--
                ``(1) the Federal Government has a special responsibility
            to ensure that educational programs for all American Indian and
            Alaska Native children and adults--
                        ``(A) are based on high-quality, internationally
                    competitive academic content standards and student
                    academic achievement standards and build on Indian
                    culture and the Indian community;
                        ``(B) assist local educational agencies, Indian
                    tribes, and other entities and individuals in providing
                    Indian students the opportunity to achieve such
                    standards; and
                        ``(C) meet the unique educational and culturally
                    related academic needs of American Indian and Alaska
                    Native students;
                ``(2) since the date of the enactment of the initial Indian
            Education Act in 1972, the level of involvement of Indian
            parents in the planning, development, and implementation of
            educational programs that affect such parents and their
            children has increased significantly, and schools should
            continue to foster such involvement;
                ``(3) although the number of Indian teachers,
            administrators, and university professors has increased since
            1972, teacher training programs are not recruiting, training,
            or retraining a sufficient number of Indian individuals as
            educators to meet the needs of a growing Indian student
            population in elementary, secondary, vocational, adult, and
            higher education;
                ``(4) the dropout rate for Indian students is unacceptably
            high; 9 percent of Indian students who were eighth graders in
            1988 had dropped out of school by 1990;
                ``(5) during the period from 1980 to 1990, the percentage
            of Indian individuals living at or below the poverty level
            increased from 24 percent to 31 percent, and the readiness of
            Indian children to learn is hampered by the high incidence of
            poverty, unemployment, and health problems among Indian
            children and their families; and
                ``(6) research related specifically to the education of
            Indian children and adults is very limited, and much of the
            research is of poor quality or is focused on limited local or
            regional issues.

    ``SEC. 3202. PURPOSE.

        ``(a) Purpose.--It is the purpose of this subpart to support the
    efforts of local educational agencies, Indian tribes and organizations,
    postsecondary institutions, and other entities to meet the unique
    educational and culturally related academic needs of American Indians
    and Alaska Natives, so that such students can achieve to the same
    challenging State academic achievement standards expected of all other
    students.
        ``(b) Programs.--this subpart carries out the purpose described in
    subsection (a) by authorizing programs of direct assistance for--
                ``(1) meeting the unique educational and culturally related
            academic needs of American Indians and Alaska Natives;
                ``(2) the education of Indian children and adults;
                ``(3) the training of Indian persons as educators and
            counselors, and in other professions serving Indian people; and
                ``(4) research, evaluation, data collection, and technical
            assistance.

           ``CHAPTER 1--FORMULA GRANTS TO LOCAL EDUCATIONAL AGENCIES

    ``SEC. 3211. PURPOSE.

        ``It is the purpose of this chapter to support local educational
    agencies in their efforts to reform elementary and secondary school
    programs that serve Indian students in order to ensure that such
    programs--
                ``(1) are based on challenging State academic content
            standards and State student academic achievement standards that
            are used for all students; and
                ``(2) are designed to assist Indian students in meeting
            those standards and assist the Nation in reaching the National
            Education Goals.

    ``SEC. 3212. GRANTS TO LOCAL EDUCATIONAL AGENCIES.

        ``(a) In General.--
                ``(1) Enrollment requirements.--A local educational agency
            shall be eligible for a grant under this chapter for any fiscal
            year if the number of Indian children eligible under section
            3217 and who were enrolled in the schools of the agency, and to
            whom the agency provided free public education, during the
            preceding fiscal year--
                        ``(A) was at least 10; or
                        ``(B) constituted not less than 25 percent of the
                    total number of individuals enrolled in the schools of
                    such agency.
                ``(2) Exclusion.--The requirement of paragraph (1) shall
            not apply in Alaska, California, or Oklahoma, or with respect
            to any local educational agency located on, or in proximity to,
            a reservation.
        ``(b) Indian Tribes.--
                ``(1) In general.--If a local educational agency that is
            eligible for a grant under this chapter does not establish a
            parent committee under section 3214(c)(4) for such grant, an
            Indian tribe that represents not less than one-half of the
            eligible Indian children who are served by such local
            educational agency may apply for such grant.
                ``(2) Special rule.--The Secretary shall treat each Indian
            tribe applying for a grant pursuant to paragraph (1) as if such
            Indian tribe were a local educational agency for purposes of
            this chapter, except that any such tribe is not subject to
            section 3214(c)(4), section 3218(c), or section 3219.

    ``SEC. 3213. AMOUNT OF GRANTS.

        ``(a) Amount of Grant Awards.--
                ``(1) In general.--Except as provided in subsection (b) and
            paragraph (2), the Secretary shall allocate to each local
            educational agency which has an approved application under this
            chapter an amount equal to the product of--
                        ``(A) the number of Indian children who are
                    eligible under section 3217 and served by such agency;
                    and
                        ``(B) the greater of--
                                ``(i) the average per pupil expenditure of
                            the State in which such agency is located; or
                                ``(ii) 80 percent of the average per pupil
                            expenditure in the United States.
                ``(2) Reduction.--The Secretary shall reduce the amount of
            each allocation determined under paragraph (1) in accordance
            with subsection (e).
        ``(b) Minimum Grant.--
                ``(1) In general.--Notwithstanding subsection (e), a local
            educational agency or an Indian tribe (as authorized under
            section 3212(b)) that is eligible for a grant under section
            3212, and a school that is operated or supported by the Bureau
            of Indian Affairs that is eligible for a grant under subsection
            (d), that submits an application that is approved by the
            Secretary, shall, subject to appropriations, receive a grant
            under this chapter in an amount that is not less than $3,000.
                ``(2) Consortia.--Local educational agencies may form a
            consortium for the purpose of obtaining grants under this
            chapter.
                ``(3) Increase.--The Secretary may increase the minimum
            grant under paragraph (1) to not more than $4,000 for all
            grantees if the Secretary determines such increase is necessary
            to ensure the quality of the programs provided.
        ``(c) Definition.--For the purpose of this section, the term
    `average per pupil expenditure of a State' means an amount equal to--
                ``(1) the sum of the aggregate current expenditures of all
            the local educational agencies in the State, plus any direct
            current expenditures by the State for the operation of such
            agencies, without regard to the sources of funds from which
            such local or State expenditures were made, during the second
            fiscal year preceding the fiscal year for which the computation
            is made; divided by
                ``(2) the aggregate number of children who were included in
            average daily attendance for whom such agencies provided free
            public education during such preceding fiscal year.
        ``(d) Schools Operated or Supported by the Bureau of Indian
    Affairs.--(1) Subject to subsection (e), in addition to the grants
    awarded under subsection (a), the Secretary shall allocate to the
    Secretary of the Interior an amount equal to the product of--
                ``(A) the total number of Indian children enrolled in
            schools that are operated by--
                        ``(i) the Bureau of Indian Affairs; or
                        ``(ii) an Indian tribe, or an organization
                    controlled or sanctioned by an Indian tribal
                    government, for the children of that tribe under a
                    contract with, or grant from, the Department of the
                    Interior under the Indian Self-Determination Act or the
                    Tribally Controlled Schools Act of 1988; and
                ``(B) the greater of--
                        ``(i) the average per pupil expenditure of the
                    State in which the school is located; or
                        ``(ii) 80 percent of the average per pupil
                    expenditure in the United States.
        ``(2) Any school described in paragraph (1)(A) that wishes to
    receive an allocation under this chapter shall submit an application in
    accordance with section 3214, and shall otherwise be treated as a local
    educational agency for the purpose of this chapter, except that such
    school shall not be subject to section 3214(c)(4), section 3218(c), or
    section 3219.
        ``(e) Ratable Reductions.--If the sums appropriated for any fiscal
    year under section 3252(a) are insufficient to pay in full the amounts
    determined for local educational agencies under subsection (a)(1) and
    for the Secretary of the Interior under subsection (d), each of those
    amounts shall be ratably reduced.

    ``SEC. 3214. APPLICATIONS.

        ``(a) Application Required.--Each local educational agency that
    desires to receive a grant under this chapter shall submit an
    application to the Secretary at such time, in such manner, and
    containing such information as the Secretary may reasonably require.
        ``(b) Comprehensive Program Required.--Each application submitted
    under subsection (a) shall include a comprehensive program for meeting
    the needs of Indian children served by the local educational agency,
    including the language and cultural needs of the children, that--
                ``(1) provides programs and activities to meet the
            culturally related academic needs of American Indian and Alaska
            Native students;
                ``(2)(A) is consistent with State and local plans under
            other provisions of this Act; and
                ``(B) includes academic content and student performance
            goals for such children, and benchmarks for attaining such
            goals, that are based on the challenging State standards under
            title I;
                ``(3) explains how Federal, State, and local programs,
            especially under title I, will meet the needs of such students;
                ``(4) demonstrates how funds made available under this
            chapter will be used for activities described in section 3215;
                ``(5) describes the professional development opportunities
            that will be provided, as needed, to ensure that--
                        ``(A) teachers and other school professionals who
                    are new to the Indian community are prepared to work
                    with Indian children; and
                        ``(B) all teachers who will be involved in programs
                    assisted under this chapter have been properly trained
                    to carry out such programs; and
                ``(6) describes how the local educational agency--
                        ``(A) will periodically assess the progress of all
                    Indian children enrolled in the schools of the local
                    educational agency, including Indian children who do
                    not participate in programs assisted under this
                    chapter, in meeting the goals described in paragraph
                    (2);
                        ``(B) will provide the results of each assessment
                    referred to in subparagraph (A) to--
                                ``(i) the committee of parents described in
                            subsection (c)(4); and
                                ``(ii) the community served by the local
                            educational agency; and
                        ``(C) is responding to findings of any previous
                    assessments that are similar to the assessments
                    described in subparagraph (A).
        ``(c) Assurances.--Each application submitted under subsection (a)
    shall include assurances that--
                ``(1) the local educational agency will use funds received
            under this chapter only to supplement the level of funds that,
            in the absence of the Federal funds made available under this
            chapter, such agency would make available for the education of
            Indian children, and not to supplant such funds;
                ``(2) the local educational agency will submit such reports
            to the Secretary, in such form and containing such information,
            as the Secretary may require to--
                        ``(A) carry out the functions of the Secretary
                    under this chapter; and
                        ``(B) determine the extent to which funds provided
                    to the local educational agency under this chapter are
                    effective in improving the educational achievement of
                    Indian students served by such agency;
                ``(3) the program for which assistance is sought--
                        ``(A) is based on a comprehensive local assessment
                    and prioritization of the unique educational and
                    culturally related academic needs of the American
                    Indian and Alaska Native students to whom the local
                    educational agency is providing an education;
                        ``(B) will use the best available talents and
                    resources, including individuals from the Indian
                    community; and
                        ``(C) was developed by such agency in open
                    consultation with parents of Indian children and
                    teachers, and, if appropriate, Indian students from
                    secondary schools, including public hearings held by
                    such agency to provide the individuals described in
                    this subparagraph a full opportunity to understand the
                    program and to offer recommendations regarding the
                    program; and
                ``(4) the local educational agency developed the program
            with the participation and written approval of a committee--
                        ``(A) that is composed of, and selected by--
                                ``(i) parents of Indian children in the
                            local educational agency's schools and
                            teachers; and
                                ``(ii) if appropriate, Indian students
                            attending secondary schools;
                        ``(B) a majority of whose members are parents of
                    Indian children;
                        ``(C) that sets forth such policies and procedures,
                    including policies and procedures relating to the
                    hiring of personnel, as will ensure that the program
                    for which assistance is sought will be operated and
                    evaluated in consultation with, and with the
                    involvement of, parents of the children, and
                    representatives of the area, to be served;
                        ``(D) with respect to an application describing a
                    schoolwide program in accordance with section 3215(c),
                    that has--
                                ``(i) reviewed in a timely fashion the
                            program; and
                                ``(ii) determined that the program will not
                            diminish the availability of culturally related
                            activities for American Indian and Alaskan
                            Native students; and
                        ``(E) that has adopted reasonable bylaws for the
                    conduct of the activities of the committee and abides
                    by such bylaws.

    ``SEC. 3215. AUTHORIZED SERVICES AND ACTIVITIES.

        ``(a) General Requirements.--Each local educational agency that
    receives a grant under this chapter shall use the grant funds, in a
    manner consistent with the purpose specified in section 3211, for
    services and activities that--
                ``(1) are designed to carry out the comprehensive program
            of the local educational agency for Indian students, and
            described in the application of the local educational agency
            submitted to the Secretary under section 3214(b);
                ``(2) are designed with special regard for the language and
            cultural needs of the Indian students; and
                ``(3) supplement and enrich the regular school program of
            such agency.
        ``(b) Particular Activities.--The services and activities referred
    to in subsection (a) may include--
                ``(1) culturally related activities that support the
            program described in the application submitted by the local
            educational agency;
                ``(2) early childhood and family programs that emphasize
            school readiness;
                ``(3) enrichment programs that focus on problem solving and
            cognitive skills development and directly support the
            attainment of challenging State academic content standards and
            State student academic achievement standards;
                ``(4) integrated educational services in combination with
            other programs that meet the needs of Indian children and their
            families;
                ``(5) career preparation activities to enable Indian
            students to participate in programs such as the programs
            supported by the Carl D. Perkins Vocational and Technical
            Education Act of 1998, including programs for tech-prep,
            mentoring, and apprenticeship;
                ``(6) activities to educate individuals concerning
            substance abuse and to prevent substance abuse;
                ``(7) the acquisition of equipment, but only if the
            acquisition of the equipment is essential to meet the purposes
            described in section 3211; and
                ``(8) family literacy services.
        ``(c) Schoolwide Programs.--Notwithstanding any other provision of
    law, a local educational agency may use funds made available to such
    agency under this chapter to support a schoolwide program under section
    1114 if--
                ``(1) the committee composed of parents established
            pursuant to section 3214(c)(4) approves the use of the funds
            for the schoolwide program; and
                ``(2) the schoolwide program is consistent with the
            purposes described in section 3211.
        ``(d) Limitation on Administrative Costs.--Not more than 5 percent
    of the funds provided to a grantee under this chapter for any fiscal
    year may be used for administrative purposes.

    ``SEC. 3216. INTEGRATION OF SERVICES AUTHORIZED.

        ``(a) Plan.--An entity receiving funds under this chapter may
    submit a plan to the Secretary for the integration of education and
    related services provided to Indian students.
        ``(b) Coordination of Programs.--Upon the receipt of an acceptable
    plan, the Secretary, in cooperation with each Federal agency providing
    grants for the provision of education and related services to the
    applicant, shall authorize the applicant to coordinate, in accordance
    with such plan, its federally funded education and related services
    programs, or portions thereof, serving Indian students in a manner that
    integrates the program services involved into a single, coordinated,
    comprehensive program and reduces administrative costs by consolidating
    administrative functions.
        ``(c) Programs Affected.--The funds that may be consolidated in a
    demonstration project under any such plan referred to in subsection (b)
    shall include funds for any Federal program exclusively serving Indian
    children or the funds reserved under any program to exclusively serve
    Indian children under which the applicant is eligible for receipt of
    funds under a statutory or administrative formula for the purposes of
    providing education and related services which would be used to serve
    Indian students.
        ``(d) Plan Requirements.--For a plan to be acceptable pursuant to
    subsection (b), it shall--
                ``(1) identify the programs or funding sources to be
            consolidated;
                ``(2) be consistent with the purposes of this section
            authorizing the services to be integrated in a demonstration
            project;
                ``(3) describe a comprehensive strategy which identifies
            the full range of potential educational opportunities and
            related services to be provided to assist Indian students to
            achieve the goals set forth in this chapter;
                ``(4) describe the way in which services are to be
            integrated and delivered and the results expected from the
            plan;
                ``(5) identify the projected expenditures under the plan in
            a single budget;
                ``(6) identify the local, State, or tribal agency or
            agencies to be involved in the delivery of the services
            integrated under the plan;
                ``(7) identify any statutory provisions, regulations,
            policies, or procedures that the applicant believes need to be
            waived in order to implement its plan;
                ``(8) set forth measures of student achievement and
            performance goals designed to be met within a specified period
            of time; and
                ``(9) be approved by a parent committee formed in
            accordance with section 3214(c)(4), if such a committee exists.
        ``(e) Plan Review.--Upon receipt of the plan from an eligible
    entity, the Secretary shall consult with the Secretary of each Federal
    department providing funds to be used to implement the plan, and with
    the entity submitting the plan. The parties so consulting shall
    identify any waivers of statutory requirements or of Federal
    departmental regulations, policies, or procedures necessary to enable
    the applicant to implement its plan. Notwithstanding any other
    provision of law, the Secretary of the affected department or
    departments shall have the authority to waive any regulation, policy,
    or procedure promulgated by that department that has been so identified
    by the applicant or department, unless the Secretary of the affected
    department determines that such a waiver is inconsistent with the
    intent of this chapter or those provisions of the statute from which
    the program involved derives its authority which are specifically
    applicable to Indian students.
        ``(f) Plan Approval.--Within 90 days after the receipt of an
    applicant's plan by the Secretary, the Secretary shall inform the
    applicant, in writing, of the Secretary's approval or disapproval of
    the plan. If the plan is disapproved, the applicant shall be informed,
    in writing, of the reasons for the disapproval and shall be given an
    opportunity to amend its plan or to petition the Secretary to
    reconsider such disapproval.
        ``(g) Responsibilities of Department of Education.--Not later than
    180 days after the date of the enactment of the No Child Left Behind
    Act of 2001, the Secretary of Education, the Secretary of the Interior,
    and the head of any other Federal department or agency identified by
    the Secretary of Education, shall enter into an interdepartmental
    memorandum of agreement providing for the implementation of the
    demonstration projects authorized under this section. The lead agency
    head for a demonstration program under this section shall be--
                ``(1) the Secretary of the Interior, in the case of
            applicant meeting the definition of contract or grant school
            under title XI of the Education Amendments of 1978; or
                ``(2) the Secretary of Education, in the case of any other
            applicant.
        ``(h) Responsibilities of Lead Agency.--The responsibilities of the
    lead agency shall include--
                ``(1) the use of a single report format related to the plan
            for the individual project which shall be used by an eligible
            entity to report on the activities undertaken under the
            project;
                ``(2) the use of a single report format related to the
            projected expenditures for the individual project which shall
            be used by an eligible entity to report on all project
            expenditures;
                ``(3) the development of a single system of Federal
            oversight for the project, which shall be implemented by the
            lead agency; and
                ``(4) the provision of technical assistance to an eligible
            entity appropriate to the project, except that an eligible
            entity shall have the authority to accept or reject the plan
            for providing such technical assistance and the technical
            assistance provider.
        ``(i) Report Requirements.--A single report format shall be
    developed by the Secretary, consistent with the requirements of this
    section. Such report format, together with records maintained on the
    consolidated program at the local level, shall contain such information
    as will allow a determination that the eligible entity has complied
    with the requirements incorporated in its approved plan, including the
    demonstration of student achievement, and will provide assurances to
    each Secretary that the eligible entity has complied with all directly
    applicable statutory requirements and with those directly applicable
    regulatory requirements which have not been waived.
        ``(j) No Reduction in Amounts.--In no case shall the amount of
    Federal funds available to an eligible entity involved in any
    demonstration project be reduced as a result of the enactment of this
    section.
        ``(k) Interagency Fund Transfers Authorized.--The Secretary is
    authorized to take such action as may be necessary to provide for an
    interagency transfer of funds otherwise available to an eligible entity
    in order to further the purposes of this section.
        ``(l) Administration of Funds.--
                ``(1) In general.--Program funds shall be administered in
            such a manner as to allow for a determination that funds from
            specific a program or programs are spent on allowable
            activities authorized under such program, except that the
            eligible entity shall determine the proportion of the funds
            granted which shall be allocated to such program.
                ``(2) Separate records not required.--Nothing in this
            section shall be construed as requiring the eligible entity to
            maintain separate records tracing any services or activities
            conducted under its approved plan to the individual programs
            under which funds were authorized, nor shall the eligible
            entity be required to allocate expenditures among such
            individual programs.
        ``(m) Overage.--All administrative costs may be commingled and
    participating entities shall be entitled to the full amount of such
    costs (under each program or department's regulations), and no overage
    shall be counted for Federal audit purposes, provided that the overage
    is used for the purposes provided for under this section.
        ``(n) Fiscal Accountability.--Nothing in this subpart shall be
    construed so as to interfere with the ability of the Secretary or the
    lead agency to fulfill the responsibilities for the safeguarding of
    Federal funds pursuant to the Single Audit Act of 1984.
        ``(o) Report on Statutory Obstacles to Program Integration.--
                ``(1) Preliminary report.--Not later than 2 years after the
            date of the enactment of the No Child Left Behind Act of 2001,
            the Secretary of Education shall submit a preliminary report to
            the Committee on Health, Education, Labor, and Pensions of the
            Senate and the Committee on Education and the Workforce of the
            House of Representatives on the status of the implementation of
            the demonstration program authorized under this section.
                ``(2) Final report.--Not later than 5 years after the date
            of the enactment of the No Child Left Behind Act of 2001, the
            Secretary of Education shall submit a report to the Committee
            on Health, Education, Labor, and Pensions of the Senate and the
            Committee on Education and the Workforce of the House of
            Representatives on the results of the implementation of the
            demonstration program authorized under this section. Such
            report shall identify statutory barriers to the ability of
            participants to integrate more effectively their education and
            related services to Indian students in a manner consistent with
            the purposes of this section.
        ``(p) Definitions.--For the purposes of this section, the term
    `Secretary' means--
                ``(1) the Secretary of the Interior, in the case of
            applicant meeting the definition of contract or grant school
            under title XI of the Education Amendments of 1978; or
                ``(2) the Secretary of Education, in the case of any other
            applicant.

    ``SEC. 3217. STUDENT ELIGIBILITY FORMS.

        ``(a) In General.--The Secretary shall require that, as part of an
    application for a grant under this chapter, each applicant shall
    maintain a file, with respect to each Indian child for whom the local
    educational agency provides a free public education, that contains a
    form that sets forth information establishing the status of the child
    as an Indian child eligible for assistance under this chapter and that
    otherwise meets the requirements of subsection (b).
        ``(b) Forms.--
                ``(1) In general.--The form described in subsection (a)
            shall include--
                        ``(A) either--
                                ``(i)(I) the name of the tribe or band of
                            Indians (as described in section 3251(3)) with
                            respect to which the child claims membership;
                                ``(II) the enrollment number establishing
                            the membership of the child (if readily
                            available); and
                                ``(III) the name and address of the
                            organization that maintains updated and
                            accurate membership data for such tribe or band
                            of Indians; or
                                ``(ii) if the child is not a member of a
                            tribe or band of Indians, the name, the
                            enrollment number (if readily available), and
                            the organization (and address thereof)
                            responsible for maintaining updated and
                            accurate membership rolls of the tribe of any
                            parent or grandparent of the child from whom
                            the child claims eligibility;
                        ``(B) a statement of whether the tribe or band of
                    Indians with respect to which the child, parent, or
                    grandparent of the child claims membership is federally
                    recognized;
                        ``(C) the name and address of the parent or legal
                    guardian of the child;
                        ``(D) a signature of the parent or legal guardian
                    of the child that verifies the accuracy of the
                    information supplied; and
                        ``(E) any other information that the Secretary
                    considers necessary to provide an accurate program
                    profile.
                ``(2) Minimum information.--In order for a child to be
            eligible to be counted for the purpose of computing the amount
            of a grant award made under section 3213, an eligibility form
            prepared pursuant to this section for a child shall include--
                        ``(A) the name of the child;
                        ``(B) the name of the tribe or band of Indians (as
                    described in section 3251(3)) with respect to which the
                    child claims eligibility; and
                        ``(C) the dated signature of the parent or guardian
                    of the child.
                ``(3) Failure.--The failure of an applicant to furnish any
            information described in this subsection other than the
            information described in paragraph (2) with respect to any
            child shall have no bearing on the determination of whether the
            child is an eligible Indian child for the purposes of
            determining the amount of a grant award made under section
            3213.
        ``(c) Statutory Construction.--Nothing in this section shall be
    construed to affect a definition contained in section 3251.
        ``(d) Forms and Standards of Proof.--The forms and the standards of
    proof (including the standard of good faith compliance) that were in
    use during the 1985-1986 academic year to establish the eligibility of
    a child for entitlement under the Indian Elementary and Secondary
    School Assistance Act shall be the forms and standards of proof used--
                ``(1) to establish such eligibility; and
                ``(2) to meet the requirements of subsection (a).
        ``(e) Documentation.--For purposes of determining whether a child
    is eligible to be counted for the purpose of computing the amount of a
    grant under section 3213, the membership of the child, or any parent or
    grandparent of the child, in a tribe or band of Indians may be
    established by proof other than an enrollment number, notwithstanding
    the availability of an enrollment number for a member of such tribe or
    band. Nothing in subsection (b) shall be construed to require the
    furnishing of an enrollment number.
        ``(f) Monitoring and Evaluation Review.--
                ``(1) In general.--(A) For each fiscal year, in order to
            provide such information as is necessary to carry out the
            responsibility of the Secretary to provide technical assistance
            under this chapter, the Secretary shall conduct a monitoring
            and evaluation review of a sampling of the recipients of grants
            under this chapter. The sampling conducted under this
            subparagraph shall take into account the size of the local
            educational agency and the geographic location of such agency.
                ``(B) A local educational agency may not be held liable to
            the United States or be subject to any penalty, by reason of
            the findings of an audit that relates to the date of
            completion, or the date of submission, of any forms used to
            establish, before April 28, 1988, the eligibility of a child
            for entitlement under the Indian Elementary and Secondary
            School Assistance Act.
                ``(2) False information.--Any local educational agency that
            provides false information in an application for a grant under
            this chapter shall--
                        ``(A) be ineligible to apply for any other grant
                    under this subpart; and
                        ``(B) be liable to the United States for any funds
                    that have not been expended.
                ``(3) Excluded children.--A student who provides false
            information for the form required under subsection (a) shall
            not be counted for the purpose of computing the amount of a
            grant under section 3213.
        ``(g) Tribal Grant and Contract Schools.--Notwithstanding any other
    provision of this section, in awarding funds under this chapter to a
    tribal school that receives a grant or contract from the Bureau of
    Indian Affairs, the Secretary shall use only one of the following, as
    selected by the school:
                ``(1) A count of the number of students in those schools
            certified by the Bureau.
                ``(2) A count of the number of students for whom the school
            has eligibility forms that comply with this section.
        ``(h) Timing of Child Counts.--For purposes of determining the
    number of children to be counted in calculating the amount of a local
    educational agency's grant under this chapter (other than in the case
    described in subsection (g)(1)), the local educational agency shall--
                ``(1) establish a date on, or a period not longer than 31
            consecutive days during which, the agency counts those
            children, so long as that date or period occurs before the
            deadline established by the Secretary for submitting an
            application under section 3214; and
                ``(2) determine that each such child was enrolled, and
            receiving a free public education, in a school of the agency on
            that date or during that period, as the case may be.

    ``SEC. 3218. PAYMENTS.

        ``(a) In General.--Subject to subsections (b) and (c), the
    Secretary shall pay to each local educational agency that submits an
    application that is approved by the Secretary under this chapter the
    amount determined under section 3213. The Secretary shall notify the
    local educational agency of the amount of the payment not later than
    June 1 of the year for which the Secretary makes the payment.
        ``(b) Payments Taken Into Account by the State.--The Secretary may
    not make a grant under this chapter to a local educational agency for a
    fiscal year if, for such fiscal year, the State in which the local
    educational agency is located takes into consideration payments made
    under this chapter in determining the eligibility of the local
    educational agency for State aid, or the amount of the State aid, with
    respect to the free public education of children during such fiscal
    year or the preceding fiscal year.
        ``(c) Reduction of Payment for Failure To Maintain Fiscal Effort.--
                ``(1) In general.--The Secretary may not pay a local
            educational agency the full amount of a grant award determined
            under section 3213 for any fiscal year unless the State
            educational agency notifies the Secretary, and the Secretary
            determines that, with respect to the provision of free public
            education by the local educational agency for the preceding
            fiscal year, the combined fiscal effort of the local
            educational agency and the State, computed on either a per
            student or aggregate expenditure basis, was not less than 90
            percent of the amount of the combined fiscal effort, computed
            on the same basis, for the second preceding fiscal year.
                ``(2) Failure to maintain effort.--If, for any fiscal year,
            the Secretary determines that a local educational agency failed
            to maintain the fiscal effort of such agency at the level
            specified in paragraph (1), the Secretary shall--
                        ``(A) reduce the amount of the grant that would
                    otherwise be made to such agency under this chapter in
                    the exact proportion of such agency's failure to
                    maintain its fiscal effort at such level; and
                        ``(B) not use the reduced amount of the agency's
                    expenditures for the preceding year to determine
                    compliance with paragraph (1) for any succeeding fiscal
                    year, but shall use the amount of expenditures that
                    would have been required to comply with paragraph (1).
                ``(3) Waiver.--(A) The Secretary may waive the requirement
            of paragraph (1), for not more than 1 year at a time, if the
            Secretary determines that the failure to comply with such
            requirement is due to exceptional or uncontrollable
            circumstances, such as a natural disaster or a precipitous and
            unforeseen decline in the agency's financial resources.
                ``(B) The Secretary shall not use the reduced amount of
            such agency's expenditures for the fiscal year preceding the
            fiscal year for which a waiver is granted to determine
            compliance with paragraph (1) for any succeeding fiscal year,
            but shall use the amount of expenditures that would have been
            required to comply with paragraph (1) in the absence of the
            waiver.
        ``(d) Reallocations.--The Secretary may reallocate, in a manner
    that the Secretary determines will best carry out the purpose of this
    chapter, any amounts that--
                ``(1) based on estimates made by local educational agencies
            or other information, the Secretary determines will not be
            needed by such agencies to carry out approved programs under
            this chapter; or
                ``(2) otherwise become available for reallocation under
            this chapter.

    ``SEC. 3219. STATE EDUCATIONAL AGENCY REVIEW.

        ``Before submitting an application to the Secretary under section
    3214, a local educational agency shall submit the application to the
    State educational agency, which may comment on such application. If the
    State educational agency comments on the application, it shall comment
    on all applications submitted by local educational agencies in the
    State and shall provide those comments to the respective local
    educational agencies, with an opportunity to respond.

       ``CHAPTER 2--SPECIAL PROGRAMS AND PROJECTS TO IMPROVE EDUCATIONAL
                       OPPORTUNITIES FOR INDIAN CHILDREN

    ``SEC. 3221. IMPROVEMENT OF EDUCATIONAL OPPORTUNITIES FOR INDIAN
                  CHILDREN.

        ``(a) Purpose.--
                ``(1) In general.--It is the purpose of this section to
            support projects to develop, test, and demonstrate the
            effectiveness of services and programs to improve educational
            opportunities and achievement of Indian children.
                ``(2) Coordination.--The Secretary shall take such actions
            as are necessary to achieve the coordination of activities
            assisted under this chapter with--
                        ``(A) other programs funded under this Act; and
                        ``(B) other Federal programs operated for the
                    benefit of American Indian and Alaska Native children.
        ``(b) Eligible Entities.--For the purpose of this section, the term
    `eligible entity' means a State educational agency, local educational
    agency, Indian tribe, Indian organization, federally supported
    elementary and secondary school for Indian students, Indian
    institution, including an Indian institution of higher education, or a
    consortium of such institutions.
        ``(c) Grants Authorized.--
                ``(1) In general.--The Secretary shall award grants to
            eligible entities to enable such entities to carry out
            activities that meet the purpose specified in subsection
            (a)(1), including--
                        ``(A) innovative programs related to the
                    educational needs of educationally disadvantaged
                    children;
                        ``(B) educational services that are not available
                    to such children in sufficient quantity or quality,
                    including remedial instruction, to raise the
                    achievement of Indian children in one or more of the
                    core academic subjects of English, mathematics,
                    science, foreign languages, art, history, and
                    geography;
                        ``(C) bilingual and bicultural programs and
                    projects;
                        ``(D) special health and nutrition services, and
                    other related activities, that address the unique
                    health, social, and psychological problems of Indian
                    children;
                        ``(E) special compensatory and other programs and
                    projects designed to assist and encourage Indian
                    children to enter, remain in, or reenter school, and to
                    increase the rate of secondary school graduation;
                        ``(F) comprehensive guidance, counseling, and
                    testing services;
                        ``(G) early childhood and kindergarten programs,
                    including family-based preschool programs that
                    emphasize school readiness and parental skills, and the
                    provision of services to Indian children with
                    disabilities;
                        ``(H) partnership projects between local
                    educational agencies and institutions of higher
                    education that allow secondary school students to
                    enroll in courses at the postsecondary level to aid
                    such students in the transition from secondary school
                    to postsecondary education;
                        ``(I) partnership projects between schools and
                    local businesses for career preparation programs
                    designed to provide Indian youth with the knowledge and
                    skills such youth need to make an effective transition
                    from school to a high-skill, high-wage career;
                        ``(J) programs designed to encourage and assist
                    Indian students to work toward, and gain entrance into,
                    an institution of higher education;
                        ``(K) family literacy services; or
                        ``(L) other services that meet the purpose
                    described in subsection (a)(1).
                ``(2) Professional development.--Professional development
            of teaching professionals and paraprofessional may be a part of
            any program assisted under this section.
        ``(d) Grant Requirements and Applications.--
                ``(1) Grant requirements.--(A) The Secretary may make
            multiyear grants under this section for the planning,
            development, pilot operation, or demonstration of any activity
            described in subsection (c) for a period not to exceed 5 years.
                ``(B) In making multiyear grants under this section, the
            Secretary shall give priority to applications that present a
            plan for combining two or more of the activities described in
            subsection (c) over a period of more than 1 year.
                ``(C) The Secretary shall make a grant payment to an
            eligible entity after the initial year of the multiyear grant
            only if the Secretary determines that the eligible entity has
            made substantial progress in carrying out the activities
            assisted under the grant in accordance with the application
            submitted under paragraph (2) and any subsequent modifications
            to such application.
                ``(D)(i) In addition to awarding the multiyear grants
            described in subparagraph (A), the Secretary may award grants
            to eligible entities for the dissemination of exemplary
            materials or programs assisted under this section.
                ``(ii) The Secretary may award a dissemination grant under
            this subparagraph if, prior to awarding the grant, the
            Secretary determines that the material or program to be
            disseminated has been adequately reviewed and has
            demonstrated--
                        ``(I) educational merit; and
                        ``(II) the ability to be replicated.
                ``(2) Application.--(A) Any eligible entity that desires to
            receive a grant under this section shall submit an application
            to the Secretary at such time and in such manner as the
            Secretary may require.
                ``(B) Each application submitted to the Secretary under
            subparagraph (A), other than an application for a dissemination
            grant under paragraph (1)(D), shall contain--
                        ``(i) a description of how parents of Indian
                    children and representatives of Indian tribes have
                    been, and will be, involved in developing and
                    implementing the activities for which assistance is
                    sought;
                        ``(ii) assurances that the applicant will
                    participate, at the request of the Secretary, in any
                    national evaluation of activities assisted under this
                    section;
                        ``(iii) information demonstrating that the proposed
                    program is either a research-based program (which may
                    be a research-based program that has been modified to
                    be culturally appropriate for the students who will be
                    served);
                        ``(iv) a description of how the applicant will
                    incorporate the proposed services into the ongoing
                    school program once the grant period is over; and
                        ``(v) such other assurances and information as the
                    Secretary may reasonably require.
        ``(e) Administrative Costs.--Not more than 5 percent of the funds
    provided to a grantee under this chapter for any fiscal year may be
    used for administrative purposes.

    ``SEC. 3222. PROFESSIONAL DEVELOPMENT FOR TEACHERS AND EDUCATION
                  PROFESSIONALS.

        ``(a) Purposes.--The purposes of this section are--
                ``(1) to increase the number of qualified Indian
            individuals in teaching or other education professions that
            serve Indian people;
                ``(2) to provide training to qualified Indian individuals
            to enable such individuals to become teachers, administrators,
            teacher aides, social workers, and ancillary educational
            personnel; and
                ``(3) to improve the skills of qualified Indian individuals
            who serve in the capacities described in paragraph (2).
        ``(b) Eligible Entities.--For the purpose of this section, the term
    `eligible entity' means--
                ``(1) an institution of higher education, including an
            Indian institution of higher education;
                ``(2) a State or local educational agency, in consortium
            with an institution of higher education; and
                ``(3) an Indian tribe or organization, in consortium with
            an institution of higher education.
        ``(c) Program Authorized.--The Secretary is authorized to award
    grants to eligible entities having applications approved under this
    section to enable such entities to carry out the activities described
    in subsection (d).
        ``(d) Authorized Activities.--
                ``(1) In general.--Grant funds under this section shall be
            used to provide support and training for Indian individuals in
            a manner consistent with the purposes of this section. Such
            activities may include but are not limited to, continuing
            programs, symposia, workshops, conferences, and direct
            financial support.
                ``(2) Special rules.--(A) For education personnel, the
            training received pursuant to a grant under this section may be
            inservice or preservice training.
                ``(B) For individuals who are being trained to enter any
            field other than teaching, the training received pursuant to a
            grant under this section shall be in a program that results in
            a graduate degree.
        ``(e) Application.--Each eligible entity desiring a grant under
    this section shall submit an application to the Secretary at such time,
    in such manner and accompanied by such information, as the Secretary
    may reasonably require.
        ``(f) Special Rule.--In making grants under this section, the
    Secretary--
                ``(1) shall consider the prior performance of the eligible
            entity; and
                ``(2) may not limit eligibility to receive a grant under
            this section on the basis of--
                        ``(A) the number of previous grants the Secretary
                    has awarded such entity; or
                        ``(B) the length of any period during which such
                    entity received such grants.
        ``(g) Grant Period.--Each grant under this section shall be awarded
    for a period of not more than 5 years.
        ``(h) Service Obligation.--
                ``(1) In general.--The Secretary shall require, by
            regulation, that an individual who receives training pursuant
            to a grant made under this section--
                        ``(A) perform work--
                                ``(i) related to the training received
                            under this section; and
                                ``(ii) that benefits Indian people; or
                        ``(B) repay all or a prorated part of the
                    assistance received.
                ``(2) Reporting.--The Secretary shall establish, by
            regulation, a reporting procedure under which a grant recipient
            under this section shall, not later than 12 months after the
            date of completion of the training, and periodically
            thereafter, provide information concerning the compliance of
            such recipient with the work requirement under paragraph (1).

                   ``CHAPTER 3--NATIONAL RESEARCH ACTIVITIES

    ``SEC. 3231. NATIONAL ACTIVITIES.

        ``(a) Authorized Activities.--The Secretary may use funds made
    available under section 3252(b) for each fiscal year to--
                ``(1) conduct research related to effective approaches for
            the education of Indian children and adults;
                ``(2) evaluate federally assisted education programs from
            which Indian children and adults may benefit;
                ``(3) collect and analyze data on the educational status
            and needs of Indians; and
                ``(4) carry out other activities that are consistent with
            the purpose of this subpart.
        ``(b) Eligibility.--The Secretary may carry out any of the
    activities described in subsection (a) directly or through grants to,
    or contracts or cooperative agreements with Indian tribes, Indian
    organizations, State educational agencies, local educational agencies,
    institutions of higher education, including Indian institutions of
    higher education, and other public and private agencies and
    institutions.
        ``(c) Coordination.--Research activities supported under this
    section--
                ``(1) shall be carried out in consultation with the Office
            of Educational Research and Improvement to assure that such
            activities are coordinated with and enhance the research and
            development activities supported by the Office; and
                ``(2) may include collaborative research activities which
            are jointly funded and carried out by the Office of Indian
            Education Programs and the Office of Educational Research and
            Improvement.

                      ``CHAPTER 4--FEDERAL ADMINISTRATION

    ``SEC. 3241. NATIONAL ADVISORY COUNCIL ON INDIAN EDUCATION.

        ``(a) Membership.--There is established a National Advisory Council
    on Indian Education (hereafter in this section referred to as the
    `Council'), which shall--
                ``(1) consist of 15 Indian members, who shall be appointed
            by the President from lists of nominees furnished, from time-
            to-time, by Indian tribes and organizations; and
                ``(2) represent different geographic areas of the United
            States.
        ``(b) Duties.--The Council shall--
                ``(1) advise the Secretary concerning the funding and
            administration (including the development of regulations and
            administrative policies and practices) of any program,
            including any program established under this subpart--
                        ``(A) with respect to which the Secretary has
                    jurisdiction; and
                        ``(B)(i) that includes Indian children or adults as
                    participants; or
                        ``(ii) that may benefit Indian children or adults;
                ``(2) make recommendations to the Secretary for filling the
            position of Director of Indian Education whenever a vacancy
            occurs; and
                ``(3) submit to the Congress, not later than June 30 of
            each year, a report on the activities of the Council,
            including--
                        ``(A) any recommendations that the Council
                    considers appropriate for the improvement of Federal
                    education programs that include Indian children or
                    adults as participants, or that may benefit Indian
                    children or adults; and
                        ``(B) recommendations concerning the funding of any
                    program described in subparagraph (A).

    ``SEC. 3242. PEER REVIEW.

        ``The Secretary may use a peer review process to review
    applications submitted to the Secretary under chapter 2 or 3.

    ``SEC. 3243. PREFERENCE FOR INDIAN APPLICANTS.

        ``In making grants under chapter 2 or 3, the Secretary shall give a
    preference to Indian tribes, organizations, and institutions of higher
    education under any program with respect to which Indian tribes,
    organizations, and institutions are eligible to apply for grants.

    ``SEC. 3244. MINIMUM GRANT CRITERIA.

        ``The Secretary may not approve an application for a grant under
    subpart 2 unless the application is for a grant that is--
                ``(1) of sufficient size, scope, and quality to achieve the
            purpose or objectives of such grant; and
                ``(2) based on relevant research findings.

           ``CHAPTER 5--DEFINITIONS; AUTHORIZATIONS OF APPROPRIATIONS

    ``SEC. 3251. DEFINITIONS.

        ``For the purposes of this subpart:
                ``(1) Adult.--The term `adult' means an individual who--
                        ``(A) has attained the age of 16 years; or
                        ``(B) has attained an age that is greater than the
                    age of compulsory school attendance under an applicable
                    State law.
                ``(2) Free public education.--The term `free public
            education' means education that is--
                        ``(A) provided at public expense, under public
                    supervision and direction, and without tuition charge;
                    and
                        ``(B) provided as elementary or secondary education
                    in the applicable State or to preschool children.
                ``(3) Indian.--The term `Indian' means an individual who
            is--
                        ``(A) a member of an Indian tribe or band, as
                    membership is defined by the tribe or band, including--
                                ``(i) any tribe or band terminated since
                            1940; and
                                ``(ii) any tribe or band recognized by the
                            State in which the tribe or band resides;
                        ``(B) a descendant, in the first or second degree,
                    of an individual described in subparagraph (A);
                        ``(C) considered by the Secretary of the Interior
                    to be an Indian for any purpose;
                        ``(D) an Eskimo, Aleut, or other Alaska Native; or
                        ``(E) a member of an organized Indian group that
                    received a grant under the Indian Education Act of 1988
                    as it was in effect the day preceding the date of the
                    enactment of the Improving America's Schools Act of
                    1994.

    ``SEC. 3252. AUTHORIZATIONS OF APPROPRIATIONS.

        ``(a) Chapter 1.--For the purpose of carrying out chapter 1 of this
    subpart, there are authorized to be appropriated $100,000,000 for
    fiscal year 2002, and such sums as may be necessary for each of fiscal
    years 2003 through 2006.
        ``(b) Chapters 2 and 3.--For the purpose of carrying out chapters 2
    and 3 of this subpart, there are authorized to be appropriated
    $25,000,000 for fiscal year 2002, and such sums as may be necessary for
    each of the fiscal years 2003 through 2006.''.
        (b) Savings Provision.--Funds appropriated for part A of title IX
    of the Elementary and Secondary Education Act of 1965 (as in effect on
    the day before the date of the enactment of this Act) shall be
    available for use under subpart 1 of part B of title III of such Act,
    as added by this section.

    SEC. 312. ALASKA NATIVE EDUCATION.

        (a) In General.--Part B of title III (as added by section 311 of
    this Act) is further amended by adding at the end the following new
    subpart:

                      ``Subpart 2--Alaska Native Education

    ``SEC. 3301. SHORT TITLE.

        ``This subpart may be cited as the `Alaska Native Educational
    Equity, Support, and Assistance Act'.

    ``SEC. 3302. FINDINGS.

        ``The Congress finds and declares:
                ``(1) The attainment of educational success is critical to
            the betterment of the conditions, long-term well-being and
            preservation of the culture of Alaska Natives.
                ``(2) It is the policy of the Federal Government to
            encourage the maximum participation by Alaska Natives in the
            planning and the management of Alaska Native education
            programs.
                ``(3) Alaska Native children enter and exit school with
            serious educational handicaps.
                ``(4) The educational achievement of Alaska Native children
            is far below national norms. In addition to low Native
            performance on standardized tests, Native student dropout rates
            are high, and Natives are significantly underrepresented among
            holders of baccalaureate degrees in the State of Alaska. As a
            result, Native students are being denied their opportunity to
            become full participants in society by grade school and high
            school educations that are condemning an entire generation to
            an underclass status and a life of limited choices.
                ``(5) The programs authorized herein, combined with
            expanded Head Start, infant learning and early childhood
            education programs, and parent education programs are essential
            if educational handicaps are to be overcome.
                ``(6) The sheer magnitude of the geographic barriers to be
            overcome in delivering educational services in rural and
            village Alaska should be addressed through the development and
            implementation of innovative, model programs in a variety of
            areas.
                ``(7) Congress finds that Native children should be
            afforded the opportunity to begin their formal education on a
            par with their non-Native peers. The Federal Government should
            lend support to efforts developed by and undertaken within the
            Alaska Native community to improve educational opportunity for
            all students.

    ``SEC. 3303. PURPOSE.

        ``It is the purpose of this subpart to--
                ``(1) recognize the unique educational needs of Alaska
            Natives;
                ``(2) authorize the development of supplemental educational
            programs to benefit Alaska Natives;
                ``(3) supplement existing programs and authorities in the
            area of education to further the purposes of this subpart; and
                ``(4) provide direction and guidance to appropriate
            Federal, State and local agencies to focus resources, including
            resources made available under this subpart, on meeting the
            educational needs of Alaska Natives.

    ``SEC. 3304. PROGRAM AUTHORIZED.

        ``(a) General Authority.--
                ``(1) Program authorized.--The Secretary is authorized to
            make grants to, or enter into contracts with, Alaska Native
            organizations, educational entities with experience in
            developing or operating Alaska Native programs or programs of
            instruction conducted in Alaska Native languages, and consortia
            of such organizations and entities to carry out programs that
            meet the purpose of this subpart.
                ``(2) Permissible activities.--Programs under this subpart
            may include--
                        ``(A) the development and implementation of plans,
                    methods, and strategies to improve the education of
                    Alaska Natives;
                        ``(B) the development of curricula and educational
                    programs that address the educational needs of Alaska
                    Native students, including--
                                ``(i) curriculum materials that reflect the
                            cultural diversity or the contributions of
                            Alaska Natives;
                                ``(ii) instructional programs that make use
                            of Native Alaskan languages; and
                                ``(iii) networks that introduce successful
                            programs, materials, and techniques to urban
                            and rural schools;
                        ``(C) professional development activities for
                    educators, including--
                                ``(i) programs to prepare teachers to
                            address the cultural diversity and unique needs
                            of Alaska Native students;
                                ``(ii) in-service programs to improve the
                            ability of teachers to meet the unique needs of
                            Alaska Native students; and
                                ``(iii) recruiting and preparing teachers
                            who are Alaska Natives, reside in communities
                            with high concentrations of Alaska Native
                            students, or are likely to succeed as teachers
                            in isolated, rural communities and engage in
                            cross-cultural instruction;
                        ``(D) the development and operation of home
                    instruction programs for Alaska Native preschool
                    children, the purpose of which is to ensure the active
                    involvement of parents in their children's education
                    from the earliest ages;
                        ``(E) family literacy services;
                        ``(F) the development and operation of student
                    enrichment programs in science and mathematics that--
                                ``(i) are designed to prepare Alaska Native
                            students from rural areas, who are preparing to
                            enter high school, to excel in science and
                            math; and
                                ``(ii) provide appropriate support services
                            to the families of such students that are
                            needed to enable such students to benefit from
                            the program;
                        ``(G) research and data collection activities to
                    determine the educational status and needs of Alaska
                    Native children and adults;
                        ``(H) other research and evaluation activities
                    related to programs under this subpart; and
                        ``(I) other activities, consistent with the
                    purposes of this subpart, to meet the educational needs
                    of Alaska Native children and adults.
                ``(3) Home instruction programs.--Home instruction programs
            for Alaska Native preschool children under paragraph (2)(D) may
            include--
                        ``(A) programs for parents and their infants, from
                    prenatal through age three;
                        ``(B) preschool programs; and
                        ``(C) training, education, and support for parents
                    in such areas as reading readiness, observation, story-
                    telling, and critical thinking.
        ``(b) Limitation on Administrative Costs.--Not more than 5 percent
    of funds provided to a grantee under this section for any fiscal year
    may be used for administrative purposes.
        ``(c) Authorization of Appropriations.--There are authorized to be
    appropriated $15,000,000 for fiscal year 2002, and such sums as may be
    necessary for each of the fiscal years 2003 through 2006 to carry out
    this subpart.

    ``SEC. 3305. ADMINISTRATIVE PROVISIONS.

        ``(a) Application Required.--No grant may be made under this
    subpart, nor any contract be entered into under this subpart, unless an
    application is submitted to the Secretary in such form, in such manner,
    and containing such information as the Secretary may determine
    necessary to carry out the provisions of this subpart.
        ``(b) Applications.--State and local educational agencies may apply
    for an award under this subpart only as subpart of a consortium
    involving an Alaska Native organization. This consortium may include
    other eligible applicants.
        ``(c) Consultation Required.--Each applicant for funding shall
    provide for ongoing advice from and consultation with representatives
    of the Alaska Native community.
        ``(d) Local Educational Agency Coordination.--Each applicant for an
    award under this subpart shall inform each local educational agency
    serving students who would participate in the project about its
    application.

    ``SEC. 3306. DEFINITIONS.

        ``For purposes of this subpart--
                ``(1) the term `Alaska Native' has the same meaning as the
            term `Native' has in section 3(b) of the Alaska Native Claims
            Settlement Act; and
                ``(2) the term `Alaska Native organization' means a
            federally recognized tribe, consortium of tribes, regional
            nonprofit Native association, and other Alaska Native
            organizations that--
                        ``(A) has or commits to acquire expertise in the
                    education of Alaska Natives; and
                        ``(B) has Alaska Natives in substantive and policy-
                    making positions within the organization.''.
        (b) Savings Provision.--Funds appropriated for part C of title IX
    of the Elementary and Secondary Education Act of 1965 (as in effect on
    the day before the date of the enactment of this Act) shall be
    available for use under subpart 2 of part B of title III of such Act,
    as added by this section.

    SEC. 313. AMENDMENTS TO THE EDUCATION AMENDMENTS OF 1978.

        Part B of title XI of the Education Amendments of 1978 (25 U.S.C.
    2001 et seq.) is amended to read as follows:

                  ``PART B--BUREAU OF INDIAN AFFAIRS PROGRAMS

    ``SEC. 1120. FINDING AND POLICY.

        ``(a) Finding.--Congress finds and recognizes that the Federal
    Government has the sole responsibility for the operation and financial
    support of the Bureau of Indian Affairs funded school system that it
    has established on or near Indian reservations and Indian trust lands
    throughout the Nation for Indian children.
        ``(b) Policy.--It is the policy of the United States to work in
    full cooperation with Indian tribes toward the goal of assuring that
    the programs of the Bureau of Indian Affairs funded school system are
    of the highest quality and meet the unique educational and cultural
    needs of Indian children.

    ``SEC. 1121. ACCREDITATION AND STANDARDS FOR THE BASIC EDUCATION OF
                  INDIAN CHILDREN IN BUREAU OF INDIAN AFFAIRS SCHOOLS.

        ``(a) Purpose.--The purpose of the standards implemented under this
    section shall be to afford Indian students being served by a school
    funded by the Bureau of Indian Affairs the same opportunities as all
    other students in the United States to achieve the same challenging
    State academic achievement standards expected of all students.
        ``(b) Studies and Surveys Relating to Standards.--Not later than 1
    year after the date of the enactment of the No Child Left Behind Act of
    2001, the Secretary, in consultation with the Secretary of Education,
    consortia of education organizations, and Indian organizations and
    tribes, and making the fullest use possible of other existing studies,
    surveys, and plans, shall carry out by contract with an Indian
    organization, studies and surveys to establish and revise standards for
    the basic education of Indian children attending Bureau funded schools.
    Such studies and surveys shall take into account factors such as
    academic needs, local cultural differences, type and level of language
    skills, geographic isolation, and appropriate teacher-student ratios
    for such children, and shall be directed toward the attainment of equal
    educational opportunity for such children.
        ``(c) Revision of Minimum Academic Standards.--
                ``(1) In general.--Not later than 2 years after the date of
            the enactment of the No Child Left Behind Act of 2001, the
            Secretary shall--
                        ``(A) propose revisions to the minimum academic
                    standards published in the Federal Register on
                    September 9, 1995 (50 Fed. Reg. 174) for the basic
                    education of Indian children attending Bureau funded
                    schools in accordance with the purpose described in
                    subsection (a) and the findings of the studies and
                    surveys conducted under subsection (b);
                        ``(B) publish such proposed revisions to such
                    standards in the Federal Register for the purpose of
                    receiving comments from the tribes, tribal school
                    boards, Bureau funded schools, and other interested
                    parties; and
                        ``(C) consistent with the provisions of this
                    section and section 1131, take such actions as are
                    necessary to coordinate standards implemented under
                    this section with the Comprehensive School Reform Plan
                    developed by the Bureau and--
                                ``(i) with the standards of the improvement
                            plans for the States in which any school
                            operated by the Bureau of Indian Affairs is
                            located; or
                                ``(ii) in the case where schools operated
                            by the Bureau are within the boundaries of
                            reservation land of one tribe but within the
                            boundaries of more than one State, with the
                            standards of the State improvement plan of one
                            such State selected by the tribe.
                ``(2) Further revisions.--Not later that 6 months after the
            close of the comment period, the Secretary shall establish
            final standards, distribute such standards to all tribes and
            publish such final standards in the Federal Register. The
            Secretary shall revise such standards periodically as
            necessary. Prior to any revision of such final standards, the
            Secretary shall distribute such proposed revision to all the
            tribes, and publish such proposed revision in the Federal
            Register, for the purpose of receiving comments from the tribes
            and other interested parties.
                ``(3) Applicability of standards.--Except as provided in
            subsection (e), the final standards published under paragraph
            (2) shall apply to all Bureau funded schools not accredited
            under subsection (f), and may also serve as a model for
            educational programs for Indian children in public schools.
                ``(4) Considerations when establishing and revising
            standards.--In establishing and revising such standards, the
            Secretary shall take into account the unique needs of Indian
            students and support and reinforcement of the specific cultural
            heritage of each tribe.
        ``(d) Alternative or Modified Standards.--The Secretary shall
    provide alternative or modified standards in lieu of the standards
    established under subsection (c), where necessary, so that the programs
    of each school are in compliance with the minimum accreditation
    standards required for schools in the State or region where the school
    is located.
        ``(e) Waiver of Standards; Alternative Standards.--A tribal
    governing body, or the local school board so designated by the tribal
    governing body, shall have the local authority to waive, in part or in
    whole, the standards established under subsections (c) and (d) if such
    standards are deemed by such body to be inappropriate. The tribal
    governing body or designated school board shall, not later than 60 days
    after a waiver under this subsection, submit to the Secretary a
    proposal for alternative standards that take into account the specific
    needs of the tribe's children. Such alternative standards shall be
    established by the Secretary unless specifically rejected by the
    Secretary for good cause and in writing to the affected tribes or local
    school board, which rejection shall be final and not subject to review.
        ``(f) Accreditation and Implementation of Standards.--
                ``(1) Deadline for meeting standards.--Not later the second
            academic year after publication of the standards, to the extent
            necessary funding is provided, all Bureau funded schools shall
            meet the standards established under subsections (c) and (d) or
            shall be accredited--
                        ``(A) by a tribal accrediting body, if the
                    accreditation standards of the tribal accrediting body
                    have been accepted by formal action of the tribal
                    governing body and are equal to or exceed the
                    accreditation standards of the State or region in which
                    the school is located;
                        ``(B) by a regional accreditation agency; or
                        ``(C) by State accreditation standards for the
                    State in which it is located.
                ``(2) Determination of standards to be applied.--The
            accreditation type or standards applied for each school shall
            be determined by the school board of the school, in
            consultation with the Administrator of the school, provided
            that in the case where the School Board and the Administrator
            fail to agree on the type of accreditation and standards to
            apply, the decision of the school board with the approval of
            the tribal governing body shall be final.
                ``(3) Assistance to school boards.--The Secretary, through
            contracts and grants, shall assist school boards of contract or
            grant schools in implementation of the standards established
            under subsections (c) and (d), if the school boards request
            that such standards, in part or in whole, be implemented.
                ``(4) Fiscal control and fund accounting standards.--The
            Bureau shall, either directly or through contract with an
            Indian organization, establish a consistent system of reporting
            standards for fiscal control and fund accounting for all
            contract and grant schools. Such standards shall provide data
            comparable to those used by Bureau operated schools.
        ``(g) Annual Plan for Meeting of Standards.--Except as provided in
    subsections (e) and (f), the Secretary shall begin to implement the
    standards established under this section immediately upon the date of
    their establishment. On an annual basis, the Secretary shall submit to
    the appropriate committees of Congress, all Bureau funded schools, and
    the tribal governing bodies of such schools a detailed plan to bring
    all Bureau schools and contract or grant schools up to the level
    required by the applicable standards established under this section.
    Such plan shall include detailed information on the status of each
    school's educational program in relation to the applicable standards
    established under this section, specific cost estimates for meeting
    such standards at each school and specific timelines for bringing each
    school up to the level required by such standards.
        ``(h) Closure or Consolidation of Schools.--
                ``(1) In general.--Except as specifically required by
            statute, no school or peripheral dormitory operated by the
            Bureau on or after January 1, 1992, may be closed or
            consolidated or have its program substantially curtailed unless
            done according to the requirements of this subsection.
                ``(2) Exceptions.--This subsection shall not apply--
                        ``(A) in those cases where the tribal governing
                    body, or the local school board concerned (if so
                    designated by the tribal governing body), requests
                    closure or consolidation; or
                        ``(B) when a temporary closure, consolidation, or
                    substantial curtailment is required by plant conditions
                    which constitute an immediate hazard to health and
                    safety.
                ``(3) Regulations.--The Secretary shall, by regulation,
            promulgate standards and procedures for the closure, transfer
            to another authority, consolidation, or substantial curtailment
            of Bureau schools, in accordance with the requirements of this
            subsection.
                ``(4) Notice.--Whenever closure, transfer to another
            authority, consolidation, or substantial curtailment of a
            school is under active consideration or review by any division
            of the Bureau or the Department of the Interior, the affected
            tribe, tribal governing body, and designated local school
            board, will be notified immediately, kept fully and currently
            informed, and afforded an opportunity to comment with respect
            to such consideration or review. When a formal decision is made
            to close, transfer to another authority, consolidate, or
            substantially curtail a school, the affected tribe, tribal
            governing body, and designated school board shall be notified
            at least 6 months prior to the end of the school year preceding
            the proposed closure date. Copies of any such notices and
            information shall be transmitted promptly to the appropriate
            committees of Congress and published in the Federal Register.
                ``(5) Report.--The Secretary shall make a report to the
            appropriate committees of Congress, the affected tribe, and the
            designated school board describing the process of the active
            consideration or review referred to in paragraph (4). The
            report shall include a study of the impact of such action on
            the student population, identify those students with particular
            educational and social needs, and ensure that alternative
            services are available to such students. Such report shall
            include the description of the consultation conducted between
            the potential service provider, current service provider,
            parents, tribal representatives and the tribe or tribes
            involved, and the Director of the Office of Indian Education
            Programs within the Bureau regarding such students.
                ``(6) Limitation on certain actions.--No irrevocable action
            may be taken in furtherance of any such proposed school
            closure, transfer to another authority, consolidation, or
            substantial curtailment (including any action which would
            prejudice the personnel or programs of such school) prior to
            the end of the first full academic year after such report is
            made.
                ``(7) Tribal governing body approval required for certain
            actions.--The Secretary may terminate, contract, transfer to
            any other authority, consolidate, or substantially curtail the
            operation or facilities of--
                        ``(A) any Bureau funded school that is operated on
                    or after of January 1, 1999;
                        ``(B) any program of such a school that is operated
                    on or after January 1, 1999; or
                        ``(C) any school board of a school operated under a
                    grant under the Tribally Controlled Schools Act of
                    1988,
            only if the tribal governing body approves such action.
        ``(i) Application for Contracts or Grants for Non-Bureau Funded
    Schools or Expansion of Bureau Funded Schools.--
                ``(1) In general.--(A)(i) The Secretary shall only consider
            the factors described in subparagraph (B) in reviewing--
                        ``(I) applications from any tribe for the awarding
                    of a contract or grant for a school that is not a
                    Bureau funded school; and
                        ``(II) applications from any tribe or school board
                    of any Bureau funded school for--
                                ``(aa) a school which is not a Bureau
                            funded school; or
                                ``(bb) the expansion of a Bureau funded
                            school which would increase the amount of funds
                            received by the Indian tribe or school board
                            under section 1127.
                ``(ii) With respect to applications described in this
            subparagraph, the Secretary shall give consideration to all the
            factors described in subparagraph (B), but no such application
            shall be denied based primarily upon the geographic proximity
            of comparable public education.
                ``(B) With respect to applications described in
            subparagraph (A) the Secretary shall consider the following
            factors relating to the program and services that are the
            subject of the application:
                        ``(i) The adequacy of the facilities or the
                    potential to obtain or provide adequate facilities.
                        ``(ii) Geographic and demographic factors in the
                    affected areas.
                        ``(iii) The adequacy of the applicant's program
                    plans or, in the case of a Bureau funded school, of
                    projected needs analysis done either by the tribe or
                    the Bureau.
                        ``(iv) Geographic proximity of comparable public
                    education.
                        ``(v) The stated needs of all affected parties,
                    including students, families, tribal governments at
                    both the central and local levels, and school
                    organizations.
                        ``(vi) Adequacy and comparability of programs
                    already available.
                        ``(vii) Consistency of available programs with
                    tribal educational codes or tribal legislation on
                    education.
                        ``(viii) The history and success of these services
                    for the proposed population to be served, as determined
                    from all factors, including but not limited to
                    standardized examination performance.
                ``(2) Determination on application.--(A) The Secretary
            shall make a determination of whether to approve any
            application described in paragraph (1)(A) not later than 180
            days after such application is submitted to the Secretary.
                ``(B) If the Secretary fails to make the determination with
            respect to an application by the date described in subparagraph
            (A), the application shall be treated a having been approved by
            the Secretary.
                ``(3) Requirements for applications.--(A) Notwithstanding
            paragraph (2)(B), an application described in paragraph (1)(A)
            may be approved by the Secretary only if--
                        ``(i) the application has been approved by the
                    tribal governing body of the students served by (or to
                    be served by) the school or program that is the subject
                    of the application; and
                        ``(ii) written evidence of such approval is
                    submitted with the application.
                ``(B) Each application described in paragraph (1)(A) shall
            provide information concerning each of the factors described in
            paragraph (1)(B).
                ``(4) Denial of applications.--Whenever the Secretary makes
            a determination to deny approval of any application described
            in paragraph (1)(A), the Secretary shall--
                        ``(A) state the objections in writing to the
                    applicant not later 180 days after the application is
                    submitted to the Secretary;
                        ``(B) provide assistance to the applicant to
                    overcome stated objections; and
                        ``(C) provide the applicant a hearing, under the
                    same rules and regulations pertaining to the Indian
                    Self-Determination and Education Assistance Act and an
                    opportunity to appeal the objections raised by the
                    Secretary.
                ``(5) Effective date of a subject application.--(A) Except
            as otherwise provided in this paragraph, the action which is
            the subject of any application described in paragraph (1)(A)
            that is approved by the Secretary shall become effective at the
            beginning of the academic year following the fiscal year in
            which the application is approved, or at an earlier date
            determined by the Secretary.
                ``(B) If an application is treated as having been approved
            by the Secretary under paragraph (2)(B), the action that is the
            subject of the application shall become effective on the date
            that is 18 months after the date on which the application is
            submitted to the Secretary, or at an earlier date determined by
            the Secretary.
                ``(6) Statutory construction.--Nothing in this section
            shall be read so as to preclude the expansion of grades and
            related facilities at a Bureau funded school where such
            expansion and the maintenance of such expansion is occasioned
            or paid for with non-Bureau funds.
        ``(j) General Use of Funds.--Funds received by Bureau funded
    schools from the Bureau of Indian Affairs and under any program from
    the Department of Education or any other Federal agency for the purpose
    of providing education or related services may be used for schoolwide
    projects to improve the educational program for all Indian students.
        ``(k) Study on Adequacy of Funds and Formulas.--The Comptroller
    General shall conduct a study, in consultation with Indian tribes and
    local school boards, to determine the adequacy of funding, and formulas
    used by the Bureau to determine funding, for programs operated by
    Bureau funded schools, taking into account unique circumstances
    applicable to Bureau funded schools, as well as expenditures for
    comparable purposes in public schools nationally. Upon completion of
    the study, the Secretary of the Interior shall take such action as
    necessary to ensure distribution of the findings of the study to all
    affected Indian tribes, local school boards, and associations of local
    school boards.

    ``SEC. 1122. NATIONAL CRITERIA FOR HOME-LIVING SITUATIONS.

        ``(a) In General.--The Secretary, in consultation with the
    Secretary of Education, Indian organizations and tribes, and Bureau
    funded schools, shall revise the national standards for home-living
    (dormitory) situations to include such factors as heating, lighting,
    cooling, adult-child ratios, needs for counselors (including special
    needs related to off-reservation home-living (dormitory) situations),
    therapeutic programs, space, and privacy. Such standards shall be
    implemented in Bureau operated schools, and shall serve as minimum
    standards for contract or grant schools. Once established, any
    revisions of such standards shall be developed according to the
    requirements established under section 1138A.
        ``(b) Implementation.--The Secretary shall implement the revised
    standards established under this section immediately upon their
    completion.
        ``(c) Plan.--At the time of each annual budget submission for
    Bureau educational services is presented, the Secretary shall submit to
    the appropriate committees of Congress, the tribes, and the affected
    schools, and publish in the Federal Register, a detailed plan to bring
    all Bureau funded schools that provide home-living (dormitory)
    situations up to the standards established under this section. Such
    plan shall include a statement of the relative needs of each Bureau
    funded home-living (dormitory) school, projected future needs of each
    Bureau funded home-living (dormitory) school, detailed information on
    the status of each school in relation to the standards established
    under this section, specific cost estimates for meeting each standard
    for each such school, aggregate cost estimates for bringing all such
    schools into compliance with the criteria established under this
    section, and specific timelines for bringing each school into
    compliance with such standards.
        ``(d) Waiver.--The criteria established under this section may be
    waived in the same manner as the standards provided under section
    1121(c) may be waived.
        ``(e) Closure for Failure To Meet Standards Prohibited.--No school
    in operation on or before January 1, 1987 (regardless of compliance or
    noncompliance with the criteria established under this section), may be
    closed, transferred to another authority, consolidated, or have its
    program substantially curtailed for failure to meet the criteria.

    ``SEC. 1123. CODIFICATION OF REGULATIONS.

        ``(a) Part 32 of Title 25 of Code of Federal Regulations.--The
    provisions of part 32 of title 25 of the Code of Federal Regulations,
    as in effect on January 1, 1987, are incorporated into this Act and
    shall be treated as though such provisions are set forth in this
    subsection. Such provisions may be altered only by means of an Act of
    Congress. To the extent that such provisions of part 32 do not conform
    with this Act or any statutory provision of law enacted before November
    1, 1978, the provisions of this Act and the provisions of such other
    statutory law shall govern.
        ``(b) Regulation Defined.--For purposes of this part, the term
    `regulation' means any rules, regulations, guidelines, interpretations,
    orders, or requirements of general applicability prescribed by any
    officer or employee of the executive branch.

    ``SEC. 1124. SCHOOL BOUNDARIES.

        ``(a) Establishment by Secretary.--The Secretary shall establish,
    by regulation, separate geographical attendance areas for each Bureau
    funded school.
        ``(b) Establishment by Tribal Body.--In any case where there is
    more than one Bureau funded school located on an Indian reservation, at
    the direction of the tribal governing body, the relevant school boards
    of the Bureau funded schools on the reservation may, by mutual consent,
    establish the relevant attendance areas for such schools, subject to
    the approval of the tribal governing body. Any such boundaries so
    established shall be accepted by the Secretary.
        ``(c) Boundary Revisions.--
                ``(1) In general.--On or after July 1, 2001, no
            geographical attendance area shall be revised or established
            with respect to any Bureau funded school unless the tribal
            governing body or the local school board concerned (if so
            designated by the tribal governing body) has been afforded--
                        ``(A) at least 6 months notice of the intention of
                    the Bureau to revise or establish such attendance area;
                    and
                        ``(B) the opportunity to propose alternative
                    boundaries.
            Any tribe may petition the Secretary for revision of existing
            attendance area boundaries. The Secretary shall accept such
            proposed alternative or revised boundaries unless the Secretary
            finds, after consultation with the affected tribe or tribes,
            that such revised boundaries do not reflect the needs of the
            Indian students to be served or do not provide adequate
            stability to all of the affected programs. The Secretary shall
            cause such revisions to be published in the Federal Register.
                ``(2) Tribal resolution determination.--Nothing in this
            section shall be interpreted as denying a tribal governing body
            the authority, on a continuing basis, to adopt a tribal
            resolution allowing parents the choice of the Bureau funded
            school their children may attend, regardless of the attendance
            boundaries established under this section.
        ``(d) Funding Restrictions.--The Secretary shall not deny funding
    to a Bureau funded school for any eligible Indian student attending the
    school solely because that student's home or domicile is outside of the
    geographical attendance area established for that school under this
    section. No funding shall be made available without tribal
    authorization to enable a school to provide transportation for any
    student to or from the school and a location outside the approved
    attendance area of the school.
        ``(e) Reservation as Boundary.--In any case where there is only one
    Bureau funded program located on an Indian reservation, the attendance
    area for the program shall be the boundaries (established by treaty,
    agreement, legislation, court decisions, or executive decisions and as
    accepted by the tribe) of the reservation served, and those students
    residing near the reservation shall also receive services from such
    program.
        ``(f) Off-Reservation Home-Living (Dormitory) Schools.--
    Notwithstanding any geographical attendance areas, attendance at off-
    reservation home-living (dormitory) schools shall include students
    requiring special emphasis programs to be implemented at each off-
    reservation home-living (dormitory) school. Such attendance shall be
    coordinated between education line officers, the family, and the
    referring and receiving programs.

    ``SEC. 1125. FACILITIES CONSTRUCTION.

        ``(a) Compliance With Health and Safety Standards.--The Secretary
    shall immediately begin to bring all schools, dormitories, and other
    Indian education-related facilities operated by the Bureau or under
    contract or grant with the Bureau into compliance with all applicable
    tribal, Federal, or State health and safety standards, whichever
    provides greater protection (except that the tribal standards to be
    applied shall be no greater than any otherwise applicable Federal or
    State standards), with section 504 of the Rehabilitation Act of 1973,
    and with the Americans with Disabilities Act of 1990. Nothing in this
    section shall require termination of the operations of any facility
    which does not comply with such provisions and which is in use on the
    date of the enactment of the No Child Left Behind Act of 2001.
        ``(b) Compliance Plan.--At the time that the annual budget request
    for Bureau educational services is presented, the Secretary shall
    submit to the appropriate committees of Congress a detailed plan to
    bring all facilities covered under subsection (a) of this section into
    compliance with the standards referred to in subsection (a). Such plan
    shall include detailed information on the status of each facility's
    compliance with such standards, specific cost estimates for meeting
    such standards at each school, and specific timelines for bringing each
    school into compliance with such standards.
        ``(c) Construction Priorities.--
                ``(1) System to establish priorities.--On an annual basis
            the Secretary shall submit to the appropriate committees of
            Congress and cause to be published in the Federal Register, the
            system used to establish priorities for replacement and
            construction projects for Bureau funded schools and home-living
            schools, including boarding schools and dormitories. At the
            time any budget request for education is presented, the
            Secretary shall publish in the Federal Register and submit with
            the budget request the current list of all Bureau funded school
            construction priorities.
                ``(2) Long-term construction and replacement list.--In
            addition to the plan submitted under subsection (b), the
            Secretary shall--
                        ``(A) not later than 18 months after the date of
                    the enactment of the No Child Left Behind Act of 2001,
                    establish a long-term construction and replacement list
                    for all Bureau funded schools;
                        ``(B) using the list prepared under subparagraph
                    (A), propose a list for the orderly replacement of all
                    Bureau funded education-related facilities over a
                    period of 40 years to enable planning and scheduling of
                    budget requests;
                        ``(C) cause the list prepared under subsection (B)
                    to be published in the Federal Register and allow a
                    period of not less than 120 days for public comment;
                        ``(D) make such revisions to the list prepared
                    under subparagraph (B) as are appropriate based on the
                    comments received; and
                        ``(E) cause the final list to be published in the
                    Federal Register.
                ``(3) Effect on other list.--Nothing in this section shall
            be construed as interfering with or changing in any way the
            construction priority list as it exists on the date of the
            enactment of the No Child Left Behind Act of 2001.
        ``(d) Hazardous Condition at Bureau School.--
                ``(1) Closure or consolidation.--A Bureau funded school may
            be closed or consolidated, and the programs of a Bureau funded
            school may be substantially curtailed by reason of plant
            conditions that constitute an immediate hazard to health and
            safety only if a health and safety officer of the Bureau
            determines that such conditions exist at the Bureau funded
            school.
                ``(2) Inspection.--(A) After making a determination
            described in paragraph (1), the Bureau health and safety
            officer shall conduct an inspection of the condition of such
            plant accompanied by an appropriate tribal, county, municipal,
            or State health and safety officer in order to determine
            whether conditions at such plant constitute an immediate hazard
            to health and safety. Such inspection shall be completed by not
            later than the date that is 30 days after the date on which the
            action described in paragraph (1) is taken. No further negative
            action may be taken unless the findings are concurred in by the
            second, non-Bureau of Indian Affairs inspector.
                ``(B) If the health and safety officer conducting the
            inspection of a plant required under subparagraph (A)
            determines that conditions at the plant do not constitute an
            immediate hazard to health and safety, any consolidation or
            curtailment that was made under paragraph (1) shall immediately
            cease and any school closed by reason of conditions at the
            plant shall be reopened immediately.
                ``(C) If a Bureau funded school is temporarily closed or
            consolidated or the programs of a Bureau funded school are
            substantially curtailed under this subsection and the Secretary
            determines that the closure, consolidation, or curtailment will
            exceed 1 year, the Secretary shall submit to the Congress, by
            not later than 6 months after the date on which the closure,
            consolidation, or curtailment was initiated, a report which
            sets forth the reasons for such temporary actions, the actions
            the Secretary is taking to eliminate the conditions that
            constitute the hazard, and an estimated date by which such
            actions will be concluded.
        ``(e) Funding Requirement.--
                ``(1) Distribution of funds.--Beginning with the fiscal
            year following the year of the date of the enactment of the No
            Child Left Behind Act of 2001, all funds appropriated for the
            operations and maintenance of Bureau funded schools shall be
            distributed by formula to the schools. No funds from this
            account may be retained or segregated by the Bureau to pay for
            administrative or other costs of any facilities branch or
            office, at any level of the Bureau.
                ``(2) Requirements for certain uses.--No funds shall be
            withheld from the distribution to the budget of any school
            operated under contract or grant by the Bureau for maintenance
            or any other facilities or road related purpose, unless such
            school has consented, as a modification to the contract or in
            writing for grants schools, to the withholding of such funds,
            including the amount thereof, the purpose for which the funds
            will be used, and the timeline for the services to be provided.
            The school may, at the end of any fiscal year, cancel an
            agreement under this paragraph upon giving the Bureau 30 days
            notice of its intent to do so.
        ``(f) No Reduction in Federal Funding.--Nothing in this section
    shall be construed to diminish any Federal funding due to the receipt
    by the school of funding for facilities improvement or construction
    from a State or any other source.

    ``SEC. 1126. BUREAU OF INDIAN AFFAIRS EDUCATION FUNCTIONS.

        ``(a) Formulation and Establishment of Policy and Procedure;
    Supervision of Programs and Expenditures.--The Secretary shall vest in
    the Assistant Secretary for Indian Affairs all functions with respect
    to formulation and establishment of policy and procedure and
    supervision of programs and expenditures of Federal funds for the
    purpose of Indian education administered by the Bureau. The Assistant
    Secretary shall carry out such functions through the Director of the
    Office of Indian Education Programs.
        ``(b) Direction and Supervision of Personnel Operations.--Not later
    than 6 months after the date of the enactment of the No Child Left
    Behind Act of 2001, the Director of the Office of Indian Education
    Programs shall direct and supervise the operations of all personnel
    directly and substantially involved in the provision of education
    services by the Bureau, including school or institution custodial or
    maintenance personnel, facilities management, contracting, procurement,
    and finance personnel. The Assistant Secretary for Indian Affairs shall
    coordinate the transfer of functions relating to procurement,
    contracts, operation, and maintenance of schools and other support
    functions to the Director.
        ``(c) Evaluation of Programs; Services and Support Functions;
    Technical and Coordinating Assistance.--Education personnel who are
    under the direction and supervision of the Director of the Office of
    Indian Education Programs in accordance with the first sentence of
    subsection (b) shall--
                ``(1) monitor and evaluate Bureau education programs;
                ``(2) provide all services and support functions for
            education programs with respect to personnel matters involving
            staffing actions and functions; and
                ``(3) provide technical and coordinating assistance in
            areas such as procurement, contracting, budgeting, personnel,
            curriculum, and operation and maintenance of school facilities.
        ``(d) Construction, Improvement, Operation, and Maintenance of
    Facilities.--
                ``(1) Plan for construction.--The Assistant Secretary shall
            submit in the annual budget a plan--
                        ``(A) for school facilities to be constructed under
                    section 1125(c);
                        ``(B) for establishing priorities among projects
                    and for the improvement and repair of educational
                    facilities, which together shall form the basis for the
                    distribution of appropriated funds; and
                        ``(C) for capital improvements to be made over the
                    five succeeding years.
                ``(2) Program for operation and maintenance.--
                        ``(A) Establishment.--The Assistant Secretary shall
                    establish a program, including the distribution of
                    appropriated funds, for the operation and maintenance
                    of education facilities. Such program shall include--
                                ``(i) a method of computing the amount
                            necessary for each educational facility;
                                ``(ii) similar treatment of all Bureau
                            funded schools;
                                ``(iii) a notice of an allocation of
                            appropriated funds from the Director of the
                            Office of Indian Education Programs directly to
                            the education line officers and appropriate
                            school officials;
                                ``(iv) a method for determining the need
                            for, and priority of, facilities repair and
                            maintenance projects, both major and minor. In
                            making such determination, the Assistant
                            Secretary shall cause to be conducted a series
                            of meetings at the agency and area level with
                            representatives of the Bureau funded schools in
                            those areas and agencies to receive comment on
                            the lists and prioritization of such projects;
                            and
                                ``(v) a system for the conduct of routine
                            preventive maintenance.
                        ``(B) Local supervisors.--The appropriate education
                    line officers shall make arrangements for the
                    maintenance of education facilities with the local
                    supervisors of the Bureau maintenance personnel. The
                    local supervisors of Bureau maintenance personnel shall
                    take appropriate action to implement the decisions made
                    by the appropriate education line officers, except that
                    no funds under this chapter may be authorized for
                    expenditure unless such appropriate education line
                    officer is assured that the necessary maintenance has
                    been, or will be, provided in a reasonable manner.
                ``(3) Implementation.--The requirements of this subsection
            shall be implemented as soon as practicable after the date of
            the enactment of the No Child Left Behind Act of 2001.
        ``(e) Acceptance of Gifts and Bequests.--Notwithstanding any other
    provision of law, the Director shall promulgate guidelines for the
    establishment of mechanisms for the acceptance of gifts and bequests
    for the use and benefit of particular schools or designated Bureau
    operated education programs, including, where appropriate, the
    establishment and administration of trust funds. When a Bureau operated
    program is the beneficiary of such a gift or bequest, the Director
    shall make provisions for monitoring its use and shall report to the
    appropriate committees of Congress the amount and terms of such gift or
    bequest, the manner in which such gift or bequest shall be used, and
    any results achieved by such action.
        ``(f) Functions Clarified.--For the purpose of this section, the
    term `functions' includes powers and duties.

    ``SEC. 1127. ALLOTMENT FORMULA.

        ``(a) Factors Considered; Revision To Reflect Standards.--
                ``(1) Formula.--The Secretary shall establish, by
            regulation adopted in accordance with section 1138A, a formula
            for determining the minimum annual amount of funds necessary to
            sustain each Bureau funded school. In establishing such
            formula, the Secretary shall consider--
                        ``(A) the number of eligible Indian students served
                    and total student population of the school;
                        ``(B) special cost factors, such as--
                                ``(i) the isolation of the school;
                                ``(ii) the need for special staffing,
                            transportation, or educational programs;
                                ``(iii) food and housing costs;
                                ``(iv) maintenance and repair costs
                            associated with the physical condition of the
                            educational facilities;
                                ``(v) special transportation and other
                            costs of isolated and small schools;
                                ``(vi) the costs of home-living (dormitory)
                            arrangements, where determined necessary by a
                            tribal governing body or designated school
                            board;
                                ``(vii) costs associated with greater
                            lengths of service by education personnel;
                                ``(viii) the costs of therapeutic programs
                            for students requiring such programs; and
                                ``(ix) special costs for gifted and
                            talented students;
                        ``(C) the cost of providing academic services which
                    are at least equivalent to those provided by public
                    schools in the State in which the school is located;
                    and
                        ``(D) such other relevant factors as the Secretary
                    determines are appropriate.
                ``(2) Revision of formula.--Upon the establishment of the
            standards required in sections 1121 and 1122, the Secretary
            shall revise the formula established under this subsection to
            reflect the cost of funding such standards. Not later than
            January 1, 2003, the Secretary shall review the formula
            established under this section and shall take such steps as are
            necessary to increase the availability of counseling and
            therapeutic programs for students in off-reservation home-
            living (dormitory) schools and other Bureau operated
            residential facilities. Concurrent with such action, the
            Secretary shall review the standards established under section
            1122 to be certain that adequate provision is made for parental
            notification regarding, and consent for, such counseling and
            therapeutic programs.
        ``(b) Pro Rata Allotment.--Notwithstanding any other provision of
    law, Federal funds appropriated for the general local operation of
    Bureau funded schools shall be allotted pro rata in accordance with the
    formula established under subsection (a).
        ``(c) Annual Adjustment; Reservation of Amount for School Board
    Activities.--
                ``(1) Annual adjustment.--For fiscal year 2003, and for
            each subsequent fiscal year, the Secretary shall adjust the
            formula established under subsection (a) to ensure that the
            formula does the following:
                        ``(A) Uses a weighted unit of 1.2 for each eligible
                    Indian student enrolled in the seventh and eighth
                    grades of the school in considering the number of
                    eligible Indian students served by the school.
                        ``(B) Considers a school with an enrollment of less
                    than 50 eligible Indian students as having an average
                    daily attendance of 50 eligible Indian students for
                    purposes of implementing the adjustment factor for
                    small schools.
                        ``(C) Takes into account the provision of
                    residential services on less than a 9-month basis at a
                    school when the school board and supervisor of the
                    school determine that a less than 9-month basis will be
                    implemented for the school year involved.
                        ``(D) Uses a weighted unit of 2.0 for each eligible
                    Indian student that--
                                ``(i) is gifted and talented; and
                                ``(ii) is enrolled in the school on a full-
                            time basis,
                    in considering the number of eligible Indian students
                    served by the school.
                        ``(E) Uses a weighted unit of 0.25 for each
                    eligible Indian student who is enrolled in a yearlong
                    credit course in an Indian or Native language as part
                    of the regular curriculum of a school, in considering
                    the number of eligible Indian students served by such
                    school. The adjustment required under this subparagraph
                    shall be used for such school after--
                                ``(i) the certification of the Indian or
                            Native language curriculum by the school board
                            of such school to the Secretary, together with
                            an estimate of the number of full-time students
                            expected to be enrolled in the curriculum in
                            the second school year for which the
                            certification is made; and
                                (ii) the funds appropriated for allotment
                            under this section are designated by the
                            appropriations Act appropriating such funds as
                            the amount necessary to implement such
                            adjustment at such school without reducing
                            allotments made under this section to any
                            school by virtue of such adjustment.
                ``(2) Reservation of amount.--
                        ``(A) In general.--From the funds allotted in
                    accordance with the formula established under
                    subsection (a) for each Bureau school, the local school
                    board of such school may reserve an amount which does
                    not exceed the greater of--
                                ``(i) $8,000; or
                                ``(ii) the lesser of--
                                        ``(I) $15,000; or
                                        ``(II) 1 percent of such allotted
                                    funds,
                    for school board activities for such school, including
                    (notwithstanding any other provision of law) meeting
                    expenses and the cost of membership in, and support of,
                    organizations engaged in activities on behalf of Indian
                    education.
                        ``(B) Training.--Each school board shall see that
                    each new member of the school board receives, within 12
                    months of the individual's assuming a position on the
                    school board, 40 hours of training relevant to that
                    individual's service on the board. Such training may
                    include legal issues pertaining to schools funded by
                    the Bureau, legal issues pertaining to school boards,
                    ethics, and other topics deemed appropriate by the
                    school board.
        ``(d) Reservation of Amount for Emergencies.--The Secretary shall
    reserve from the funds available for distribution for each fiscal year
    under this section an amount which, in the aggregate, shall equal 1
    percent of the funds available for such purpose for that fiscal year.
    Such funds shall be used, at the discretion of the Director of the
    Office of Indian Education Programs, to meet emergencies and unforeseen
    contingencies affecting the education programs funded under this
    section. Funds reserved under this subsection may only be expended for
    education services or programs, including emergency repairs of
    educational facilities, at a schoolsite (as defined by section
    5204(c)(2) of the Tribally Controlled Schools Act of 1988). Funds
    reserved under this subsection shall remain available without fiscal
    year limitation until expended. However, the aggregate amount available
    from all fiscal years may not exceed 1 percent of the current year
    funds. Whenever, the Secretary makes funds available under this
    subsection, the Secretary shall report such action to the appropriate
    committees of Congress within the annual budget submission.
        ``(e) Supplemental Appropriations.--Supplemental appropriations
    enacted to meet increased pay costs attributable to school level
    personnel shall be distributed under this section.
        ``(f) Eligible Indian Student Defined.--For the purpose of this
    section, the term `eligible Indian student' means a student who--
                ``(1) is a member of or is at least one-fourth degree
            Indian blood descendant of a member of an Indian tribe which is
            eligible for the special programs and services provided by the
            United States through the Bureau because of their status as
            Indians; and
                ``(2) resides on or near an Indian reservation or meets the
            criteria for attendance at a Bureau off-reservation home-living
            (dormitory) school.
        ``(g) Tuition.--
                ``(1) In general.--An eligible Indian student may not be
            charged tuition for attendance at a Bureau school or contract
            or grant school. A student attending a Bureau school under
            paragraph (2)(C) may not be charged tuition for attendance at
            such a school.
                ``(2) Attendance of non-indian students at bureau
            schools.--The Secretary may permit the attendance at a Bureau
            school of a student who is not an eligible Indian student if--
                        ``(A) the Secretary determines that the student's
                    attendance will not adversely affect the school's
                    program for eligible Indian students because of cost,
                    overcrowding, or violation of standards or
                    accreditation;
                        ``(B) the school board consents;
                        ``(C) the student is a dependent of a Bureau,
                    Indian Health Service, or tribal government employee
                    who lives on or near the schoolsite; or
                        ``(D) a tuition is paid for the student that is not
                    more than that charged by the nearest public school
                    district for out-of-district students, and shall be in
                    addition to the school's allocation under this section.
                ``(3) Attendance of non-indian students at contract and
            grant schools.--The school board of a contract or grant school
            may permit students who are not eligible Indian students under
            this subsection to attend its contract school or grant school
            and any tuition collected for those students shall be in
            addition to funding received under this section.
        ``(h) Funds Available Without Fiscal Year Limitation.--
    Notwithstanding any other provision of law, at the election of the
    school board of a Bureau school made at any time during the fiscal
    year, a portion equal to not more than 15 percent of the funds
    allocated with respect to a school under this section for any fiscal
    year shall remain available to the school for expenditure without
    fiscal year limitation. The Assistant Secretary shall take steps as may
    be necessary to implement this provision.
        ``(i) Students at Richfield Dormitory, Richfield, Utah.--Tuition
    for out-of-State Indian students in home-living (dormitory)
    arrangements at the Richfield dormitory in Richfield, Utah, who attend
    Sevier County high schools in Richfield, Utah, shall be paid from the
    Indian school equalization program funds authorized in this section and
    section 1130 at a rate not to exceed the amounts per weighted student
    unit for that year for the instruction of such students. No additional
    administrative cost funds shall be added to the grant.

    ``SEC. 1128. ADMINISTRATIVE COST GRANTS.

        ``(a) Grants; Effect Upon Appropriated Amounts.--
                ``(1) Grants.--Subject to the availability of appropriated
            funds, the Secretary shall provide grants to each tribe or
            tribal organization operating a contract school or grant school
            in the amount determined under this section with respect to the
            tribe or tribal organization for the purpose of paying the
            administrative and indirect costs incurred in operating
            contract or grant schools, provided that no school operated as
            a stand-alone institution shall receive less than $200,000 per
            year for these purposes, in order to--
                        ``(A) enable tribes and tribal organizations
                    operating such schools, without reducing direct program
                    services to the beneficiaries of the program, to
                    provide all related administrative overhead services
                    and operations necessary to meet the requirements of
                    law and prudent management practice; and
                        ``(B) carry out other necessary support functions
                    which would otherwise be provided by the Secretary or
                    other Federal officers or employees, from resources
                    other than direct program funds, in support of
                    comparable Bureau operated programs.
                ``(2) Effect upon appropriated amounts.--Amounts
            appropriated to fund the grants provided under this section
            shall be in addition to, and shall not reduce, the amounts
            appropriated for the program being administered by the contract
            or grant school.
        ``(b) Determination of Grant Amount.--
                ``(1) In general.--The amount of the grant provided to each
            tribe or tribal organization under this section for each fiscal
            year shall be determined by applying the administrative cost
            percentage rate of the tribe or tribal organization to the
            aggregate of the Bureau elementary and secondary functions
            operated by the tribe or tribal organization for which funds
            are received from or through the Bureau. The administrative
            cost percentage rate determined under subsection (c) does not
            apply to other programs operated by the tribe or tribal
            organization.
                ``(2) Direct cost base funds.--The Secretary shall--
                        ``(A) reduce the amount of the grant determined
                    under paragraph (1) to the extent that payments for
                    administrative costs are actually received by an Indian
                    tribe or tribal organization under any Federal
                    education program included in the direct cost base of
                    the tribe or tribal organization; and
                        ``(B) take such actions as may be necessary to be
                    reimbursed by any other department or agency of the
                    Federal Government for the portion of grants made under
                    this section for the costs of administering any program
                    for Indians that is funded by appropriations made to
                    such other department or agency.
        ``(c) Administrative Cost Percentage Rate.--
                ``(1) In general.--For purposes of this section, the
            administrative cost percentage rate for a contract or grant
            school for a fiscal year is equal to the percentage determined
            by dividing--
                        ``(A) the sum of--
                                ``(i) the amount equal to--
                                        ``(I) the direct cost base of the
                                    tribe or tribal organization for the
                                    fiscal year, multiplied by
                                        ``(II) the minimum base rate; plus
                                ``(ii) the amount equal to--
                                        ``(I) the standard direct cost
                                    base; multiplied by
                                        ``(II) the maximum base rate; by
                        ``(B) the sum of--
                                ``(i) the direct cost base of the tribe or
                            tribal organization for the fiscal year; plus
                                ``(ii) the standard direct cost base.
                ``(2) Rounding.--The administrative cost percentage rate
            shall be determined to the \1/100\ of a decimal point.
        ``(d) Combining Funds.--
                ``(1) In general.--Funds received by a tribe or contract or
            grant school as grants under this section for tribal elementary
            or secondary educational programs may be combined by the tribe
            or contract or grant school into a single administrative cost
            account without the necessity of maintaining separate funding
            source accounting.
                ``(2) Indirect cost funds.--Indirect cost funds for
            programs at the school which share common administrative
            services with tribal elementary or secondary educational
            programs may be included in the administrative cost account
            described in paragraph (1).
        ``(e) Availability of Funds.--Funds received as grants under this
    section with respect to tribal elementary or secondary education
    programs shall remain available to the contract or grant school without
    fiscal year limitation and without diminishing the amount of any grants
    otherwise payable to the school under this section for any fiscal year
    beginning after the fiscal year for which the grant is provided.
        ``(f) Treatment of Funds.--Funds received as grants under this
    section for Bureau funded programs operated by a tribe or tribal
    organization under a contract or agreement shall not be taken into
    consideration for purposes of indirect cost underrecovery and
    overrecovery determinations by any Federal agency for any other funds,
    from whatever source derived.
        ``(g) Treatment of Entity Operating Other Programs.--In applying
    this section and section 105 of the Indian Self-Determination and
    Education Assistance Act with respect to an Indian tribe or tribal
    organization that--
                ``(1) receives funds under this section for administrative
            costs incurred in operating a contract or grant school or a
            school operated under the Tribally Controlled Schools Act of
            1988; and
                ``(2) operates one or more other programs under a contract
            or grant provided under the Indian Self-Determination and
            Education Assistance Act,
    the Secretary shall ensure that the Indian tribe or tribal organization
    is provided with the full amount of the administrative costs that are
    associated with operating the contract or grant school, and of the
    indirect costs, that are associated with all of such other programs,
    provided that funds appropriated for implementation of this section
    shall be used only to supply the amount of the grant required to be
    provided by this section.
        ``(h) Definitions.--For purposes of this section:
                ``(1) Administrative cost.--(A) The term `administrative
            cost' means the costs of necessary administrative functions
            which--
                        ``(i) the tribe or tribal organization incurs as a
                    result of operating a tribal elementary or secondary
                    educational program;
                        ``(ii) are not customarily paid by comparable
                    Bureau operated programs out of direct program funds;
                    and
                        ``(iii) are either--
                                ``(I) normally provided for comparable
                            Bureau programs by Federal officials using
                            resources other than Bureau direct program
                            funds; or
                                ``(II) are otherwise required of tribal
                            self-determination program operators by law or
                            prudent management practice.
                ``(B) The term `administrative cost' may include--
                        ``(i) contract or grant (or other agreement)
                    administration;
                        ``(ii) executive, policy, and corporate leadership
                    and decisionmaking;
                        ``(iii) program planning, development, and
                    management;
                        ``(iv) fiscal, personnel, property, and procurement
                    management;
                        ``(v) related office services and record keeping;
                    and
                        ``(vi) costs of necessary insurance, auditing,
                    legal, safety and security services.
                ``(2) Bureau elementary and secondary functions.--The term
            `Bureau elementary and secondary functions' means--
                        ``(A) all functions funded at Bureau schools by the
                    Office;
                        ``(B) all programs--
                                ``(i) funds for which are appropriated to
                            other agencies of the Federal Government; and
                                ``(ii) which are administered for the
                            benefit of Indians through Bureau schools; and
                        ``(C) all operation, maintenance, and repair funds
                    for facilities and government quarters used in the
                    operation or support of elementary and secondary
                    education functions for the benefit of Indians, from
                    whatever source derived.
                ``(3) Direct cost base.--(A) Except as otherwise provided
            in subparagraph (B), the direct cost base of a tribe or tribal
            organization for the fiscal year is the aggregate direct cost
            program funding for all tribal elementary or secondary
            educational programs operated by the tribe or tribal
            organization during--
                        ``(i) the second fiscal year preceding such fiscal
                    year; or
                        ``(ii) if such programs have not been operated by
                    the tribe or tribal organization during the two
                    preceding fiscal years, the first fiscal year preceding
                    such fiscal year.
                ``(B) In the case of Bureau elementary or secondary
            education functions which have not previously been operated by
            a tribe or tribal organization under contract, grant, or
            agreement with the Bureau, the direct cost base for the initial
            year shall be the projected aggregate direct cost program
            funding for all Bureau elementary and secondary functions to be
            operated by the tribe or tribal organization during that fiscal
            year.
                ``(4) Maximum base rate.--The term `maximum base rate'
            means 50 percent.
                ``(5) Minimum base rate.--The term `minimum base rate'
            means 11 percent.
                ``(6) Standard direct cost base.--The term `standard direct
            cost base' means $600,000.
                ``(7) Tribal elementary or secondary educational
            programs.--The term `tribal elementary or secondary educational
            programs' means all Bureau elementary and secondary functions,
            together with any other Bureau programs or portions of programs
            (excluding funds for social services that are appropriated to
            agencies other than the Bureau and are expended through the
            Bureau, funds for major subcontracts, construction, and other
            major capital expenditures, and unexpended funds carried over
            from prior years) which share common administrative cost
            functions, that are operated directly by a tribe or tribal
            organization under a contract, grant, or agreement with the
            Bureau.
        ``(i) Studies for Determination of Factors Affecting Costs; Base
    Rates Limits; Standard Direct Cost Base; Report to Congress.--
                ``(1) Studies.--Not later than 120 days after the date of
            the enactment of the No Child Left Behind Act of 2001, the
            Director of the Office of Indian Education Programs shall--
                        ``(A) conduct such studies as may be needed to
                    establish an empirical basis for determining relevant
                    factors substantially affecting required administrative
                    costs of tribal elementary and secondary education
                    programs, using the formula set forth in subsection
                    (c); and
                ``(B) conduct a study to determine--
                        ``(i) a maximum base rate which ensures that the
                    amount of the grants provided under this section will
                    provide adequate (but not excessive) funding of the
                    administrative costs of the smallest tribal elementary
                    or secondary educational programs;
                        ``(ii) a minimum base rate which ensures that the
                    amount of the grants provided under this section will
                    provide adequate (but not excessive) funding of the
                    administrative costs of the largest tribal elementary
                    or secondary educational programs; and
                        ``(iii) a standard direct cost base which is the
                    aggregate direct cost funding level for which the
                    percentage determined under subsection (c) will--
                                ``(I) be equal to the median between the
                            maximum base rate and the minimum base rate;
                            and
                                ``(II) ensure that the amount of the grants
                            provided under this section will provide
                            adequate (but not excessive) funding of the
                            administrative costs of tribal elementary or
                            secondary educational programs closest to the
                            size of the program.
                ``(2) Guidelines.--The studies required under paragraph (1)
            shall--
                        ``(A) be conducted in full consultation (in
                    accordance with section 1131) with--
                                ``(i) the tribes and tribal organizations
                            that are affected by the application of the
                            formula set forth in subsection (c); and
                                ``(ii) all national and regional Indian
                            organizations of which such tribes and tribal
                            organizations are typically members;
                        ``(B) be conducted onsite with a representative
                    statistical sample of the tribal elementary or
                    secondary educational programs under a contract entered
                    into with a nationally reputable public accounting and
                    business consulting firm;
                        ``(C) take into account the availability of skilled
                    labor; commodities, business and automatic data
                    processing services, related Indian preference and
                    Indian control of education requirements, and any other
                    market factors found substantially to affect the
                    administrative costs and efficiency of each such tribal
                    elementary or secondary educational program studied in
                    order to assure that all required administrative
                    activities can reasonably be delivered in a cost
                    effective manner for each such program, given an
                    administrative cost allowance generated by the values,
                    percentages, or other factors found in the studies to
                    be relevant in such formula;
                        ``(D) identify, and quantify in terms of
                    percentages of direct program costs, any general
                    factors arising from geographic isolation, or numbers
                    of programs administered, independent of program size
                    factors used to compute a base administrative cost
                    percentage in such formula; and
                        ``(E) identify any other incremental cost factors
                    substantially affecting the costs of required
                    administrative cost functions at any of the tribal
                    elementary or secondary educational programs studied
                    and determine whether the factors are of general
                    applicability to other such programs, and (if so) how
                    the factors may effectively be incorporated into such
                    formula.
                ``(3) Consultation with inspector general.--In carrying out
            the studies required under this subsection, the Director shall
            obtain the input of, and afford an opportunity to participate
            to, the Inspector General of the Department of the Interior.
                ``(4) Consideration of delivery of administrative
            services.--Determinations described in paragraph (2)(C) shall
            be based on what is practicable at each location studied, given
            prudent management practice, irrespective of whether required
            administrative services were actually or fully delivered at
            these sites, or whether other services were delivered instead,
            during the period of the study.
                ``(5) Report.--Upon completion of the studies conducted
            under paragraph (1), the Director shall submit to Congress a
            report on the findings of the studies, together with
            determinations based upon such studies that would affect the
            definitions set forth under subsection (e) that are used in the
            formula set forth in subsection (c).
                ``(6) Projection of costs.--The Secretary shall include in
            the Bureau's justification for each appropriations request
            beginning in the first fiscal year after the completion of the
            studies conducted under paragraph (1), a projection of the
            overall costs associated with the formula set forth in
            subsection (c) for all tribal elementary or secondary education
            programs which the Secretary expects to be funded in the fiscal
            year for which the appropriations are sought.
                ``(7) Determination of program size.--For purposes of this
            subsection, the size of tribal elementary or secondary
            educational programs is determined by the aggregate direct cost
            program funding level for all Bureau funded programs which
            share common administrative cost functions.
        ``(j) Authorization of Appropriations.--
                ``(1) In general.--There are authorized to be appropriated
            such sums as necessary to carry out this section.
                ``(2) Reductions.--If the total amount of funds necessary
            to provide grants to tribes and tribal organizations in the
            amounts determined under subsection (b) for a fiscal year
            exceeds the amount of funds appropriated to carry out this
            section for such fiscal year, the Secretary shall reduce the
            amount of each grant determined under subsection (b) for such
            fiscal year by an amount that bears the same relationship to
            such excess as the amount of such grants determined under
            subsection (b) bears to the total of all grants determined
            under subsection (b) section for all tribes and tribal
            organizations for such fiscal year.
        ``(k) Applicability to Schools Operating Under Tribally Controlled
    Schools Act of 1988.--The provisions of this section shall also apply
    to those schools operating under the Tribally Controlled Schools Act of
    1988.

    ``SEC. 1129. DIVISION OF BUDGET ANALYSIS.

        ``(a) Establishment.--Not later than 12 months after the date of
    the enactment of the No Child Left Behind Act of 2001, the Secretary
    shall establish within the Office of Indian Education Programs a
    Division of Budget Analysis (hereinafter referred to as the
    `Division'). Such Division shall be under the direct supervision and
    control of the Director of the Office.
        ``(b) Functions.--In consultation with the tribal governing bodies
    and tribal school boards, the Director of the Office, through the
    Division, shall conduct studies, surveys, or other activities to gather
    demographic information on Bureau funded schools and project the amount
    necessary to provide Indian students in such schools the educational
    program set forth in this part.
        ``(c) Annual Reports.--Not later than the date that the Assistant
    Secretary for Indian Affairs makes the annual budget submission, for
    each fiscal year after the date of the enactment of the No Child Left
    Behind Act of 2001, the Director of the Office shall submit to the
    appropriate committees of Congress (including the Appropriations
    committees), all Bureau funded schools, and the tribal governing bodies
    of such schools, a report which shall contain--
                ``(1) projections, based upon the information gathered
            pursuant to subparagraph (b) and any other relevant
            information, of amounts necessary to provide Indian students in
            Bureau funded schools the educational program set forth in this
            part;
                ``(2) a description of the methods and formulas used to
            calculate the amounts projected pursuant to paragraph (1); and
                ``(3) such other information as the Director of the Office
            considers appropriate.
        ``(d) Use of Reports.--The Director of the Office and the Assistant
    Secretary for Indian Affairs shall use the annual report required by
    subsection (c) when preparing their annual budget submissions.

    ``SEC. 1130. UNIFORM DIRECT FUNDING AND SUPPORT.

        ``(a) Establishment of System and Forward Funding.--
                ``(1) In general.--The Secretary shall establish, by
            regulation adopted in accordance with section 1138, a system
            for the direct funding and support of all Bureau funded
            schools. Such system shall allot funds in accordance with
            section 1127. All amounts appropriated for distribution under
            this section may be made available under paragraph (2).
                ``(2) Timing for use of funds.--(A) For the purposes of
            affording adequate notice of funding available pursuant to the
            allotments made under section 1127, amounts appropriated in an
            appropriations Act for any fiscal year shall become available
            for obligation by the affected schools on July 1 of the fiscal
            year in which such amounts are appropriated without further
            action by the Secretary, and shall remain available for
            obligation through the succeeding fiscal year.
                ``(B) The Secretary shall, on the basis of the amount
            appropriated in accordance with this paragraph--
                        ``(i) publish, not later than July 1 of the fiscal
                    year for which the funds are appropriated, allotments
                    to each affected school made under section 1127 of 85
                    percent of such appropriation; and
                        ``(ii) publish, not later than September 30 of such
                    fiscal year, the allotments to be made under section
                    1127 of the remaining 15 percent of such appropriation,
                    adjusted to reflect the actual student attendance.
                ``(3) Limitation.--(A) Notwithstanding any other provision
            of law or regulation, the supervisor of a Bureau funded school
            may expend an aggregate of not more than $50,000 of the amount
            allotted the school under section 1127 to acquire materials,
            supplies, equipment, services, operation, and maintenance for
            the school without competitive bidding if--
                        ``(i) the cost for any single item purchased does
                    not exceed $15,000;
                        ``(ii) the school board approves the procurement;
                        ``(iii) the supervisor certifies that the cost is
                    fair and reasonable;
                        ``(iv) the documents relating to the procurement
                    executed by the supervisor or other school staff cite
                    this paragraph as authority for the procurement; and
                        ``(v) the transaction is documented in a journal
                    maintained at the school clearly identifying when the
                    transaction occurred, what was acquired and from whom,
                    the price paid, the quantities acquired, and any other
                    information the supervisor or school board considers
                    relevant.
                ``(B) Not later than 6 months after the date of the
            enactment of the No Child Left Behind Act of 2001, the
            Secretary shall cause to be sent to each supervisor of a Bureau
            operated program and school board chairperson, the education
            line officer or officers of each agency and area, and the
            Bureau Division in charge of procurement, at both the local and
            national levels, notice of this paragraph.
                ``(C) The Director shall be responsible for determining the
            application of this paragraph, including the authorization of
            specific individuals to carry out this paragraph, and shall be
            responsible for the provision of guidelines on the use of this
            paragraph and adequate training on such guidelines.
                ``(4) Effect of sequestration order.--If a sequestration
            order issued under the Balanced Budget and Emergency Deficit
            Control Act of 1985 reduces the amount of funds available for
            allotment under section 1127 for any fiscal year by more than 7
            percent of the amount of funds available for allotment under
            such section during the preceding fiscal year--
                        ``(A) to fund allotments under section 1127, the
                    Secretary, notwithstanding any other law, may use--
                                ``(i) funds appropriated for the operation
                            of any Bureau school that is closed or
                            consolidated; and
                                ``(ii) funds appropriated for any program
                            that has been curtailed at any Bureau school;
                            and
                        ``(B) the Secretary may waive the application of
                    the provisions of section 1121(h) with respect to the
                    closure or consolidation of a school, or the
                    curtailment of a program at a school, during such
                    fiscal year if the funds described in clauses (i) and
                    (ii) of subparagraph (A) with respect to such school
                    are used to fund allotments made under section 1127 for
                    such fiscal year.
        ``(b) Local Financial Plans for Expenditure of Funds.--
                ``(1) Plan required.--In the case of all Bureau operated
            schools, allotted funds shall be expended on the basis of local
            financial plans which ensure meeting the accreditation
            requirements or standards for the school established pursuant
            to section 1121 and which shall be prepared by the local school
            supervisor in active consultation with the local school board
            for each school. The local school board for each school shall
            have the authority to ratify, reject, or amend such financial
            plan, and expenditures thereunder, and, on its own
            determination or in response to the supervisor of the school,
            to revise such financial plan to meet needs not foreseen at the
            time of preparation of the financial plan.
                ``(2) The supervisor--
                        ``(A) shall put into effect the decisions of the
                    school board;
                        ``(B) shall provide the appropriate local union
                    representative of the education employees with copies
                    of proposed draft financial plans and all amendments or
                    modifications thereto, at the same time such copies are
                    submitted to the local school board; and
                        ``(C) may appeal any such action of the local
                    school board to the appropriate education line officer
                    of the Bureau agency by filing a written statement
                    describing the action and the reasons the supervisor
                    believes such action should be overturned. A copy of
                    such statement shall be submitted to the local school
                    board and such board shall be afforded an opportunity
                    to respond, in writing, to such appeal. After reviewing
                    such written appeal and response, the appropriate
                    education line officer may, for good cause, overturn
                    the action of the local school board. The appropriate
                    education line officer shall transmit the determination
                    of such appeal in the form of a written opinion to such
                    board and to such supervisor identifying the reasons
                    for overturning such action.
        ``(c) Use of Self-Determination Grants Funds.--Funds for self-
    determination grants under section 103(a)(2) of the Indian Self-
    Determination and Education Assistance Act shall not be used for
    providing technical assistance and training in the field of education
    by the Bureau unless such services are provided in accordance with a
    plan, agreed to by the tribe or tribes affected and the Bureau, under
    which control of education programs is intended to be transferred to
    such tribe or tribes within a specific period of time negotiated under
    such agreement. The Secretary may approve applications for funding
    tribal divisions of education and development of tribal codes of
    education from funds appropriated pursuant to section 104(a) of such
    Act.
        ``(d) Technical Assistance and Training.--In the exercise of its
    authority under this section, a local school board may request
    technical assistance and training from the Secretary, and the Secretary
    shall, to the greatest extent possible, provide such services, and make
    appropriate provisions in the budget of the Office for such services.
        ``(e) Summer Program of Academic and Support Services.--
                ``(1) In general.--A financial plan under subsection (b)
            for a school may include, at the discretion of the local
            administrator and the school board of such school, a provision
            for a summer program of academic and support services for
            students of the school. Any such program may include activities
            related to the prevention of alcohol and substance abuse. The
            Assistant Secretary for Indian Affairs shall provide for the
            utilization of any such school facility during any summer in
            which such utilization is requested.
                ``(2) Use of other funds.--Notwithstanding any other
            provision of law, funds authorized under the Act of April 16,
            1934, and this Act may be used to augment the services provided
            in each summer program at the option, and under the control, of
            the tribe or Indian controlled school receiving such funds.
                ``(3) Technical assistance and program coordination.--The
            Assistant Secretary for Indian Affairs, acting through the
            Director of the Office, shall provide technical assistance and
            coordination for any program described in paragraph (1) and
            shall, to the extent possible, encourage the coordination of
            such programs with any other summer programs that might benefit
            Indian youth, regardless of the funding source or
            administrative entity of any such program.
        ``(f) Cooperative Agreements.--
                ``(1) In general.--From funds allotted to a Bureau school
            under section 1127, the Secretary shall, if specifically
            requested by the tribal governing body (as defined in section
            1141), implement any cooperative agreement entered into between
            the tribe, the Bureau school board, and the local public school
            district which meets the requirements of paragraph (2) and
            involves the school. The tribe, the Bureau school board, and
            the local public school district shall determine the terms of
            the agreement. Such agreement may encompass coordination of all
            or any part of the following:
                        ``(A) Academic program and curriculum, unless the
                    Bureau school is currently accredited by a State or
                    regional accrediting entity and would not continue to
                    be so accredited.
                        ``(B) Support services, including procurement and
                    facilities maintenance.
                        ``(C) Transportation.
                ``(2) Equal benefit and burden.--Each agreement entered
            into pursuant to the authority provided in paragraph (1) shall
            confer a benefit upon the Bureau school commensurate with the
            burden assumed, though this requirement shall not be construed
            so as to require equal expenditures or an exchange of similar
            services.
        ``(g) Product or Result of Student Projects.--Notwithstanding any
    other provision of law, where there is agreement on action between the
    superintendent and the school board of a Bureau funded school, the
    product or result of a project conducted in whole or in major part by a
    student may be given to that student upon the completion of such
    project.
        ``(h) Not Considered Federal Funds for Matching Requirements.--
    Notwithstanding any other provision of law, funds received by a Bureau
    funded school under this part shall not be considered Federal funds for
    the purposes of meeting a matching funds requirement for any Federal
    program.

    ``SEC. 1131. POLICY FOR INDIAN CONTROL OF INDIAN EDUCATION.

        ``(a) Facilitation of Indian Control.--It shall be the policy of
    the Secretary and the Bureau, in carrying out the functions of the
    Bureau, to facilitate tribal control of Indian affairs in all matters
    relating to education.
        ``(b) Consultation With Tribes.--
                ``(1) In general.--All actions under this Act shall be done
            with active consultation with tribes.
                ``(2) Requirements.--The consultation required under
            paragraph (1) means a process involving the open discussion and
            joint deliberation of all options with respect to potential
            issues or changes between the Bureau and all interested
            parties. During such discussions and joint deliberations,
            interested parties (including tribes and school officials)
            shall be given an opportunity to present issues including
            proposals regarding changes in current practices or programs
            which will be considered for future action by the Bureau. All
            interested parties shall be given an opportunity to participate
            and discuss the options presented or to present alternatives,
            with the views and concerns of the interested parties given
            effect unless the Secretary determines, from information
            available from or presented by the interested parties during
            one or more of the discussions and deliberations, that there is
            a substantial reason for another course of action. The
            Secretary shall submit to any Member of Congress, within 18
            days of the receipt of a written request by such Member, a
            written explanation of any decision made by the Secretary which
            is not consistent with the views of the interested parties.

    ``SEC. 1132. INDIAN EDUCATION PERSONNEL.

        ``(a) In General.--Chapter 51, subchapter III of chapter 53, and
    chapter 63 of title 5, United States Code, relating to classification,
    pay and leave, respectively, and the sections of such title relating to
    the appointment, promotion, hours of work, and removal of civil service
    employees, shall not apply to educators or to education positions (as
    defined in subsection (p)).
        ``(b) Regulations.--Not later than 60 days after the date of the
    enactment of the No Child Left Behind Act of 2001, the Secretary shall
    prescribe regulations to carry out this section. Such regulations shall
    include--
                ``(1) the establishment of education positions;
                ``(2) the establishment of qualifications for educators and
            education personnel;
                ``(3) the fixing of basic compensation for educators and
            education positions;
                ``(4) the appointment of educators;
                ``(5) the discharge of educators;
                ``(6) the entitlement of educators to compensation;
                ``(7) the payment of compensation to educators;
                ``(8) the conditions of employment of educators;
                ``(9) the leave system for educators;
                ``(10) the annual leave and sick leave for educators; and
                ``(11) such matters as may be appropriate.
        ``(c) Qualifications of Educators.--
                ``(1) Requirements.--In prescribing regulations to govern
            the qualifications of educators, the Secretary shall require--
                        ``(A)(i) that lists of qualified and interviewed
                    applicants for education positions be maintained in
                    each agency and area office of the Bureau from among
                    individuals who have applied at the agency or area
                    level for an education position or who have applied at
                    the national level and have indicated in such
                    application an interest in working in certain areas or
                    agencies; and
                        ``(ii) that a list of qualified and interviewed
                    applicants for education positions be maintained in the
                    Office from among individuals who have applied at the
                    national level for an education position and who have
                    expressed interest in working in an education position
                    anywhere in the United States;
                        ``(B) that a local school board shall have the
                    authority to waive on a case-by-case basis, any formal
                    education or degree qualifications established by
                    regulation pursuant to subsection (b)(2), in order for
                    a tribal member to be hired in an education position to
                    teach courses on tribal culture and language and that
                    subject to subsection (e)(2), a determination by a
                    school board that such a person be hired shall be
                    instituted supervisor; and
                        ``(C) that it shall not be a prerequisite to the
                    employment of an individual in an education position at
                    the local level that such individual's name appear on
                    the national list maintained pursuant to subparagraph
                    (A)(ii) or that such individual has applied at the
                    national level for an education position.
                ``(2) Exception for certain temporary employment.--The
            Secretary may authorize the temporary employment in an
            education position of an individual who has not met the
            certification standards established pursuant to regulations, if
            the Secretary determines that failure to do so would result in
            that position remaining vacant.
        ``(d) Hiring of Educators.--
                ``(1) Requirements.--In prescribing regulations to govern
            the appointment of educators, the Secretary shall require--
                        ``(A)(i) that educators employed in a Bureau
                    operated school (other than the supervisor of the
                    school) shall be hired by the supervisor of the school.
                    In cases where there are no qualified applicants
                    available, such supervisor may consult the national
                    list maintained pursuant to subsection (c)(1)(A)(ii);
                        ``(ii) each school supervisor shall be hired by the
                    education line officer of the agency office of the
                    Bureau in which the school is located;
                        ``(iii) educators employed in an agency office of
                    the Bureau shall be hired by the superintendent for
                    education of the agency office; and
                        ``(iv) each education line officer and educators
                    employed in the Office of the Director of Indian
                    Education Programs shall be hired by the Director;
                        ``(B) that before an individual is employed in an
                    education position in a school by the supervisor of a
                    school (or with respect to the position of supervisor,
                    by the appropriate agency education line officer), the
                    local school board for the school shall be consulted. A
                    determination by such school board that such individual
                    should or should not be so employed shall be instituted
                    by the supervisor (or with respect to the position of
                    supervisor, by the agency superintendent for
                    education);
                        ``(C) that before an individual may be employed in
                    an education position at the agency level, the
                    appropriate agency school board shall be consulted, and
                    that a determination by such school board that such
                    individual should or should not be employed shall be
                    instituted by the agency superintendent for education;
                    and
                        ``(D) that before an individual may be employed in
                    an education position in the Office of the Director
                    (other than the position of Director), the national
                    school boards representing all Bureau schools shall be
                    consulted.
                ``(2) Information regarding application at national
            level.--Any individual who applies at the local level for an
            education position shall state on such individual's application
            whether or not such individual has applied at the national
            level for an education position in the Bureau. If such
            individual is employed at the local level, such individual's
            name shall be immediately forwarded to the Secretary, who
            shall, as soon as practicable but in no event in more than 30
            days, ascertain the accuracy of the statement made by such
            individual pursuant to the first sentence of this paragraph.
            Notwithstanding subsection (e), if the individual's statement
            is found to have been false, such individual, at the
            Secretary's discretion, may be disciplined or discharged. If
            the individual has applied at the national level for an
            education position in the Bureau, the appointment of such
            individual at the local level shall be conditional for a period
            of 90 days, during which period the Secretary may appoint a
            more qualified individual (as determined by the Secretary) from
            the list maintained at the national level pursuant to
            subsection (c)(1)(A)(ii) to the position to which such
            individual was appointed.
                ``(3) Statutory construction.--Except as expressly
            provided, nothing in this section shall be construed as
            conferring upon local school boards authority over, or control
            of, educators at Bureau funded schools or the authority to
            issue management decisions.
        ``(e) Discharge and Conditions of Employment of Educators.--
                ``(1) Regulations.--In prescribing regulations to govern
            the discharge and conditions of employment of educators, the
            Secretary shall require--
                        ``(A) that procedures be established for the rapid
                    and equitable resolution of grievances of educators;
                        ``(B) that no educator may be discharged without
                    notice of the reasons therefore and opportunity for a
                    hearing under procedures that comport with the
                    requirements of due process; and
                        ``(C) that educators employed in Bureau schools be
                    notified 30 days prior to the end of the school year
                    whether their employment contract will be renewed for
                    the following year.
                ``(2) Procedures for discharge.--The supervisor of a Bureau
            school may discharge (subject to procedures established under
            paragraph (1)(B)) for cause (as determined under regulations
            prescribed by the Secretary) any educator employed in such
            school. Upon giving notice of proposed discharge to an
            educator, the supervisor involved shall immediately notify the
            local school board for the school of such action. A
            determination by the local school board that such educator
            shall not be discharged shall be followed by the supervisor.
            The supervisor shall have the right to appeal such action to
            the education line officer of the appropriate agency office of
            the Bureau. Upon such an appeal, the agency education line
            officer may, for good cause and in writing to the local school
            board, overturn the determination of the local school board
            with respect to the employment of such individual.
                ``(3) Recommendations of school boards for discharge.--Each
            local school board for a Bureau school shall have the right--
                        ``(A) to recommend to the supervisor of such school
                    that an educator employed in the school be discharged;
                    and
                        ``(B) to recommend to the education line officer of
                    the appropriate agency office of the Bureau and to the
                    Director of the Office, that the supervisor of the
                    school be discharged.
        ``(f) Applicability of Indian Preference Laws.--
                ``(1) In general.--Notwithstanding any provision of the
            Indian preference laws, such laws shall not apply in the case
            of any personnel action under this section respecting an
            applicant or employee not entitled to Indian preference if each
            tribal organization concerned grants a written waiver of the
            application of such laws with respect to such personnel action
            and states that such waiver is necessary. This paragraph shall
            not relieve the Bureau's responsibility to issue timely and
            adequate announcements and advertisements concerning any such
            personnel action if such action is intended to fill a vacancy
            (no matter how such vacancy is created).
                ``(2) Tribal organization defined.--For purposes of this
            subsection, the term `tribal organization' means--
                        ``(A) the recognized governing body of any Indian
                    tribe, band, nation, pueblo, or other organized
                    community, including a Native village (as defined in
                    section 3(c) of the Alaska Native Claims Settlement
                    Act); or
                        ``(B) in connection with any personnel action
                    referred to in this subsection, any local school board
                    as defined in section 1141 which has been delegated by
                    such governing body the authority to grant a waiver
                    under this subsection with respect to personnel action.
                ``(3) Indian preference law defined.--The term `Indian
            preference laws' means section 12 of the Act of June 18, 1934,
            or any other provision of law granting a preference to Indians
            in promotions and other personnel actions. Such term shall not
            include section 7(b) of the Indian Self-Determination and
            Education Assistance Act.
        ``(g) Compensation or Annual Salary.--
                ``(1) In general.--(A) Except as otherwise provided in this
            section, the Secretary shall fix the basic compensation for
            educators and education positions at rates in effect under the
            General Schedule for individuals with comparable
            qualifications, and holding comparable positions, to whom
            chapter 51 of title 5, United States Code, is applicable or on
            the basis of the Federal Wage System schedule in effect for the
            locality, and for the comparable positions, the rates of
            compensation in effect for the senior executive service.
                ``(B) The Secretary shall establish the rate of basic
            compensation, or annual salary rates, for the positions of
            teachers and counselors (including dormitory counselors and
            home-living counselors) at the rates of basic compensation
            applicable (on the date of the enactment of the No Child Left
            Behind Act of 2001 and thereafter) to comparable positions in
            the overseas schools under the Defense Department Overseas
            Teachers Pay Act. The Secretary shall allow the local school
            boards authority to implement only the aspects of the Defense
            Department Overseas Teacher pay provisions that are considered
            essential for recruitment and retention. Implementation of such
            provisions shall not be construed to require the implementation
            of the Act in its entirety.
                ``(C)(i) Beginning with the fiscal year following the date
            of the enactment of the No Child Left Behind Act of 2001, each
            school board may set the rate of compensation or annual salary
            rate for teachers and counselors (including academic
            counselors) who are new hires at the school and who have not
            worked at the school on the date of implementation of this
            provision, at rates consistent with the rates paid for
            individuals in the same positions, with the same tenure and
            training, in any other school within whose boundaries the
            Bureau school lies. In instances where the adoption of such
            rates cause a reduction in the payment of compensation from
            that which was in effect for the fiscal year following the date
            of the enactment of the No Child Left Behind Act of 2001, the
            new rate may be applied to the compensation of employees of the
            school who worked at the school on of the date of the enactment
            of that Act by applying those rates to each contract renewal
            such that the reduction takes effect in three equal
            installments. Where adoption of such rates lead to an increase
            in the payment of compensation from that which was in effect
            for the fiscal year following the date of the enactment of the
            No Child Left Behind Act of 2001, the school board may make
            such rates applicable at the next contract renewal such that
            either--
                        ``(I) the increase occurs in its entirety; or
                        ``(II) the increase is applied in three equal
                    installments.
                ``(ii) The establishment of rates of basic compensation and
            annual salary rates under subparagraphs (B) and (C) shall not
            preclude the use of regulations and procedures used by the
            Bureau prior to April 28, 1988, in making determinations
            regarding promotions and advancements through levels of pay
            that are based on the merit, education, experience, or tenure
            of the educator.
                ``(D) The establishment of rates of basic compensation and
            annual salary rates under subparagraphs (B) and (C) shall not
            affect the continued employment or compensation of an educator
            who was employed in an education position on October 31, 1979,
            and who did not make an election under subsection (p) is in
            effect on January 1, 1990.
                ``(2) Post-differential rates.--(A) The Secretary may pay a
            post-differential rate not to exceed 25 percent of the rate of
            basic compensation, on the basis of conditions of environment
            or work which warrant additional pay as a recruitment and
            retention incentive.
                ``(B)(i) Upon the request of the supervisor and the local
            school board of a Bureau school, the Secretary shall grant the
            supervisor of the school authorization to provide one or more
            post-differentials under subparagraph (A) unless the Secretary
            determines for clear and convincing reasons (and advises the
            board in writing of those reasons) that certain of the
            requested post-differentials should be disapproved or decreased
            because there is no disparity of compensation for the involved
            employees or positions in the Bureau school, as compared with
            the nearest public school, that is either--
                        ``(I) at least 5 percent; or
                        ``(II) less than 5 percent and affects the
                    recruitment or retention of employees at the school.
                ``(ii) A request under clause (i) shall be deemed granted
            at the end of the 60th day after the request is received in the
            Central Office of the Bureau unless before that time the
            request is approved, approved with modification, or disapproved
            by the Secretary.
                ``(iii) The Secretary or the supervisor of a Bureau school
            may discontinue or decrease a post-differential authorized
            under this subparagraph at the beginning of a school year if--
                        ``(I) the local school board requests that such
                    differential be discontinued or decreased; or
                        ``(II) the Secretary or the supervisor determines
                    for clear and convincing reasons (and advises the board
                    in writing of those reasons) that there is no disparity
                    of compensation that would affect the recruitment or
                    retention of employees at the school after the
                    differential is discontinued or decreased.
                ``(iv) On or before February 1 of each year, the Secretary
            shall submit to Congress a report describing the requests and
            grants of authority under this subparagraph during the previous
            year and listing the positions contracted under those grants of
            authority.
        ``(h) Liquidation of Remaining Leave Upon Termination.--Upon
    termination of employment with the Bureau, any annual leave remaining
    to the credit of an individual within the purview of this section shall
    be liquidated in accordance with sections 5551(a) and 6306 of title 5,
    United States Code, except that leave earned or accrued under
    regulations prescribed pursuant to subsection (b)(10) of this section
    shall not be so liquidated.
        ``(i) Transfer of Remaining Sick Leave Upon Transfer, Promotion, or
    Reemployment.--In the case of any educator who is transferred,
    promoted, or reappointed, without break in service, to a position in
    the Federal Government under a different leave system, any remaining
    leave to the credit of such person earned or credited under the
    regulations prescribed pursuant to subsection (b)(10) shall be
    transferred to such person's credit in the employing agency on an
    adjusted basis in accordance with regulations which shall be prescribed
    by the Office of Personnel Management.
        ``(j) Ineligibility for Employment of Voluntarily Terminated
    Educators.--An educator who voluntarily terminates employment with the
    Bureau before the expiration of the existing employment contract
    between such educator and the Bureau shall not be eligible to be
    employed in another education position in the Bureau during the
    remainder of the term of such contract.
        ``(k) Dual Compensation.--In the case of any educator employed in
    an education position described in subsection (l)(1)(A) who--
                ``(1) is employed at the close of a school year;
                ``(2) agrees in writing to serve in such position for the
            next school year; and
                ``(3) is employed in another position during the recess
            period immediately preceding such next school year, or during
            such recess period receives additional compensation referred to
            in section 5533 of title 5, United States Code, relating to
            dual compensation,
    shall not apply to such educator by reason of any such employment
    during a recess period for any receipt of additional compensation.
        ``(l) Voluntary Services.--Notwithstanding section 1342 of title
    31, United States Code, the Secretary may, subject to the approval of
    the local school board concerned, accept voluntary services on behalf
    of Bureau schools. Nothing in this part shall be construed to require
    Federal employees to work without compensation or to allow the use of
    volunteer services to displace or replace Federal employees. An
    individual providing volunteer services under this section is a Federal
    employee only for purposes of chapter 81 of title 5, United States
    Code, and chapter 171 of title 28, United States Code.
        ``(m) Proration of Pay.--
                ``(1) Election of employee.--Notwithstanding any other
            provision of law, including laws relating to dual compensation,
            the Secretary, at the election of the employee, shall prorate
            the salary of an employee employed in an education position for
            the academic school year over the entire 12-month period. Each
            educator employed for the academic school year shall annually
            elect to be paid on a 12-month basis or for those months while
            school is in session. No educator shall suffer a loss of pay or
            benefits, including benefits under unemployment or other
            Federal or federally assisted programs, because of such
            election.
                ``(2) Change of election.--During the course of such year
            the employee may change election once.
                ``(3) Lump sum payment.--That portion of the employee's pay
            which would be paid between academic school years may be paid
            in a lump sum at the election of the employee.
                ``(4) Definitions.--For purposes of this subsection, the
            terms `educator' and `education position' have the meanings
            contained in paragraphs (1) and (2) of subsection (o). This
            subsection applies to those individuals employed under the
            provisions of section 1132 of this title or title 5, United
            States Code.
        ``(n) Extracurricular Activities.--
                ``(1) Stipend.--Notwithstanding any other provision of law,
            the Secretary may provide, for each Bureau area, a stipend in
            lieu of overtime premium pay or compensatory time off. Any
            employee of the Bureau who performs additional activities to
            provide services to students or otherwise support the school's
            academic and social programs may elect to be compensated for
            all such work on the basis of the stipend. Such stipend shall
            be paid as a supplement to the employee's base pay.
                ``(2) Election not to receive stipend.--If an employee
            elects not to be compensated through the stipend established by
            this subsection, the appropriate provisions of title 5, United
            States Code, shall apply.
                ``(3) Applicability of subsection.--This subsection applies
            to all Bureau employees, whether employed under section 1132 of
            this title or title 5, United States Code.
        ``(o) Definitions.--For the purpose of this section--
                ``(1) Education position.--The term `education position'
            means a position in the Bureau the duties and responsibilities
            of which--
                        ``(A) are performed on a school-year basis
                    principally in a Bureau school and involve--
                                ``(i) classroom or other instruction or the
                            supervision or direction of classroom or other
                            instruction;
                                ``(ii) any activity (other than teaching)
                            which requires academic credits in educational
                            theory and practice equal to the academic
                            credits in educational theory and practice
                            required for a bachelor's degree in education
                            from an accredited institution of higher
                            education;
                                ``(iii) any activity in or related to the
                            field of education notwithstanding that
                            academic credits in educational theory and
                            practice are not a formal requirement for the
                            conduct of such activity; or
                                ``(iv) support services at, or associated
                            with, the site of the school; or
                        ``(B) are performed at the agency level of the
                    Bureau and involve the implementation of education-
                    related programs other than the position for agency
                    superintendent for education.
                ``(2) Educator.--The term `educator' means an individual
            whose services are required, or who is employed, in an
            education position.
        ``(p) Covered Individuals; Election.--This section shall apply with
    respect to any educator hired after November 1, 1979 (and to any
    educator who elected for coverage under that provision after November
    1, 1979) and to the position in which such individual is employed. The
    enactment of this section shall not affect the continued employment of
    an individual employed on October 31, 1979 in an education position, or
    such person's right to receive the compensation attached to such
    position.

    ``SEC. 1133. COMPUTERIZED MANAGEMENT INFORMATION SYSTEM.

        ``(a) Establishment of System.--Not later than July 1, 2003, the
    Secretary shall establish within the Office, a computerized management
    information system, which shall provide processing and information to
    the Office. The information provided shall include information
    regarding--
                ``(1) student enrollment;
                ``(2) curriculum;
                ``(3) staffing;
                ``(4) facilities;
                ``(5) community demographics;
                ``(6) student assessment information;
                ``(7) information on the administrative and program costs
            attributable to each Bureau program, divided into discreet
            elements;
                ``(8) relevant reports;
                ``(9) personnel records;
                ``(10) finance and payroll; and
                ``(11) such other items as the Secretary deems appropriate.
        ``(b) Implementation of System.--Not later than July 1, 2004, the
    Secretary shall complete implementation of such a system at each field
    office and Bureau funded school.

    ``SEC. 1134. UNIFORM EDUCATION PROCEDURES AND PRACTICES.

        ``The Secretary shall cause the various divisions of the Bureau to
    formulate uniform procedures and practices with respect to such
    concerns of those divisions as relate to education, and shall report
    such practices and procedures to the Congress.

    ``SEC. 1135. RECRUITMENT OF INDIAN EDUCATORS.

        ``The Secretary shall institute a policy for the recruitment of
    qualified Indian educators and a detailed plan to promote employees
    from within the Bureau. Such plan shall include opportunities for
    acquiring work experience prior to actual work assignment.

    ``SEC. 1136. BIENNIAL REPORT; AUDITS.

        ``(a) Biennial Reports.--The Secretary shall submit to each
    appropriate committee of Congress, all Bureau funded schools, and the
    tribal governing bodies of such schools, a detailed biennial report on
    the state of education within the Bureau and any problems encountered
    in Indian education during the 2-year period covered by the report.
    Such report shall contain suggestions for the improvement of the Bureau
    educational system and for increasing tribal or local Indian control of
    such system. Such report shall also include the current status of
    tribally controlled community colleges. The annual budget submission
    for the Bureau's education programs shall include--
                ``(1) information on the funds provided to previously
            private schools under section 208 of the Indian Self-
            Determination and Education Assistance Act, and recommendations
            with respect to the future use of such funds;
                ``(2) the needs and costs of operations and maintenance of
            tribally controlled community colleges eligible for assistance
            under the Tribally Controlled Community College Assistance Act
            of 1978 and recommendations with respect to meeting such needs
            and costs; and
                ``(3) the plans required by sections 1121 (g), 1122(c), and
            1125(b).
        ``(b) Financial and Compliance Audits.--The Inspector General of
    the Department of the Interior shall establish a system to ensure that
    financial and compliance audits are conducted of each Bureau operated
    school at least once in every 3 years. Audits of Bureau schools shall
    be based upon the extent to which such school has complied with its
    local financial plan under section 1130.

    ``SEC. 1137. RIGHTS OF INDIAN STUDENTS.

        ``The Secretary shall prescribe such rules and regulations as are
    necessary to ensure the constitutional and civil rights of Indian
    students attending Bureau funded schools, including such students'
    right to privacy under the laws of the United States, such students'
    right to freedom of religion and expression, and such students' right
    to due process in connection with disciplinary actions, suspensions,
    and expulsions.

    ``SEC. 1138. REGULATIONS.

        ``(a) In General.--The Secretary is authorized to issue only such
    regulations as are necessary to ensure compliance with the specific
    provision of this Act. The Secretary shall publish proposed regulations
    in the Federal Register, shall provide a period of not less than 90
    days for public comment thereon, and shall place in parentheses after
    each regulatory section the citation to any statutory provision
    providing authority to promulgate such regulatory provision.
        ``(b) Miscellaneous.--
                ``(1) Construction.--The provisions of this Act shall
            supersede any conflicting provisions of law (including any
            conflicting regulations) in effect on the day before the date
            of the enactment of this Act and the Secretary is authorized to
            repeal any regulation inconsistent with the provisions of this
            Act.
                ``(2) Legal authority to be stated.--Regulations issued to
            implement this Act shall contain, immediately following each
            substantive provision of such regulations, citations to the
            particular section or sections of statutory law or other legal
            authority upon which provision is based.

    ``SEC. 1138A. REGIONAL MEETINGS AND NEGOTIATED RULEMAKING.

        ``(a) Meetings.--
                ``(1) In general.--The Secretary shall obtain tribal
            involvement in the development of proposed regulations under
            this part and the Tribally Controlled Schools Act of 1988. The
            Secretary shall obtain the advice of and recommendations from
            representatives of Indian tribes with Bureau funded schools on
            their reservations, Indian tribes whose children attend Bureau
            funded off-reservation boarding schools, school boards,
            administrators or employees of Bureau funded schools, and
            parents and teachers of students enrolled in Bureau funded
            schools.
                ``(2) Issues.--The Secretary shall provide for a
            comprehensive discussion and exchange of information concerning
            the implementation of this part and the Tribally Controlled
            Schools Act of 1988 through such mechanisms as regional
            meetings and electronic exchanges of information. The Secretary
            shall take into account the information received through such
            mechanisms in the development of proposed regulations and shall
            publish a summary of such information in the Federal Register
            together with such proposed regulations.
        ``(b) Draft Regulations.--
                ``(1) In general.--After obtaining the advice and
            recommendations described in subsection (a)(1) and before
            publishing proposed regulations in the Federal Register, the
            Secretary shall prepare draft regulations implementing this
            part and the Tribally Controlled Schools Act of 1988 and shall
            submit such regulations to a negotiated rulemaking process.
            Participants in the negotiations process shall be chosen by the
            Secretary from individuals nominated by the entities described
            in subsection (a)(1). To the maximum extent possible, the
            Secretary shall ensure that the tribal representative
            membership chosen pursuant to the preceding sentence reflects
            the proportionate share of students from tribes served by the
            Bureau funded school system. The negotiation process shall be
            conducted in a timely manner in order that the final
            regulations may issued by the Secretary no later than 18 months
            after the enactment of this section.
                ``(2) Notification to congress.--If draft regulations
            implementing this part and the Tribally Controlled Schools Act
            of 1988 are not issued in final form by the deadline provided
            in paragraph (1), the Secretary shall notify the appropriate
            committees of Congress of which draft regulations were not
            issued in final form by the deadline and the reason such final
            regulations were not issued.
                ``(3) Expansion of negotiated rulemaking.--All regulations
            pertaining to this part and the Tribally Controlled Schools Act
            of 1988 that are promulgated after the date of the enactment of
            this subsection shall be subject to a negotiated rulemaking
            (including the selection of the regulations to be negotiated),
            unless the Secretary determines that applying such a
            requirement with respect to given regulations is impracticable,
            unnecessary, or contrary to the public interest (within the
            meaning of section 553(b)(3)(B) of title 5), and publishes the
            basis for such determination in the Federal Register at the
            same time as the proposed regulations in question are first
            published. All published proposed regulations shall conform to
            agreements resulting from such negotiated rulemaking unless the
            Secretary reopens the negotiated rulemaking process or provides
            a written explanation to the participants in that process why
            the Secretary has decided to depart from such agreements. Such
            negotiated rulemaking shall be conducted in accordance with the
            provisions of subsection (a), and the Secretary shall ensure
            that a clear and reliable record of agreements reached during
            the negotiation process is maintained.
        ``(c) Applicability of Federal Advisory Committee Act.--The Federal
    Advisory Committee Act shall apply to activities carried out under this
    section.

    ``SEC. 1139. EARLY CHILDHOOD DEVELOPMENT PROGRAM.

        ``(a) In General.--The Secretary shall provide grants to tribes,
    tribal organizations, and consortia of tribes and tribal organizations
    to fund early childhood development programs that are operated by such
    tribes, organizations, or consortia.
        ``(b) Amount of Grants.--
                ``(1) In general.--The total amount of the grants provided
            under subsection (a) with respect to each tribe, tribal
            organization, or consortium of tribes or tribal organizations
            for each fiscal year shall be equal to the amount which bears
            the same relationship to the total amount appropriated under
            the authority of subsection (g) for such fiscal year (less
            amounts provided under subsection (f)) as--
                      ``(A) the total number of children under 6 years of
                    age who are members of--
                                ``(i) such tribe;
                                ``(ii) the tribe that authorized such
                            tribal organization; or
                                ``(iii) any tribe that--
                                        ``(I) is a member of such
                                    consortium; or
                                        ``(II) authorizes any tribal
                                    organization that is a member of such
                                    consortium; bears to
                        ``(B) the total number of all children under 6
                    years of age who are members of any tribe that--
                                ``(i) is eligible to receive funds under
                            subsection (a);
                                ``(ii) is a member of a consortium that is
                            eligible to receive such funds; or
                                ``(iii) authorizes a tribal organization
                            that is eligible to receive such funds.
                ``(2) Limitation.--No grant may be provided under
            subsection (a)--
                        ``(A) to any tribe that has less than 500 members;
                        ``(B) to any tribal organization which is
                    authorized--
                                ``(i) by only one tribe that has less than
                            500 members; or
                                ``(ii) by one or more tribes that have a
                            combined total membership of less than 500
                            members; or
                        ``(C) to any consortium composed of tribes, or
                    tribal organizations authorized by tribes, that have a
                    combined total tribal membership of less than 500
                    members.
        ``(c) Application.
                ``(1) In general.--A grant may be provided under subsection
            (a) to a tribe, tribal organization, or consortia of tribes and
            tribal organizations only if the tribe, organization, or
            consortia submits to the Secretary an application for the grant
            at such time and in such form as the Secretary shall prescribe.
                ``(2) Contents.--Applications submitted under paragraph (1)
            shall set forth the early childhood development program that
            the applicant desires to operate.
        ``(d) Requirement of Programs Funded.--The early childhood
    development programs that are funded by grants provided under
    subsection (a)--
                ``(1) shall coordinate existing programs and may provide
            services that meet identified needs of parents and children
            under 6 years of age which are not being met by existing
            programs, including--
                        ``(A) prenatal care;
                        ``(B) nutrition education;
                        ``(C) health education and screening;
                        ``(D) family literacy services;
                        ``(E) educational testing; and
                        ``(F) other educational services;
                ``(2) may include instruction in the language, art, and
            culture of the tribe; and
                ``(3) shall provide for periodic assessment of the program.
        ``(e) Coordination of Family Literacy Programs.--Family literacy
    programs operated under this section and other family literacy programs
    operated by the Bureau of Indian Affairs shall be coordinated with
    family literacy programs for Indian children under part B of title I of
    the Elementary and Secondary Education Act of 1965 in order to avoid
    duplication and to encourage the dissemination of information on
    quality family literacy programs serving Indians.
        ``(f) Administrative Costs.--The Secretary shall, out of funds
    appropriated under subsection (g), include in the grants provided under
    subsection (a) amounts for administrative costs incurred by the tribe,
    tribal organization, or consortium of tribes in establishing and
    maintaining the early childhood development program.
        ``(g) Authorization of Appropriations.--For the purpose of carrying
    out the provisions of this section, there are authorized to be
    appropriated $10,000,000 for fiscal year 2002 and such sums as may be
    necessary for each of the fiscal years 2003, 2004, 2005, and 2006.

    ``SEC. 1140. TRIBAL DEPARTMENTS OR DIVISIONS OF EDUCATION.

        ``(a) In General.--Subject to the availability of appropriations,
    the Secretary shall provide grants and technical assistance to tribes
    for the development and operation of tribal departments of education
    for the purpose of planning and coordinating all educational programs
    of the tribe.
        ``(b) Grants.--Grants provided under this section shall--
                ``(1) be based on applications from the governing body of
            the tribe;
                ``(2) reflect factors such as geographic and population
            diversity;
                ``(3) facilitate tribal control in all matters relating to
            the education of Indian children on Indian reservations (and on
            former Indian reservations in Oklahoma);
                ``(4) provide for the development of coordinated
            educational programs on Indian reservations (and on former
            Indian reservations in Oklahoma) (including all preschool,
            elementary, secondary, and higher or vocational educational
            programs funded by tribal, Federal, or other sources) by
            encouraging tribal administrative support of all Bureau funded
            educational programs as well as encouraging tribal cooperation
            and coordination with all educational programs receiving
            financial support from State agencies, other Federal agencies,
            or private entities;
                ``(5) provide for the development and enforcement of tribal
            educational codes, including tribal educational policies and
            tribal standards applicable to curriculum, personnel, students,
            facilities, and support programs; and
                ``(6) otherwise comply with regulations for grants under
            section 103(a) of the Indian Self-Determination and Educational
            Assistance Act that are in effect on the date that application
            for such grants are made.
        ``(c) Priorities.--
                ``(1) In general.--In making grants under this section, the
            Secretary shall give priority to any application that--
                        ``(A) includes assurances from the majority of
                    Bureau funded schools located within the boundaries of
                    the reservation of the applicant that the tribal
                    department of education to be funded under this section
                    will provide coordinating services and technical
                    assistance to all of such schools, including the
                    submission to each applicable agency of a unified
                    application for funding for all of such schools which
                    provides that--
                                ``(i) no administrative costs other than
                            those attributable to the individual programs
                            of such schools will be associated with the
                            unified application; and
                                ``(ii) the distribution of all funds
                            received under the unified application will be
                            equal to the amount of funds provided by the
                            applicable agency to which each of such schools
                            is entitled under law;
                        ``(B) includes assurances from the tribal governing
                    body that the tribal department of education funded
                    under this section will administer all contracts or
                    grants (except those covered by the other provisions of
                    this title and the Tribally Controlled Community
                    College Assistance Act of 1978) for education programs
                    administered by the tribe and will coordinate all of
                    the programs to the greatest extent possible;
                        ``(C) includes assurances for the monitoring and
                    auditing by or through the tribal department of
                    education of all education programs for which funds are
                    provided by contract or grant to ensure that the
                    programs meet the requirements of law; and
                        ``(D) provides a plan and schedule for--
                                ``(i) the assumption over the term of the
                            grant by the tribal department of education of
                            all assets and functions of the Bureau agency
                            office associated with the tribe, insofar as
                            those responsibilities relate to education; and
                                ``(ii) the termination by the Bureau of
                            such operations and office at the time of such
                            assumption,
                    except that when mutually agreeable between the tribal
                    governing body and the Assistant Secretary, the period
                    in which such assumption is to occur may be modified,
                    reduced, or extended after the initial year of the
                    grant.
                ``(2) Time period of grant.--Subject to the availability of
            appropriated funds, grants provided under this section shall be
            provided for a period of 3 years and the grant may, if
            performance by the grantee is satisfactory to the Secretary, be
            renewed for additional 3-year terms.
        ``(d) Terms, Conditions, or Requirements.--The Secretary shall not
    impose any terms, conditions, or requirements on the provision of
    grants under this section that are not specified in this section.
        ``(e) Authorization of Appropriations.--For the purpose of carrying
    out the provisions of this section, there are authorized to be
    appropriated $2,000,000 for fiscal year 2002 and such sums as may be
    necessary for each of the fiscal years 2003, 2004, 2005, and 2006.

    ``SEC. 1141. DEFINITIONS.

        ``For the purposes of this part, unless otherwise specified:
                ``(1) Agency school board.--The term `agency school board'
            means a body, the members of which are appointed by all of the
            school boards of the schools located within an agency,
            including schools operated under contract or grant, and the
            number of such members shall be determined by the Secretary in
            consultation with the affected tribes, except that, in agencies
            serving a single school, the school board of such school shall
            fulfill these duties, and in agencies having schools or a
            school operated under contract or grant, one such member at
            least shall be from such a school.
                ``(2) Bureau.--The term `Bureau' means the Bureau of Indian
            Affairs of the Department of the Interior.
                ``(3) Bureau funded school.--The term `Bureau funded
            school' means--
                        ``(A) a Bureau school;
                        ``(B) a contract or grant school; or
                        ``(C) a school for which assistance is provided
                    under the Tribally Controlled Schools Act of 1988.
                ``(4) Bureau school.--The term `Bureau school' means a
            Bureau operated elementary or secondary day or boarding school
            or a Bureau operated dormitory for students attending a school
            other than a Bureau school.
                ``(5) Contract or grant school.--The term `contract or
            grant school' means an elementary or secondary school or
            dormitory which receives financial assistance for its operation
            under a contract, grant or agreement with the Bureau under
            section 102, 103(a), or 208 of the Indian Self-Determination
            and Education Assistance Act, or under the Tribally Controlled
            Schools Act of 1988.
                ``(6) Education line officer.--The term `education line
            officer' means education personnel under the supervision of the
            Director, whether located in the central, area, or agency
            offices.
                ``(7) Family literacy services.--The term `family literacy
            services' has the meaning given that term in section 8101 of
            the Elementary and Secondary Education Act of 1965 (20 U.S.C.
            8801).
                ``(8) Financial plan.--The term `financial plan' means a
            plan of services provided by each Bureau school.
                ``(9) Indian organization.--the term `Indian organization'
            means any group, association, partnership, corporation, or
            other legal entity owned or controlled by a federally
            recognized Indian tribe or tribes, or a majority of whose
            members are members of federally recognized tribes.
                ``(10) Local educational agency.--The term `local
            educational agency' means a board of education or other legally
            constituted local school authority having administrative
            control and direction of free public education in a county,
            township, independent, or other school district located within
            a State, and includes any State agency which directly operates
            and maintains facilities for providing free public education.
                ``(11) Local school board.--The term `local school board',
            when used with respect to a Bureau school, means a body chosen
            in accordance with the laws of the tribe to be served or, in
            the absence of such laws, elected by the parents of the Indian
            children attending the school, except that in schools serving a
            substantial number of students from different tribes, the
            members shall be appointed by the governing bodies of the
            tribes affected, and the number of such members shall be
            determined by the Secretary in consultation with the affected
            tribes.
                ``(12) Office.--The term `Office' means the Office of
            Indian Education Programs within the Bureau.
                ``(13) Secretary.--The term `Secretary' means the Secretary
            of the Interior.
                ``(14) Supervisor.--The term `supervisor' means the
            individual in the position of ultimate authority at a Bureau
            school.
                ``(15) Tribal governing body.--The term `tribal governing
            body' means, with respect to any school, the tribal governing
            body, or tribal governing bodies, that represent at least 90
            percent of the students served by such school.
                ``(16) Tribe.--The term `tribe' means any Indian tribe,
            band, nation, or other organized group or community, including
            any Alaska Native village or regional or village corporation as
            defined in or established pursuant to the Alaska Native Claims
            Settlement Act, which is recognized as eligible for the special
            programs and services provided by the United States to Indians
            because of their status as Indians.''.

    SEC. 314. TRIBALLY CONTROLLED SCHOOLS ACT OF 1988.

        Sections 5202 through 5212 of the Tribally Controlled Schools Act
    of 1988 (25 U.S.C. 2501 et seq.) are amended to read as follows:

    ``SEC. 5202. FINDINGS.

        ``Congress, after careful review of the Federal Government's
    historical and special legal relationship with, and resulting
    responsibilities to, Indians, finds that--
                ``(1) the Indian Self-Determination and Education
            Assistance Act, which was a product of the legitimate
            aspirations and a recognition of the inherent authority of
            Indian nations, was and is a crucial positive step towards
            tribal and community control;
                ``(2) the Bureau of Indian Affairs' administration and
            domination of the contracting process under such Act has not
            provided the full opportunity to develop leadership skills
            crucial to the realization of self-government and has denied
            Indians an effective voice in the planning and implementation
            of programs for the benefit of Indians which are responsive to
            the true needs of Indian communities;
                ``(3) Indians will never surrender their desire to control
            their relationships both among themselves and with non-Indian
            governments, organizations, and persons;
                ``(4) true self-determination in any society of people is
            dependent upon an educational process which will ensure the
            development of qualified people to fulfill meaningful
            leadership roles;
                ``(5) the Federal administration of education for Indian
            children has not effected the desired level of educational
            achievement or created the diverse opportunities and personal
            satisfaction that education can and should provide;
                ``(6) true local control requires the least possible
            Federal interference; and
                ``(7) the time has come to enhance the concepts made
            manifest in the Indian Self-Determination and Education
            Assistance Act.

    ``SEC. 5203. DECLARATION OF POLICY.

        ``(a) Recognition.--Congress recognizes the obligation of the
    United States to respond to the strong expression of the Indian people
    for self-determination by assuring maximum Indian participation in the
    direction of educational services so as to render such services more
    responsive to the needs and desires of those communities.
        ``(b) Commitment.--Congress declares its commitment to the
    maintenance of the Federal Government's unique and continuing trust
    relationship with and responsibility to the Indian people through the
    establishment of a meaningful Indian self-determination policy for
    education which will deter further perpetuation of Federal bureaucratic
    domination of programs.
        ``(c) National Goal.--Congress declares that a major national goal
    of the United States is to provide the resources, processes, and
    structure which will enable tribes and local communities to effect the
    quantity and quality of educational services and opportunities which
    will permit Indian children to compete and excel in the life areas of
    their choice and to achieve the measure of self-determination essential
    to their social and economic well-being.
        ``(d) Educational Needs.--Congress affirms the reality of the
    special and unique educational needs of Indian peoples, including the
    need for programs to meet the linguistic and cultural aspirations of
    Indian tribes and communities. These may best be met through a grant
    process.
        ``(e) Federal Relations.--Congress declares its commitment to these
    policies and its support, to the full extent of its responsibility, for
    Federal relations with the Indian Nations.
        ``(f) Termination.--Congress hereby repudiates and rejects House
    Resolution 108 of the 83d Congress and any policy of unilateral
    termination of Federal relations with any Indian Nation.

    ``SEC. 5204. GRANTS AUTHORIZED.

        ``(a) In General.--
                ``(1) Eligibility.--The Secretary shall provide grants to
            Indian tribes, and tribal organizations that--
                        ``(A) operate contract schools under title XI of
                    the Education Amendments of 1978 and notify the
                    Secretary of their election to operate the schools with
                    assistance under this part rather than continuing as
                    contract school;
                        ``(B) operate other tribally controlled schools
                    eligible for assistance under this part and submit
                    applications (which are approved by their tribal
                    governing bodies) to the Secretary for such grants; or
                        ``(C) elect to assume operation of Bureau funded
                    schools with the assistance under this part and submit
                    applications (which are approved by their tribal
                    governing bodies) to the Secretary for such grants.
                ``(2) Deposit of funds.--Grants provided under this part
            shall be deposited into the general operating fund of the
            tribally controlled school with respect to which the grant is
            made.
                ``(3) Use of funds.--(A) Except as otherwise provided in
            this paragraph, grants provided under this part shall be used
            to defray, at the discretion of the school board of the
            tribally controlled school with respect to which the grant is
            provided, any expenditures for education related activities for
            which any funds that compose the grant may be used under the
            laws described in section 5205(a), including, but not limited
            to, expenditures for--
                        ``(i) school operations, academic, educational,
                    residential, guidance and counseling, and
                    administrative purposes; and
                        ``(ii) support services for the school, including
                    transportation.
                ``(B) Grants provided under this part may, at the
            discretion of the school board of the tribally controlled
            school with respect to which such grant is provided, be used to
            defray operations and maintenance expenditures for the school
            if any funds for the operation and maintenance of the school
            are allocated to the school under the provisions of any of the
            laws described in section 5205(a).
        ``(b) Limitations.--
                ``(1) One grant per tribe or organization per fiscal
            year.--Not more than one grant may be provided under this part
            with respect to any Indian tribe or tribal organization for any
            fiscal year.
                ``(2) Nonsectarian use.--Funds provided under any grant
            made under this part may not be used in connection with
            religious worship or sectarian instruction.
                ``(3) Administrative costs limitation.--Funds provided
            under any grant under this part may not be expended for
            administrative costs (as defined in section 1128(h)(1) of the
            Education Amendments of 1978) in excess of the amount generated
            for such costs under section 1128 of such Act.
        ``(c) Limitation on Transfer of Funds Among Schoolsites.--
                ``(1) In general.--In the case of a grantee that operates
            schools at more than one schoolsite, the grantee may expend not
            more than the lesser of--
                        ``(A) 10 percent of the funds allocated for such
                    schoolsite under section 1128 of the Education
                    Amendments of 1978; or
                        ``(B) $400,000 of such funds, at any other
                    schoolsite.
                ``(2) Definition of schoolsite.--For purposes of this
            subsection, the term `schoolsite' means the physical location
            and the facilities of an elementary or secondary educational or
            residential program operated by, or under contract or grant
            with, the Bureau for which a discreet student count is
            identified under the funding formula established under section
            1127 of the Education Amendments of 1978.
        ``(d) No Requirement To Accept Grants.--Nothing in this part may be
    construed--
                ``(1) to require a tribe or tribal organization to apply
            for or accept; or
                ``(2) to allow any person to coerce any tribe or tribal
            organization to apply for, or accept,
    a grant under this part to plan, conduct, and administer all of, or any
    portion of, any Bureau program. Such applications and the timing of
    such applications shall be strictly voluntary. Nothing in this part may
    be construed as allowing or requiring any grant with any entity other
    than the entity to which the grant is provided.
        ``(e) No Effect on Federal Responsibility.--Grants provided under
    this part shall not terminate, modify, suspend, or reduce the
    responsibility of the Federal Government to provide a program.
        ``(f) Retrocession.--
                ``(1) In general.--Whenever a tribal governing body
            requests retrocession of any program for which assistance is
            provided under this part, such retrocession shall become
            effective upon a date specified by the Secretary that is not
            later than 120 days after the date on which the tribal
            governing body requests the retrocession. A later date as may
            be specified if mutually agreed upon by the Secretary and the
            tribal governing body. If such a program is retroceded, the
            Secretary shall provide to any Indian tribe served by such
            program at least the same quantity and quality of services that
            would have been provided under such program at the level of
            funding provided under this part prior to the retrocession.
                ``(2) Status after retrocession.--The tribe requesting
            retrocession shall specify whether the retrocession is to
            status as a Bureau operated school or as a school operated
            under contract under title XI of the Education Amendments of
            1978.
                ``(3) Transfer of equipment and materials.--Except as
            otherwise determined by the Secretary, the tribe or tribal
            organization operating the program to be retroceded must
            transfer to the Secretary (or to the tribe or tribal
            organization which will operate the program as a contract
            school) the existing equipment and materials which were
            acquired--
                        ``(A) with assistance under this part; or
                        ``(B) upon assumption of operation of the program
                    under this part if the school was a Bureau funded
                    school under title XI of the Education Amendments of
                    1978 before receiving assistance under this part.
        ``(g) Prohibition of Termination for Administrative Convenience.--
    Grants provided under this part may not be terminated, modified,
    suspended, or reduced solely for the convenience of the administering
    agency.

    ``SEC. 5205. COMPOSITION OF GRANTS.

        ``(a) In General.--The grant provided under this part to an Indian
    tribe or tribal organization for any fiscal year shall consist of--
                ``(1) the total amount of funds allocated for such fiscal
            year under sections 1127 and 1128 of the Education Amendments
            of 1978 with respect to the tribally controlled schools
            eligible for assistance under this part which are operated by
            such Indian tribe or tribal organization, including, but not
            limited to, funds provided under such sections, or under any
            other provision of law, for transportation costs;
                ``(2) to the extent requested by such Indian tribe or
            tribal organization, the total amount of funds provided from
            operations and maintenance accounts and, notwithstanding
            section 105 of the Indian Self-Determination Act, or any other
            provision of law, other facilities accounts for such schools
            for such fiscal year (including but not limited to those
            referenced under section 1126(d) of the Education Amendments of
            1978 or any other law); and
                ``(3) the total amount of funds that are allocated to such
            schools for such fiscal year under--
                        ``(A) title I of the Elementary and Secondary
                    Education Act of 1965;
                        ``(B) the Individuals with Disabilities Education
                    Act; and
                        ``(C) any other Federal education law, that are
                    allocated to such schools for such fiscal year.
        ``(b) Special Rules.--
                ``(1) In general.--(A) Funds allocated to a tribally
            controlled school by reason of paragraph (1) or (2) of
            subsection (a) shall be subject to the provisions of this part
            and shall not be subject to any additional restriction,
            priority, or limitation that is imposed by the Bureau with
            respect to funds provided under--
                        ``(i) title I of the Elementary and Secondary
                    Education Act of 1965;
                        ``(ii) the Individuals with Disabilities Education
                    Act; or
                        ``(iii) any Federal education law other than title
                    XI of the Education Amendments of 1978.
                ``(B) Indian tribes and tribal organizations to which
            grants are provided under this part, and tribally controlled
            schools for which such grants are provided, shall not be
            subject to any requirements, obligations, restrictions, or
            limitations imposed by the Bureau that would otherwise apply
            solely by reason of the receipt of funds provided under any law
            referred to in clause (i), (ii), or (iii) of subparagraph (A).
                ``(2) Schools considered contract schools.--Tribally
            controlled schools for which grants are provided under this
            part shall be treated as contract schools for the purposes of
            allocation of funds under sections 1126(d), 1127, and 1128 of
            the Education Amendments of 1978.
                ``(3) Schools considered bureau schools.--Tribally
            controlled schools for which grants are provided under this
            chapter shall be treated as Bureau schools for the purposes of
            allocation of funds provided under--
                        ``(A) title I of the Elementary and Secondary
                    Education Act of 1965;
                        ``(B) the Individuals with Disabilities Education
                    Act; and
                        ``(C) any other Federal education law, that are
                    distributed through the Bureau.
                ``(4) Accounts; use of certain funds.--(A) Notwithstanding
            section 5204(a)(2), with respect to funds from facilities
            improvement and repair, alteration and renovation (major or
            minor), health and safety, or new construction accounts
            included in the grant under section 5204(a), the grantee shall
            maintain a separate account for such funds. At the end of the
            period designated for the work covered by the funds received,
            the grantee shall submit to the Secretary a separate accounting
            of the work done and the funds expended to the Secretary. Funds
            received from these accounts may only be used for the purpose
            for which they were appropriated and for the work encompassed
            by the application or submission under which they were
            received.
                ``(B) Notwithstanding subparagraph (A), a school receiving
            a grant under this part for facilities improvement and repair
            may use such grant funds for new construction if the tribal
            government or other organization provides funding for the new
            construction equal to at least 25 percent of the total cost of
            such new construction.
                ``(C) Where the appropriations measure or the application
            submission does not stipulate a period for the work covered by
            the funds so designated, the Secretary and the grantee shall
            consult and determine such a period prior to the transfer of
            the funds. A period so determined may be extended upon mutual
            agreement of the Secretary and the grantee.
                ``(5) Enforcement of request to include funds.--If the
            Secretary fails to carry out a request made under subsection
            (a)(2) within 180 days of a request filed by an Indian tribe or
            tribal organization to include in such tribe or organization's
            grant the funds described in subsection (a)(2), the Secretary
            shall be deemed to have approved such request and the Secretary
            shall immediately amend the grant accordingly. Such tribe or
            organization may enforce its rights under subsection (a)(2) and
            this paragraph, including any denial or failure to act on such
            tribe or organization's request, pursuant to the disputes
            authority described in section 5209(e).

    ``SEC. 5206. ELIGIBILITY FOR GRANTS.

        ``(a) Rules.--
                ``(1) In general.--A tribally controlled school is eligible
            for assistance under this part if the school--
                        ``(A) on April 28, 1988, was a contract school
                    under title XI of the Education Amendments of 1978 and
                    the tribe or tribal organization operating the school
                    submits to the Secretary a written notice of election
                    to receive a grant under this part;
                        ``(B) was a Bureau operated school under title XI
                    of the Education Amendments of 1978 and has met the
                    requirements of subsection (b);
                        ``(C) is a school for which the Bureau has not
                    provided funds, but which has met the requirements of
                    subsection (c); or
                        ``(D) is a school with respect to which an election
                    has been made under paragraph (2) and which has met the
                    requirements of subsection (b).
                ``(2) New schools.--Any application which has been
            submitted under the Indian Self-Determination and Education
            Assistance Act by an Indian tribe for a school which is not in
            operation on the date of the enactment of the No Child Left
            Behind Act of 2001 shall be reviewed under the guidelines and
            regulations for applications submitted under the Indian Self-
            Determination and Education Assistance Act that were in effect
            at the time the application was submitted, unless the Indian
            tribe or tribal organization elects to have the application
            reviewed under the provisions of subsection (b).
        ``(b) Additional Requirements for Bureau Funded Schools and Certain
    Electing Schools.--
                ``(1) Bureau funded schools.--A school that was a Bureau
            funded school under title XI of the Education Amendments of
            1978 on the date of the enactment of the No Child Left Behind
            Act of 2001, and any school with respect to which an election
            is made under subsection (a)(2), meets the requirements of this
            subsection if--
                        ``(A) the Indian tribe or tribal organization that
                    operates, or desires to operate, the school submits to
                    the Secretary an application requesting that the
                    Secretary--
                                ``(i) transfer operation of the school to
                            the Indian tribe or tribal organization, if the
                            Indian tribe or tribal organization is not
                            already operating the school; and
                                ``(ii) make a determination as to whether
                            the school is eligible for assistance under
                            this part; and
                        ``(B) the Secretary makes a determination that the
                    school is eligible for assistance under this part.
                ``(2) Certain electing schools.--(A) By not later than the
            date that is 120 days after the date on which an application is
            submitted to the Secretary under paragraph (1)(A), the
            Secretary shall determine--
                        ``(i) in the case of a school which is not being
                    operated by the Indian tribe or tribal organization,
                    whether to transfer operation of the school to the
                    Indian tribe or tribal organization; and
                        ``(ii) whether the school is eligible for
                    assistance under this part.
                ``(B) In considering applications submitted under paragraph
            (1)(A), the Secretary--
                        ``(i) shall transfer operation of the school to the
                    Indian tribe or tribal organization, if the tribe or
                    tribal organization is not already operating the
                    school; and
                        ``(ii) shall determine that the school is eligible
                    for assistance under this part, unless the Secretary
                    finds by clear and convincing evidence that the
                    services to be provided by the Indian tribe or tribal
                    organization will be deleterious to the welfare of the
                    Indians served by the school.
                ``(C) In considering applications submitted under paragraph
            (1)(A), the Secretary shall consider whether the Indian tribe
            or tribal organization would be deficient in operating the
            school with respect to--
                        ``(i) equipment;
                        ``(ii) bookkeeping and accounting procedures;
                        ``(iii) ability to adequately manage a school; or
                        ``(iv) adequately trained personnel.
        ``(c) Additional Requirements for a School Which Is Not a Bureau
    Funded School.--
                ``(1) In general.--A school which is not a Bureau funded
            school under title XI of the Education Amendments of 1978 meets
            the requirements of this subsection if--
                        ``(A) the Indian tribe or tribal organization that
                    operates, or desires to operate, the school submits to
                    the Secretary an application requesting a determination
                    by the Secretary as to whether the school is eligible
                    for assistance under this part; and
                        ``(B) the Secretary makes a determination that a
                    school is eligible for assistance under this part.
                ``(2) Deadline for determination by secretary.--(A) By not
            later than the date that is 180 days after the date on which an
            application is submitted to the Secretary under paragraph
            (1)(A), the Secretary shall determine whether the school is
            eligible for assistance under this part.
                ``(B) In making the determination under subparagraph (A),
            the Secretary shall give equal consideration to each of the
            following factors:
                        ``(i) with respect to the applicant's proposal--
                                ``(I) the adequacy of facilities or the
                            potential to obtain or provide adequate
                            facilities;
                                ``(II) geographic and demographic factors
                            in the affected areas;
                                ``(III) adequacy of the applicant's program
                            plans;
                                ``(IV) geographic proximity of comparable
                            public education; and
                                ``(V) the needs as expressed by all
                            affected parties, including but not limited to
                            students, families, tribal governments at both
                            the central and local levels, and school
                            organizations; and
                        ``(ii) with respect to all education services
                    already available--
                                ``(I) geographic and demographic factors in
                            the affected areas;
                                ``(II) adequacy and comparability of
                            programs already available;
                                ``(III) consistency of available programs
                            with tribal education codes or tribal
                            legislation on education; and
                                ``(IV) the history and success of these
                            services for the proposed population to be
                            served, as determined from all factors
                            including, if relevant, standardized
                            examination performance.
                        ``(C) The Secretary may not make a determination
                    under this paragraph that is primarily based upon the
                    geographic proximity of comparable public education.
                        ``(D) Applications submitted under paragraph (1)(A)
                    shall include information on the factors described in
                    subparagraph (B)(i), but the applicant may also provide
                    the Secretary such information relative to the factors
                    described in subparagraph (B)(ii) as the applicant
                    considers appropriate.
                        ``(E) If the Secretary fails to make a
                    determination under subparagraph (A) with respect to an
                    application within 180 days after the date on which the
                    Secretary received the application, the Secretary shall
                    be treated as having made a determination that the
                    tribally controlled school is eligible for assistance
                    under the title and the grant shall become effective 18
                    months after the date on which the Secretary received
                    the application, or on an earlier date, at the
                    Secretary's discretion.
        ``(d) Filing of Applications and Reports.--
                ``(1) In general.--All applications and reports submitted
            to the Secretary under this part, and any amendments to such
            applications or reports, shall be filed with the education line
            officer designated by the Director of the Office of Indian
            Education Programs of the Bureau of Indian Affairs. The date on
            which such filing occurs shall, for purposes of this part, be
            treated as the date on which the application or amendment was
            submitted to the Secretary.
                ``(2) Supporting documentation.--Any application that is
            submitted under this chapter shall be accompanied by a document
            indicating the action taken by the tribal governing body in
            authorizing such application.
        ``(e) Effective Date for Approved Applications.--Except as provided
    by subsection (c)(2)(E), a grant provided under this part, and any
    transfer of the operation of a Bureau school made under subsection (b),
    shall become effective beginning the academic year succeeding the
    fiscal year in which the application for the grant or transfer is made,
    or at an earlier date determined by the Secretary.
        ``(f) Denial of Applications.--
                ``(1) In general.--Whenever the Secretary refuses to
            approve a grant under this chapter, to transfer operation of a
            Bureau school under subsection (b), or determines that a school
            is not eligible for assistance under this part, the Secretary
            shall--
                        ``(A) state the objections in writing to the tribe
                    or tribal organization within the allotted time;
                        ``(B) provide assistance to the tribe or tribal
                    organization to overcome all stated objections.
                        ``(C) at the request of the tribe or tribal
                    organization, provide the tribe or tribal organization
                    a hearing on the record under the same rules and
                    regulations that apply under the Indian Self-
                    Determination and Education Assistance Act; and
                        ``(D) provide an opportunity to appeal the
                    objection raised.
                ``(2) Timeline for reconsideration of amended
            applications.--The Secretary shall reconsider any amended
            application submitted under this part within 60 days after the
            amended application is submitted to the Secretary.
        ``(g) Report.--The Bureau shall submit an annual report to the
    Congress on all applications received, and actions taken (including the
    costs associated with such actions), under this section at the same
    time that the President is required to submit to Congress the budget
    under section 1105 of title 31, United States Code.

    ``SEC. 5207. DURATION OF ELIGIBILITY DETERMINATION.

        ``(a) In General.--If the Secretary determines that a tribally
    controlled school is eligible for assistance under this part, the
    eligibility determination shall remain in effect until the
    determination is revoked by the Secretary, and the requirements of
    subsection (b) or (c) of section 5206, if applicable, shall be
    considered to have been met with respect to such school until the
    eligibility determination is revoked by the Secretary.
        ``(b) Annual Reports.--
                ``(1) In general.--Each recipient of a grant provided under
            this part shall complete an annual report which shall be
            limited to--
                        ``(A) an annual financial statement reporting
                    revenue and expenditures as defined by the cost
                    accounting established by the grantee;
                        ``(B) an annual financial audit conducted pursuant
                    to the standards of the Single Audit Act of 1984;
                        ``(C) an annual submission to the Secretary of the
                    number of students served and a brief description of
                    programs offered under the grant; and
                        ``(D) a program evaluation conducted by an
                    impartial evaluation review team, to be based on the
                    standards established for purposes of subsection
                    (c)(1)(A)(ii).
                ``(2) Evaluation review teams.--Where appropriate, other
            tribally controlled schools and representatives of tribally
            controlled community colleges shall make up members of the
            evaluation review teams.
                ``(3) Evaluations.--In the case of a school which is
            accredited, evaluations will be conducted at intervals under
            the terms of accreditation.
                ``(4) Submission of report.--
                        ``(A) To tribally governing body.--Upon completion
                    of the report required under paragraph (a), the
                    recipient of the grant shall send (via first class
                    mail, return receipt requested) a copy of such annual
                    report to the tribal governing body (as defined in
                    section 1132(f) of the Education Amendments of 1978) of
                    the tribally controlled school.
                        ``(B) To secretary.--Not later than 30 days after
                    receiving written confirmation that the tribal
                    governing body has received the report send pursuant to
                    subsection (A), the recipient of the grant shall send a
                    copy of the report to the Secretary.
        ``(c) Revocation of Eligibility.--
                ``(1) In general.--(A) The Secretary shall not revoke a
            determination that a school is eligible for assistance under
            this part if--
                        ``(i) the Indian tribe or tribal organization
                    submits the reports required under subsection (b) with
                    respect to the school; and
                        ``(ii) at least one of the following subclauses
                    applies with respect to the school:
                                ``(I) The school is certified or accredited
                            by a State or regional accrediting association
                            or is a candidate in good standing for such
                            accreditation under the rules of the State or
                            regional accrediting association, showing that
                            credits achieved by the students within the
                            education programs are, or will be, accepted at
                            grade level by a State certified or regionally
                            accredited institution.
                                ``(II) A determination made by the
                            Secretary that there is a reasonable
                            expectation that the accreditation described in
                            subclause (I), or the candidacy in good
                            standing for such accreditation, will be
                            reached by the school within 3 years and that
                            the program offered by the school is beneficial
                            to the Indian students.
                                ``(III) The school is accredited by a
                            tribal department of education if such
                            accreditation is accepted by a generally
                            recognized regional or State accreditation
                            agency.
                                ``(IV) The schools accept the standards
                            promulgated under section 1121 of the Education
                            Amendments of 1978 and an evaluation of
                            performance is conducted under this section in
                            conformance with the regulations pertaining to
                            Bureau operated schools by an impartial
                            evaluator chosen by the grantee, but no grantee
                            shall be required to comply with these
                            standards to a higher degree than a comparable
                            Bureau operated school.
                                ``(V) A positive evaluation of the school
                            is conducted by an impartial evaluator agreed
                            upon by the Secretary and the grantee every 2
                            years under standards adopted by the contractor
                            under a contract for a school entered into
                            under the Indian Self-Determination and
                            Education Assistance Act (or revisions of such
                            standards agreed to by the Secretary and the
                            grantee) prior to the date of the enactment of
                            this Act. If the Secretary and the grantee
                            other than the tribal governing body fail to
                            agree on such an evaluator, the tribal
                            governing body shall choose the evaluator or
                            perform the evaluation. If the Secretary and a
                            grantee which is the tribal governing body fail
                            to agree on such an evaluator, this subclause
                            shall not apply.
                ``(B) The choice of standards employed for the purpose of
            subparagraph (A)(ii) shall be consistent with section 1121(e)
            of the Education Amendments of 1978.
                ``(2) Notice requirements for revocation.--The Secretary
            shall not revoke a determination that a school is eligible for
            assistance under this part, or reassume control of a school
            that was a Bureau school prior to approval of an application
            submitted under section 5206(b)(1)(A) until the Secretary--
                        ``(A) provides notice to the tribally controlled
                    school and the tribal governing body (within the
                    meaning of section 1141(14) of the Education Amendments
                    of 1978) of the tribally controlled school which
                    states--
                                ``(i) the specific deficiencies that led to
                            the revocation or resumption determination; and
                                ``(ii) the actions that are needed to
                            remedy such deficiencies; and
                        ``(B) affords such authority an opportunity to
                    effect the remedial actions.
                ``(3) Technical assistance.--The Secretary shall provide
            such technical assistance as is practicable to effect such
            remedial actions. Such notice and technical assistance shall be
            in addition to a hearing and appeal to be conducted pursuant to
            the regulations described in section 5206(f)(1)(C).
        ``(d) Applicability of Section Pursuant to Election Under Section
    5209(b).--With respect to a tribally controlled school which receives
    assistance under this part pursuant to an election made under section
    5209(b)--
                ``(1) subsection (b) of this section shall apply; and
                ``(2) the Secretary may not revoke eligibility for
            assistance under this part except in conformance with
            subsection (c) of this section.

    ``SEC. 5208. PAYMENT OF GRANTS; INVESTMENT OF FUNDS.

        ``(a) Payments.--
                ``(1) In general.--Except as otherwise provided in this
            subsection, the Secretary shall make payments to grantees under
            this part in two payments, of which--
                        ``(A) the first payment shall be made not later
                    than July 15 of each year in an amount equal to 85
                    percent of the amount which the grantee was entitled to
                    receive during the preceding academic year; and
                        ``(B) the second payment, consisting of the
                    remainder to which the grantee is entitled for the
                    academic year, shall be made not later than December 1
                    of each year.
                ``(2) Newly funded schools.--For any school for which no
            payment under this part was made from Bureau funds in the
            preceding academic year, full payment of the amount computed
            for the first academic year of eligibility under this part
            shall be made not later than December 1 of the academic year.
                ``(3) Late funding.--With regard to funds for grantees that
            become available for obligation on October 1 of the fiscal year
            for which such funds are appropriated, the Secretary shall make
            payments to grantees not later than December 1 of the fiscal
            year.
                ``(4) Applicability of certain title 31 provisions.--The
            provisions of chapter 39 of Title 31, United States Code, shall
            apply to the payments required to be made by paragraphs (1),
            (2), and (3).
                ``(5) Restrictions.--Paragraphs (1), (2), and (3) shall be
            subject to any restriction on amounts of payments under this
            part that are imposed by a continuing resolution or other Act
            appropriating the funds involved.
        ``(b) Investment of Funds.--
                ``(1) Treatment of interest and investment income.--
            Notwithstanding any other provision of law, any interest or
            investment income that accrues to any funds provided under this
            part after such funds are paid to the Indian tribe or tribal
            organization and before such funds are expended for the purpose
            for which such funds were provided under this part shall be the
            property of the Indian tribe or tribal organization and shall
            not be taken into account by any officer or employee of the
            Federal Government in determining whether to provide
            assistance, or the amount of assistance, under any provision of
            Federal law. Such interest income shall be spent on behalf of
            the school.
                ``(2) Permissible investments.--Funds provided under this
            part may be invested by the Indian tribe or tribal organization
            before such funds are expended for the purposes of this part so
            long as such funds are--
                        ``(A) invested by the Indian tribe or tribal
                    organization only in obligations of the United States,
                    or in obligations or securities that are guaranteed or
                    insured by the United States, or mutual (or other)
                    funds registered with the Securities and Exchange
                    Commission and which only invest in obligations of the
                    United States, or securities that are guaranteed or
                    insured by the United States; or
                        ``(B) deposited only into accounts that are insure
                    by and agency or instrumentality of the United States,
                    or are fully collateralized to ensure protection of the
                    funds, even in the event of a bank failure.
        ``(c) Recoveries.--For the purposes of underrecovery and
    overrecovery determinations by any Federal agency for any other funds,
    from whatever source derived, funds received under this part shall not
    be taken into consideration.

    ``SEC. 5209. APPLICATION WITH RESPECT TO INDIAN SELF-DETERMINATION AND
                  EDUCATION ASSISTANCE ACT.

        ``(a) Certain Provisions To Apply to Grants.--The following
    provisions of the Indian Self-Determination and Education Assistance
    Act (and any subsequent revisions thereto or renumbering thereof),
    shall apply to grants provided under this part:
                ``(1) Section 5(f) (relating to single agency audit).
                ``(2) Section 6 (relating to criminal activities;
            penalties).
                ``(3) Section 7 (relating to wage and labor standards).
                ``(4) Section 104 (relating to retention of Federal
            employee coverage).
                ``(5) Section 105(f) (relating to Federal property).
                ``(6) Section 105(k) (relating to access to Federal sources
            of supply).
                ``(7) Section 105(l) (relating to lease of facility used
            for administration and delivery of services).
                ``(8) Section 106(e) (relating to limitation on remedies
            relating to cost allowances).
                ``(9) Section 106(i) (relating to use of funds for matching
            or cost participation requirements).
                ``(10) Section 106(j) (relating to allowable uses of
            funds).
                ``(11) Section 108(c) (Model Agreements provisions
            (1)(a)(5) (relating to limitations of costs), (1)(a)(7)
            (relating to records and monitoring), (1)(a)(8) (relating to
            property), and (a)(1)(9) (relating to availability of funds).
                ``(12) Section 109 (relating to reassumption).
                ``(13) Section 111 (relating to sovereign immunity and
            trusteeship rights unaffected).
        ``(b) Election for Grant in Lieu of Contract.--
                ``(1) In general.--Contractors for activities to which this
            part applies who have entered into a contract under the Indian
            Self-Determination and Education Assistance Act that is in
            effect upon the date of the enactment of the No Child Left
            Behind Act of 2001 may, by giving notice to the Secretary,
            elect to have the provisions of this part apply to such
            activity in lieu of such contract.
                ``(2) Effective date of election.--Any election made under
            paragraph (1) shall take effect on the later of--
                        ``(A) October 1 of the fiscal year succeeding the
                    fiscal year in which such election is made; or
                        ``(B) 60 days after the date of such election.
                ``(3) Exception.--In any case in which the 60-day period
            referred to in paragraph (2)(B) is less than 60 days before the
            beginning of the succeeding fiscal year, such election shall
            not take effect until the fiscal year after the fiscal year
            succeeding the election.
        ``(c) No Duplication.--No funds may be provided under any contract
    entered into under the Indian Self-Determination and Education
    Assistance Act to pay any expenses incurred in providing any program or
    services if a grant has been made under this part to pay such expenses.
        ``(d) Transfers and Carryovers.--
                ``(1) Buildings, equipment, supplies, materials.--A tribe
            or tribal organization assuming the operation of--
                        ``(A) a Bureau school with assistance under this
                    part shall be entitled to the transfer or use of
                    buildings, equipment, supplies, and materials to the
                    same extent as if it were contracting under the Indian
                    Self-Determination and Education Assistance Act; or
                        ``(B) a contract school with assistance under this
                    part shall be entitled to the transfer or use of
                    buildings, equipment, supplies and materials that were
                    used in the operation of the contract school to the
                    same extent as if it were contracting under the Indian
                    Self-Determination and Education Assistance Act.
                ``(2) Funds.--Any tribe or tribal organization which
            assumes operation of a Bureau school with assistance under this
            part and any tribe or tribal organization which elects to
            operate a school with assistance under this part rather that to
            continue as a contract school shall be entitled to any funds
            which would carryover from the previous fiscal year as if such
            school were operated as a contract school.
        ``(e) Exceptions, Problems, and Disputes.--Any exception or problem
    cited in an audit conducted pursuant to section 5207(b)(2), any dispute
    regarding a grant authorized to be made pursuant to this part or any
    amendment to such grant, and any dispute involving an administrative
    cost grant under section 1128 of the Education Amendments of 1978 shall
    be administered under the provisions governing such exceptions,
    problems, or disputes in the case of contracts under the Indian Self-
    Determination and Education Assistance Act of 1975. The Equal Access to
    Justice Act shall apply to administrative appeals filed after September
    8, 1988, by grantees regarding a grant under this part, including an
    administrative cost grant.

    ``SEC. 5210. ROLE OF THE DIRECTOR.

        ``Applications for grants under this part, and all application
    modifications, shall be reviewed and approved by personnel under the
    direction and control of the Director of the Office of Indian Education
    Programs. Required reports shall be submitted to education personnel
    under the direction and control of the Director of such Office.

    ``SEC. 5211. REGULATIONS.

        ``The Secretary is authorized to issue regulations relating to the
    discharge of duties specifically assigned to the Secretary by this
    part. In all other matters relating to the details of planning,
    development, implementing, and evaluating grants under this part, the
    Secretary shall not issue regulations. Regulations issued pursuant to
    this part shall not have the standing of a Federal statute for the
    purposes of judicial review.

    ``SEC. 5212. THE TRIBALLY CONTROLLED GRANT SCHOOL ENDOWMENT PROGRAM.

        ``(a) In General.--
                ``(1) Trust funds.--Each school receiving grants under this
            part may establish, at a Federally insured banking and savings
            institution, a trust fund for the purposes of this section.
                ``(2) Authority of schools regarding trust funds.--The
            school may provide--
                        ``(A) for the deposit into the trust fund, only
                    funds from non-Federal sources, except that the
                    interest on funds received from grants under this part
                    may be used for this purpose;
                        ``(B) for the deposit in the account of any
                    earnings on funds deposited in the account; and
                        ``(C) for the sole use of the school any noncash,
                    in-kind contributions of real or personal property,
                    such property may at any time be converted to cash.
        ``(b) Interest.--Interest from the fund established under
    subsection (a) may periodically be withdrawn and used, at the
    discretion of the school, to defray any expenses associated with the
    operation of the school.

    ``SEC. 5213. DEFINITIONS.

        ``For the purposes of this part:
                ``(1) Bureau.--The term `Bureau' means the Bureau of Indian
            Affairs of the Department of the Interior.
                ``(2) Eligible indian student.--The term `eligible Indian
            student' has the meaning of such term in section 1127(f) of the
            Education Amendments of 1978.
                ``(3) Indian tribe.--The term `Indian tribe' means any
            Indian tribe, band, nation, or other organized group or
            community, including Alaska Native Village or regional
            corporations (as defined in or established pursuant to the
            Alaskan Native Claims Settlement Act, which is recognized as
            eligible for the special programs and services provided by the
            United States to Indians because of their status as Indians.
                ``(4) Local educational agency.--The term `local
            educational agency' means a public board of education or other
            public authority legally constituted within a State for either
            administrative control or direction of, or to perform a service
            function for, public elementary or secondary schools in a city,
            county, township, school district, or other political
            subdivision of a State or such combination of school districts
            or counties as are recognized in a State as an administrative
            agency for its public elementary or secondary schools. Such
            term includes any other public institution or agency having
            administrative control and direction of a public elementary or
            secondary school.
                ``(5) Secretary.--The term `Secretary' means the Secretary
            of the Interior.
                ``(6) Tribal organization.--(A) The term `tribal
            organization' means--
                        ``(i) the recognized governing body of any Indian
                    tribe; or
                        ``(ii) any legally established organization of
                    Indians which--
                                ``(I) is controlled, sanctioned, or
                            chartered by such governing body or is
                            democratically elected by the adult members of
                            the Indian community to be served by such
                            organization; and
                                ``(II) includes the maximum participation
                            of Indians in all phases of its activities.
                ``(B) In any case in which a grant is provided under this
            part to an organization to provide services benefiting more
            than one Indian tribe, the approval of the governing bodies of
            Indian tribes representing 80 percent of those students
            attending the tribally controlled school shall be considered a
            sufficient tribal authorization for such grant.
                ``(7) Tribally controlled school.--The term `tribally
            controlled school' means a school operated by a tribe or a
            tribal organization, enrolling students in kindergarten through
            grade 12, including preschools, which is not a local
            educational agency and which is not directly administered by
            the Bureau of Indian Affairs.''.

      TITLE IV--PROMOTING INFORMED PARENTAL CHOICE AND INNOVATIVE PROGRAMS

                          PART A--INNOVATIVE PROGRAMS

    SEC. 401. INNOVATIVE PROGRAMS.

        Title IV is amended to read as follows:

     ``TITLE IV--PROMOTING INFORMED PARENTAL CHOICE AND INNOVATIVE PROGRAMS

                         ``PART A--INNOVATIVE PROGRAMS

                ``Subpart 1--State and Local Innovative Programs

    ``SEC. 4101. FINDINGS AND STATEMENT OF PURPOSE.

        ``(a) Findings.--Congress finds that this subpart--
                ``(1) provides flexibility to meet local needs;
                ``(2) promotes local and State education reforms;
                ``(3) contributes to the improvement of academic
            achievement for all students;
                ``(4) provides funding for critical activities; and
                ``(5) provides services for private school students.
        ``(b) Statement of Purpose.--It is the purpose of programs under
    this subpart--
                ``(1) to provide funding to enable States and local
            educational agencies to implement promising educational reform
            programs and school improvement initiatives based on
            scientifically based research;
                ``(2) to provide a continuing source of innovation and
            educational improvement, including support for library services
            and instructional and media materials; and
                ``(3) to meet the educational needs of all students,
            including at-risk youth.
        ``(c) State and Local Responsibility.--
                ``(1) In general.--The States shall have the basic
            responsibility for the administration of funds made available
            under this subpart, but such administration shall be carried
            out with a minimum of paperwork.
                ``(2) Design and implementation.--Notwithstanding paragraph
            (1), local educational agencies, school superintendents and
            principals, and classroom teachers and supporting personnel
            shall be mainly responsible for the design and implementation
            of programs assisted under this subpart, because such agencies
            and individuals have the most direct contact with students and
            are most likely to be able to design programs to meet the
            educational needs of students in their own school districts.

                     ``CHAPTER 1--STATE AND LOCAL PROGRAMS

    ``SEC. 4111. ALLOCATION TO STATES.

        ``(a) Reservations.--From the sums appropriated to carry out this
    subpart for each fiscal year, the Secretary shall reserve not more than
    1 percent for payments to outlying areas to be allotted in accordance
    with their respective needs.
        ``(b) Allocation of remainder.--From the remainder of such sums,
    the Secretary shall allocate, and make available in accordance with
    this subpart, to each State an amount which bears the same ratio to the
    amount of such remainder as the school-age population of the State
    bears to the school-age population of all States, except that no State
    shall receive less than an amount equal to \1/2\ of 1 percent of such
    remainder.

    ``SEC. 4112. ALLOCATION TO LOCAL EDUCATIONAL AGENCIES.

        ``(a) Distribution Rule.--
                ``(1) In general.--Subject to paragraph (2), from the sums
            made available each year to carry out this subpart, the State
            shall distribute not less than 85 percent to local educational
            agencies within such State according to the relative
            enrollments in public and private, nonprofit schools within the
            jurisdictions of such agencies, adjusted, in accordance with
            criteria approved by the Secretary, to provide higher per-pupil
            allocations to local educational agencies that have the
            greatest numbers or percentages of children whose education
            imposes a higher than average cost per child, such as--
                        ``(A) children living in areas with high
                    concentrations of economically disadvantaged families;
                        ``(B) children from economically disadvantaged
                    families; and
                        ``(C) children living in sparsely populated areas.
                ``(2) Exception.--100 percent of any amount by which the
            funds paid to a State under this subpart for a fiscal year
            exceed the amount of such funds paid to the State for fiscal
            year 2001 shall be distributed to local educational agencies
            and used locally for innovative assistance described in section
            4131(b).
                ``(3) Limitation on use of funds for administration.--In
            each fiscal year, a State may use not more than 25 percent of
            the funds available for State programs under this subpart for
            State administration under section 4121.
        ``(b) Calculation of Enrollments.--
                ``(1) In general.--The calculation of relative enrollments
            under subsection (a)(1) shall be on the basis of the total of--
                        ``(A) the number of children enrolled in public
                    schools; and
                        ``(B) the number of children enrolled in private,
                    nonprofit schools whose parents would like their
                    children to participate in programs or projects
                    assisted under this subpart, for the fiscal year
                    preceding the fiscal year for which the determination
                    is made.
                ``(2) Construction.--Nothing in this subsection shall
            diminish the responsibility of each local educational agency to
            contact, on an annual basis, appropriate officials from private
            nonprofit schools within the areas served by such agencies in
            order to determine whether such schools desire that their
            children participate in programs assisted under this chapter.
                ``(3) Adjustments.--
                        ``(A) In general.--Relative enrollments calculated
                    under subsection (a)(1) shall be adjusted, in
                    accordance with criteria approved by the Secretary
                    under subparagraph (B), to provide higher per-pupil
                    allocations only to local educational agencies that
                    serve the greatest numbers or percentages of--
                                ``(i) children living in areas with high
                            concentrations of economically disadvantaged
                            families;
                                ``(ii) children from economically
                            disadvantaged families; or
                                ``(iii) children living in sparsely
                            populated areas.
                        ``(B) Criteria.--The Secretary shall review
                    criteria submitted by a State for adjusting allocations
                    under paragraph (1) and shall approve such criteria
                    only if the Secretary determines that such criteria are
                    reasonably calculated to produce an adjusted allocation
                    that reflects the relative needs of the State's local
                    educational agencies based on the factors set forth in
                    subparagraph (A).
        ``(c) Payment of Allocations.--
                ``(1) Distribution.--From the funds paid to a State under
            this subpart for a fiscal year, a State shall distribute to
            each eligible local educational agency that has submitted an
            application as required in section 4133 the amount of such
            local educational agency's allocation, as determined under
            subsection (a).
                ``(2) Additional funds.--
                        ``(A) In general.--Additional funds resulting from
                    higher per-pupil allocations provided to a local
                    educational agency on the basis of adjusted enrollments
                    of children described in subsection (a)(1) may, in the
                    discretion of the local educational agency, be
                    allocated for expenditures to provide services for
                    children enrolled in public and private, nonprofit
                    schools in direct proportion to the number of children
                    described in subsection (a)(1) and enrolled in such
                    schools within the local educational agency.
                        ``(B) Election.--In any fiscal year, any local
                    educational agency that elects to allocate such
                    additional funds in the manner described in
                    subparagraph (A) shall allocate all additional funds to
                    schools within the local educational agency in such
                    manner.
                        ``(C) Construction.--Subparagraphs (A) and (B) may
                    not be construed to require any school to limit the use
                    of the additional funds described in subparagraph (A)
                    to the provision of services to specific students or
                    categories of students.

                          ``CHAPTER 2--STATE PROGRAMS

    ``SEC. 4121. STATE USE OF FUNDS.

        ``A State may use funds made available for State use under this
    subpart only for--
                ``(1) State administration of programs under this subpart
            including--
                        ``(A) supervision of the allocation of funds to
                    local educational agencies;
                        ``(B) planning, supervision, and processing of
                    State funds; and
                        ``(C) monitoring and evaluation of programs and
                    activities under this subpart;
                ``(2) support for planning, designing, and initial
            implementation of charter schools as described in part B;
                ``(3) statewide education reform and school improvement
            activities and technical assistance and direct grants to local
            educational agencies which assist such agencies under section
            4131; and
                ``(4) support for arrangements that provide for independent
            analysis to measure and report on school district achievement.

    ``SEC. 4122. STATE APPLICATIONS.

        ``(a) Application Requirements.--If a State seeks to receive
    assistance under this subpart, the individual, entity, or agency
    responsible for public elementary and secondary education policy under
    the State constitution or State law shall submit to the Secretary an
    application that--
                ``(1) provides for an annual statewide summary of how
            assistance under this subpart is contributing toward improving
            student achievement or improving the quality of education for
            students;
                ``(2) provides information setting forth the allocation of
            such funds required to implement section 4142;
                ``(3) provides that the State will keep such records and
            provide such information to the Secretary as may be required
            for fiscal audit and program evaluation (consistent with the
            responsibilities of the Secretary under this section);
                ``(4) provides assurance that, apart from technical and
            advisory assistance and monitoring compliance with this
            subpart, the State has not exercised and will not exercise any
            influence in the decisionmaking processes of local educational
            agencies as to the expenditure made pursuant to an application
            under section 4133;
                ``(5) contains assurances that there is compliance with the
            specific requirements of this subpart; and
                ``(6) provides for timely public notice and public
            dissemination of the information provided under paragraph (2).
        ``(b) Statewide Summary.--The statewide summary referred to in
    subsection (a)(1) shall be submitted to the Secretary and shall be
    derived from the evaluation information submitted by local educational
    agencies to the State under section 4133(a)(2)(H). The format and
    content of such summary shall be in the discretion of the State and may
    include statistical measures such as the number of students served by
    each type of innovative assistance described in section 4131(b),
    including the number of teachers trained.
        ``(c) Period of Application.--An application filed by the State
    under subsection (a) shall be for a period not to exceed 3 years, and
    may be amended annually as may be necessary to reflect changes without
    filing a new application.
        ``(d) Audit Limitation.--Each local educational agency receiving
    less than an average of $5,000 under this subpart may not be audited
    more frequently than once every 5 years.

                ``CHAPTER 3--LOCAL INNOVATIVE EDUCATION PROGRAMS

    ``SEC. 4131. USE OF FUNDS.

        ``(a) In General.--Funds made available to local educational
    agencies under section 4112 shall be used for innovative assistance
    programs described in subsection (b).
        ``(b) Innovative Assistance.--The innovative assistance programs
    referred to in subsection (a) may include--
                ``(1) professional development activities and the hiring of
            teachers, including activities carried out in accordance with
            title II, that give teachers, principals, and administrators
            the knowledge and skills to provide students with the
            opportunity to meet challenging State or local academic content
            standards and student achievement standards;
                ``(2) technology related to the implementation of school-
            based reform programs, including professional development to
            assist teachers, and other school officials, regarding how to
            use effectively such equipment and software;
                ``(3) programs for the development or acquisition and use
            of instructional and educational materials, including library
            services and materials (including media materials), academic
            assessments, reference materials, computer software and
            hardware for instructional use, and other curricular materials
            that are tied to high academic standards, that will be used to
            improve student achievement, and that are part of an overall
            education reform program;
                ``(4) promising education reform projects, including
            effective schools and magnet schools;
                ``(5) programs to improve the academic skills of
            disadvantaged elementary and secondary school students and to
            prevent students from dropping out of school;
                ``(6) programs to combat illiteracy;
                ``(7) programs to provide for the educational needs of
            gifted and talented children;
                ``(8) planning, designing, and initial implementation of
            charter schools as described in part B;
                ``(9) school improvement programs or activities under
            sections 1116 and 1117;
                ``(10) community service programs that use qualified school
            personnel to train and mobilize young people to measurably
            strengthen their communities through nonviolence,
            responsibility, compassion, respect, and moral courage;
                ``(11) activities to promote consumer, economic, and
            personal finance education, such as disseminating and
            encouraging the best practices for teaching the basic
            principles of economics and promoting the concept of achieving
            financial literacy through the teaching of personal financial
            management skills (including the basic principles involved with
            earning, spending, saving, and investing);
                ``(12) activities to promote, implement, or expand public
            school choice;
                ``(13) programs to hire and support school nurses;
                ``(14) expanding and improving school-based mental health
            services, including early identification of drug use and
            violence, assessment, and direct individual or group counseling
            services provided to students, parents, and school personnel by
            qualified school based mental health services personnel; and
                ``(15) alternative educational programs for those students
            who have been expelled or suspended from their regular
            educational setting, including programs to assist students to
            reenter the regular educational setting upon return from
            treatment or alternative educational programs.

    ``SEC. 4132. ADMINISTRATIVE AUTHORITY.

        ``In order to conduct the activities authorized by this subpart,
    each State or local educational agency may use funds made available
    under this subpart to make grants to, and to enter into contracts with,
    local educational agencies, institutions of higher education,
    libraries, museums, and other public and private nonprofit agencies,
    organizations, and institutions, including religious organizations.

    ``SEC. 4133. LOCAL APPLICATIONS.

        ``(a) Certification.--
                ``(1) In general.--A local educational agency or a
            consortium of such agencies may receive an allocation of funds
            under this subpart for any year for which the agency or
            consortium submits an application under this section that is
            certified by the State to meet the requirements of this
            section.
                ``(2) Contents of Application.--The State shall certify
            each application that--
                        ``(A) describes locally identified needs relative
                    to the purposes of this subpart and to the innovative
                    assistance described in section 4131(b);
                        ``(B) based on the needs identified in subparagraph
                    (A), sets forth the planned allocation of funds among
                    innovative assistance programs described in section
                    4131 and describes the programs, projects, and
                    activities designed to carry out such innovative
                    assistance programs that the local educational agency
                    intends to support;
                        ``(C) contains information setting forth the
                    allocation of such funds required to implement section
                    4142;
                        ``(D) describes how assistance under this subpart
                    will contribute to improving student academic
                    achievement;
                        ``(E) provides assurances of compliance with the
                    provisions of this subpart, including the participation
                    of children enrolled in private, nonprofit schools in
                    accordance with section 4142;
                        ``(F) provides assurance that the local educational
                    agency will keep such records, and provide such
                    information to the State as may be reasonably required
                    for fiscal audit and program evaluation, consistent
                    with the responsibilities of the State under this
                    subpart;
                        ``(G) provides in the allocation of funds for the
                    assistance authorized by this subpart, and in the
                    design, planning, and implementation of such programs,
                    for systematic consultation with parents of children
                    attending elementary and secondary schools in the area
                    served by the local educational agency, with teachers
                    and administrative personnel in such schools, and with
                    other groups involved in the implementation of this
                    subpart (such as librarians, school counselors, and
                    other pupil services personnel) as may be considered
                    appropriate by the local educational agency; and
                        ``(H) provides assurance that--
                                ``(i) programs, services, and activities
                            will be evaluated annually;
                                ``(ii) such evaluation will be used to
                            determine and implement appropriate changes in
                            program services and activities for the
                            subsequent year;
                                ``(iii) such evaluation will describe how
                            assistance under this subpart contributed
                            toward improving student academic achievement;
                            and
                                ``(iv) such evaluation will be submitted to
                            the State in the time and manner requested by
                            the State.
        ``(b) Time Period to Which Application Relates.--An application
    submitted by a local educational agency under subsection (a) may seek
    allocations under this part for a period of time not to exceed 3 fiscal
    years and may be amended annually as may be necessary to reflect
    changes without the filing of a new application.
        ``(c) Local Educational Agency Discretion.--
                ``(1) In general.--Subject to the limitations and
            requirements of this subpart, a local educational agency shall
            have complete discretion in determining how funds made
            available under this chapter will be divided among programs and
            activities described in section 4131.
                ``(2) Limitation.--In exercising the discretion described
            in paragraph (1), a local educational agency shall ensure that
            expenditures under this chapter carry out the purposes of this
            subpart and are used to meet the educational needs within the
            schools of such local educational agency.

                        ``CHAPTER 4--GENERAL PROVISIONS

    ``SEC. 4141. MAINTENANCE OF EFFORT; FEDERAL FUNDS SUPPLEMENTARY.

        ``(a) Maintenance of Effort.--
                ``(1) In general.--Except as provided in paragraph (2), a
            State is entitled to receive its full allocation of funds under
            this subpart for any fiscal year only if the Secretary
            determines that either the combined fiscal effort per student
            or the aggregate expenditures within the State with respect to
            the provision of free public education for the fiscal year
            preceding the fiscal year for which the determination is made
            was not less than 90 percent of such combined fiscal effort or
            aggregate expenditures for the fiscal year that is 2 fiscal
            years before the fiscal year for which the determination is
            made.
                ``(2) Reduction of funds.--The Secretary shall reduce the
            amount of the allocation of funds under this subpart in any
            fiscal year in the exact proportion to which the State fails to
            meet the requirements of paragraph (1) by falling below 90
            percent of both the fiscal effort per student and aggregate
            expenditures (using the measure most favorable to the State),
            and no such lesser amount shall be used for computing the
            effort required under paragraph (1) for subsequent years.
                ``(3) Waiver.--The Secretary may waive, for 1 fiscal year
            only, the requirements of this section if the Secretary
            determines that such a waiver would be equitable due to
            exceptional or uncontrollable circumstances such as a natural
            disaster or a precipitous and unforeseen decline in the
            financial resources of the State.
        ``(b) Federal Funds Supplementary.--A State or local educational
    agency may use and allocate funds received under this subpart only to
    supplement and, to the extent practical, to increase the level of funds
    that would, in the absence of Federal funds made available under this
    subpart, be made available from non-Federal sources, and in no case may
    such funds be used so as to supplant funds from non-Federal sources.

    ``SEC. 4142. PARTICIPATION OF CHILDREN ENROLLED IN PRIVATE SCHOOLS.

        ``(a) Participation on Equitable Basis.--
                ``(1) In general.--To the extent consistent with the number
            of children in the school district of a local educational
            agency which is eligible to receive funds under this subpart or
            which serves the area in which a program or project assisted
            under this subpart is located, who are enrolled in private
            nonprofit elementary and secondary schools, or with respect to
            instructional or personnel training programs funded by the
            State from funds made available for State use, such agency,
            after consultation with appropriate private school officials--
                        ``(A) shall provide for the benefit of such
                    children in such schools secular, neutral, and
                    nonideological services, materials, and equipment,
                    including the participation of the teachers of such
                    children (and other educational personnel serving such
                    children) in training programs, and the repair or minor
                    remodeling of public facilities as may be necessary for
                    their provision (consistent with subsection (c) of this
                    section); or
                        ``(B) if such services, materials, and equipment
                    are not feasible or necessary in 1 or more such private
                    schools as determined by the local educational agency
                    after consultation with the appropriate private school
                    officials, shall provide such other arrangements as
                    will assure equitable participation of such children in
                    the purposes and benefits of this subpart.
                ``(2) Other provisions for services.--If no program or
            project is carried out under paragraph (1) in the school
            district of a local educational agency, the State shall make
            arrangements, such as through contracts with nonprofit agencies
            or organizations, under which children in private schools in
            such district are provided with services and materials to the
            extent that would have occurred if the local educational agency
            had received funds under this subpart.
                ``(3) Application of requirements.--The requirements of
            this section relating to the participation of children,
            teachers, and other personnel serving such children shall apply
            to programs and projects carried out under this subpart by a
            State or local educational agency, whether directly or through
            grants to or contracts with other public or private agencies,
            institutions, or organizations.
        ``(b) Equal Expenditures.--
                ``(1) In general.--Expenditures for programs pursuant to
            subsection (a) shall be equal (consistent with the number of
            children to be served) to expenditures for programs under this
            subpart for children enrolled in the public schools of the
            local educational agency.
                ``(2) Concentrated programs.--Taking into account the needs
            of the individual children and other factors which relate to
            the expenditures referred to in paragraph (1), and when funds
            available to a local educational agency under this subpart are
            used to concentrate programs or projects on a particular group,
            attendance area, or grade or age level, children enrolled in
            private schools who are included within the group, attendance
            area, or grade or age level selected for such concentration
            shall, after consultation with the appropriate private school
            officials, be assured equitable participation in the purposes
            and benefits of such programs or projects.
        ``(c) Administrative Rules.--
                ``(1) Funds and property.--The control of funds provided
            under this subpart, and title to materials, equipment, and
            property repaired, remodeled, or constructed with such funds,
            shall be in a public agency for the uses and purposes provided
            in this subpart, and a public agency shall administer such
            funds and property.
                ``(2) Provision of services.--The provision of services
            pursuant to this subpart shall be provided by employees of a
            public agency or through contract by such public agency with a
            person, an association, agency, or corporation who or which, in
            the provision of such services, is independent of such private
            school and of any religious organizations, and such employment
            or contract shall be under the control and supervision of such
            public agency, and the funds provided under this subpart shall
            not be commingled with State or local funds.
        ``(d) Waiver.--
                ``(1) State prohibition waiver.--If by reason of any
            provision of law a State or local educational agency is
            prohibited from providing for the participation in programs of
            children enrolled in private elementary and secondary schools,
            as required by this section, the Secretary shall waive such
            requirements and shall arrange for the provision of services to
            such children through arrangements which shall be subject to
            the requirements of this section.
                ``(2) Failure to comply.--If the Secretary determines that
            a State or a local educational agency has substantially failed
            or is unwilling to provide for the participation on an
            equitable basis of children enrolled in private elementary and
            secondary schools as required by this section, the Secretary
            may waive such requirements and shall arrange for the provision
            of services to such children through arrangements which shall
            be subject to the requirements of this section.
        ``(e) Withholding of Allocation.--Pending final resolution of any
    investigation or complaint that could result in a waiver under
    subsection (d)(1) or (d)(2), the Secretary may withhold from the
    allocation of the affected State or local educational agency the amount
    estimated by the Secretary to be necessary to pay the cost of services
    to be provided by the Secretary under such subsection.
        ``(f) Term of Determinations.--Any determination by the Secretary
    under this section shall continue in effect until the Secretary
    determines that there will no longer be any failure or inability on the
    part of the State or local educational agency to meet the requirements
    of subsections (a) and (b).
        ``(g) Payment From State Allotment.--When the Secretary arranges
    for services pursuant to this section, the Secretary shall, after
    consultation with the appropriate public and private school officials,
    pay the cost of such services, including the administrative costs of
    arranging for those services, from the appropriate allotment of the
    State under this subpart.
        ``(h) Review.--
                ``(1) Written objections.--The Secretary shall not take any
            final action under this section until the State and the local
            educational agency affected by such action have had an
            opportunity, for not less than 45 days after receiving written
            notice thereof, to submit written objections and to appear
            before the Secretary or the Secretary's designee to show cause
            why that action should not be taken.
                ``(2) Court action.--If a State or local educational agency
            is dissatisfied with the Secretary's final action after a
            proceeding under paragraph (1), such agency may, not later than
            60 days after notice of such action, file with the United
            States court of appeals for the circuit in which such State is
            located a petition for review of that action. A copy of the
            petition shall be transmitted by the clerk of the court to the
            Secretary. The Secretary thereupon shall file in the court the
            record of the proceedings on which the Secretary based this
            action, as provided in section 2112 of title 28, United States
            Code.
                ``(3) Remand to secretary.--The findings of fact by the
            Secretary, if supported by substantial evidence, shall be
            conclusive; but the court, for good cause shown, may remand the
            case to the Secretary to take further evidence and the
            Secretary may make new or modified findings of fact and may
            modify the Secretary's previous action, and shall file in the
            court the record of the further proceedings. Such new or
            modified findings of fact shall likewise be conclusive if
            supported by substantial evidence.
                ``(4) Court review.--Upon the filing of such petition, the
            court shall have jurisdiction to affirm the action of the
            Secretary or to set such action aside, in whole or in part. The
            judgment of the court shall be subject to review by the Supreme
            Court of the United States upon certiorari or certification as
            provided in section 1254 of title 28, United States Code.
        ``(i) Prior Determination.--Any bypass determination by the
    Secretary under chapter 2 of title I of this Act (as such chapter was
    in effect on the day preceding the date of enactment of the Improving
    America's Schools Act of 1994) shall, to the extent consistent with the
    purposes of this title, apply to programs under this title.

    ``SEC. 4143. FEDERAL ADMINISTRATION.

        ``(a) Technical Assistance.--The Secretary, upon request, shall
    provide technical assistance to States and local educational agencies
    under this subpart.
        ``(b) Rulemaking.--The Secretary shall issue regulations under this
    subpart only to the extent that such regulations are necessary to
    ensure that there is compliance with the specific requirements and
    assurances required by this subpart.
        ``(c) Availability of Appropriations.--Notwithstanding any other
    provision of law, unless expressly in limitation of this subsection,
    funds appropriated in any fiscal year to carry out activities under
    this subpart shall become available for obligation on July 1 of such
    fiscal year and shall remain available for obligation until the end of
    the subsequent fiscal year.

    ``SEC. 4144. DEFINITIONS.

        ``In this subpart, the following definitions apply:
                ``(1) School-age population.--The term `school-age
            population' means the population aged 5 through 17.
                ``(2) State.--The term `State' means each of the 50 States,
            the District of Columbia, and the Commonwealth of Puerto Rico.

    ``SEC. 4145. AUTHORIZATION OF APPROPRIATIONS.

        ``There are authorized to be appropriated to carry out this subpart
    $450,000,000 for fiscal year 2002 and such sums as may be necessary for
    each of fiscal years 2003 through 2006.

                          ``Subpart 2--Arts Education

    ``SEC. 4151. ASSISTANCE FOR ARTS EDUCATION.

        ``(a) Findings.--The Congress finds that--
                ``(1) every student can benefit from an education in the
            arts;
                ``(2) a growing body of research indicates that education
            in the arts may provide cognitive benefits and bolster academic
            achievement, beginning at an early age and continuing through
            secondary school;
                ``(3) qualified arts teachers and a sequential curriculum
            are the basis and core for substantive arts education for
            students;
                ``(4) the arts should be taught according to rigorous
            academic standards under arts education programs that provide
            mechanisms under which educators are accountable to parents,
            school officials, and the community;
                ``(5) opportunities to participate in the arts have enabled
            individuals with disabilities of all ages to participate more
            fully in school and community activities; and
                ``(6) arts education is a valuable part of the elementary
            and secondary school curriculum.
        ``(b) Purposes.--The purposes of this subpart are to--
                ``(1) support systemic education reform by strengthening
            arts education as an integral part of the elementary and
            secondary school curriculum; and
                ``(2) help ensure that all students meet challenging State
            academic content standards and challenging State student
            academic achievement standards in the arts.
        ``(c) Authority.--In accordance with this subpart, the Secretary
    may make grants to, or enter into contracts or cooperative agreements
    with, eligible entities described in subsection (d).
        ``(d) Eligible Entities.--The Secretary may make assistance
    available under subsection (c) to each of the following entities:
                ``(1) States.
                ``(2) Local educational agencies.
                ``(3) Institutions of higher education.
                ``(4) Museums or other cultural institutions.
                ``(5) Any other public or private agencies, institutions,
            and organizations.
        ``(e) Use of Funds.--Assistance made available under this subpart
    may be used only for--
                ``(1) research on arts education;
                ``(2) planning, developing, acquiring, expanding,
            improving, or disseminating model school-based arts education
            programs;
                ``(3) the development of model State arts education
            assessments based on State academic standards;
                ``(4) the development and implementation of curriculum
            frameworks for arts education;
                ``(5) the development of model inservice professional
            development programs for arts educators and other instructional
            staff;
                ``(6) supporting collaborative activities with Federal
            agencies or institutions, arts educators, and organizations
            representing the arts, including State and local arts agencies
            involved in arts education;
                ``(7) supporting model projects or programs in the
            performing arts for children and youth or programs which assure
            the participation in mainstream settings in arts and education
            programs of individuals with disabilities through arrangements
            made with organizations such as the John F. Kennedy Center for
            the Performing Arts and VSA arts;
                ``(8) supporting model projects or programs to integrate
            arts education into the regular elementary and secondary school
            curriculum; or
                ``(9) other activities that further the purposes of this
            subpart.
        ``(f) Conditions.--As conditions of receiving assistance made
    available under this subpart, the Secretary shall require each entity
    receiving such assistance--
                ``(1) to coordinate, to the extent practicable, each
            project or program carried out with such assistance with
            appropriate activities of public or private cultural agencies,
            institutions, and organizations, including museums, arts
            education associations, libraries, and theaters; and
                ``(2) to use such assistance only to supplement and not to
            supplant any other assistance or funds made available from non-
            Federal sources for the activities assisted under this subpart.
        ``(g) Consultation.--In carrying out this part, the Secretary shall
    consult with Federal agencies or institutions, arts educators
    (including professional arts education associations), and organizations
    representing the arts including State and local arts agencies involved
    in arts education.
        ``(h) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this subpart such sums as may be necessary
    for each of fiscal years 2002 through 2006.

                   ``Subpart 3--Gifted and Talented Children

    ``SEC. 4161. SHORT TITLE.

        ``This subpart may be cited as the `Jacob K. Javits Gifted and
    Talented Students Education Act of 2001'.

    ``SEC. 4162. FINDINGS AND PURPOSE.

        ``(a) Findings.--Congress finds the following:
                ``(1) While the families and communities of some gifted and
            talented students can provide private educational programs with
            appropriately trained staff to supplement public educational
            offerings, most gifted and talented students, especially those
            from inner cities, rural communities, or low-income families,
            must rely on the services and personnel available in public
            schools. In order to ensure that there are equal educational
            opportunities for all gifted and talented students in the
            United States, the public schools should provide gifted and
            talented education programs carried out by qualified
            professionals.
                ``(2) Due to the wide dispersal of students who are gifted
            and talented and the national interest in a well-educated
            populace, it is the Federal Government that can most
            effectively and appropriately conduct scientifically based
            research and development to ensure that there is a national
            capacity to educate students who are gifted and talented in the
            21st century.
                ``(3) Many State and local educational agencies lack the
            specialized resources and trained personnel necessary to
            consistently plan and implement effective programs for the
            identification of gifted and talented students and for the
            provision of educational services and programs appropriate for
            the needs of such students.
                ``(4) Because gifted and talented students are generally
            more advanced academically, are generally able to learn more
            quickly, and generally study in more depth and complexity than
            others their age, they require educational opportunities and
            experiences that are different from those usually available to
            other students.
                ``(5) A typical elementary school student who is
            academically gifted and talented has already mastered 35 to 50
            percent of the content to be learned in several subjects in any
            school year before that year begins. Without an advanced and
            challenging curriculum, such a student may lose motivation and
            develop poor study habits that are difficult to break.
                ``(6) Classes in elementary and secondary schools in the
            United States consist of students with a wide variety of
            traits, characteristics, and needs. Although most teachers
            receive some training to meet the needs of students with
            limited English proficiency, students with disabilities, and
            students from diverse cultural and racial backgrounds, few
            receive training to meet the needs of students who are gifted
            and talented.
        ``(b) Purpose.--The purpose of this subpart is to initiate a
    coordinated program of scientifically based research, demonstration
    projects, innovative strategies, and similar activities designed to
    build and enhance the ability of elementary and secondary schools
    nationwide to meet the special educational needs of gifted and talented
    students.

    ``SEC. 4163. RULE OF CONSTRUCTION.

        Nothing in this subpart shall be construed to prohibit a recipient
    of funds under this subpart from serving gifted and talented students
    simultaneously with students with similar educational needs, in the
    same educational settings where appropriate.

    ``SEC. 4164. AUTHORIZED PROGRAMS.

        ``(a) Establishment of Program.--
                ``(1) In general.--From the sums available to carry out
            this subpart in any fiscal year, the Secretary (after
            consultation with experts in the field of the education of
            gifted and talented students) shall make grants to, or enter
            into contracts with, State educational agencies, local
            educational agencies, institutions of higher education, other
            public agencies, and other private agencies and organizations
            (including Indian tribes and Indian organizations (as such
            terms are defined in section 4 of the Indian Self-Determination
            and Education Assistance Act (25 U.S.C. 450b)) and Native
            Hawaiian organizations) to assist such agencies, institutions,
            and organizations in carrying out programs or projects
            authorized by this subpart that are designed to meet the
            educational needs of gifted and talented students, including
            the training of personnel in the education of gifted and
            talented students and in the use, where appropriate, of gifted
            and talented services, materials, and methods for all students.
                ``(2) Application.--
                        ``(A) In general.--Each entity seeking assistance
                    under this subpart shall submit an application to the
                    Secretary at such time, in such manner, and containing
                    such information as the Secretary may reasonably
                    require.
                        ``(B) Contents.--Each application submitted under
                    this paragraph shall describe how--
                                ``(i) the proposed gifted and talented
                            services, materials, and methods can be
                            adapted, if appropriate, for use by all
                            students; and
                                ``(ii) the proposed programs can be
                            evaluated.
        ``(b) Use of Funds.--Programs and projects assisted under this
    section may include each of the following:
                ``(1) Conducting--
                        ``(A) scientifically based research on methods and
                    techniques for identifying and teaching gifted and
                    talented students, and for using gifted and talented
                    programs and methods to serve all students; and
                        ``(B) program evaluations, surveys, and the
                    collection, analysis, and development of information
                    needed to accomplish the purpose of this subpart.
                ``(2) Professional development (including fellowships) for
            personnel (including leadership personnel) involved in the
            education of gifted and talented students.
                ``(3) Establishment and operation of model projects and
            exemplary programs for serving gifted and talented students,
            including innovative methods for identifying and educating
            students who may not be served by traditional gifted and
            talented programs, including summer programs, mentoring
            programs, service learning programs, and cooperative programs
            involving business, industry, and education.
                ``(4) Implementing innovative strategies, such as
            cooperative learning, peer tutoring, and service learning.
                ``(5) Programs of technical assistance and information
            dissemination, including assistance and information with
            respect to how gifted and talented programs and methods, where
            appropriate, may be adapted for use by all students.
        ``(c) Establishment of National Center.--
                ``(1) In general.--The Secretary (after consultation with
            experts in the field of the education of gifted and talented
            students) shall establish a National Center for Research and
            Development in the Education of Gifted and Talented Children
            and Youth through grants to or contracts with one or more
            institutions of higher education or State educational agencies,
            or a combination or consortium of such institutions and
            agencies and other public or private agencies and
            organizations, for the purpose of carrying out activities
            described in paragraph (1) of subsection (b).
                ``(2) Director.--The National Center established under
            paragraph (1) shall be headed by a Director. The Secretary may
            authorize the Director to carry out such functions of the
            National Center as may be agreed upon through arrangements with
            institutions of higher education, State or local educational
            agencies, or other public or private agencies and
            organizations.
        ``(d) Limitation.--Not more than 30 percent of the funds available
    in any fiscal year to carry out the programs and projects authorized by
    this section may be used to conduct activities pursuant to subsection
    (b)(1) or subsection (c).
        ``(e) Coordination.--Scientifically based research activities
    supported under this subpart--
                ``(1) shall be carried out in consultation with the Office
            of Educational Research and Improvement to ensure that such
            activities are coordinated with and enhance the research and
            development activities supported by such Office; and
                ``(2) may include collaborative scientifically based
            research activities which are jointly funded and carried out
            with such Office.

    ``SEC. 4165. PROGRAM PRIORITIES.

        ``(a) General Priority.--In carrying out this subpart, the
    Secretary shall give highest priority to programs and projects designed
    to develop new information that--
                ``(1) improves the capability of schools to plan, conduct,
            and improve programs to identify and serve gifted and talented
            students; and
                ``(2) assists schools in the identification of, and
            provision of services to, gifted and talented students who may
            not be identified and served through traditional assessment
            methods (including economically disadvantaged individuals,
            individuals of limited English proficiency, and individuals
            with disabilities).
        ``(b) Service Priority.--In approving applications for assistance
    under section 4164(a)(2), the Secretary shall ensure that in each
    fiscal year not less than 50 percent of the applications approved under
    such section address the priority described in subsection (a)(2) of
    this section.

    ``SEC. 4166. GENERAL PROVISIONS.

        ``(a) Participation of Private School Children and Teachers.--In
    making grants and entering into contracts under this subpart, the
    Secretary shall ensure, where appropriate, that provision is made for
    the equitable participation of students and teachers in private
    nonprofit elementary and secondary schools, including the participation
    of teachers and other personnel in professional development programs
    serving such children.
        ``(b) Review, Dissemination, and Evaluation.--The Secretary shall--
                ``(1) use a peer review process in reviewing applications
            under this subpart;
                ``(2) ensure that information on the activities and results
            of programs and projects funded under this subpart is
            disseminated to appropriate State and local educational
            agencies and other appropriate organizations, including
            nonprofit private organizations; and
                ``(3) evaluate the effectiveness of programs under this
            subpart in accordance with section 8651, both in terms of the
            impact on students traditionally served in separate gifted and
            talented programs and on other students, and submit the results
            of such evaluation to the Congress not later than 2 years after
            the date of the enactment of the No Child Left Behind Act of
            2001.
        ``(c) Program Operations.--The Secretary shall ensure that the
    programs under this subpart are administered within the Department by a
    person who has recognized professional qualifications and experience in
    the field of the education of gifted and talented students and who
    shall--
                ``(1) administer and coordinate the programs authorized
            under this subpart;
                ``(2) serve as a focal point of national leadership and
            information on the educational needs of gifted and talented
            students and the availability of educational services and
            programs designed to meet such needs; and
                ``(3) assist the Assistant Secretary of the Office of
            Educational Research and Improvement in identifying research
            priorities which reflect the needs of gifted and talented
            students.

    ``SEC. 4167. AUTHORIZATION OF APPROPRIATIONS.

        ``There are authorized to be appropriated to carry out this subpart
    such sums as may be necessary for each of fiscal years 2002 through
    2006.''.

    SEC. 402. CONTINUATION OF AWARDS.

        Notwithstanding any other provision of this Act, any person or
    agency that was awarded a grant under part B or D of title X (20 U.S.C.
    8031 et seq., 8091 et seq.) prior to the date of the enactment of this
    Act shall continue to receive funds in accordance with the terms of
    such award until the date on which the award period terminates under
    such terms.

                         PART B--PUBLIC CHARTER SCHOOLS

    SEC. 411. PUBLIC CHARTER SCHOOLS.

        Title IV, as amended by section 401, is further amended by adding
    at the end the following:

                        ``PART B--PUBLIC CHARTER SCHOOLS

    ``SEC. 4201. 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
            meet challenging State academic content standards and State
            student academic achievement 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 academic content standards
            and State student academic achievement standards for all
            students;
                ``(4) charter schools 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, and this
            reduction 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) Purpose.--It is the purpose of this part to increase national
    understanding of the charter schools model by--
                ``(1) providing financial assistance for the planning,
            program design and initial implementation of charter schools;
                ``(2) evaluating the effects of such schools, including the
            effects on students, student achievement, staff, and parents;
            and
                ``(3) expanding the number of high-quality charter schools
            available to students across the Nation.

    ``SEC. 4202. PROGRAM AUTHORIZED.

        ``(a) In General.--The Secretary may award grants to State
    educational agencies having applications approved pursuant to section
    4203 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 4203, the Secretary may award a
    grant to an eligible applicant that serves such State and has an
    application approved pursuant to section 4203(c).
        ``(c) Program Periods.--
                ``(1) Grants to states.--Grants awarded to State
            educational agencies under this part shall be awarded for a
            period of not more than 3 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 a period of not more than 3 years, of
            which the eligible applicant may use--
                        ``(A) not more than 18 months for planning and
                    program design;
                        ``(B) not more than 2 years for the initial
                    implementation of a charter school; and
                        ``(C) not more than 2 years to carry out
                    dissemination activities described in section
                    4204(f)(6)(B).
        ``(d) Limitation.--A charter school may not receive--
                ``(1) more than one grant for activities described in
            subparagraphs (A) and (B) of subsection (c)(2); or
                ``(2) more than one grant for activities under subparagraph
            (C) of subsection (c)(2).
        ``(e) Priority Treatment..--
                ``(1) In general.--In awarding grants under this part from
            any funds appropriated under section 4211, the Secretary shall
            give priority to States to the extent that the States meet the
            criteria described in paragraph (2) and one or more of the
            criteria described in subparagraph (A), (B), or (C) of
            paragraph (3).
                ``(2) Review and evaluation priority criteria.--The
            criteria referred to in paragraph (1) is that the State
            provides for periodic review and evaluation by the authorized
            public chartering agency of each charter school, at least once
            every 5 years unless required more frequently by State law, to
            determine whether the charter school is meeting the terms of
            the school's charter, and is meeting or exceeding the academic
            performance requirements and goals for charter schools as set
            forth under State law or the school's charter.
                ``(3) Priority criteria.--The criteria referred to in
            paragraph (1) are the following:
                        ``(A) The State has demonstrated progress, in
                    increasing the number of high quality charter schools
                    that are held accountable in the terms of the schools'
                    charters for meeting clear and measurable objectives
                    for the educational progress of the students attending
                    the schools, in the period prior to the period for
                    which a State educational agency or eligible applicant
                    applies for a grant under this part.
                        ``(B) The State--
                                ``(i) provides for one authorized public
                            chartering agency that is not a local
                            educational agency, such as a State chartering
                            board, for each individual or entity seeking to
                            operate a charter school pursuant to such State
                            law; or
                                ``(ii) in the case of a State in which
                            local educational agencies are the only
                            authorized public chartering agencies, allows
                            for an appeals process for the denial of an
                            application for a charter school.
                        ``(C) The State ensures that each charter school
                    has a high degree of autonomy over the charter school's
                    budgets and expenditures.
        ``(f) Amount Criteria.--In determining the amount of a grant to be
    awarded under this part to a State educational agency, the Secretary
    shall take into consideration the number of charter schools that are
    operating, or are approved to open, in the State.

    ``SEC. 4203. 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 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;
            and
                ``(2) describe how the State educational agency--
                        ``(A) will inform each charter school in the State
                    regarding--
                                ``(i) Federal funds that the charter school
                            is eligible to receive; and
                                ``(ii) Federal programs in which the
                            charter school may participate;
                        ``(B) will ensure that each charter school in the
                    State receives the charter school's commensurate share
                    of Federal education funds that are allocated by
                    formula each year, including during the first year of
                    operation of the charter school; and
                        ``(C) will disseminate best or promising practices
                    of charter schools to each local educational agency in
                    the State; 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
                            academic achievement 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 its 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
                    planning, program 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) a description of how a charter school that is
                    considered a local educational agency under State law,
                    or a local educational agency in which a charter school
                    is located, will comply with sections 613(a)(5) and
                    613(e)(1)(B) of the Individuals with Disabilities
                    Education Act;
                        ``(M) if the eligible applicant desires to use
                    subgrant funds for dissemination activities under
                    section 4202(c)(2)(C), a description of those
                    activities and how those activities will involve
                    charter schools and other public schools, local
                    educational agencies, developers, and potential
                    developers; and
                        ``(N) such other information and assurances as the
                    Secretary and the State educational agency may require.
        ``(c) Contents of Eligible Applicant Application.--Each eligible
    applicant desiring a grant pursuant to section 4202(b) 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 (N) of subsection (b)(3), except that
            for purposes of this subsection subparagraphs (J), (K), and (N)
            of such subsection shall be applied by striking `and the State
            educational agency' each place such term appears;
                ``(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 4204(e); and
                ``(3) assurances that the eligible applicant has provided
            its authorized public chartering authority timely notice, and a
            copy, of the application, except that the State educational
            agency (or the Secretary, in the case of an application
            submitted to the Secretary) may waive this requirement in the
            case of an application for a precharter planning grant or
            subgrant if the authorized public chartering authority to which
            a charter school proposal will be submitted has not been
            determined at the time the grant or subgrant application is
            submitted.

    ``SEC. 4204. 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 4203(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 academic content standards
            and State student academic achievement 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;
                ``(6) the number of high quality charter schools created
            under this part in the State; and
                ``(7) in the case of State educational agencies that
            propose to use grant funds to support dissemination activities
            under section 4202(c)(2)(C), the quality of those activities
            and the likelihood that those activities will improve student
            academic achievement.
        ``(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 4203(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;
                ``(6) the likelihood that the charter school will meet
            those objectives and improve educational results for students;
            and
                ``(7) in the case of an eligible applicant that proposes to
            use grant funds to support dissemination activities under
            section 4202(c)(2)(C), the quality of those activities and the
            likelihood that those activities will improve student
            achievement.
        ``(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 4210(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 one or more eligible applicants in
            the State to enable such applicant to plan and implement a
            charter school in accordance with this part, except that the
            State educational agency may reserve not more than 10 percent
            of the grant funds to support dissemination activities
            described in paragraph (6).
                ``(2) Eligible applicants.--Each eligible applicant
            receiving funds from the Secretary or a State educational
            agency shall use such funds to plan and implement a charter
            school, or to disseminate information about the charter school
            and successful practices in the charter school, in accordance
            with this part.
                ``(3) Allowable activities.--An eligible applicant
            receiving a grant or subgrant under this part may use the grant
            or subgrant funds only for--
                        ``(A) post-award planning and 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. A local educational agency may not
            deduct funds for administrative fees or expenses from a
            subgrant awarded to an eligible applicant.
                ``(5) Revolving loan funds.--Each State educational agency
            receiving a grant pursuant to this part may reserve not more
            than 10 percent of the grant amount for the establishment of a
            revolving loan fund. Such fund may be used to make loans to
            eligible applicants that have received a subgrant under this
            part, under such terms as may be determined by the State
            educational agency, for the initial operation of the charter
            school grant program of such recipient until such time as the
            recipient begins receiving ongoing operational support from
            State or local financing sources.
                ``(6) Dissemination.--
                        ``(A) In general.--A charter school may apply for
                    funds under this part, whether or not the charter
                    school has applied for or received funds under this
                    part for planning, program design, or implementation,
                    to carry out the activities described in subparagraph
                    (B) if the charter school has been in operation for at
                    least 3 consecutive years and has demonstrated overall
                    success, including--
                                ``(i) substantial progress in improving
                            student academic achievement;
                                ``(ii) high levels of parent satisfaction;
                            and
                                ``(iii) the management and leadership
                            necessary to overcome initial start-up problems
                            and establish a thriving, financially viable
                            charter school.
                        ``(B) Activities.--A charter school described in
                    subparagraph (A) may use funds reserved under paragraph
                    (1) to assist other schools in adapting the charter
                    school's program (or certain aspects of the charter
                    school's program), or to disseminate information about
                    the charter school, through such activities as--
                                ``(i) assisting other individuals with the
                            planning and start-up of one or more new public
                            schools, including charter schools, that are
                            independent of the assisting charter school and
                            the assisting charter school's developers, and
                            that agree to be held to at least as high a
                            level of accountability as the assisting
                            charter school;
                                ``(ii) developing partnerships with other
                            public schools, including charter schools,
                            designed to improve student academic
                            achievement in each of the schools
                            participating in the partnership;
                                ``(iii) developing curriculum materials,
                            academic assessments, and other materials that
                            promote increased student academic achievement
                            and are based on successful practices within
                            the assisting charter school; and
                                ``(iv) conducting evaluations and
                            developing materials that document the
                            successful practices of the assisting charter
                            school and that are designed to improve student
                            academic achievement in other schools.
        ``(g) Tribally Controlled Schools.--Each State that receives a
    grant under this part and designates a tribally controlled school as a
    charter school shall not consider payments to a school under the
    Tribally Controlled Schools Act of 1988 (25 U.S.C. 2507) in
    determining--
                ``(1) the eligibility of the school to receive any other
            Federal, State, or local aid; or
                ``(2) the amount of such aid.

    ``SEC. 4205. NATIONAL ACTIVITIES.

        ``(a) In General.--The Secretary shall reserve for each fiscal year
    the greater of 5 percent or $5,000,000 of the amount appropriated to
    carry out this part, except that in no fiscal year shall the total
    amount so reserved exceed $8,000,000, to carry out the following
    activities:
                ``(1) To provide charter schools, either directly or
            through State educational agencies, with--
                        ``(A) information regarding--
                                ``(i) Federal funds that charter schools
                            are eligible to receive; and
                                ``(ii) other Federal programs in which
                            charter schools may participate; and
                        ``(B) assistance in applying for Federal education
                    funds that are allocated by formula, including
                    assistance with filing deadlines and submission of
                    applications.
                ``(2) To provide for other evaluations or studies that
            include the evaluation of the impact of charter schools on
            student academic achievement, including information regarding--
                        ``(A) students attending charter schools reported
                    on the basis of race, age, disability, gender, limited
                    English proficiency, and previous enrollment in public
                    school; and
                        ``(B) the professional qualifications of teachers
                    within a charter school and the turnover of the
                    teaching force.
                ``(3) 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 4203;
                        ``(C) assistance in the planning and startup of
                    charter schools;
                        ``(D) training and technical assistance to existing
                    charter schools; and
                        ``(E) for the dissemination to other public schools
                    of best or promising practices in charter schools.
                ``(4) To provide (including through the use of one or more
            contracts that use a competitive bidding process) for the
            collection of information regarding the financial resources
            available to charter schools, including access to private
            capital, and to widely disseminate to charter schools any such
            relevant information and model descriptions of successful
            programs.
        ``(b) Construction.--Nothing in this section shall be construed to
    require charter schools to collect any data described in subsection
    (a).

    ``SEC. 4206. FEDERAL FORMULA ALLOCATION DURING FIRST YEAR AND FOR
                  SUCCESSIVE ENROLLMENT EXPANSIONS.

        ``(a) In General.--For purposes of the allocation to schools by the
    States or their agencies of funds under part A of title I, and any
    other Federal funds which the Secretary allocates to States on a
    formula basis, the Secretary and each State educational agency shall
    take such measures as are necessary to ensure that every charter school
    receives the Federal funding for which the charter school is eligible
    not later than 5 months after the charter school first opens,
    notwithstanding the fact that the identity and characteristics of the
    students enrolling in that charter school are not fully and completely
    determined until that charter school actually opens. The measures
    similarly shall ensure that every charter school expanding its
    enrollment in any subsequent year of operation receives the Federal
    funding for which the charter school is eligible not later than 5
    months after such expansion.
        ``(b) Adjustment and Late Openings.--
                ``(1) In general.--The measures described in subsection (a)
            shall include provision for appropriate adjustments, through
            recovery of funds or reduction of payments for the succeeding
            year, in cases where payments made to a charter school on the
            basis of estimated or projected enrollment data exceed the
            amounts that the school is eligible to receive on the basis of
            actual or final enrollment data.
                ``(2) Rule.--For charter schools that first open after
            November 1 of any academic year, the State, in accordance with
            guidance provided by the Secretary and applicable Federal
            statutes and regulations, shall ensure that such charter
            schools that are eligible for the funds described in subsection
            (a) for such academic year have a full and fair opportunity to
            receive those funds during the charter schools' first year of
            operation.

    ``SEC. 4207. SOLICITATION OF INPUT FROM CHARTER SCHOOL OPERATORS.

        ``To the extent practicable, the Secretary shall ensure that
    administrators, teachers, and other individuals directly involved in
    the operation of charter schools are consulted in the development of
    any rules or regulations required to implement this part, as well as in
    the development of any rules or regulations relevant to charter schools
    that are required to implement part A of title I, the Individuals with
    Disabilities Education Act (20 U.S.C. 1400 et seq.), or any other
    program administered by the Secretary that provides education funds to
    charter schools or regulates the activities of charter schools.

    ``SEC. 4208. RECORDS TRANSFER.

        ``State educational agencies 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 a charter school upon the transfer
    of the student to the charter school, to another public school upon the
    transfer of the student from a charter school to another public school,
    and to a private school upon the transfer of the student from a charter
    or public school to the private school (with the written consent of a
    parent of the student), in accordance with applicable State law.

    ``SEC. 4209. 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. 4210. DEFINITIONS.

        ``As used in this part:
                ``(1) The term `charter school' means a public school
            that--
                        ``(A) in accordance with a specific State statute
                    authorizing the granting of charters to schools, 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, or in another nondiscriminatory manner
                    consistent with State law, 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 that
                    includes a description of how student academic
                    achievement will be measured in charter schools
                    pursuant to State academic assessments that are
                    required of other schools and pursuant to any other
                    assessments mutually agreeable to the authorized public
                    chartering agency and the charter school.
                ``(2) 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.
                ``(3) The term `eligible applicant' means a developer that
            has--
                        ``(A) applied to an authorized public chartering
                    authority; and
                        ``(B) provided adequate and timely notice to that
                    authority under section 4203(d)(3).
                ``(4) 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.

    ``SEC. 4211. AUTHORIZATION OF APPROPRIATIONS.

        ``For the purpose of carrying out this part, there are authorized
    to be appropriated $225,000,000 for fiscal year 2002 and such sums as
    may be necessary for each of the 4 succeeding fiscal years.''.

    SEC. 412. CONTINUATION OF AWARDS.

        Notwithstanding any other provision of this Act, any person or
    agency that was awarded a grant or subgrant under subpart 1 of part C
    of title X (20 U.S.C. 8061 et seq.) prior to the date of the enactment
    of this Act shall continue to receive funds in accordance with the
    terms of such award until the date on which the award period terminates
    under such terms.

          PART C--MAGNET SCHOOLS ASSISTANCE; WOMEN'S EDUCATIONAL EQUITY

    SEC. 421. MAGNET SCHOOLS ASSISTANCE.

        Title IV, as amended by sections 401 and 411, is further amended by
    adding at the end the following:

        ``PART C--MAGNET SCHOOLS ASSISTANCE; WOMEN'S EDUCATIONAL EQUITY

                     ``Subpart 1--Magnet Schools Assistance

    ``SEC. 4301. FINDINGS.

        ``The Congress finds as follows:
                ``(1) Magnet schools are a significant part of the Nation's
            efforts to achieve voluntary desegregation in our schools.
                ``(2) The use of magnet schools has increased dramatically
            since the inception of the magnet schools assistance program
            under this Act, with approximately 2,000,000 students
            nationwide attending such schools, of whom more than 65 percent
            are non-white.
                ``(3) Magnet schools offer a wide range of distinctive
            programs that have served as models for school improvement
            efforts.
                ``(4) It is in the best interests of the United States--
                        ``(A) to continue the Federal Government's support
                    of local educational agencies that are implementing
                    court-ordered desegregation plans and local educational
                    agencies that are voluntarily seeking to foster
                    meaningful interaction among students of different
                    racial and ethnic backgrounds, beginning at the
                    earliest stage of such students' education;
                        ``(B) to ensure that all students have equitable
                    access to a quality education that will prepare them to
                    function well in a highly competitive economy;
                        ``(C) to maximize the ability of local educational
                    agencies to plan, develop, implement, and continue
                    effective and innovative magnet schools that contribute
                    to State and local systemic reform; and
                        ``(D) to ensure that grant recipients provide
                    adequate data that demonstrate an ability to improve
                    student academic achievement.

    ``SEC. 4302. STATEMENT OF PURPOSE.

        ``The purpose of this part is to assist in the desegregation of
    schools served by local educational agencies by providing financial
    assistance to eligible local educational agencies for--
                ``(1) the elimination, reduction, or prevention of minority
            group isolation in elementary and secondary schools with
            substantial proportions of minority students;
                ``(2) the development and implementation of magnet school
            projects that will assist local educational agencies in
            achieving systemic reforms and providing all students the
            opportunity to meet challenging State academic content
            standards and student academic achievement standards;
                ``(3) the development and design of innovative educational
            methods and practices that promote diversity and increase
            choices in public elementary and secondary schools and
            educational programs; and
                ``(4) courses of instruction within magnet schools that
            will substantially strengthen the knowledge of academic
            subjects and the grasp of tangible and marketable vocational
            and technical skills of students attending such schools.

    ``SEC. 4303. PROGRAM AUTHORIZED.

        ``The Secretary, in accordance with this part, is authorized to
    make grants to eligible local educational agencies, and consortia of
    such agencies where appropriate, to carry out the purpose of this part
    for magnet schools that are--
                ``(1) part of an approved desegregation plan; and
                ``(2) designed to bring students from different social,
            economic, ethnic, and racial backgrounds together.

    ``SEC. 4304. DEFINITION.

        ``For the purpose of this part, the term `magnet school' means a
    public elementary or secondary school or public elementary or secondary
    education center that offers a special curriculum capable of attracting
    substantial numbers of students of different racial backgrounds.

    ``SEC. 4305. ELIGIBILITY.

        ``A local educational agency, or consortium of such agencies where
    appropriate, is eligible to receive assistance under this part to carry
    out the purpose of this part if such agency or consortium--
                ``(1) is implementing a plan undertaken pursuant to a final
            order issued by a court of the United States, or a court of any
            State, or any other State agency or official of competent
            jurisdiction, that requires the desegregation of minority-
            group-segregated children or faculty in the elementary and
            secondary schools of such agency; or
                ``(2) without having been required to do so, has adopted
            and is implementing, or will, if assistance is made available
            to such local educational agency or consortium of such agencies
            under this part, adopt and implement a plan that has been
            approved by the Secretary as adequate under title VI of the
            Civil Rights Act of 1964 for the desegregation of minority-
            group-segregated children or faculty in such schools.

    ``SEC. 4306. APPLICATIONS AND REQUIREMENTS.

        ``(a) Applications.--An eligible local educational agency, or
    consortium of such agencies, desiring to receive assistance under this
    part shall submit an application to the Secretary at such time, in such
    manner, and containing such information and assurances as the Secretary
    may reasonably require.
        ``(b) Information and Assurances.--Each such application shall
    include--
                ``(1) a description of--
                        ``(A) how assistance made available under this part
                    will be used to promote desegregation, including how
                    the proposed magnet school project will increase
                    interaction among students of different social,
                    economic, ethnic, and racial backgrounds;
                        ``(B) the manner and extent to which the magnet
                    school project will increase student academic
                    achievement in the instructional area or areas offered
                    by the school;
                        ``(C) how an applicant will continue the magnet
                    school project after assistance under this part is no
                    longer available, including, if applicable, an
                    explanation of why magnet schools established or
                    supported by the applicant with funds under this part
                    cannot be continued without the use of funds under this
                    part;
                        ``(D) how funds under this part will be used to
                    improve student academic performance for all students
                    attending the magnet schools; and
                        ``(E) the criteria to be used in selecting students
                    to attend the proposed magnet school projects; and
                ``(2) assurances that the applicant will--
                        ``(A) use funds under this part for the purpose
                    specified in section 4302;
                        ``(B) employ fully qualified teachers in the
                    courses of instruction assisted under this part;
                        ``(C) not engage in discrimination based on race,
                    religion, color, national origin, sex, or disability
                    in--
                                ``(i) the hiring, promotion, or assignment
                            of employees of the agency or other personnel
                            for whom the agency has any administrative
                            responsibility;
                                ``(ii) the assignment of students to
                            schools, or to courses of instruction within
                            the school, of such agency, except to carry out
                            the approved plan; and
                                ``(iii) designing or operating
                            extracurricular activities for students;
                        ``(D) carry out a high-quality education program
                    that will encourage greater parental decisionmaking and
                    involvement; and
                        ``(E) give students residing in the local
                    attendance area of the proposed magnet school projects
                    equitable consideration for placement in those
                    projects.

    ``SEC. 4307. PRIORITY.

        ``In approving applications under this part, the Secretary shall
    give priority to applicants that--
                ``(1) demonstrate the greatest need for assistance, based
            on the expense or difficulty of effectively carrying out an
            approved desegregation plan and the projects for which
            assistance is sought;
                ``(2) propose to carry out new magnet school projects, or
            significantly revise existing magnet school projects; and
                ``(3) propose to select students to attend magnet school
            projects by methods such as lottery, rather than through
            academic examination.

    ``SEC. 4308. USE OF FUNDS.

        ``(a) In General.--Grant funds made available under this part may
    be used by an eligible local educational agency or consortium of such
    agencies--
                ``(1) for planning and promotional activities directly
            related to the development, expansion, continuation, or
            enhancement of academic programs and services offered at magnet
            schools;
                ``(2) for the acquisition of books, materials, and
            equipment, including computers and the maintenance and
            operation thereof, necessary for the conduct of programs in
            magnet schools;
                ``(3) for the payment, or subsidization of the
            compensation, of elementary and secondary school teachers who
            are fully qualified, and instructional staff where applicable,
            who are necessary for the conduct of programs in magnet
            schools;
                ``(4) with respect to a magnet school program offered to
            less than the entire student population of a school, for
            instructional activities that--
                        ``(A) are designed to make available the special
                    curriculum that is offered by the magnet school project
                    to students who are enrolled in the school but who are
                    not enrolled in the magnet school program; and
                        ``(B) further the purpose of this part; and
                ``(5) for activities, which may include professional
            development, that will build the recipient's capacity to
            operate magnet school programs once the grant period has ended.
        ``(b) Special Rule.--Grant funds under this part may be used in
    accordance with paragraphs (2) and (3) of subsection (a) only if the
    activities described in such paragraphs are directly related to
    improving the students' academic performance based on the State's
    challenging academic content standards and student academic achievement
    standards or directly related to improving the students' reading skills
    or knowledge of mathematics, science, history, geography, English,
    foreign languages, art, or music, or to improving vocational and
    technical skills.

    ``SEC. 4309. PROHIBITIONS.

        ``(a) Transportation.--Grants under this part may not be used for
    transportation or any activity that does not augment academic
    improvement.
        ``(b) Planning.--A local educational agency shall not expend funds
    under this part after the third year that such agency receives funds
    under this part for such project.

    ``SEC. 4310. LIMITATIONS.

        ``(a) Duration of Awards.--A grant under this part shall be awarded
    for a period that shall not exceed three fiscal years.
        ``(b) Limitation on Planning Funds.--A local educational agency may
    expend for planning not more than 50 percent of the funds received
    under this part for the first year of the project, 15 percent of such
    funds for the second such year, and 10 percent of such funds for the
    third such year.
        ``(c) Amount.--No local educational agency or consortium awarded a
    grant under this part shall receive more than $4,000,000 under this
    part in any one fiscal year.
        ``(d) Timing.--To the extent practicable, the Secretary shall award
    grants for any fiscal year under this part not later than July 1 of the
    applicable fiscal year.

    ``SEC. 4311. EVALUATIONS.

        ``(a) Reservation.--The Secretary may reserve not more than 2
    percent of the funds appropriated under section 4312(a) for any fiscal
    year to carry out evaluations, technical assistance, and dissemination
    projects with respect to magnet school projects and programs assisted
    under this part.
        ``(b) Contents.--Each evaluation described in subsection (a), at a
    minimum, shall address--
                ``(1) how and the extent to which magnet school programs
            lead to educational quality and improvement;
                ``(2) the extent to which magnet school programs enhance
            student access to quality education;
                ``(3) the extent to which magnet school programs lead to
            the elimination, reduction, or prevention of minority group
            isolation in elementary and secondary schools with substantial
            proportions of minority students; and
                ``(4) the extent to which magnet school programs differ
            from other school programs in terms of the organizational
            characteristics and resource allocations of such magnet school
            programs.

    ``SEC. 4312. AUTHORIZATION OF APPROPRIATIONS; RESERVATION.

        ``(a) Authorization.--For the purpose of carrying out this part,
    there are authorized to be appropriated $125,000,000 for fiscal year
    2002 and such sums as may be necessary for each of the 4 succeeding
    fiscal years.
        ``(b) Availability of Funds for Grants to Agencies Not Previously
    Assisted.--In any fiscal year for which the amount appropriated
    pursuant to subsection (a) exceeds $75,000,000, the Secretary shall
    give priority to using such amounts in excess of $75,000,000 to award
    grants to local educational agencies or consortia of such agencies that
    did not receive a grant under this part in the preceding fiscal
    year.''.

    SEC. 422. WOMEN'S EDUCATIONAL EQUITY.

        (a) Transfer and Redesignation.--Part B of title V (20 U.S.C. 7231
    et seq.) is transferred and redesignated as subpart 2 of part C of
    title IV. Sections 5201 through 5208 are redesignated as sections 4321
    through 4328, respectively.
        (b) Report.--Section 4326 (as so redesignated) is amended by
    striking ``January 1, 1999,'' and inserting ``January 1, 2005,''.
        (c) Evaluation and Dissemination.--Section 4327(a) (as so
    redesignated) is amended--
                (1) by striking ``14701,'' and inserting ``8651,''; and
                (2) by striking ``January 1, 1998.'' and inserting
            ``January 1, 2004.''.
        (d) Reauthorization.--Section 4328 (as so redesignated) is amended
    by striking ``$5,000,000 for fiscal year 1995 and such sums as may be
    necessary for each of the four succeeding fiscal years,'' and inserting
    ``$3,000,000 for fiscal year 2002 and such sums as may be necessary for
    each of the four succeeding fiscal years,''.
        (e) Other Conforming Amendments.--
                (1) Short title.--Section 4321(a) (as so redesignated) is
            amended to read as follows:
        ``(a) Short Title.--This subpart may be cited as the `Women's
    Educational Equity Act of 2001'.''.
                (2) References.--Subpart 2 of part C of title IV (as so
            redesignated) is amended--
                        (A) by striking ``this part'' each place such term
                    appears and inserting ``this subpart''; and
                        (B) by striking ``5203(b)'' each place such term
                    appears and inserting ``4423(b)''.

    SEC. 423. CONTINUATION OF AWARDS.

        Notwithstanding any other provision of this Act, any person or
    agency that was awarded a grant under part A of title V (20 U.S.C. 7201
    et seq.), or a grant, contract, or cooperative agreement under part B
    of such title (20 U.S.C. 7231 et seq.), prior to the date of the
    enactment of this Act shall continue to receive funds in accordance
    with the terms of such award until the date on which the award period
    terminates under such terms.

                         TITLE V--21ST CENTURY SCHOOLS

    SEC. 501. SAFE SCHOOLS.

        Title V, except part B (which is transferred and redesignated as
    subpart 2 of part C of title IV by section 422(a) of this Act) is
    amended to read as follows:

                        ``TITLE V--21ST CENTURY SCHOOLS

        ``PART A--SUPPORTING VIOLENCE AND DRUG PREVENTION AND ACADEMIC
                                   ENRICHMENT

    ``SEC. 5001. SHORT TITLE.

        ``This part may be cited as the `21st Century Schools Act of 2001'.

    ``SEC. 5002. PURPOSE.

        ``The purpose of this part is to support programs that prevent the
    use of illegal drugs, prevent violence, provide quality before and
    after school activities and supervision for school age youth, involve
    parents and communities, and are coordinated with related Federal,
    State, and community efforts and resources to foster a safe and drug-
    free learning environment in which students increase their academic
    achievement, through the provision of Federal assistance to--
                ``(1) States for grants to local educational agencies and
            consortia of such agencies to establish, operate, and improve
            local programs of drug and violence prevention in elementary
            and secondary schools;
                ``(2) States for grants to local educational agencies,
            community-based organizations, and other public entities and
            private organizations, for before and after school programs for
            youth; and
                ``(3) States and public and private nonprofit and for-
            profit organizations to conduct training, demonstrations, and
            evaluations.

    ``SEC. 5003. AUTHORIZATION OF APPROPRIATIONS.

        ``There are authorized to be appropriated--
                ``(1) $475,000,000 for fiscal year 2002, and such sums as
            may be necessary for each of the 4 succeeding fiscal years, for
            State grants under subpart 1;
                ``(2) $900,000,000 for fiscal year 2002, and such sums as
            may be necessary for each of the four succeeding fiscal years,
            for State grants under subpart 2; and
                ``(3) $60,000,000 for fiscal year 2002, and for each of the
            4 succeeding fiscal years, for national programs under subpart
            3.

                           ``Subpart 1--Safe Schools

    ``SEC. 5111. RESERVATIONS AND ALLOTMENTS.

        ``(a) Reservations.--From the amount made available under section
    5003(1) to carry out this subpart for each fiscal year, the Secretary--
                ``(1) shall reserve 1 percent or $4,750,000 (whichever is
            greater) of such amount for grants to Guam, American Samoa, the
            United States Virgin Islands, and the Commonwealth of the
            Northern Mariana Islands, to be allotted in accordance with the
            Secretary's determination of their respective needs and to
            carry out programs described in this subpart;
                ``(2) shall reserve 1 percent or $4,750,000 (whichever is
            greater) of such amount for the Secretary of the Interior to
            carry out programs described in this subpart for Indian youth;
                ``(3) shall reserve 0.2 percent of such amount for Native
            Hawaiians to be used to carry out programs described in this
            subpart;
                ``(4) notwithstanding section 3 of the Leave No Child
            Behind Act of 2001, shall reserve an amount necessary to make
            continuation grants to grantees under part I of title X of this
            Act (under the terms of those grants), as such part existed on
            the day before the effective date of the Leave No Child Behind
            Act of 2001; and
                ``(5) notwithstanding section 3 of the Leave No Child
            Behind Act of 2001, shall reserve an amount necessary to make
            continuation grants to grantees under the Safe Schools/Healthy
            Students initiative (under the terms of those grants), as it
            existed on the day before the date of the effective date of the
            Leave No Child Behind Act of 2001.
        ``(b) State Allotments.--
                ``(1) In general.--Except as provided in paragraph (2), the
            Secretary, for each fiscal year, shall allocate among the
            States--
                        ``(A) one-half of the remainder not reserved under
                    subsection (a) according to the ratio between the
                    school-aged population of each State and the school-
                    aged population of all the States; and
                        ``(B) one-half of such remainder according to the
                    ratio between the amount each State received under part
                    A of title I for the preceding year and the sum of such
                    amounts received by all the States.
                ``(2) Minimum.--For any fiscal year, no State shall be
            allotted under this subsection an amount that is less than one-
            half of 1 percent of the total amount allotted to all the
            States under this subsection.
        ``(c) Reallotment of Unused Funds.--If any State does not apply for
    an allotment under this subpart for a fiscal year, the Secretary shall
    reallot the amount of the State's allotment to the remaining States in
    accordance with this section.
        ``(d) Definition.--For the purposes of this section, the term
    `Native Hawaiian' means any individual any of whose ancestors were
    natives, prior to 1778, of the area which now comprises the State of
    Hawaii.

    ``SEC. 5112. RESERVATION OF STATE FUNDS FOR SAFE SCHOOLS.

        ``(a) State Reservation for the Governor.--
                ``(1) In general.--The chief executive officer of a State
            may reserve not more than 20 percent of the total amount
            allocated to a State under section 5111(b) for each fiscal year
            to award competitive grants and contracts to local educational
            agencies, community-based organizations, and other public
            entities and private organizations for programs or activities
            to support community efforts that complement activities of
            local educational agencies described in section 5115. Such
            officer shall award grants based on--
                        ``(A) the quality of the activity or program
                    proposed; and
                        ``(B) how the program or activity is aligned with
                    the appropriate principles of effectiveness described
                    in section 5114(a).
                ``(2) Special consideration.--In awarding funds under
            subparagraph (A), a chief executive officer shall give special
            consideration to grantees that pursue a comprehensive approach
            to drug and violence prevention by providing and incorporating
            mental health services in their programs.
                ``(3) Administrative costs.--The chief executive officer of
            a State may use not more than 1 percent of the amount described
            in subparagraph (A) for the administrative costs incurred in
            carrying out the duties of such officer under this section.
        ``(b) State Funds.--
                ``(1) Additional reservations.--Each State shall reserve an
            amount equal to the total amount allotted to a State under
            section 5111(b), less the amount reserved under subsection (a)
            and paragraphs (2) and (3) of this subsection, for each fiscal
            year for its local educational agencies.
                ``(2) State activities.--A State may use not more than 4
            percent of the total amount available under subsection (a) for
            State activities described in subsection (c).
                ``(3) State administration.--A State may use not more than
            1 percent of the amount made available under subsection (a) for
            the administrative costs of carrying out its responsibilities
            under this subpart.
        ``(c) Activities.--
                ``(1) In general.--A State shall use a portion of the funds
            described in subsection (b)(2), either directly, or through
            grants and contracts, to plan, develop, and implement capacity
            building, technical assistance, evaluation, program improvement
            services, and coordination activities for local educational
            agencies, community-based organizations, other public entities,
            and private organizations that are designed to support the
            implementation of programs and activities under this subpart.
                ``(2) Data collection.--
                        ``(A) Statistics.--A State may use a portion of the
                    funds, not to exceed 20 percent, described in
                    subsection (b)(2), either directly or through grants
                    and contracts, to establish and implement a statewide
                    system of collecting data regarding statistics on--
                                ``(i) truancy rates; and
                                ``(ii) the frequency, seriousness, and
                            incidence of violence and drug related offenses
                            resulting in suspensions and expulsion in
                            elementary and secondary schools in States.
                        ``(B) Compilation of statistics.--The statistics
                    shall be compiled in accordance with definitions as
                    determined in the State criminal code, but shall not
                    identify victims of crimes or persons accused of
                    crimes. The collected data shall include, incident
                    reports by school officials, anonymous student surveys,
                    and anonymous teacher surveys.
                        ``(C) Reporting.--Such data and statistics shall be
                    reported to the public and shall be reported on a
                    school-by-school basis.
                        ``(D) Limitation.--Nothing in this subsection shall
                    be construed to authorize the Secretary to require
                    particular policies, procedures, or practices with
                    respect to crimes on school property or school
                    security.
                ``(3) Safe schools.--The State shall establish and
            implement a statewide policy requiring that students attending
            persistently dangerous public elementary and secondary schools,
            as determined by the State, or who become a victim of a violent
            criminal offense, as defined by State law, while in or on the
            grounds of a public elementary school or secondary school that
            the student attends, be allowed to attend a safe public
            elementary or secondary school, within the local educational
            agency, including a public charter school and allowing payment
            of reasonable transportation costs and tuition costs for such
            students.

    ``SEC. 5113. STATE APPLICATION.

        ``(a) In General.--In order to receive an allotment under section
    5111 for any fiscal year, a State shall submit to the Secretary, at
    such time as the Secretary may require, an application that--
                ``(1) describes the activities to be funded under section
            5112(c);
                ``(2) describes how activities funded under this subpart
            will support State academic achievement standards in accordance
            with section 1111;
                ``(3) describes how funds under this subpart will be
            coordinated with programs under this Act, and other programs,
            as appropriate, in accordance with the provisions of section
            8306;
                ``(4) provides an assurance that the application was
            developed in consultation and coordination with appropriate
            State officials and others, including the chief executive
            officer, the chief State school officer, the head of the State
            alcohol and drug abuse agency, the heads of the State health
            and mental health agencies, the head of the State criminal
            justice planning agency, the head of the State child welfare
            agency, the head of the State board of education, or their
            designees, and representatives of parents, students, and
            community-based organizations;
                ``(5) provides an assurance that the State will cooperate
            with, and assist, the Secretary in conducting data collection
            as required by section 5116(a);
                ``(6) provides an assurance that the local educational
            agencies in the State will comply with the provisions of
            section 8503 pertaining to the participation of private school
            children and teachers in the programs and activities under this
            subpart;
                ``(7) provides an assurance that funds under this subpart
            will be used to increase the level of State, local, and other
            non-Federal funds that would, in the absence of funds under
            this subpart, be made available for programs and activities
            authorized under this subpart, and in no case supplant such
            State, local, and other non-Federal funds;
                ``(8) describes the results of the State's needs and
            resources assessment for violence and illegal drug use
            prevention which shall be based on the results of on-going
            evaluation (which may include data on the incidence and
            prevalence, age of onset, perception of health risk and
            perception of social disapproval of violence and illegal drug
            use by youth in schools and communities and the prevalence of
            risk and protective factors or other scientifically based
            research variables in the school and community);
                ``(9)(A) provides a statement of the State's performance
            measures for drug and violence prevention programs and
            activities to be funded under this part that shall be developed
            in consultation between the State and local officials and that
            consist of--
                        ``(i) performance indicators for drug and violence
                    prevention programs and activities; and
                        ``(ii) levels of performance for each performance
                    indicator;
                ``(B) a description of the procedures the State will use
            for assessing and publicly reporting progress toward meeting
            those performance measures; and
                ``(C) a plan for monitoring the implementation of, and
            providing technical assistance regarding, the activities and
            programs conducted by local educational agencies, community-
            based organizations, other public entities, and private
            organizations under this subpart;
                ``(10) provides an assurance that the State will consult
            with a representative sample of local educational agencies in
            the development of the definition of `persistently dangerous
            school' for the purposes of section 5112(c)(3);
                ``(11) provides a description of how the State defines
            `persistently dangerous school' for the purposes of section
            5112(c)(3); and
                ``(12) provides an assurance that the State application
            will be available for public review after submission of the
            application.
        ``(b) General Approval.--A State application submitted pursuant to
    subsection (a) shall be deemed to be approved by the Secretary unless
    the Secretary makes a written determination, prior to the expiration of
    the 90-day period beginning on the date that the Secretary receives the
    application, that the application is in violation of this subpart.
        ``(c) Disapproval.--The Secretary shall not finally disapprove a
    State application, except after giving the State notice and opportunity
    for a hearing.

    ``SEC. 5114. FORMULA GRANT PROGRAM.

        ``(a) In General.--
                ``(1) Funds to local educational agencies.--A State shall
            provide the amount made available to the State under this
            subpart, less the amounts reserved under sections 5111 and 5112
            to local educational agencies for drug and violence prevention
            and education as follows:
                        ``(A) 60 percent of such amount based on the
                    relative amount such agencies received under part A of
                    title I for the preceding fiscal year.
                        ``(B) 40 percent of such amount to local
                    educational agencies based on the relative enrollments
                    in public and private nonprofit elementary and
                    secondary schools within the boundaries of such
                    agencies.
                ``(2) Administrative costs.--Of the amount received under
            paragraph (1), a local educational agency may use not more than
            1 percent for the administrative costs of carrying out its
            responsibilities under this subpart.
                ``(3) Return of funds to state; reallocation.--
                        ``(A) Return.--Except as provided in subparagraph
                    (B), upon the expiration of the 1-year period beginning
                    on the date that a local educational agency receives
                    its allocation--
                                ``(i) such agency shall return to the State
                            any funds from such allocation that remain
                            unobligated; and
                                ``(ii) the State shall reallocate any such
                            amount to local educational agencies that have
                            submitted plans for using such amount for
                            programs or activities on a timely basis.
                        ``(B) Carryover.--In any fiscal year, a local
                    educational agency, may retain for obligation in the
                    succeeding fiscal year--
                                ``(i) an amount equal to not more than 25
                            percent of the allocation it received under
                            this subpart for such fiscal year; or
                                ``(ii) upon a demonstration of good cause
                            by such agency and approval by the State, an
                            amount that exceeds 25 percent of such
                            allocation.
        ``(b) Eligibility.--To be eligible to receive a subgrant under this
    subpart, a local educational agency desiring a subgrant shall submit an
    application to the State. Such an application shall be amended, as
    necessary, to reflect changes in the activities and programs of the
    local educational agency.
        ``(c) Development.--
                ``(1) Consultation.--
                        ``(A) In general.--A local educational agency shall
                    develop its application through timely and meaningful
                    consultation with State and local government
                    representatives, representatives of schools to be
                    served, school personnel, and community organizations
                    with relevant and demonstrated expertise in drug and
                    violence prevention activities, students and parents.
                        ``(B) Continued consultation.--On an ongoing basis,
                    the local educational agency shall consult with such
                    representatives and organizations in order to seek
                    advice regarding how best to coordinate such agency's
                    activities under this subpart with other related
                    strategies, programs, and activities being conducted in
                    the community.
                ``(2) Design and development.--To ensure timely and
            meaningful consultation, a local educational agency at the
            initial stages of design and development of a program or
            activity shall consult, in accordance with this subsection,
            with appropriate entities and persons on issues regarding the
            design and development of the program or activity, including
            efforts to meet the principles of effectiveness described in
            section 5115(a).
        ``(d) Contents of Applications.--
                ``(1) In general.--An application submitted by a local
            educational agency under this section shall contain--
                        ``(A) an assurance that the activities or programs
                    to be funded support State academic achievement goals
                    in accordance with section 1111;
                        ``(B) a detailed explanation of the local
                    educational agency's comprehensive plan for drug and
                    violence prevention, which shall include a description
                    of--
                                ``(i) how the plan will be coordinated with
                            programs under this Act, other Federal, State,
                            and local programs for drug and violence
                            prevention, in accordance with the provisions
                            of section 8306;
                                ``(ii) the local educational agency's
                            performance measures for drug and violence
                            prevention programs and activities, that shall
                            consist of--
                                        ``(I) performance indicators for
                                    drug and violence prevention programs
                                    and activities; and
                                        ``(II) levels of performance for
                                    each performance indicator;
                                ``(iii) how such agency will assess and
                            publicly report progress toward attaining its
                            performance measures;
                                ``(iv) the drug and violence prevention
                            activity or program to be funded, including how
                            the activity or program will meet the
                            principles of effectiveness described in
                            section 5115(a), and the means of evaluating
                            such activity or program; and
                                ``(v) how the services will be targeted to
                            schools and students with the greatest need;
                        ``(C) a certification that a meaningful assessment
                    has been conducted to determine community needs
                    (including consultation with community leaders,
                    businesses, and school officials), available resources
                    and capacity in the public and private sector (which
                    may include an analysis based on data reasonably
                    available at the time on the incidence and prevalence,
                    age of onset, perception of health risk, and perception
                    of social disapproval of drug use and violence by youth
                    in schools and communities, prevalence of risk and
                    protective factors, buffers or assets, or other
                    scientifically based research variables in the school
                    and community), the findings of such assessments;
                        ``(D) an assurance that funds under this subpart
                    will be used to increase the level of State, local, and
                    other non-Federal funds that would, in the absence of
                    funds under this subpart, be made available for
                    programs and activities authorized under this subpart,
                    and in no case supplant such State, local, and other
                    non-Federal funds;
                        ``(E) a description of the mechanisms used to
                    provide effective notice to the community of an
                    intention to submit an application under this title;
                        ``(F) an assurance that drug prevention programs
                    supported under this part convey a clear and consistent
                    message that the illegal use of drugs is wrong and
                    harmful;
                        ``(G) an assurance that the local educational
                    agency has established and implemented a student code
                    of conduct policy that clearly states responsibilities
                    of students, teachers, and administrators in
                    maintaining a classroom environment that allows a
                    teacher to communicate effectively with all students in
                    the class, that allows all students in the class to
                    learn, has consequences that are fair and appropriate
                    for violations, and is enforced equitably;
                        ``(H) an assurance that the application and any
                    waiver request will be available for public review
                    after submission of the application; and
                        ``(I) such other information and assurances as the
                    State may reasonably require.
                ``(2) General approval.--A local educational agency's
            application submitted to the State under this subpart shall be
            deemed to be approved by the State unless the State makes a
            written determination, prior to the expiration of the 90-day
            period beginning on the date that the State receives the
            application, that the application is in violation of this
            subpart.
                ``(3) Disapproval.--The State shall not finally disapprove
            a local educational agency application, except after giving
            such agency notice and an opportunity for a hearing.

    ``SEC. 5115. AUTHORIZED ACTIVITIES.

        ``(a) Principles of Effectiveness.--
                ``(1) In general.--For a program or activity developed
            pursuant to this subpart to meet the principles of
            effectiveness, such program or activity shall--
                        ``(A) be based upon an assessment of objective data
                    regarding the incidence of violence and illegal drug
                    use in the elementary and secondary schools and
                    communities to be served, including an objective
                    analysis of the current conditions and consequences
                    regarding violence and illegal drug use, including
                    delinquency and serious discipline problems, among
                    students who attend such schools (including private
                    school students who participate in the drug and
                    violence prevention program) that is based on ongoing
                    local assessment or evaluation activities;
                        ``(B) be based upon an established set of
                    performance measures aimed at ensuring that the
                    elementary and secondary schools and communities to be
                    served by the program have a drug-free, safe, and
                    orderly learning environment; and
                        ``(C) be based upon scientifically based research
                    that provides evidence that the program to be used will
                    reduce violence and illegal drug use.
                ``(2) Periodic evaluation.--The program or activity shall
            undergo a periodic evaluation to assess its progress toward
            reducing violence and illegal drug use in schools to be served
            based on performance measures described in section
            5114(d)(1)(B)(ii) The results shall be used to refine, improve,
            and strengthen the program, and to refine the performance
            measures. The results shall also be made available to the
            public upon request, with public notice of such availability
            provided.
                ``(3) Waiver.--A local educational agency may apply to the
            State for a waiver of the requirement of paragraph (1)(C) to
            allow innovative activities or programs that demonstrate
            substantial likelihood of success.
        ``(b) Local Educational Agency Activities.--
                ``(1) Program requirements.--A local educational agency
            shall use funds made available under section 5114 to develop,
            implement, and evaluate comprehensive programs and activities,
            which are coordinated with other school and community-based
            services and programs, that shall--
                        ``(A) support State academic achievement goals in
                    accordance with section 1111;
                        ``(B) be consistent with the principles of
                    effectiveness described in subsection (a);
                        ``(C) be designed to--
                                ``(i) prevent or reduce violence and
                            illegal drug use, delinquency, serious
                            discipline problems, and poor academic
                            achievement and illegal drug use; and
                                ``(ii) create a well disciplined
                            environment conducive to learning, which
                            includes consultation between teachers,
                            principals, and other school personnel to
                            identify early warning signs of drug use and
                            violence and to provide behavioral
                            interventions as part of classroom management
                            efforts; and
                        ``(D) include activities to promote the involvement
                    of parents in the activity or program, to promote
                    coordination with community groups and coalitions, and
                    government agencies, and to distribute information
                    about the local educational agency's needs, goals, and
                    programs under this subpart.
                ``(2) Authorized activities.--Each local educational agency
            or consortium of such agencies, that receives a subgrant under
            this subpart may use such funds to carry out activities, such
            as--
                        ``(A) developmentally appropriate drug and violence
                    prevention programs in both elementary and secondary
                    schools that incorporate a variety of prevention
                    strategies and activities, which may include--
                                ``(i) teaching students that most people do
                            not use illegal drugs;
                                ``(ii) teaching students to recognize
                            social and peer pressure to use illegal drugs
                            and the skills for resisting illegal drug use;
                                ``(iii) teaching students about the dangers
                            of emerging drugs;
                                ``(iv) engaging students in the learning
                            process;
                                ``(v) incorporating activities in secondary
                            schools that reinforce prevention activities
                            implemented in elementary schools; and
                                ``(vi) involving families and communities
                            in setting clear expectations against violence
                            and illegal drug use and enforcing appropriate
                            consequences for violence and illegal drug use;
                        ``(B) training of school personnel and parents in
                    youth drug and violence prevention, including training
                    in early identification, intervention, and prevention
                    of threatening behavior;
                        ``(C) community-wide strategies for reducing
                    violence and illegal drug use, and illegal gang
                    activity;
                        ``(D) to the extent that expenditures do not exceed
                    20 percent of the amount made available to a local
                    educational agency under this subpart, law enforcement
                    and security activities, including--
                                ``(i) acquisition and installation of metal
                            detectors;
                                ``(ii) hiring and training of security
                            personnel, that are related to youth drug and
                            violence prevention;
                                ``(iii) reporting of criminal offenses on
                            school property; and
                                ``(iv) development of comprehensive school
                            security assessments;
                        ``(E) expanding and improving school-based mental
                    health services, including early identification of
                    violence and illegal drug use, assessment, and direct
                    individual or group counseling services provided to
                    students, parents, and school personnel by qualified
                    school based mental health services personnel;
                        ``(F) establishing and maintaining peer mediation
                    programs that include educating and training peer
                    mediators and a designated faculty supervisor and
                    purchasing necessary materials to facilitate training
                    and the mediation process;
                        ``(G) alternative education programs or services
                    that reduce the need for suspensions or expulsions or
                    programs or services for students who have been
                    expelled or suspended from the regular educational
                    settings, including programs or services to assist
                    students to reenter the regular education setting upon
                    return from treatment or alternative education
                    programs;
                        ``(H) counseling, mentoring, and referral services,
                    and other student assistance practices and programs,
                    including assistance provided by qualified school based
                    mental health services personnel and the training of
                    teachers by school-based mental health service
                    providers in appropriate identification and
                    intervention techniques for students, at risk of
                    violent behavior and drug use;
                        ``(I) activities that reduce truancy;
                        ``(J) age appropriate, developmentally based
                    violence prevention and education programs that address
                    the legal, health, personal, and social consequences of
                    illegal drug use and violent and disruptive behavior
                    and that include activities designed to help students
                    develop a sense of individual responsibility and
                    respect for the rights of others, and to resolve
                    conflicts without violence;
                        ``(K) providing guidance to students that
                    encourages students to seek advice for anxiety, threats
                    of violence, or actual violence and to confide in a
                    trusted adult regarding an uncomfortable or threatening
                    situation;
                        ``(L) the development of educational programs that
                    prevent school based crime, including preventing crimes
                    motivated by hate that result in acts of physical
                    violence at school and any programs or published
                    materials that address school based crime shall not
                    recommend or require any action that abridges or
                    infringes upon the constitutionally protected rights of
                    free speech, religion, and equal protection of
                    students, their parents, or legal guardians;
                        ``(M) testing students for illegal drug use or
                    conducting student locker searches for illegal drugs or
                    drug paraphernalia consistent with the 4th amendment to
                    the Constitution;
                        ``(N) emergency intervention services following
                    traumatic crisis events, such as a shooting, major
                    accident, or a drug-related incident, that has
                    disrupted the learning environment;
                        ``(O) establishing and implementing a system for
                    transferring suspension and expulsion records by a
                    local educational agency to any public or private
                    elementary or secondary school;
                        ``(P) allowing students attending a persistently
                    dangerous public elementary or secondary school, as
                    determined by the State, or who become a victim of a
                    violent criminal offense, as defined by State law,
                    while in or on the grounds of a public elementary
                    school or secondary school that the student attends, to
                    attend a safe public elementary or secondary school,
                    within the local educational agency, including a public
                    charter school, and allowing payment of reasonable
                    transportation costs and tuition costs for such
                    students;
                        ``(Q) the development and implementation of
                    character education and training programs that reflect
                    values, that take into account the views of parents or
                    guardians of the student for whom the program is
                    intended, which may include honesty, citizenship,
                    courage, justice, respect, personal responsibility, and
                    trustworthiness;
                        ``(R) establishing and maintaining a school
                    violence hotline;
                        ``(S) activities to ensure students' safe travel to
                    and from school, including pedestrian and bicycle
                    safety education; and
                        ``(T) the evaluation of any of the activities
                    authorized under this subsection and the collection of
                    any data required by this part.

    ``SEC. 5116. EVALUATION AND REPORTING.

        ``(a) Data Collection.--
                ``(1) In general.--The National Center for Education
            Statistics shall report, and when appropriate, collect data to
            determine the frequency, seriousness, and incidence of illegal
            drug use and violence by youth in schools and communities in
            the States, using if appropriate, data submitted by the States
            pursuant to subsection (b).
                ``(2) Report.--The Secretary shall submit to the Congress a
            report on the data collected under this subsection.
        ``(b) State Report.--
                ``(1) In general.--Not later than October 1, 2004, and
            every third year thereafter, the chief executive officer of a
            State, in consultation with the State educational agency, shall
            submit to the Secretary a report on the implementation and
            effectiveness of State and local programs under this subpart.
                ``(2) Special rule.--The report required by this subsection
            shall be--
                        ``(A) based on the State's ongoing evaluation
                    activities, and shall include data on the prevalence of
                    violence and illegal drug use by youth in schools and
                    communities; and
                        ``(B) made available to the public upon request,
                    with public notice of such availability provided.
        ``(c) Local Educational Agency Report.--Each local educational
    agency receiving funds under this subpart shall submit to the State
    such information, and at such intervals as the State reasonably
    requires to complete the State report required by subsection (b),
    information on the prevalence of violence and illegal drug use by youth
    in the schools and the community and the progress of the local
    educational agency toward meeting its performance measures. The report
    shall be made available to the public upon request, with public notice
    of such availability provided.

                       ``Subpart 2--21st Century Schools

    ``SEC. 5121. STATE ALLOTMENTS FOR 21ST CENTURY SCHOOLS.

        ``(a) State Allotments.--
                ``(1) In general.--Except as provided in paragraph (2),
            from the amount made available under section 5003(2) to carry
            out this subpart for each fiscal year, the Secretary shall
            allocate among the States--
                        ``(A) one-half of such amount according to the
                    ratio between the school-aged population of each State
                    and the school-aged population of all the States; and
                        ``(B) one-half of such amount according to the
                    ratio between the amount each State received under part
                    A of title I for the preceding year and the sum of such
                    amounts received by all the States.
                ``(2) Minimum.--For any fiscal year, no State shall be
            allotted under this subsection an amount that is less than one-
            half of 1 percent of the total amount allotted to all the
            States under this subsection.
        ``(b) Reallotment of Unused Funds.--If any State does not apply for
    an allotment under this subpart for a fiscal year, the Secretary shall
    reallot the amount of the State's allotment to the remaining States in
    accordance with this section.
        ``(c) State Funds.--
                ``(1) In general.--Each State that receives a grant under
            this subpart shall reserve an amount equal to the amount
            allotted to such State under subsection (a), less the amount
            reserved under paragraphs (2) and (3) of this subsection, for
            each fiscal year for its local educational agencies.
                ``(2) State administration.--A State may use not more than
            1 percent of the amount made available under subsection (a) for
            the administrative costs of carrying out its responsibilities
            under this subpart.
                ``(3) State activities.--A State may use not more than 4
            percent of the amount made available under subsection (a) for
            the following activities:
                        ``(A) Monitoring and evaluation of programs and
                    activities assisted under this subpart.
                        ``(B) Providing capacity building, training, and
                    technical assistance under this subpart.

    ``SEC. 5122. STATE APPLICATION.

        ``(a) In General.--In order to receive an allotment under section
    5121(a) for any fiscal year, a State shall submit to the Secretary, at
    such time as the Secretary may require, an application that--
                ``(1) designates the State educational agency as the agency
            responsible for the administration and supervision of programs
            assisted under this subpart;
                ``(2) describes the competitive procedures and criteria the
            State will use to ensure that grants under this subpart will
            support quality extended learning opportunities;
                ``(3) an assurance that the program will primarily target
            schools eligible for schoolwide programs under section 1114;
                ``(4) describes the steps the State will take to ensure
            that programs implement effective strategies, including
            providing ongoing technical assistance and training,
            evaluation, and dissemination of promising practices;
                ``(5) describe how activities funded under this subpart
            will support State academic achievement goals in accordance
            with section 1111;
                ``(6) describe how funds under this subpart will be
            coordinated with programs under this Act, and other programs;
            as appropriate, in accordance with the provisions of section
            8306;
                ``(7) provides an assurance that funds under this subpart
            will be used to increase the level of State, local, and other
            non-Federal funds that would, in the absence of funds under
            this subpart, be made available for programs and activities
            authorized under this subpart; and in no case supplant such
            State, local, and other non-Federal funds:
                ``(8) provides an assurance that the application was
            developed in consultation and coordination with appropriate
            State officials, including the chief State school officer, the
            heads of the State health and mental health agencies or their
            designees, representatives of teachers, parents, students, the
            business community, and community-based organizations,
            including religious organizations;
                ``(9) describes the results of the State's needs and
            resources assessment for before and after school activities,
            which shall be based on the results of on-going State
            evaluation activities;
                ``(10) describes how the State will evaluate the
            effectiveness of programs and activities carried out under this
            subpart which shall include at a minimum--
                        ``(A) a description of the performance indicators
                    and performance measures that will be used to evaluate
                    programs and activities; and
                        ``(B) public dissemination of the evaluations of
                    programs and activities carried out under this subpart;
                    and
                ``(11) provides for timely public notice of intent to file
            application and an assurance that the application will be
            available for public review after submission of the
            application.
        ``(b) General Approval.--A State application submitted pursuant to
    subsection (a) shall be deemed to be approved by the Secretary unless
    the Secretary makes a written determination, prior to the expiration of
    the 90-day period beginning on the date that the Secretary receives the
    application, that the application is in violation of this subpart.
        ``(c) Disapproval.--The Secretary shall not finally disapprove a
    State application, except after giving the State notice and opportunity
    for a hearing.

    ``SEC. 5123. COMPETITIVE GRANT PROGRAM.

        ``(a) In General.--A State that receives funds under this subpart
    shall provide the amount made available under section 5121 to eligible
    entities for 21st century community learning programs in accordance
    with this subpart.
        ``(b) Eligibility.--
                ``(1) In general.--To be eligible to receive a subgrant
            under this subpart, an eligible entity desiring a subgrant
            shall submit an application to the State that contains--
                        ``(A) a description of the before and after school
                    activity to be funded including--
                                ``(i) an assurance that the program will
                            take place in a safe and easily accessible
                            facility;
                                ``(ii) a description of how students
                            participating in the center will travel safely
                            to and from the community learning center and
                            back home; and
                                ``(iii) a description of how the eligible
                            applicant will disseminate information about
                            the project (including its location) to the
                            community in a manner that is understandable
                            and accessible.
                        ``(B) a description of how the activity is expected
                    to improve student academic performance;
                        ``(C) a description of how the activity will meet
                    the principles of effectiveness described in section
                    5124;
                        ``(D) an assurance that the program will primarily
                    target students who attend schools eligible for
                    schoolwide programs under section 1114;
                        ``(E) provides an assurance that funds under this
                    subpart will be used to increase the level of State,
                    local, and other non-Federal funds that would, in the
                    absence of funds under this subpart, be made available
                    for programs and activities authorized under this
                    subpart; and in no case supplant such State, local, and
                    other non-Federal funds;
                        ``(F) a description of the partnership with local
                    educational agency, a community-based organization, and
                    another public entity or private organization, if
                    appropriate;
                        ``(G) a certification that a meaningful assessment
                    has been conducted to determine community needs,
                    available resources and capacity in the findings of
                    such assessments, and a description of the mechanisms
                    used to provide effective notice to the community of an
                    intention to submit an application under this subpart;
                        ``(H) a description of the applicants experience,
                    or promise of success, in providing educational or
                    related activities that will compliment and enhance the
                    student's academic achievement;
                        ``(I) an assurance that the applicant will develop
                    a plan to continue the activity after funding under
                    this subpart ends;
                        ``(J) an assurance that the application and any
                    waiver request will be available for public review
                    after submission of the application; and
                        ``(K) such other information and assurances as the
                    State may reasonably require.
                ``(2) Eligible entity.--An eligible entity under this
            subpart is a local educational agency, community-based
            organization, and other public entity or private organization
            or a consortium of two or more of such groups.
        ``(c) Peer Review.--In reviewing local applications under this
    section, a State shall use a peer review process or other methods of
    assuring the quality of such applications.
        ``(d) Geographic Diversity.--To the extent practicable, a State
    shall distribute funds equitably among geographic areas within the
    State.
        ``(e) Duration of Awards.--Grants under this subpart may be awarded
    for a period of not less than 3 years and not more than 5 years.
        ``(f) Amount of Awards.--A grant awarded under this subpart may not
    be made in an amount of less than $50,000.
        ``(g) Priority.--In making awards under this subpart, the State
    shall give priority to applications submitted by applicants proposing
    to target services to students who attend schools that have been
    identified as in need of improvement under section 1116.
        ``(h) Permissive Local Match.--
                ``(1) In general.--A State may require an eligible entity
            to match funds awarded under this subpart, except that such
            match may not exceed the amount of the grant award.
                ``(2) Sliding scale.--The amount of a match under paragraph
            (1) shall be established based on a sliding fee scale that
            takes into account--
                        ``(A) the relative poverty of the population to be
                    targeted by the eligible entity; and
                        ``(B) the ability of the eligible entity to obtain
                    such matching funds.
                ``(3) Consideration.--Notwithstanding this subsection, a
            State shall not consider an eligible entity's ability to match
            funds when determining which eligible entities will receive
            subgrants under this subpart.

    ``SEC. 5124. LOCAL ACTIVITIES.

        ``(a) Principles of Effectiveness.--
                ``(1) In general.--For a program or activity developed
            pursuant to this subpart to meet the principles of
            effectiveness, such program or activity shall--
                        ``(A) be based upon an assessment of objective data
                    regarding the need for before and after school programs
                    and activities in such schools and communities;
                        ``(B) be based upon an established set of
                    performance measures aimed at ensuring the availability
                    of quality extended learning opportunities; and
                        ``(C) if appropriate, be based upon scientifically
                    based research that provides evidence that the program
                    will help students meet State and local performance
                    standards to be used.
                ``(2) Periodic evaluation.--The program or activity shall
            undergo a periodic evaluation to assess its progress toward
            achieving its goal of providing quality extended learning
            opportunities. The results shall be used to refine, improve,
            and strengthen the program, and to refine the performance
            measures. The results shall also be made available to the
            public upon request, with public notice of such availability
            provided.
                ``(3) Waiver.--A local educational agency may apply to the
            State for a waiver of the requirement of paragraph (1)(C) to
            allow innovative activities or programs that demonstrate
            substantial likelihood of success.
        ``(b) Services.--Each eligible entity that receives a subgrant
    under this subpart shall use such funds to establish or expand
    activities in community learning centers that--
                ``(1) provide quality extended learning opportunities to
            help students, particularly students who attend low-performing
            schools, to meet State and local student performance standards
            in the core academic subjects, such as reading and mathematics;
            and
                ``(2) provide students with additional activities, such as
            drug and violence prevention programs, art and music programs,
            technology education programs, recreational activity, and
            character education programs that are linked to, and reinforce,
            the regular academic program of schools those students attend.
        ``(c) Authorized Activities.--Each eligible entity that receives a
    subgrant under this subpart may use such funds to carry out activities,
    such as--
                ``(1) before and after school activities that advance
            student achievement, including--
                        ``(A) remedial education activities and academic
                    enrichment learning programs, including providing
                    additional assistance to students in order to allow
                    them to improve their academic achievement;
                        ``(B) math and science education activities;
                        ``(C) arts and music education activities;
                        ``(D) entrepreneurial education programs;
                        ``(E) tutoring services (including those provided
                    by senior citizen volunteers) and mentoring programs;
                        ``(F) recreational activities;
                        ``(G) telecommunications and technology education
                    programs;
                        ``(H) expanded library service hours;
                        ``(I) programs that promote parental involvement;
                    and
                        ``(J) programs that provide assistance to students
                    who have been truant, suspended, or expelled to allow
                    them to improve their academic achievement; and
                ``(2) establishing or enhancing programs or initiatives
            that improve academic achievement.
        ``(d) Definition.--For the purpose of this section, a `community
    learning center' is an entity that assists students to meet State and
    local content and student performance standards in core academic
    subjects, such as reading and mathematics, by providing them with
    quality extended learning opportunities and related activities (such as
    drug and violence-prevention programs, art and music programs,
    recreational programs, technology education programs, and character
    education programs) that are linked to, and reinforce, the regular
    academic program of schools attended by the students served and is
    operated by a local educational agency, community-based organization,
    other public entity or private organization or a consortium of two or
    more such groups. Community learning centers shall operate outside
    school hours, such as before or after school or when school is not in
    session.

                         ``Subpart 3--National Programs

    ``SEC. 5131. FEDERAL ACTIVITIES.

        ``(a) Program Authorized.--
                ``(1) In general.--From funds made available to carry out
            this part under section 5003(3), the Secretary, in consultation
            with the Secretary of Health and Human Services, the Director
            of the Office of National Drug Control Policy, and the Attorney
            General, shall evaluate the effectiveness of programs and
            activities that prevent violence and the illegal use of drugs
            by youth, that promote safety and discipline for students in
            elementary and secondary schools, and that provide before and
            after school supervision and academic enrichment, based on the
            needs reported by States and local educational agencies.
                ``(2) Coordination.--The Secretary shall carry out
            activities described in paragraph (1) directly, or through
            grants, contracts, or cooperative agreements with public and
            private nonprofit and for-profit organizations, and
            individuals, or through agreements with other Federal agencies,
            and shall coordinate such activities with other appropriate
            Federal activities.
                ``(3) Programs.--Activities described in paragraph (1) may
            include--
                        ``(A) demonstrations and rigorous scientifically
                    based evaluations of innovative approaches to drug and
                    violence prevention and before and after school
                    activities based on needs reported by State and local
                    educational agencies;
                        ``(B) the provision of information on drug abuse
                    education and prevention to the Secretary of Health and
                    Human Services for dissemination by the clearinghouse
                    for alcohol and drug abuse information established
                    under section 501(d)(16) of the Public Health Service
                    Act;
                        ``(C) the provision of information on violence
                    prevention and school safety to the Attorney General
                    for dissemination; and
                        ``(D) continuing technical assistance to chief
                    executive officers, State agencies, and local
                    educational agencies to build capacity to develop and
                    implement high-quality, effective programs consistent
                    with the principles of effectiveness.
        ``(b) Peer Review.--The Secretary shall use a peer review process
    in reviewing applications for funds under this section.

                          ``Subpart 4--Gun Possession

    ``SEC. 5141. GUN-FREE SCHOOL REQUIREMENTS.

        ``(a) Requirements.--
                ``(1) State law.--Each State receiving funds under this Act
            shall--
                        ``(A) have in effect a State law requiring each
                    local educational agency to expel from school for a
                    period of not less than one year a student who is
                    determined to have possessed a firearm in or at a
                    school or on school grounds under the jurisdiction of a
                    local educational agency in that State, except that
                    such State law shall allow the chief administering
                    officer of such local educational agency to modify such
                    expulsion requirement for a student on a case-by-case
                    basis; and
                        ``(B) require each local educational agency to
                    adopt a policy requiring each elementary and secondary
                    school to refer to the criminal justice or juvenile
                    delinquency system any student who possesses a firearm
                    in school.
                ``(2) Construction.--Nothing in this part shall be
            construed to prevent a State from allowing a local educational
            agency that has expelled a student from such student's regular
            school setting from providing educational services to such
            student in an alternative setting.
        ``(b) Report to State.--Each local educational agency requesting
    assistance from the State educational agency that is to be provided
    from funds made available to the State under this Act shall provide to
    the State, in the application requesting such assistance--
                ``(1) an assurance that such local educational agency is in
            compliance with the requirements of subsection (a); and
                ``(2) a description of the circumstances surrounding
            incidents of possessions and any expulsions imposed under the
            State law required by subsection (a)(1), including--
                        ``(A) the name of the school concerned;
                        ``(B) the number of students expelled from such
                    school for firearm possession; and
                        ``(C) the type of firearm concerned.
        ``(c) Special Rule.--The provisions of this section shall be
    construed in a manner consistent with the Individuals with Disabilities
    Education Act.
        ``(d) Definitions.--For the purpose of this subpart--
                ``(1) the term `firearm' has the same meaning given to such
            term under section 921(a)(3) of title 18, United States Code;
            and
                ``(2) the term `school' does not include a home school,
            regardless of whether a home school is treated as a private
            school under State law.

                        ``Subpart 5--General Provisions

    ``SEC. 5151. DEFINITIONS.

        ``For the purposes of this part, the following terms have the
    following meanings:
                ``(1) Before and after school activities.--The term `before
            and after school activities' means academic, recreational, and
            enrichment activities for school-age youth outside of the
            regular school hours or school year.
                ``(2) Controlled substance.--The term `controlled
            substance' means a drug or other substance identified under
            Schedule I, II, III, IV, or V in section 202(c) of the
            Controlled Substances Act (21 U.S.C. 812(c)).
                ``(3) Drug.--The term `drug' includes controlled
            substances; the illegal use of alcohol and tobacco; and the
            harmful, abusive, or addictive use of substances, including
            inhalants and anabolic steroids.
                ``(4) Drug and violence prevention.--The term `drug and
            violence prevention' means--
                        ``(A) with respect to drugs, prevention, early
                    intervention, rehabilitation referral, or education
                    related to the illegal use of drugs; and
                        ``(B) with respect to violence, the promotion of
                    school safety, such that students and school personnel
                    are free from violent and disruptive acts, on school
                    premises, going to and from school, and at school-
                    sponsored activities, through the creation and
                    maintenance of a school environment that is free of
                    weapons and fosters individual responsibility and
                    respect for the rights of others.
                ``(5) Nonprofit.--The term `nonprofit,' as applied to a
            school, agency, organization, or institution means a school,
            agency, organization, or institution owned and operated by one
            or more nonprofit corporations or associations, no part of the
            net earnings of which inures, or may lawfully inure, to the
            benefit of any private shareholder or individual.
                ``(6) School-aged population.--The term `school-aged
            population' means the population aged 5 through 17, as
            determined by the Secretary on the basis of the most recent
            satisfactory data available from the Department of Commerce.
                ``(7) School based mental health services provider.--The
            term `school based mental health services provider' includes a
            State licensed or State certified school counselor, school
            psychologist, school social worker, or other State licensed or
            certified mental health professional qualified under State law
            to provide such services to children and adolescents.
                ``(8) School personnel.--The term `school personnel'
            includes teachers, principals, administrators, guidance
            counselors, social workers, psychologists, nurses, librarians,
            and other support staff who are employed by a school or who
            perform services for the school on a contractual basis.
                ``(9) State.--The term `State' means each of the 50 States,
            the District of Columbia, and the Commonwealth of Puerto Rico.

    ``SEC. 5152. MESSAGE AND MATERIALS.

        ``(a) `Wrong and Harmful' Message.--Drug prevention programs
    supported under this title shall convey a clear and consistent message
    that the illegal use of drugs is wrong and harmful.
        ``(b) Curriculum.--The Secretary shall not prescribe the use of
    specific curricula for programs supported under this part.

    ``SEC. 5153. PARENTAL CONSENT.

        ``Upon receipt of written notification from the parents or legal
    guardians of a student, the local educational agency shall withdraw
    such student from any program or activity funded under this title. The
    local educational agency shall make reasonable efforts to inform
    parents or legal guardians of the content of such programs or
    activities funded under this title, other than classroom instruction.

    ``SEC. 5154. PROHIBITED USES OF FUNDS.

        ``No funds under this part may be used for--
                ``(1) construction (except for minor remodeling needed to
            accomplish the purposes of this part); or
                ``(2) medical services, drug treatment or rehabilitation,
            except for pupil services or referral to treatment for students
            who are victims of, or witnesses to, use of drugs or crime.

                ``PART B--ENHANCING EDUCATION THROUGH TECHNOLOGY

    ``SEC. 5201. SHORT TITLE.

        ``This part may be cited as the `Enhancing Education Through
    Technology Act of 2001'.

    ``SEC. 5202. PURPOSES.

        ``The purposes of this part are as follows:
                ``(1) To provide assistance to States and localities for
            implementing innovative technology initiatives that lead to
            increased student academic achievement and that may be
            evaluated for effectiveness and replicated if successful.
                ``(2) To encourage the establishment or expansion of
            initiatives, including those involving public-private
            partnerships, designed to increase access to technology,
            particularly in high-need local educational agencies.
                ``(3) To assist States and localities in the acquisition,
            development, interconnection, implementation, improvement, and
            maintenance of an effective educational technology
            infrastructure in a manner that expands access to technology
            for students (particularly for disadvantaged students) and
            teachers.
                ``(4) To promote initiatives that provide school teachers,
            principals, and administrators with the capacity to effectively
            integrate technology into curriculum that is aligned with
            challenging State academic content and student academic
            achievement standards, through such means as high quality
            professional development programs.
                ``(5) To enhance the ongoing professional development of
            teachers, principals, and administrators by providing constant
            access to updated research in teaching and learning via
            electronic means.
                ``(6) To support the development of electronic networks and
            other innovative methods, such as distance learning, of
            delivering challenging courses and curricula for students who
            would otherwise not have access to such courses and curricula,
            particularly in geographically remote regions.
                ``(7) To support the rigorous evaluation of programs funded
            under this part, particularly the impact of such initiatives on
            student academic performance, and ensure that timely
            information on the results of such evaluations is widely
            accessible through electronic means.
                ``(8) To support local efforts for the use of technology to
            promote parent and family involvement in education and
            communication among students, parents, teachers, principals,
            and administrators.

    ``SEC. 5203. AUTHORIZATION OF APPROPRIATIONS; FUNDING RULE.

        ``(a) In General.--There are authorized to be appropriated--
                ``(1) to carry out subparts 1 and 2 of this part--
                        ``(A) $1,000,000,000 for fiscal year 2002; and
                        ``(B) such sums as may be necessary for each of
                    fiscal years 2003 through 2006; and
                ``(2) to carry out subpart 3 of this part--
                        ``(A) $24,500,000 for fiscal year 2002; and
                        ``(B) such sums as may be necessary for each of
                    fiscal years 2003 through 2006.
        ``(b) Allocation of Funds Between National and State and Local
    Initiatives.--The amount of funds made available under subsection (a)
    shall be allocated as follows:
                ``(1) Not less than 95 percent shall be made available for
            State and local technology initiatives under subpart 1.
                ``(2) Not more than 5 percent may be made available for
            activities of the Secretary under subpart 2, of which not more
            than $15,000,000 may be used for the study required by section
            5221(a)(1).

    ``SEC. 5204. DEFINITIONS.

        ``In this part:
                ``(1) The term `distance learning' means the transmission
            of educational or instructional programming to geographically
            dispersed individuals and groups via telecommunications.
                ``(2) The term `eligible local entity' means--
                        ``(A) a high-need local educational agency; or
                        ``(B) an eligible local partnership.
                ``(3) The term `eligible local partnership' means a
            partnership that includes at least one high-need local
            educational agency and at least one--
                        ``(A) local educational agency that can demonstrate
                    that teachers in schools served by that agency are
                    effectively integrating technology and proven teaching
                    practices into instruction, based on scientifically
                    based research, that result in improvement in--
                                ``(i) classroom instruction in the core
                            academic subject areas; and
                                ``(ii) the preparation of students to meet
                            challenging State academic content and student
                            academic achievement standards;
                        ``(B) institution of higher education that is in
                    full compliance with the reporting requirements of
                    section 207(f) of the Higher Education Act of 1965 (20
                    U.S.C. 1027(f)) and that has not been identified by its
                    State as low-performing under section 208 of such Act
                    (20 U.S.C. 1028);
                        ``(C) for-profit business or organization that
                    develops, designs, manufactures, or produces technology
                    products or services, or has substantial expertise in
                    the application of technology; or
                        ``(D) public or private nonprofit organization with
                    demonstrated experience in the application of
                    educational technology.
                ``(4) The term `high-need local educational agency' means a
            local educational agency that--
                        ``(A) is among the local educational agencies in
                    the State with the highest numbers or percentages of
                    children from families with incomes below 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));
                        ``(B) includes one or more schools identified under
                    section 1116; and
                        ``(C) has a substantial need for assistance in
                    acquiring and using technology.

           ``Subpart 1--State and Local Technology for Success Grants

    ``SEC. 5211. DETERMINATION OF AMOUNT OF STATE ALLOTMENT.

        ``(a) In General.--Except as otherwise provided in this subpart,
    each State shall be eligible to receive a grant under this subpart for
    a fiscal year in an allotment determined as follows:
                ``(1) 50 percent shall bear the same relationship to the
            amount made available under section 5203(b)(1) for such year as
            the amount such State received under part A for title I for
            such year bears to the amount received for such year under such
            part by all States.
                ``(2) 50 percent shall be determined on the basis of the
            State's relative population of individuals age 5 through 17, as
            determined by the Secretary on the basis of the most recent
            satisfactory data.
        ``(b) Reservation of Funds for Bureau of Indian Affairs and
    Outlying Areas.--Of the amount made available to carry out this subpart
    under section 5203(b)(1) for a fiscal year--
                ``(1) the Secretary shall reserve \1/2\ of 1 percent for
            the Secretary of the Interior for programs under this subpart
            for schools operated or funded by the Bureau of Indian Affairs;
            and
                ``(2) the Secretary shall reserve \1/2\ of 1 percent to
            provide assistance under this subpart to the outlying areas.
        ``(c) Minimum Allotment.--The amount of any State's allotment under
    subsection (a) for any fiscal year may not be less than \1/2\ of 1
    percent of the amount made available under section 5203(b)(1) for such
    year.
        ``(d) Reallotment of Unused Funds.--If any State does not apply for
    an allotment under this subpart for a fiscal year, or does not use its
    entire allotment for that fiscal year, the Secretary shall reallot the
    amount of the State's allotment, or the unused portion thereof, to the
    remaining States in accordance with this section.

    ``SEC. 5212. USE OF ALLOTMENT BY STATE.

        ``(a) In General.--Of the amount provided to a State from its
    allotment under section 5211--
                ``(1) the State may use not more than 5 percent to carry
            out activities under section 5215; and
                ``(2) subject to subsection (b), not less than 95 percent
            shall be distributed by the State as follows:
                        ``(A) 60 percent of such amount shall--
                                ``(i) be awarded to local educational
                            agencies that have submitted applications to
                            the State under section 5214 (which, in the
                            case of a local educational agency that is an
                            eligible local entity, may be combined with an
                            application for funds awarded under
                            subparagraph (B)), in an amount that bears the
                            same relationship to the amount made available
                            under section 5211(a) for such year as the
                            amount such local educational agency received
                            under part A of title I for such year bears to
                            the amount received for such year under such
                            part by all local educational agencies within
                            the State; and
                                ``(ii) be used for the activities described
                            in section 5216.
                        ``(B) 40 percent of such amount shall be awarded
                    through a State-determined competitive process to
                    eligible local entities that have submitted
                    applications to the State under section 5214 (which, in
                    the case of an eligible local entity that is a local
                    educational agency, may be combined with an application
                    for funds provided under subparagraph (A)), to be used
                    to carry out activities consistent with activities
                    described in section 5216.
        ``(b) Continuation of Awards.--Notwithstanding section 3 of the No
    Child Left Behind Act of 2001, a State shall make continuation awards
    on multiyear grants awarded by the State under section 3132(a)(2) (as
    in effect on the day preceding the date of enactment of such Act) from
    the funds described in subsection (a)(2) for the shorter of--
                ``(1) the duration of the original grant period; or
                ``(2) two years after the date of enactment of such Act.

    ``SEC. 5213. STATE APPLICATIONS.

        ``(a) In General.--To be eligible to receive a grant under this
    subpart, a State shall submit an application to the Secretary
    containing a new or updated statewide, long-range strategic educational
    technology plan (which shall consider the educational technology needs
    of local educational agencies), and such other information as the
    Secretary may reasonably require, at such time and in such manner as
    the Secretary may specify.
        ``(b) Contents.--Each State application submitted under this
    section shall include the following:
                ``(1) A description of how the State will use funds
            provided under this subpart to improve the academic achievement
            of all students and to improve the capacity of all teachers to
            provide instruction in the State through the use of education
            technology.
                ``(2) A description of the State's goals for using advanced
            technology to improve student achievement aligned to
            challenging State academic content and student academic
            achievement standards.
                ``(3) A description of how the State will take steps
            (including through public and private partnerships) to ensure
            that all students and teachers in the State, particularly those
            residing or teaching in districts served by high-need local
            educational agencies, will have increased access to educational
            technology.
                ``(4) A description of--
                        ``(A) how the State will ensure that ongoing
                    integration of technology into instructional strategies
                    and school curricula in all schools in the State so
                    that technology will be fully integrated into those
                    schools by December 31, 2006; and
                        ``(B) the process and accountability measures the
                    State will use for the evaluation of such integration,
                    including whether such integration--
                                ``(i) has increased the ability of teachers
                            to teach effectively; and
                                ``(ii) has enabled students to meet
                            challenging State academic content and student
                            academic achievement standards.
                ``(5) A description of how the State will encourage the
            development and utilization of innovative strategies for the
            delivery of specialized or rigorous academic courses and
            curricula through the use of technology and distance learning,
            particularly for those areas of the State that would not
            otherwise have access to such courses and curricula due to
            geographical isolation or insufficient resources.
                ``(6) An assurance that financial assistance provided under
            this subpart shall supplement, not supplant, State and local
            funds.
                ``(7) A description of how the State will ensure that every
            teacher and principal within a school funded under this subpart
            will be computer-literate and proficient (as determined by the
            State) by December 31, 2006.
                ``(8) A description of how the State will ensure that each
            grant under section 5212(a)(2)(B) to an eligible local
            applicant is of sufficient duration, size, scope, and quality
            to carry out the purposes of this part effectively.
                ``(9) A description of how the State educational agency
            will provide technical assistance to eligible local applicants,
            and its capacity for providing such assistance, including
            developing public and private partnerships under this part.
        ``(c) Deemed Approval.--A State application submitted to the
    Secretary under this section shall be deemed to be approved by the
    Secretary unless the Secretary makes a written determination, prior to
    the expiration of the 90-day period that begins on the date the
    Secretary receives the complete application, that the application does
    not reasonably meet the purposes of this subpart.
        ``(d) Disapproval.--The Secretary may issue a final disapproval of
    a State's application under this subpart only after giving the State
    notice and an opportunity for a hearing.
        ``(e) Dissemination of Information on State Applications.--The
    Secretary shall make information on State applications under this
    subpart widely available to schools and the general public, including
    through dissemination on the Internet, in a timely and user-friendly
    manner.

    ``SEC. 5214. LOCAL APPLICATIONS.

        ``(a) In General.--An applicant seeking to receive funds from a
    State under this subpart shall submit to the State an application
    containing a new or updated long-range local strategic educational
    technology plan consistent with the objectives of the statewide
    education technology plan described in section 5213(a), and such other
    information as the State may reasonably require, at such time, and in
    such manner as the State may specify.
        ``(b) Contents of Local Application.--Each local application
    described in this section shall include the following:
                ``(1) A description of how the applicant will use Federal
            funds provided under this subpart to improve the academic
            achievement of all students and to improve the capacity of all
            teachers to provide instruction through the use of education
            technology.
                ``(2) A description of the applicant's specific goals for
            using advanced technology to improve student achievement
            aligned to challenging State academic content and student
            academic achievement standards.
                ``(3) A description of--
                        ``(A) how the applicant will take steps to ensure
                    that all students and teachers in schools served by the
                    local educational agency (particularly those in high-
                    poverty and high-need schools) have increased access to
                    educational technology; and
                        ``(B) how such technology will be used to improve
                    the academic achievement for such students.
                ``(4) A description of how the applicant will promote--
                        ``(A) the utilization of teaching strategies and
                    curricula, based on scientifically based research,
                    which effectively integrate technology into
                    instruction, leading to improvements in student
                    academic achievement as measured by challenging State
                    academic content and student academic achievement
                    standards; and
                        ``(B) sustained and intensive, high-quality
                    professional development consistent with section 2033
                    (as applicable), based on scientifically based
                    research, which increases teacher and principal
                    capacity to create improved learning environments
                    through the integration of technology into instruction
                    through proven strategies and improved content as
                    described in subparagraph (A).
                ``(5) A description of how the applicant will integrate
            technology across the curriculum and a time line for such
            integration, including a description of how the applicant will
            make effective use of new and emerging technologies and
            teaching practices that are linked to such emerging
            technologies to provide challenging content and improved
            classroom instruction.
                ``(6) A description of how the applicant will coordinate
            education technology activities funded under this subpart,
            including professional development, with any such activities
            provided under other Federal, State, and local programs,
            including those authorized under title I, title II, title IV,
            and the Individuals with Disabilities Education Act (20 U.S.C.
            1400 et seq.) and the Carl D. Perkins Vocational and Technical
            Education Act of 1998 (20 U.S.C. 2301 et seq.).
                ``(7) A description of the accountability measures and
            process the applicant will use for the evaluation of the extent
            to which funds provided under this subpart were effective in
            integrating technology into school curriculum, increasing the
            ability of teachers to teach, and enabling students to meet
            challenging State academic content and student academic
            achievement standards.
                ``(8) A description of how the applicant will encourage the
            development and utilization of innovative strategies for the
            delivery of specialized or rigorous academic courses and
            curricula through the use of technology and distance learning,
            particularly for those areas that would not otherwise have
            access to such courses and curricula due to geographical
            isolation or insufficient resources.
                ``(9) A description of what steps the applicant has taken,
            or will take, to comply with section 5205(a)(1).
                ``(10) If requested by the State--
                        ``(A) a description of how the applicant will use
                    funds provided under this subpart in a manner that is
                    consistent with any statewide education technology
                    priorities that may be established by the State
                    consistent with this subpart; and
                        ``(B) an assurance that any technology obtained
                    with funds provided under this subpart will have
                    compatibility and interconnectivity with technology
                    obtained with funds provided previously under title III
                    (as in effect on the day preceding the date of
                    enactment of the No Child Left Behind Act of 2001), as
                    appropriate.

    ``SEC. 5215. STATE ACTIVITIES.

        ``(a) In General.--From funds made available under section
    5212(a)(1), a State shall carry out activities and assist local efforts
    to carry out the purposes of this subpart, which may include the
    following activities:
                ``(1) Developing, or assisting applicants in the
            development and utilization of, innovative strategies to
            deliver rigorous academic programs through the use of
            technology and distance learning, and providing other technical
            assistance to such applicants throughout the State, with a
            priority to high-need local educational agencies.
                ``(2) Establishing or supporting public-private
            initiatives, such as interest-free or reduced-cost loans for
            the acquisition of educational technology for high-need local
            educational agencies and students attending schools served by
            such agencies.
                ``(3) Assisting applicants in providing sustained and
            intensive, high-quality professional development based on
            scientifically based research in the integration of advanced
            technologies (including emerging technologies) into curriculum
            and in using those technologies to create new learning
            environments, including training in the use of technology to--
                        ``(A) access data and resources to develop
                    curricula and instructional materials;
                        ``(B) enable teachers--
                                ``(i) to use the Internet to communicate
                            with parents, other teachers, principals, and
                            administrators; and
                                ``(ii) to retrieve Internet-based learning
                            resources; and
                        ``(C) lead to improvements in classroom instruction
                    in the core academic subject areas, which effectively
                    prepare students to meet challenging State academic
                    content and student academic achievement standards.
                ``(4) Assisting applicants in providing all students
            (including students with disabilities and students with limited
            English proficiency) and teachers with access to educational
            technology.
                ``(5) Establishing or expanding access to technology in
            areas served by high-need local educational agencies, with
            special emphasis on access provided through technology centers
            in partnership with libraries and with the support of the
            private sector.
                ``(6) Developing enhanced performance measurement systems
            to determine the effectiveness of education technology programs
            funded under this subpart, particularly in determining the
            extent to which education technology funded under this subpart
            has been successfully integrated into teaching strategies and
            school curriculum, has increased the ability of teachers to
            teach, and has enabled students to meet challenging State
            academic content and student academic achievement standards.
                ``(7) Collaborating with other States on distance learning,
            including making advanced courses available to students who
            would otherwise not have access to such courses.
        ``(b) Limitation on Administrative Costs.--Of the 5 percent of the
    State's allotment under section 5211 which may be used to carry out
    activities under this section, not more than 40 percent may be used by
    the State for administrative costs.

    ``SEC. 5216. LOCAL ACTIVITIES.

        ``(a) Professional Development.--A recipient of funds made
    available under section 5212(a)(2)(A) shall use not less than 20
    percent of such funds to provide sustained and intensive, high-quality
    professional development, consistent with section 2033 (as applicable),
    based on scientifically based research in the integration of advanced
    technologies (including emerging technologies) into curriculum and in
    using those technologies to create new learning environments, including
    professional development in the use of technology to--
                ``(1) access data and resources to develop curricula and
            instructional materials;
                ``(2) enable teachers--
                        ``(i) to use the Internet to communicate with
                    parents, other teachers, principals, and
                    administrators; and
                        ``(ii) to retrieve Internet-based learning
                    resources; and
                ``(3) lead to improvements in classroom instruction in the
            core academic subject areas, which effectively prepare students
            to meet challenging State academic content and student academic
            achievement standards.
        ``(b) Waiver.--Subsection (a) does not apply to a recipient of
    funds under section 5212(a)(2)(A) that demonstrates, to the
    satisfaction of the State, that such recipient already provides
    sustained and intensive, high-quality professional development based on
    scientifically based research in the integration of technology
    (including emerging technologies) into the curriculum.
        ``(c) Other Activities.--In addition to the activities described in
    subsection (a), a recipient of funds distributed by a State under
    section 5212(a)(2)(A) shall use such funds to carry out other
    activities consistent with this subpart, which may include the
    following:
                ``(1) Adapting or expanding existing and new applications
            of technology to enable teachers to increase student academic
            achievement through the use of teaching practices and advanced
            technologies that are based on scientifically based research
            and are designed to prepare students to meet challenging State
            academic content and student academic achievement standards,
            and for developing and utilizing innovative strategies to
            deliver rigorous academic programs.
                ``(2) Expanding, acquiring, implementing, applying, and
            maintaining education technology as a means to improve the
            academic achievement of all students.
                ``(3) The establishment or expansion of initiatives,
            particularly those involving public-private partnerships,
            designed to increase access to technology for students and
            teachers, with special emphasis on the access of high-need
            local educational agencies to technology.
                ``(4) Using technology to promote parent and family
            involvement, and support communications between students,
            parents, and teachers.
                ``(5) Acquiring proven and effective curricula that include
            integrated technology and are designed to help students achieve
            challenging State academic content and student academic
            achievement standards.
                ``(6) Using technology to collect, manage, and analyze data
            to inform school improvement efforts.
                ``(7) Implementing enhanced performance measurement systems
            to determine the effectiveness of education technology programs
            funded under this subpart, particularly in determining the
            extent to which education technology funded under this subpart
            has been successfully integrated into teaching strategies and
            school curriculum, has increased the ability of teachers to
            teach, and has enabled students to meet challenging State
            academic content and student academic achievement standards.
                ``(8) Preparing one or more teachers in elementary and
            secondary schools as technology leaders who are provided with
            the means to serve as experts and train other teachers in the
            effective use of technology.
                ``(9) Establishing or expanding access to technology in
            areas served by high-need local educational agencies, with
            special emphasis for access provided through technology centers
            in partnership with libraries and with the support of the
            private sector.

                  ``Subpart 2--National Technology Activities

    ``SEC. 5221. NATIONAL ACTIVITIES.

        ``(a) In General.--Using funds made available under section
    5203(b)(2), the Secretary--
                ``(1) shall--
                        ``(A) conduct an independent, long-term study,
                    utilizing scientifically based research methods and
                    control groups, on the effect of educational technology
                    on improving student academic achievement;
                        ``(B) include in the study an identification of
                    uses of educational technology (including how teachers
                    can integrate technology into the curricula) that have
                    a measurable positive impact on student achievement;
                        ``(C) establish an independent review panel to
                    advise the Secretary on methodological and other issues
                    that arise in conducting this long-term study; and
                        ``(D) submit to the Congress interim reports, when
                    appropriate, and a final report, to be submitted not
                    later than 6 months before the end of fiscal year 2006,
                    on the findings of the study;
                ``(2) may fund national technology initiatives that are
            supported by scientifically based research and utilize
            technology in education, through the competitive award of
            grants or contracts, pursuant to a peer review process, to
            States, local educational agencies, eligible local entities,
            institutions of higher education, public agencies, and private
            nonprofit or for-profit agencies; and
                ``(3) may provide technical assistance (directly or through
            the competitive award of grants or contracts) to States, local
            educational agencies, and other recipients of funds under this
            part in order to assist such States, local educational
            agencies, and other recipients to achieve the purposes of this
            part.
        ``(b) National Technology Initiatives.--
                ``(1) Use of funds.--In funding national technology
            initiatives under subsection (a)(2), the Secretary--
                        ``(A) shall place a priority on projects that--
                                ``(i) develop innovative models using
                            electronic networks or other forms of distance
                            learning to provide challenging courses that
                            are otherwise not readily available to students
                            in a particular school district, particularly
                            in rural areas; or
                                ``(ii) increase access to technology to
                            students served by high-need local educational
                            agencies; and
                        ``(B) shall, in order to identify effective uses of
                    educational technology that have a measurable positive
                    impact on student achievement and as specified in
                    paragraph (3)--
                                ``(i) develop tools and provide resources
                            and support, including technical assistance,
                            for recipients of funds under subsection (a)(2)
                            to effectively evaluate their activities; and
                                ``(ii) disseminate the evaluations made
                            under paragraph (2)(A)(ii).
                ``(2) Requirements for recipients of funds.--
                        ``(A) Application.--In order to receive a grant or
                    contract under subsection (a)(2), an entity shall
                    submit an application to the Secretary (at such time
                    and in such form as the Secretary may require), and
                    shall include in the application--
                                ``(i) a description of the project proposed
                            to be carried out with the grant or contract
                            and how it would carry out the purposes of
                            subsection (a)(2); and
                                ``(ii) a detailed plan for an independent
                            evaluation, supported by scientifically based
                            research principles, of the project to
                            determine the impact on the academic
                            achievement of students served under such
                            project, as measured by challenging State
                            academic content and student academic
                            achievement standards.
                        ``(B) Non-federal share.--
                                ``(i) In general.--Subject to clauses (ii)
                            and (iii), the Secretary may require any
                            recipient of a grant or contract under
                            subsection (a)(2) to share in the cost of the
                            activities assisted under such grant or
                            contract, which may be in the form of cash or
                            in-kind contributions, fairly valued.
                                ``(ii) Increase.--The Secretary may
                            increase the non-Federal share required of a
                            recipient of a grant or contract under
                            subsection (a)(2) after the first year such
                            recipient receives funds under such grant or
                            contract.
                                ``(iii) Maximum.--The non-Federal share
                            required under this subsection may not exceed
                            50 percent of the cost of the activities
                            assisted under a grant or contract under this
                            subpart.
                                ``(iv) Notice.--The Secretary shall
                            publish, in the Federal Register, the non-
                            Federal share required under this subparagraph.
                ``(3) Evaluation and dissemination.--The Secretary shall
            make information on each project funded with a grant or
            contract under subsection (a)(2) widely available to schools
            and the general public, including through dissemination on the
            Internet, in a timely and user-friendly manner. This
            information shall, at a minimum, include--
                        ``(A) upon the awarding of such a grant or contract
                    under subsection (a)(2), the identification of the
                    grant or contract recipient, the amount of the grant or
                    contract, the stated goals of the grant or contract,
                    the methods by which the grant or contract will be
                    evaluated in meeting such stated goals, and the
                    timeline for meeting such goals;
                        ``(B) not later than 3 months after the completion
                    of the first year of the project period, information on
                    the progress of the grant or contract recipient in
                    carrying out the grant or contract, including a
                    detailed description of the use of the funds provided,
                    the extent to which the stated goals have been reached,
                    and the results (or progress of) the evaluation of the
                    project; and
                        ``(C) not later than 3 months after the completion
                    of the second year of the project period (and updated
                    thereafter as appropriate), a followup to the
                    information described in subparagraph (B).

                  ``Subpart 3--Ready to Learn, Ready to Teach

    ``SEC. 5231. READY TO LEARN TELEVISION.

        ``(a) Program Authorized.--
                ``(1) In general.--The Secretary shall award grants to or
            enter into contracts or cooperative agreements with eligible
            entities described in paragraph (3) to--
                        ``(A) develop, produce, and distribute educational
                    and instructional video programming for preschool and
                    elementary school children and their parents in order
                    to facilitate student academic achievement;
                        ``(B) facilitate the development (directly or
                    through contracts with producers of children and family
                    educational television programming) of educational
                    programming for preschool and elementary school
                    children and accompanying support materials and
                    services that directly promote the effective use of
                    such programming;
                        ``(C) facilitate the development of programming and
                    digital content especially designed for nationwide
                    distribution over digital broadcasting channels and the
                    Internet, containing Ready to Learn-based children's
                    programming and resources for parents and caregivers;
                        ``(D) enable such entities to contract with other
                    entities (such as public telecommunications entities)
                    so that programs under this section are disseminated
                    and distributed by the most appropriate distribution
                    technologies to the widest possible audience
                    appropriate to be served by the programming; and
                        ``(E) develop and disseminate training and support
                    materials, including interactive programs and programs
                    adaptable to distance learning technologies which are
                    designed to--
                        ``(i) promote school readiness; and
                        ``(ii) promote the effective use of programming
                    developed under subparagraphs (B) and (C) among
                    parents, Head Start providers, Even Start and providers
                    of family literacy services, child care providers,
                    early childhood development personnel, and elementary
                    school teachers, public libraries, and after school
                    program personnel caring for preschool and elementary
                    school children.
                ``(2) Availability.--In making grants, contracts, or
            cooperative agreements under this subsection, the Secretary
            shall ensure that recipients increase the effective use of the
            programming under this section by making it widely available
            with support materials, as appropriate, to young children,
            their parents, child care workers, Head Start providers, Even
            Start and providers of family literacy services.
                ``(3) Eligible entities described.--In this section, an
            `eligible entity' means a nonprofit entity (including a public
            telecommunications entity) which is able--
                        ``(A) to demonstrate a capacity for the development
                    and national distribution of educational and
                    instructional television programming of high quality
                    which is accessible by a large majority of
                    disadvantaged preschool and elementary school children;
                    and
                        ``(B) to demonstrate--
                                ``(i) a capacity to contract with the
                            producers of children's television programming
                            for the purpose of developing educational
                            television programming of high quality which is
                            accessible by a large majority of disadvantaged
                            preschool and elementary school children, and
                                ``(ii) consistent with the entity's mission
                            and nonprofit nature, a capacity to negotiate
                            such contracts in a manner which returns to the
                            entity an appropriate share of any ancillary
                            income from sales of any program-related
                            products.
                ``(4) Cap on administrative costs.--An entity receiving a
            grant, contract, or cooperative agreement from the Secretary
            under this subsection may not use more than 5 percent of the
            amounts received under the grant, contract, or cooperative
            agreement for the expenses of administering the grant,
            contract, or cooperative agreement.
                ``(5) Coordination of activities.--An entity receiving a
            grant, contract, or cooperative agreement from the Secretary
            under this subsection shall work with the Secretary and the
            Secretary of Health and Human Services to--
                        ``(A) maximize the utilization by preschool and
                    elementary school children of the programming under
                    this section and to make such programming widely
                    available to federally funded programs serving such
                    populations; and
                        ``(B) coordinate with Federal programs that have
                    major training components for early childhood
                    development (including Head Start, Even Start, family
                    literacy services, and State training activities funded
                    under the Child Care Development Block Grant Act of
                    1990 (42 U.S.C. 9858 et seq.)) regarding the
                    availability and utilization of materials developed
                    with funds provided under this section to enhance
                    parent and child care provider skills in early
                    childhood development and education.
        ``(b) Applications.--Any entity desiring a grant, contract, or
    cooperative agreement under subsection (a) shall submit an application
    to the Secretary at such time, in such manner, and accompanied by such
    information as the Secretary may reasonably require.
        ``(c) Report and Evaluation..--
                ``(1) Annual report by grant recipients to secretary.--Each
            entity receiving funds under this section shall prepare and
            submit to the Secretary an annual report which contains such
            information as the Secretary may require. At a minimum, the
            report shall describe the program activities undertaken with
            funds received under this section, including information
            regarding--
                        ``(A) the programming that has been developed
                    directly or indirectly by the entity and the target
                    population of the programs developed;
                        ``(B) the support and training materials that have
                    been developed to accompany the programming and the
                    method by which such materials are distributed to
                    consumers and users of the programming;
                        ``(C) the means by which the programming has been
                    distributed, including the distance learning
                    technologies that have been utilized to make
                    programming available and the geographic distribution
                    achieved through such technologies; and
                        ``(D) the initiatives undertaken by the entity to
                    develop public-private partnerships to secure non-
                    Federal support for the development and distribution
                    and broadcast of educational and instructional
                    programming.
                ``(2) Report to congress.--The Secretary shall prepare and
            submit to the relevant committees of Congress a biannual report
            on the activities funded and carried out under this section,
            and shall include in the report--
                        ``(A) a summary of the programming developed using
                    funds provided under this section; and
                        ``(B) a description of the training materials
                    developed using funds provided under this section, the
                    manner in which outreach has been conducted to inform
                    parents and child care providers of the availability of
                    such materials, and the manner in which such materials
                    have been distributed.
        ``(d) Funding Rule.--Not less than 60 percent of the amounts
    authorized to be appropriated under section 5233 for any fiscal year
    shall be used to carry out subparagraphs (B) and (C) of subsection
    (a)(1).

    ``SEC. 5232. TELECOMMUNICATIONS PROGRAM.

        ``(a) In General.--The Secretary may carry out any of the following
    activities:
                ``(1) Awarding grants to a nonprofit telecommunications
            entity (or a partnership of such entities) for the purpose of
            carrying out a national telecommunications-based program to
            improve the teaching of core academic subjects and to assist
            elementary and secondary school teachers in preparing all
            students to achieve State academic content standards.
                ``(2) Awarding grants to or entering into contracts or
            cooperative agreements with a local public telecommunications
            entity to develop, produce, and distribute educational and
            instructional video programming which is designed for use by
            elementary and secondary school students, created for or
            adaptable to State academic content standards, and capable of
            distribution through digital broadcasting and school digital
            networks.
        ``(b) Applications.--
                ``(1) In general.--Any telecommunications entity or
            partnership of such entities desiring a grant under this
            section shall submit an application to the Secretary.
                ``(2) Specific requirements for national
            telecommunications-based program.--Each application for a grant
            under subsection (a)(1) shall--
                        ``(A) demonstrate that the applicant will use the
                    existing publicly funded telecommunications
                    infrastructure, the Internet, and school digital
                    networks (where available) to deliver video, voice, and
                    data in an integrated service to train teachers in the
                    use of materials and learning technologies for
                    achieving State academic content standards;
                        ``(B) assure that the program for which assistance
                    is sought will be conducted in cooperation with States
                    as appropriate, local educational agencies, and State
                    or local nonprofit public telecommunications entities;
                        ``(C) assure that a significant portion of the
                    benefits available for elementary and secondary schools
                    from the program for which assistance is sought will be
                    available to schools of local educational agencies
                    which have a high percentage of children counted for
                    the purpose of part A of title I; and
                        ``(D) contain such additional assurances as the
                    Secretary may reasonably require.
        ``(c) Approval of Applications; Number of Demonstration Sites.--In
    approving applications under this section, the Secretary shall assure
    that--
                ``(1) the national telecommunications-based program under
            subsection (a)(1) is conducted at elementary and secondary
            school sites in at least 15 States; and
                ``(2) grants under subsection (a)(2) are awarded on a
            competitive basis and for a period of 3 years to entities
            which--
                        ``(A) enter into multiyear collaborative
                    arrangements for content development with State
                    educational agencies, local educational agencies,
                    institutions of higher education, businesses, or other
                    agencies and organizations, and
                        ``(B) contribute non-Federal matching funds
                    (including funds provided for transitions to digital
                    broadcasting as well as in-kind contributions) to the
                    activities assisted with the grant in an amount not
                    less than 100 percent of the amount of the grant.

                         ``PART C--CHARACTER EDUCATION

    ``SEC. 5301. CHARACTER EDUCATION PROGRAM.

        ``(a) Program Authorized.--
                ``(1) In general.--The Secretary may make grants to State
            educational agencies, local educational agencies, or consortia
            of such agencies for the design and implementation of character
            education programs that--
                        ``(A) can be integrated into State academic content
                    standards for the core academic subjects; and
                        ``(B) can be carried out in conjunction with other
                    educational reform efforts.
                ``(2) Duration.--Each grant under this section shall be
            made for a period not to exceed 5 years, of which the grant
            recipient may not use more than 1 year for planning and program
            design.
        ``(b) Contracts Under Program.--
                ``(1) Evaluation.--Each agency or consortium receiving
            assistance under this section may contract with outside
            sources, including institutions of higher education and private
            and nonprofit organizations (including religious
            organizations), for the purposes of--
                        ``(A) evaluating the program for which the
                    assistance is made available;
                        ``(B) measuring the integration of such program
                    into the curriculum and teaching methods of schools
                    where the program is carried out; and
                        ``(C) measuring the success of such program in
                    fostering the elements of character selected by the
                    recipient under subsection (c)(1).
                ``(2) Materials and program development.--Each agency or
            consortium receiving assistance under this section may contract
            with outside sources, including institutions of higher
            education and private and nonprofit organizations (including
            religious organizations), for assistance in--
                        ``(A) developing secular curricula, materials,
                    teacher training, and other activities related to
                    character education; and
                        ``(B) integrating secular character education into
                    the curriculum and teaching methods of schools where
                    the program is carried out.
        ``(c) Elements of Character.--
                ``(1) Selection.--
                        ``(A) In general.--Each agency or consortium
                    receiving assistance under this section may select the
                    elements of character that will be taught under the
                    program for which the assistance is made available.
                        ``(B) Consideration of views.--In selecting
                    elements of character under paragraph (1), the agency
                    or consortium shall consider the views of the parents
                    or guardians of the students to be taught under the
                    program.
                ``(2) Example elements.--Elements of character selected
            under this subsection may include any of the following:
                        ``(A) Trustworthiness.
                        ``(B) Respect.
                        ``(C) Responsibility.
                        ``(D) Fairness.
                        ``(E) Caring.
                        ``(F) Citizenship.
                        ``(G) Giving.
        ``(d) Application.--
                ``(1) In general.--Each agency or consortium seeking
            assistance under this section shall submit an application to
            the Secretary at such time and in such manner as the Secretary
            may require.
                ``(2) Required information.--Each application for
            assistance under this section shall include information that--
                        ``(A) demonstrates that the program for which the
                    assistance is sought has clear goals and objectives
                    that are based on scientifically based research;
                        ``(B) describes the activities that will be carried
                    out with the assistance and how such activities will
                    meet the goals and objectives described in paragraph
                    (1); and
                        ``(C) describes how the program for which the
                    assistance is sought will be linked to other efforts to
                    improve educational achievement, including--
                                ``(i) broader educational reforms that are
                            being instituted by the applicant or its
                            partners; and
                                ``(ii) applicable State academic content
                            standards for student achievement.
        ``(e) Selection of Recipients.--
                ``(1) Peer review.--
                        ``(A) In general.--In selecting agencies or
                    consortia to receive assistance under this section from
                    among the applicants for such assistance, the Secretary
                    shall use a peer review process that includes the
                    participation of experts in the field of character
                    education.
                        ``(B) Use of funds.--The Secretary may use funds
                    appropriated under this section for the cost of
                    carrying out peer reviews under this paragraph.
                ``(2) Selection criteria.--Each selection under paragraph
            (1) shall be made on the basis of the quality of the
            application submitted, taking into consideration such factors
            as--
                        ``(A) the extent of parental, student, and
                    community involvement in the program; and
                        ``(B) the likelihood that the goals of the program
                    will be realistically achieved.
                ``(3) Equitable distribution.--In making selections under
            this subsection, the Secretary shall ensure, to the extent
            practicable under paragraph (2), that the programs assisted
            under this section are equitably distributed among the
            geographic regions of the United States, and among urban,
            suburban, and rural areas.
        ``(f) Evaluations.--
                ``(1) In general.--As a condition of receiving assistance
            under this section, the Secretary shall require each agency or
            consortium receiving such assistance to transmit to the
            Secretary, not later than 5 years after such receipt, a report
            containing an evaluation of each program assisted.
                ``(2) Attainment of goals and objectives.--In conducting an
            evaluation referred to in paragraph (1), each agency or
            consortium shall evaluate the degree to which each program for
            which assistance was made available attained the goals and
            objectives for the program as described in the application for
            assistance submitted under subsection (d).
                ``(3) Dissemination.--The Secretary shall--
                        ``(A) make each evaluation received under this
                    subsection publicly available; and
                        ``(B) provide public notice (through such means as
                    the Internet, the media, and public agencies) of the
                    availability of each such evaluation after it is
                    received by the Secretary.
        ``(g) Matching Funds.--As a condition of receiving assistance under
    this section, the Secretary may require that each agency or consortium
    receiving such assistance provide matching funds from non-Federal
    sources.

    ``SEC. 5302. AUTHORIZATION OF APPROPRIATIONS.

        ``There are authorized to be appropriated to carry out this part
    $25,000,000 for fiscal year 2002 and such sums as may be necessary for
    each of fiscal years 2003 through 2006.''.

         ``PART D--ELEMENTARY AND SECONDARY SCHOOL COUNSELING PROGRAMS

    ``SEC. 5401. ELEMENTARY AND SECONDARY SCHOOL COUNSELING PROGRAMS.

        ``(a) Findings.--Congress finds as follows:
                ``(1) The Surgeon General reported in January 2001 that 1
            in 10 children suffer from mental illnesses severe enough to
            impair development and fewer than 1 in 5 children get treatment
            for mental illnesses.
                ``(2) The Surgeon General reported that the burden of
            suffering by children with mental health needs and their
            families has created a health crisis in this country. Growing
            numbers of children are suffering needlessly because their
            emotional, behavioral, and developmental needs are not being
            met by the very institutions and systems that were created to
            take care of them.
                ``(3) As a result of the concern about the failure of the
            healthcare system to reach children and adolescents with mental
            illnesses, there is currently great interest in developing new
            models for the delivery of mental health and counseling
            services that can reach underserved groups efficiently.
                ``(4) Schools are a sensible point of intervention because
            of their central position in many children's lives and
            development, especially when families are unable to assume a
            leading role.
                ``(5) School-based mental health and counseling services
            allow for the identification of children in need of treatment
            much earlier in their development.
                ``(6) Establishing mental health and counseling services in
            schools provides access to underserved youth with or at risk of
            emotional or behavioral problems.
                ``(7) The Surgeon General's 2000 report on youth violence
            concludes that effective treatment can divert a significant
            proportion of delinquent and violent youths from future
            violence and crime.
                ``(8) Mental health and counseling services can play an
            important role in violence prevention on all levels, including
            preventing problem behaviors from developing; identifying and
            serving specific, at-risk populations; and reducing the
            deleterious effects of violence on victims and witnesses.
                ``(9) An evaluation of the model program for the elementary
            school counseling demonstration program established pursuant to
            this section prior to the date of enactment of the Elementary
            and Secondary Counseling Improvement Act of 2001 found that the
            number of referrals to the principal's office decreased by
            nearly half, the use of force, weapons, and threatening of
            others also decreased, school suspensions were reduced, and
            students felt safer.
                ``(10) The report produced by the Institute of Medicine,
            `Schools and Health: Our Nation's Investment', recommended a
            student-to-school counselor ratio of 250:1, student-to-school
            psychologist ratio of 1000:1, and a student-to-school social
            worker ratio of 800:1. The United States average student-to-
            counselor ratio is 551:1. Ratios for school psychologists and
            school social workers also exceed the recommended levels.
        ``(b) Grants Authorized.--
                ``(1) In general.--The Secretary may use funds provided
            under this section to award grants to local educational
            agencies to enable such agencies to establish or expand
            elementary and secondary school counseling programs which meet
            the requirements of subsection (c).
                ``(2) Priority.--In awarding grants under this section, the
            Secretary shall give special consideration to applications
            describing programs which--
                        ``(A) demonstrate the greatest need for new or
                    additional counseling services among children in the
                    schools served by the applicant, in part, by providing
                    information on current ratios of students to school
                    counselors, students to school social workers, and
                    students to school psychologists;
                        ``(B) propose the most promising and innovative
                    approaches for initiating or expanding school
                    counseling; and
                        ``(C) show the greatest potential for replication
                    and dissemination.
                ``(3) Equitable distribution.--In awarding grants under
            this section, the Secretary shall ensure an equitable
            geographic distribution among the regions of the United States
            and among urban, suburban, and rural local educational
            agencies.
                ``(4) Duration.--A grant under this section shall be
            awarded for a period not to exceed 3 years.
                ``(5) Maximum grant.--A grant awarded under this program
            shall not exceed $400,000 for any fiscal year.
                ``(6) Supplement.--Assistance made available under this
            section shall be used to supplement, and may not supplant,
            other Federal, State, or local funds used for providing school-
            based counseling and mental health services to students.
        ``(c) Requirements for Counseling Programs.--Each program funded
    under this section shall--
                ``(1) be comprehensive in addressing the counseling and
            educational needs of all students;
                ``(2) use a developmental, preventive approach to
            counseling;
                ``(3) increase the range, availability, quantity, and
            quality of counseling services in the elementary and secondary
            schools of the local educational agency;
                ``(4) expand counseling services through qualified school
            counselors, school psychologists, school social workers, and
            child and adolescent psychiatrists;
                ``(5) use innovative approaches to increase children's
            understanding of peer and family relationships, work and self,
            decisionmaking, or academic and career planning, or to improve
            peer interaction;
                ``(6) provide counseling services in settings that meet the
            range of needs of students;
                ``(7) include inservice training, including training for
            teachers in appropriate identification and intervention
            techniques for disciplining and teaching students at risk of
            violent behavior, by school counselors, school psychologists,
            school social workers, and child and adolescent psychiatrists;
                ``(8) involve parents of participating students in the
            design, implementation, and evaluation of a counseling program;
                ``(9) involve community groups, social service agencies, or
            other public or private entities in collaborative efforts to
            enhance the program;
                ``(10) evaluate annually the effectiveness and outcomes of
            the counseling services and activities assisted under this
            section;
                ``(11) ensure a team approach to school counseling in the
            elementary and secondary schools of the local educational
            agency by working toward ratios recommended by the American
            School Health Association of one school counselor to 250
            students, one school social worker to 800 students, and one
            school psychologist to 1,000 students; and
                ``(12) ensure that school counselors, school psychologists,
            school social workers, or child and adolescent psychiatrists
            paid from funds made available under this section spend a
            majority of their time at the school in activities directly
            related to the counseling process.
        ``(d) Limitation on Administrative Costs.--Not more than 3 percent
    of the amounts made available under this section in any fiscal year may
    be used for administrative costs to carry out this section.
        ``(e) Definitions.--For purposes of this section--
                ``(1) the term `school counselor' means an individual who
            has documented competence in counseling children and
            adolescents in a school setting and who--
                        ``(A) possesses State licensure or certification
                    granted by an independent professional regulatory
                    authority;
                        ``(B) in the absence of such State licensure or
                    certification, possesses national certification in
                    school counseling or a specialty of counseling granted
                    by an independent professional organization; or
                        ``(C) holds a minimum of a master's degree in
                    school counseling from a program accredited by the
                    Council for Accreditation of Counseling and Related
                    Educational Programs or the equivalent;
                ``(2) the term `school psychologist' means an individual
            who--
                        ``(A) possesses a minimum of 60 graduate semester
                    hours in school psychology from an institution of
                    higher education and has completed 1,200 clock hours in
                    a supervised school psychology internship, of which 600
                    hours shall be in the school setting;
                        ``(B) possesses State licensure or certification in
                    the State in which the individual works; or
                        ``(C) in the absence of such State licensure or
                    certification, possesses national certification by the
                    National School Psychology Certification Board;
                ``(3) the term `school social worker' means an individual
            who--
                        ``(A) holds a master's degree in social work from a
                    program accredited by the Council on Social Work
                    Education; and
                        ``(B) is licensed or certified by the State in
                    which services are provided; or
                        ``(C) in the absence of such State licensure or
                    certification, possesses a national credential or
                    certification as a `school social work specialist'
                    granted by an independent professional organization;
                    and
                ``(4) the term `child and adolescent psychiatrist' means an
            individual who--
                        ``(A) possesses State medical licensure; and
                        ``(B) has completed residency training programs in
                    general and child and adolescent psychiatry.
        ``(f) Report.--Not later than 1 year after assistance is made
    available under this section, the Secretary shall make publicly
    available the information from applicants regarding the ratios of
    students to school counselors, students to school social workers, and
    students to school psychologists.
        ``(g) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section such sums as may be necessary
    for each of fiscal years 2002 through 2006.

                          ``PART E--MENTORING PROGRAMS

    ``SEC. 5501. DEFINITIONS.

        ``In this part, the following definitions apply:
                ``(1) Child with greatest need.--The term `child with
            greatest need' means a child at risk of educational failure,
            dropping out of school, or involvement in criminal or
            delinquent activities, or that has lack of strong positive
            adult role models.
                ``(2) Mentor.--The term `mentor' means an individual who
            works with a child to provide a positive role model for the
            child, to establish a supportive relationship with the child,
            and to provide the child with academic assistance and exposure
            to new experiences and examples of opportunity that enhance the
            ability of the child to become a responsible adult.
                ``(3) State.--The term `State' means each of the several
            States, the District of Columbia, the Commonwealth of Puerto
            Rico, the Virgin Islands, Guam, American Samoa, and the
            Commonwealth of the Northern Mariana Islands.

    ``SEC. 5502. PURPOSES.

        ``The purposes of this part are to make assistance available to
    promote mentoring programs for children with greatest need--
                ``(1) to assist such children in receiving support and
            guidance from a caring adult;
                ``(2) to improve the academic performance of such children;
                ``(3) to improve interpersonal relationships between such
            children and their peers, teachers, other adults, and family
            members;
                ``(4) to reduce the dropout rate of such children; and
                ``(5) to reduce juvenile delinquency and involvement in
            gangs by such children.

    ``SEC. 5503. GRANT PROGRAM.

        ``(a) In General.--In accordance with this section, the Secretary
    may make grants to eligible entities to assist such entities in
    establishing and supporting mentoring programs and activities that--
                ``(1) are designed to link children with greatest need
            (particularly such children living in rural areas, high crime
            areas, or troubled home environments, or such children
            experiencing educational failure) with responsible adults,
            who--
                        ``(A) have received training and support in
                    mentoring;
                        ``(B) have been screened using appropriate
                    reference checks, child and domestic abuse record
                    checks, and criminal background checks; and
                        ``(C) are interested in working with youth; and
                ``(2) are intended to achieve 1 or more of the following
            goals:
                        ``(A) Provide general guidance to children with
                    greatest need.
                        ``(B) Promote personal and social responsibility
                    among children with greatest need.
                        ``(C) Increase participation by children with
                    greatest need in, and enhance their ability to benefit
                    from, elementary and secondary education.
                        ``(D) Discourage illegal use of drugs and alcohol,
                    violence, use of dangerous weapons, promiscuous
                    behavior, and other criminal, harmful, or potentially
                    harmful activity by children with greatest need.
                        ``(E) Encourage children with greatest need to
                    participate in community service and community
                    activities.
                        ``(F) Encourage children with greatest need to set
                    goals for themselves or to plan for their futures,
                    including encouraging such children to make graduation
                    from secondary school a goal and to make plans for
                    postsecondary education or training.
                        ``(G) Discourage involvement of children with
                    greatest need in gangs.
        ``(b) Eligible Entities.--Each of the following is an entity
    eligible to receive a grant under subsection (a):
                ``(1) A local educational agency.
                ``(2) A nonprofit, community-based organization.
                ``(3) A partnership between an agency referred to in
            paragraph (1) and an organization referred to in paragraph (2).
        ``(c) Use of Funds.--
                ``(1) In general.--Each entity receiving a grant under this
            section shall use the grant funds for activities that establish
            or implement a mentoring program, including--
                        ``(A) hiring of mentoring coordinators and support
                    staff;
                        ``(B) providing for the professional development of
                    mentoring coordinators and support staff;
                        ``(C) recruitment, screening, and training of adult
                    mentors;
                        ``(D) reimbursement of schools, if appropriate, for
                    the use of school materials or supplies in carrying out
                    the program;
                        ``(E) dissemination of outreach materials;
                        ``(F) evaluation of the program using
                    scientifically based methods; and
                        ``(G) such other activities as the Secretary may
                    reasonably prescribe by rule.
                ``(2) Prohibited uses.--Notwithstanding paragraph (1), an
            entity receiving a grant under this section may not use the
            grant funds--
                        ``(A) to directly compensate mentors;
                        ``(B) to obtain educational or other materials or
                    equipment that would otherwise be used in the ordinary
                    course of the entity's operations;
                        ``(C) to support litigation of any kind; or
                        ``(D) for any other purpose reasonably prohibited
                    by the Secretary by rule.
        ``(d) Term of Grant.--Each grant made under this section shall be
    available for expenditure for a period of 3 years.
        ``(e) Application.--Each eligible entity seeking a grant under this
    section shall submit to the Secretary an application that includes--
                ``(1) a description of the mentoring plan the applicant
            proposes to carry out with such grant;
                ``(2) information on the children expected to be served by
            the mentoring program for which such grant is sought;
                ``(3) a description of the mechanism that applicant will
            use to match children with mentors based on the needs of the
            children;
                ``(4) an assurance that no mentor will be assigned to
            mentor so many children that the assignment would undermine
            either the mentor's ability to be an effective mentor or the
            mentor's ability to establish a close relationship (a one-on-
            one relationship, where practicable) with each mentored child;
                ``(5) an assurance that mentoring programs will provide
            children with a variety of experiences and support, including--
                        ``(A) emotional support;
                        ``(B) academic assistance; and
                        ``(C) exposure to experiences that children might
                    not otherwise encounter on their own;
                ``(6) an assurance that mentoring programs will be
            monitored to ensure that each child assigned a mentor benefits
            from that assignment and that there will be a provision for the
            assignment of a new mentor if the relationship between the
            original mentor is not beneficial to the child;
                ``(7) information on the method by which mentors and
            children will be recruited to the mentor program;
                ``(8) information on the method by which prospective
            mentors will be screened;
                ``(9) information on the training that will be provided to
            mentors; and
                ``(10) information on the system that the applicant will
            use to manage and monitor information relating to the program's
            reference checks, child and domestic abuse record checks, and
            criminal background checks and to its procedure for matching
            children with mentors.
        ``(f) Selection.--
                ``(1) Competitive basis.--In accordance with this
            subsection, the Secretary shall select grant recipients from
            among qualified applicants on a competitive basis.
                ``(2) Priority.--In selecting grant recipients under
            paragraph (1), the Secretary shall give priority to each
            applicant that--
                        ``(A) serves children with greatest need living in
                    rural areas, high crime areas, or troubled home
                    environments, or who attend schools with violence
                    problems;
                        ``(B) provides background screening of mentors,
                    training of mentors, and technical assistance in
                    carrying out mentoring programs;
                        ``(C) proposes a mentoring program under which each
                    mentor will be assigned to not more children than the
                    mentor can serve effectively; or
                        ``(D) proposes a school-based mentoring program.
                ``(3) Other considerations.--In selecting grant recipients
            under paragraph (1), the Secretary shall also consider--
                        ``(A) the degree to which the location of the
                    programs proposed by each applicant contributes to a
                    fair distribution of programs with respect to urban and
                    rural locations;
                        ``(B) the quality of the mentoring programs
                    proposed by each applicant, including--
                                ``(i) the resources, if any, the applicant
                            will dedicate to providing children with
                            opportunities for job training or postsecondary
                            education;
                                ``(ii) the degree to which parents,
                            teachers, community-based organizations, and
                            the local community have participated, or will
                            participate, in the design and implementation
                            of the applicant's mentoring program;
                                ``(iii) the degree to which the applicant
                            can ensure that mentors will develop
                            longstanding relationships with the children
                            they mentor;
                                ``(iv) the degree to which the applicant
                            will serve children with greatest need in the
                            4th, 5th, 6th, 7th, and 8th grades; and
                                ``(v) the degree to which the program will
                            continue to serve children from the 4th grade
                            through graduation from secondary school; and
                        ``(C) the capability of each applicant to
                    effectively implement its mentoring program.
                ``(4) Grant to each state.--Notwithstanding any other
            provision of this subsection, in selecting grant recipients
            under paragraph (1), the Secretary shall select not less than 1
            grant recipient from each State for which there is a qualified
            applicant.
        ``(g) Model Screening Guidelines.--
                ``(1) In general.--Based on model screening guidelines
            developed by the Office of Juvenile Programs of the Department
            of Justice, the Secretary shall develop and distribute to
            program participants specific model guidelines for the
            screening of mentors who seek to participate in programs to be
            assisted under this part.
                ``(2) Background checks.--The guidelines developed under
            this subsection shall include, at a minimum, a requirement that
            potential mentors be subject to reference checks, child and
            domestic abuse record checks, and criminal background checks.

    ``SEC. 5504. STUDY BY GENERAL ACCOUNTING OFFICE.

        ``(a) In General.--The Comptroller General of the United States
    shall conduct a study to identify successful school-based mentoring
    programs, and the elements, policies, or procedures of such programs
    that can be replicated.
        ``(b) Report.--Not later than 3 years after the date of enactment
    of the Mentoring for Success Act, the Comptroller General shall submit
    a report to the Secretary and Congress containing the results of the
    study conducted under this section.
        ``(c) Use of Information.--The Secretary shall use information
    contained in the report referred to in subsection (b)--
                ``(1) to improve the quality of existing mentoring programs
            assisted under this part and other mentoring programs assisted
            under this Act; and
                ``(2) to develop models for new programs to be assisted or
            carried out under this Act.

    ``SEC. 5505. AUTHORIZATION OF APPROPRIATIONS.

        ``There are authorized to be appropriated to carry out section 5503
    $50,000,000 for fiscal year 2002 and such sums as may be necessary for
    each of fiscal years 2003 through 2006.''.

                          TITLE VI--IMPACT AID PROGRAM

    SEC. 601. PAYMENTS UNDER SECTION 8002 WITH RESPECT TO FISCAL YEARS IN
                  WHICH INSUFFICIENT FUNDS ARE APPROPRIATED.

        (a) Foundation Payments for Pre-1995 Recipients.--Section
    8002(h)(1) (20 U.S.C. 7702(h)(1)) is amended--
                (1) in subparagraph (A), by striking ``and was eligible to
            receive a payment under section 2 of the Act of September 30,
            1950'' and inserting ``and that filed, or has been determined
            pursuant to statute to have filed a timely application, and
            met, or has been determined pursuant to statute to meet, the
            eligibility requirements of section 2(a)(1)(C) of the Act of
            September 30, 1950''; and
                (2) in subparagraph (B), by striking ``(or if the local
            educational agency was not eligible to receive a payment under
            such section 2 for fiscal year 1994'' and inserting ``(or if
            the local educational agency did not meet, or has not been
            determined pursuant to statute to meet, the eligibility
            requirements of section 2(a)(1)(C) of the Act of September 30,
            1950 for fiscal year 1994''.
        (b) Payments for 1995 Recipients.--Section 8002(h)(2) (20 U.S.C.
    7702(h)(2)) is amended--
                (1) in subparagraph (A), by adding at the end before the
            period ``, or whose application for fiscal year 1995 was
            determined pursuant to statute to be timely filed for purposes
            of payments for subsequent fiscal years''; and
                (2) in subparagraph (B)(ii), by striking ``for each local
            educational agency that received a payment under this section
            for fiscal year 1995'' and inserting ``for each local
            educational agency described in subparagraph (A)''.
        (c) Remaining Funds.--Section 8002(h)(4)(B) (20 U.S.C.
    7702(h)(4)(B)) is amended--
                (1) by striking ``(in the same manner as percentage shares
            are determined for local educational agencies under paragraph
            (2)(B)(ii))'' and inserting ``(by dividing the maximum amount
            that the agency is eligible to receive under subsection (b) by
            the total of the maximum amounts for all such agencies)''; and
                (2) by striking ``, except that for the purpose of
            calculating a local educational agency's assessed value of the
            Federal property'' and inserting ``, except that, for purposes
            of calculating a local educational agency's maximum amount
            under subsection (b)''.
        (d) Application for Payment.--Notwithstanding any other provision
    of law, the Secretary shall treat as timely filed an application under
    section 8002 (20 U.S.C. 7702) from Academy School District 20,
    Colorado, for a payment for fiscal year 1999, and shall process that
    application from funds appropriated for that section for fiscal year
    2001.

    SEC. 602. CALCULATION OF PAYMENT UNDER SECTION 8003 FOR SMALL LOCAL
                  EDUCATIONAL AGENCIES.

        Section 8003(b)(3)(B)(iv) (20 U.S.C. 7703(b)(3)(B)(iv)) is amended
    by inserting after ``of the State in which the agency is located'' the
    following: ``or less than the average per pupil expenditure of all the
    States''.

    SEC. 603. CONSTRUCTION.

        (a) School Facility Emergency and Modernization Grants.--Section
    8007(b) (20 U.S.C. 7707(b)) is amended to read as follows:
        ``(b) School Facility Emergency and Modernization Grants
    Authorized.--
                ``(1) In general.--From 60 percent of the amount
            appropriated for each fiscal year under section 8014(e), the
            Secretary--
                        ``(A) shall award emergency grants in accordance
                    with this subsection to eligible local educational
                    agencies to enable the agencies to carry out emergency
                    repairs of school facilities; and
                        ``(B) shall award modernization grants in
                    accordance with this subsection to eligible local
                    educational agencies to enable the agencies to carry
                    out the modernization of school facilities.
                ``(2) Priority.--In approving applications from local
            educational agencies for emergency grants and modernization
            grants under this subsection, the Secretary shall give priority
            to applications for emergency grants and, among such
            applications for emergency grants, shall give priority to those
            applications of local educational agencies based on the
            severity of the emergency.
                ``(3) Eligibility requirements.--
                        ``(A) Emergency grants.--A local educational agency
                    is eligible to receive an emergency grant under this
                    subsection only if--
                                ``(i) the agency (or in the case of a local
                            educational agency that does not have the
                            authority to tax or issue bonds, the agency's
                            fiscal agent)--
                                        ``(I) has no practical capacity to
                                    issue bonds;
                                        ``(II) has minimal capacity to
                                    issue bonds and is at 75 percent of the
                                    agency's limit of bonded indebtedness;
                                    or
                                        ``(III) does not meet the
                                    requirements of subclauses (I) and (II)
                                    but is eligible to receive funds under
                                    section 8003(b)(2) for the fiscal year;
                                    and
                                ``(ii) the agency is eligible to receive
                            assistance under subsection (a) for the fiscal
                            year and has a school facility emergency, as
                            determined by the Secretary, that poses a
                            health or safety hazard to the students and
                            school personnel assigned to the school
                            facility.
                        ``(B) Modernization grants.--A local educational
                    agency is eligible to receive a modernization grant
                    under this subsection only if--
                                ``(i) the agency (or in the case of a local
                            educational agency that does not have the
                            authority to tax or issue bonds, the agency's
                            fiscal agent) meets the requirements of
                            subclause (I), (II), or (III) of subparagraph
                            (A)(i);
                                ``(ii) the agency is eligible to receive
                            assistance under section 8002 for the fiscal
                            year and has an assessed value of real property
                            per student that may be taxed for school
                            purposes that is less than the average of the
                            assessed value of real property per student
                            that may be taxed for school purposes in the
                            State in which the local educational agency is
                            located; and
                                ``(iii) the agency has facility needs
                            resulting from actions of the Federal
                            Government, such as enrollment increases due to
                            the expansion of Federal activities, housing
                            privatization, or the acquisition of Federal
                            property.
                        ``(C) Rule of construction.--For purposes of
                    subparagraph (A)(i), a local educational agency--
                                ``(i) has no practical capacity to issue
                            bonds if the total assessed value of real
                            property that may be taxed for school purposes
                            is less than $25,000,000; and
                                ``(ii) has minimal capacity to issue bonds
                            if the total assessed value of real property
                            that may be taxed for school purposes is not
                            less than $25,000,000 but not more than
                            $50,000,000.
                ``(4) Award criteria.--In awarding emergency grants and
            modernization grants under this subsection, the Secretary shall
            consider the following factors:
                        ``(A) The ability of the local educational agency
                    to respond to the emergency, or to pay for the
                    modernization project, as the case may be, as measured
                    by--
                                ``(i) the agency's level of bonded
                            indebtedness;
                                ``(ii) the assessed value of real property
                            per student that may be taxed for school
                            purposes compared to the average of the
                            assessed value of real property per student
                            that may be taxed for school purposes in the
                            State in which the agency is located;
                                ``(iii) the agency's total tax rate for
                            school purposes (or, if applicable, for capital
                            expenditures) compared to the average total tax
                            rate for school purposes (or the average
                            capital expenditure tax rate, if applicable) in
                            the State in which the agency is located; and
                                ``(iv) funds that are available to the
                            agency, from any other source, including
                            section 8007(a), that may be used for capital
                            expenditures.
                        ``(B) The percentage of property in the agency that
                    is nontaxable due to the presence of the Federal
                    Government.
                        ``(C) The number and percentages of children
                    described in subparagraphs (A), (B), (C), and (D) of
                    section 8003(a)(1) served in the school facility with
                    the emergency or served in the school facility proposed
                    for modernization, as the case may be.
                        ``(D) In the case of an emergency grant, the
                    severity of the emergency, as measured by the threat
                    that the condition of the school facility poses to the
                    health, safety, and well-being of students.
                        ``(E) In the case of a modernization grant--
                                ``(i) the severity of the need for
                            modernization, as measured by such factors as--
                                        ``(I) overcrowding, as evidenced by
                                    the use of portable classrooms; or
                                        ``(II) the agency's inability to
                                    maximize the use of technology or offer
                                    a curriculum in accordance with
                                    contemporary State standards due to the
                                    physical limitations of the current
                                    school facility; and
                                ``(ii) the age of the school facility
                            proposed for modernization.
                ``(5) Other award provisions.--
                        ``(A) General provisions.--
                                ``(i) Limitations on amount of funds.--
                                        ``(I) In general.--The amount of
                                    funds provided under an emergency grant
                                    or a modernization grant awarded under
                                    this subsection to a local educational
                                    agency that meets the requirements of
                                    subclause (II) or (III) of paragraph
                                    (3)(A)(i)--
                                                ``(aa) shall not exceed 50
                                            percent of the total cost of
                                            the project to be assisted
                                            under this subsection; and
                                                ``(bb) shall not exceed
                                            $3,000,000 during any 5-year
                                            period.
                                        ``(II) In-kind contributions.--A
                                    local educational agency may use in-
                                    kind contributions to meet the matching
                                    requirement of subclause (I)(aa).
                                ``(ii) Prohibitions on use of funds.--A
                            local educational agency may not use funds
                            provided under an emergency grant or
                            modernization grant awarded under this
                            subsection for--
                                        ``(I) a project for a school
                                    facility for which the agency does not
                                    have full title or other interest; or
                                        ``(II) stadiums or other facilities
                                    primarily used for athletic contests,
                                    exhibitions, or other events for which
                                    admission is charged to the general
                                    public.
                                ``(iii) Supplement not supplant.--A local
                            educational agency shall use funds provided
                            under an emergency grant or modernization grant
                            awarded under this subsection only to
                            supplement the amount of funds that would, in
                            the absence of the Federal funds provided under
                            the grant, be made available from non-Federal
                            sources to carry out emergency repairs of
                            school facilities or to carry out the
                            modernization of school facilities, as the case
                            may be, and not to supplant such funds.
                        ``(B) Emergency grants.--
                                ``(i) Prohibition on use of funds.--A local
                            educational agency that is awarded an emergency
                            grant under this subsection may not use amounts
                            under the grant for the complete or partial
                            replacement of an existing school facility
                            unless such replacement is less expensive or
                            more cost-effective to correct the identified
                            emergency.
                                ``(ii) Carry-over of certain
                            applications.--In the case of a local
                            educational agency that applies for an
                            emergency grant under this subsection for a
                            fiscal year and does not receive the grant for
                            the fiscal year, the Secretary--
                                        ``(I) shall, upon the request of
                                    the agency, treat the application as an
                                    application for an emergency grant
                                    under this subsection for the
                                    subsequent fiscal year in accordance
                                    with the priority requirements of
                                    paragraph (2); and
                                        ``(II) shall allow the agency to
                                    amend or otherwise update the
                                    application, as appropriate.
                ``(6) Application.--A local educational agency that desires
            to receive an emergency grant or a modernization grant under
            this subsection shall submit an application to the Secretary at
            such time, in such manner, and accompanied by such information
            as the Secretary may require. Each application shall contain
            the following:
                        ``(A) The information described in clauses (i)
                    through (iv) of paragraph (4)(A) and subparagraphs (B)
                    and (C) of paragraph (4).
                        ``(B) In the case of an application for an
                    emergency grant--
                                ``(i) a description of the school facility
                            deficiency that poses a health or safety hazard
                            to the occupants of the facility and a
                            description of how the deficiency will be
                            repaired; and
                                ``(ii) a signed statement from an
                            appropriate local official certifying that a
                            deficiency in the school facility threatens the
                            health or safety of the occupants of the
                            facility or that prevents the use of all or a
                            portion of the building.
                        ``(C) In the case of an application for a
                    modernization grant--
                                ``(i) an explanation of the need for the
                            school facility modernization project; and
                                ``(ii) the date on which original
                            construction of the facility to be modernized
                            was completed.
                        ``(D) A description of the project for which a
                    grant under this subsection would be used, including a
                    cost estimate for the project.
                        ``(E) A description of the interest in, or
                    authority over, the school facility involved, such as
                    an ownership interest or a lease arrangement.
                        ``(F) Such other information and assurances as the
                    Secretary may reasonably require.
                ``(7) Report.--
                        ``(A) In general.--Not later than January 1 of each
                    year, the Secretary shall prepare and submit to the
                    appropriate congressional committees a report that
                    contains a justification for each grant awarded under
                    this subsection for the prior fiscal year.
                        ``(B) Definition.--In this paragraph, the term
                    `appropriate congressional committees' means--
                                ``(i) the Committee on Appropriations and
                            the Committee on Education and the Workforce of
                            the House of Representatives; and
                                ``(ii) the Committee on Appropriations and
                            the Committee on Health, Education, Labor and
                            Pensions of the Senate.''.
        (b) Authorization of Appropriations.--Section 8014(e) (20 U.S.C.
    7714(e)) is amended by striking ``for each of the three succeeding
    fiscal years'' and inserting ``for fiscal year 2001, $150,000,000 for
    fiscal year 2002, and such sums as may be necessary for each of the
    four succeeding fiscal years''.

    SEC. 604. STATE CONSIDERATION OF PAYMENTS IN PROVIDING STATE AID.

        Section 8009(b)(1) (20 U.S.C. 7709(b)(1)) is amended by inserting
    after ``section 8003(a)(2)(B)'' the following: ``and, with respect to a
    local educational agency that receives a payment under section
    8003(b)(2), the amount in excess of the amount that the agency would
    receive if the agency were deemed to be an agency eligible to receive a
    payment under section 8003(b)(1) and not section 8003(b)(2)''.

    SEC. 605. AUTHORIZATION OF APPROPRIATIONS.

        Section 8014 (20 U.S.C. 7714) is amended by striking ``three
    succeeding fiscal years'' each place it appears and inserting ``six
    succeeding fiscal years''.

    SEC. 606. REPEAL OF EXISTING TITLE VI; TRANSFER AND REDESIGNATION OF
                  PROGRAM.

        (a) Repeal of Existing Title VI.--Title VI (20 U.S.C. 7301 et seq.)
    is repealed.
        (b) Transfer and Redesignation of Program.--(1) Title VIII (20
    U.S.C. 7701 et seq.)--
                (A) is transferred from the current placement of the title
            and inserted after title V; and
                (B) is redesignated as title VI.
        (2) Title VI (as redesignated by paragraph (1)(B)) is amended--
                (A) by redesignating sections 8001 through 8005 (20 U.S.C.
            7701-7705) as sections 6001 through 6005, respectively; and
                (B) by redesignating sections 8007 through 8014 (20 U.S.C.
            7707-7714) as sections 6006 through 6013, respectively.
        (c) Conforming Amendments.--(1) Title VI (as redesignated by
    subsection (b)) is amended by striking ``8002'', ``8003'', ``8004'',
    ``8005'', ``8008'', ``8009'', ``8011'', ``8013'', and ``8014'' each
    place such terms appear and inserting ``6002'', ``6003'', ``6004'',
    ``6005'', ``6007'', ``6008'', ``6010'', ``6012'', and ``6013'',
    respectively.
        (2) Section 6005 (as redesignated by subsection (b)) is amended in
    the heading by striking ``8002 and 8003'' and inserting ``6002 and
    6003''.
        (3) Section 6009(c)(1) (as redesignated by subsection (b)) is
    amended in the heading by striking ``8003'' and inserting ``6003''.
        (d) Savings Provision.--Funds appropriated for title VIII of the
    Elementary and Secondary Education Act of 1965 (as in effect on the day
    before the date of the enactment of this Act) shall be available for
    use under title VI of such Act, as added by this section.

                           TITLE VII--ACCOUNTABILITY

    SEC. 701. FLEXIBILITY AND ACCOUNTABILITY.

        Title VII is amended to read as follows:

                  ``TITLE VII--FLEXIBILITY AND ACCOUNTABILITY

       ``PART A--STATE ACCOUNTABILITY FOR IMPROVING ACADEMIC ACHIEVEMENT

    ``SEC. 7101. STATE FINANCIAL AWARDS.

        ``(a) In General.--Beginning in the 2002-2003 school year, the
    Secretary shall make in accordance with this section financial awards,
    to be known as `Achievement in Education Awards', to States that have
    made significant progress in improving educational achievement.
        ``(b) Criteria of Progress.--For the purposes of subsection (a),
    the Secretary shall judge progress using each of the following
    criteria, giving the greatest weight to the criterion described in
    paragraph (1):
                ``(1) The progress of the State's students from
            economically disadvantaged families and students from racial
            and ethnic minority groups--
                        ``(A) on the assessments administered by the State
                    under section 1111; and
                        ``(B) beginning in the 2003-2004 school year, on
                    assessments of 4th and 8th grade reading and
                    mathematics under--
                                ``(i) the State assessments carried out as
                            part of the National Assessment of Educational
                            Progress under section 411 of the National
                            Education Statistics Act of 1994 (20 U.S.C.
                            9010); or
                                ``(ii) an assessment selected by the State
                            that--
                                        ``(I) is administered annually;
                                        ``(II) yields high quality data
                                    that are valid and reliable;
                                        ``(III) meets widely recognized
                                    professional and technical standards,
                                    including specific and rigorous test
                                    security procedures;
                                        ``(IV) is developed by an entity
                                    independent from each State and local
                                    government agency in the State in a
                                    manner that protects against any
                                    conflict of interest ;
                                        ``(V) has no test questions that
                                    are identical to the test questions
                                    used by the assessment used to meet the
                                    State assessment requirements under
                                    section 1111;
                                        ``(VI) provides results in such a
                                    form that they may be expressed in
                                    terms of achievement levels that are
                                    consistent with the achievement levels
                                    (basic, proficient, and advanced) set
                                    forth in section 1111;
                                        ``(VII) provides results in such a
                                    form that they may be disaggregated, at
                                    a minimum, according to income level
                                    and major racial and ethnic group; and
                                        ``(VIII) is administered to all
                                    students or to a representative sample
                                    of students in the 4th and 8th grades
                                    statewide, with a sample size that is
                                    sufficiently large to produce
                                    statistically significant estimates of
                                    statewide student achievement.
                ``(2) The overall improvement in the achievement of all of
            the State's students, as measured by--
                        ``(A) the assessments administered by the State
                    under section 1111; and
                        ``(B) beginning in the 2003-2004 school year, the
                    assessments described in paragraph (1)(B).
                ``(3) The progress of the State in improving the English
            proficiency of students who enter school with limited English
            proficiency.
        ``(c) Other Considerations.--In judging a State's progress under
    subsection (a), the Secretary may also consider--
                ``(1) the progress of the State in increasing the
            percentage of students who graduate from secondary schools; and
                ``(2) the progress of the State in increasing the
            percentage of students who take advanced coursework (such as
            Advanced Placement or International Baccalaureate courses) and
            who pass the exams associated with such coursework.
        ``(d) Amount.--The Secretary shall determine the amount of an award
    under subsection (a) based on--
                ``(1) the school-age population of the State; and
                ``(2) the degree of progress shown by a State with respect
            to the criteria set forth in subsections (b) and (c).
        ``(e) Use of Funds.--
                ``(1) In general.--A State receiving a financial award
            under this section shall use the proceeds of such award only to
            make financial awards to public elementary and secondary
            schools in the State that have made the most significant
            progress with respect to the criteria described in subsection
            (b).
                ``(2) Use by schools.--In consultation with the school's
            teachers, the principal of each elementary or secondary school
            that receives a financial award from a State under this section
            shall use the proceeds of such award at the school for any
            educational purpose permitted under State law.
                ``(3) Responsible state agency.--The State educational
            agency for each State shall be the agency responsible for
            making awards under this subsection.
        ``(f) Peer Review.--In selecting States for awards under subsection
    (a), the Secretary shall use a peer-review process.
        ``(g) Costs of Independent Assessments.--
                ``(1) In general.--Subject to paragraph (2), the Secretary
            shall make grants to States to offset the costs of
            administering assessments administered by the States to meet
            the requirements of (b)(1)(B)(ii).
                ``(2) Limitations.--Grants made by the Secretary in any
            year to a State under paragraph (1)--
                        ``(A) may be awarded only to offset the costs of a
                    single administration of an assessment described in
                    such paragraph in the State for that year; and
                        ``(B) may not exceed the costs of administering in
                    the State for that year the State assessments that
                    would be carried out under the National Assessment of
                    Educational Progress described in subsection (b)(1)(B).
                ``(3) Allocation.--The Secretary may determine the
            appropriate methodology of allocating grants to States under
            this subsection.

    ``SEC. 7102. STATE SANCTIONS.

        ``(a) Failure to Make Progress.--
                ``(1) Loss of administrative funds.--The Secretary shall
            reduce, by 30 percent, the amount of funding that a State may
            reserve for State administration under the State formula grant
            programs authorized by this Act if the Secretary determines
            that, for 2 consecutive years--
                        ``(A) the State's students from economically
                    disadvantaged families and students from racial and
                    ethnic minority groups failed to make adequate yearly
                    progress on the assessments administered by the State
                    under section 1111; and
                        ``(B) the State's students from economically
                    disadvantaged families and students from racial and
                    ethnic minority groups failed to make measurable
                    progress in reading and mathematics, as measured by the
                    4th and 8th grade assessments described in subsection
                    (b)(1)(B).
        ``(2) Further reductions.--In each of the first 2 years after the
    years described in paragraph (1), the Secretary may increase the
    reduction described in such paragraph by any amount not more than a
    total of an additional 45 percent.
        ``(b) Other Failures.--In addition to any action taken under
    subsection (a)(1) or (a)(2), the Secretary shall reduce, by 20 percent,
    the amount of funding that a State may reserve for State administration
    under the State formula grant programs authorized by this Act if the
    Secretary determines that, for 2 consecutive years, the State failed to
    make adequate yearly progress--
                ``(1) with respect to the achievement of children with
            limited English proficiency under section
            1111(b)(2)(C)(iii)(II)(dd); or
                ``(2) with respect to the acquisition of English language
            proficiency by children with limited English proficiency under
            section 1111(b)(2)(C)(iii)(III).
        ``(c) Use of Funds for Improvement.--
                ``(1) In general.--The Secretary shall require that any
            funds reduced under this section be allocated by the State to
            local educational agencies in the State for school improvement
            purposes described in section 1116.
                ``(2) Treatment of funds.--Funds described in paragraph (1)
            shall not count toward the amounts that are required to be
            reserved by a State for school improvement under section 1003.

    ``SEC. 7103. DEVELOPMENT OF STATE STANDARDS AND ASSESSMENTS.

        ``(a) In General.--The Secretary shall make financial awards to
    States to enable the States--
                ``(1) to pay the costs of the development of the additional
            State assessments and standards required by section 1111(b),
            including the costs of working in voluntary partnerships with
            other States, at the sole discretion of each such State, in
            developing such assessments and standards if a State chooses to
            do so; and
                ``(2) if a State has developed the assessments and
            standards referred to in paragraph (1), to administer such
            assessments or to carry out other activities described in this
            title and other activities related to ensuring accountability
            for results in the State's schools and local educational
            agencies, such as--
                        ``(A) developing academic content and achievement
                    standards and aligned assessments in other subjects not
                    required by Section 1111;
                        ``(B) developing assessments of English language
                    proficiency necessary to comply with section
                    1111(b)(7);
                        ``(C) assuring the continued validity and
                    reliability of State assessments;
                        ``(D) refining State assessments to ensure their
                    continued alignment with the State's academic content
                    standards and to improve the alignment of curricula and
                    instruction materials;
                        ``(E) providing for multiple measures to increase
                    the reliability and validity of student and school
                    classifications;
                        ``(F) strengthening the capacity of local
                    educational agencies and schools to provide all
                    students the opportunity to increase educational
                    achievement;
                        ``(G) expanding the range of accommodations
                    available to students with limited English proficiency
                    and students with disabilities to improve the rates of
                    inclusion of such students; and
                        ``(H) improving the dissemination of information on
                    student achievement and school performance to parents
                    and the community.
        ``(b) Bonuses.--The Secretary shall make a one-time bonus payment
    to each State that completes the development of the assessments
    described in subsection (a) ahead of the deadline set forth in section
    1111.

    ``SEC. 7104. FUNDING.

        ``(a) Authorization of appropriations.--
                ``(1) Awards and bonus payments.--For the purposes of
            making awards under section 7101 and bonus payments under
            section 7103(b), there are authorized to be appropriated
            $40,000,000 for fiscal year 2002 and such sums as may be
            necessary for each of fiscal years 2003 through 2006.
                ``(2) Grants for independent assessments; administration of
            state assessments under naep.--For the purposes of making
            grants to offset the costs of independent assessments under
            section 7101(g) and for the purposes of administering the State
            assessments carried out under the National Assessment of
            Educational Progress referred to in section 7101(b)(1)(B)(i),
            there are authorized to be appropriated to the Secretary
            $69,000,000 for fiscal year 2002 and such sums as may be
            necessary for each of fiscal years 2003 through 2006.
                ``(3) Development and administration of state standards and
            assessments.--For the purposes of carrying out subsection
            7103(a), there are authorized to be appropriated $400,000,000
            for fiscal year 2002 and such sums as may be necessary for each
            of the fiscal years 2003 through 2005.
        ``(b) Allocation of Appropriated Funds.--From each of the amounts
    appropriated under subsection (a), the Secretary shall allocate to the
    States--
                ``(1) 50 percent based on the relative number of children
            aged 5 to 17 in each State; and
                ``(2) 50 percent allocated equally among the States.

     ``PART B--FUNDING FLEXIBILITY FOR STATE AND LOCAL EDUCATIONAL AGENCIES

    ``SEC. 7201. SHORT TITLE.

        ``This part may be cited as the `State and Local Transferability
    Act'.

    ``SEC. 7202. PURPOSE.

        ``The purpose of this part is to allow States and local educational
    agencies the flexibility--
                ``(1) to target Federal funds to Federal programs that most
            effectively address the unique needs of States and localities;
            and
                ``(2) to transfer Federal funds allocated to other
            activities to allocations for activities authorized under title
            I programs.

    ``SEC. 7203. TRANSFERABILITY OF FUNDS.

        ``(a) Transfers by States.--
                ``(1) In general.--In accordance with this part, a State
            may transfer up 50 percent of the nonadministrative State funds
            allocated to the State for use for State-level activities under
            each of the following provisions to 1 or more of the State's
            allocations under any other of such provisions:
                        ``(A) Part A of Title II.
                        ``(B) Subpart 1 of part A of title IV.
                        ``(C) Part A or B of title V.
                ``(2) Supplemental funds for title I.--In accordance with
            this part, a State may transfer any funds allocated to the
            State under a provision listed in paragraph (1) to its
            allocation under title I.
        ``(b) Transfers by Local Educational Agencies.--
                ``(1) Authority to transfer funds.--
                        ``(A) In general.--In accordance with this part, a
                    local educational agency (except a local educational
                    agency identified for improvement under section
                    1116(c)(2) or subject to corrective action under
                    section 1116(c)(9)) may transfer not more than 50
                    percent of the funds allocated to it under each of the
                    provisions listed in paragraph (2) for a fiscal year to
                    1 or more of its allocations for such fiscal year under
                    any other provision listed in paragraph (2).
                        ``(B) Agencies identified for improvement.--A local
                    educational agency identified for improvement under
                    section 1116(c)(2) may transfer in accordance with this
                    part not more than 30 percent of the funds allocated to
                    it under each of the provisions listed in paragraph
                    (2)--
                                ``(i) to its allocation for school
                            improvement under section 1003;
                                ``(ii) to any other allocation if such
                            transferred funds are used only for local
                            educational agency improvement activities
                            consistent with section 1116(d).
                        ``(C) Supplemental funds for title I.--In
                    accordance with this part, a local educational agency
                    may transfer funds allocated to such agency under a
                    provision listed in paragraph (2) to its allocation
                    under title I.
                ``(2) Applicable provisions.--A local educational agency
            may transfer funds under subparagraph (A) or (B) from
            allocations made under each of the following provisions:
                        ``(A) Title II.
                        ``(B) Subpart 1 of Part A of title IV.
                        ``(C) Part A of title V or section 5212(2)(A).
        ``(c) No Transfer of Title I Funds.--A State or a local educational
    agency may not transfer under this part to any other program any funds
    allocated to it under title I.
        ``(d) Modification of plans and applications; notification.--
                ``(1) State transfers.--Each State that makes a transfer of
            funds under this section shall--
                        ``(A) modify to account for such transfer each
                    State plan, or application submitted by the State, to
                    which such funds relate;
                        ``(B) not later than 30 days after the date of such
                    transfer, submit a copy of such modified plan or
                    application to the Secretary; and
                        ``(C) not later than 30 days before the effective
                    date of such transfer, notify the Secretary of such
                    transfer.
                ``(2) Local transfers.--Each local educational agency that
            makes a transfer under this section shall--
                        ``(A) modify to account for such transfer each
                    local plan, or application submitted by the agency, to
                    which such funds relate;
                        ``(B) not later than 30 days after the date of such
                    transfer, submit a copy of such modified plan or
                    application to the State; and
                        ``(C) not later than 30 days before the effective
                    date of such transfer, notify the State of such
                    transfer.
        ``(e) Applicable rules.--
                ``(1) In general.--Except as otherwise provided in this
            part, funds transferred under this section are subject to each
            of the rules and requirements applicable to the funds allocated
            by the Secretary under the provision to which the transferred
            funds are transferred.
                ``(2) Consultation.--Each State educational agency or local
            educational agency that transfers funds under this section
            shall conduct consultations in accordance with section 8503(c),
            if such transfer transfers funds from a program that provides
            for the participation of students, teachers, or other
            educational personnel, from private schools.''.

                         TITLE VIII--GENERAL PROVISIONS

    SEC. 801. GENERAL PROVISIONS.

        The Elementary and Secondary Education Act of 1965, as amended by
    this Act, is further amended by adding at the end of title VII the
    following:

                        ``TITLE VIII--GENERAL PROVISIONS

                             ``PART A--DEFINITIONS

    ``SEC. 8101. DEFINITIONS.

        ``Except as otherwise provided, for the purposes of this Act, the
    following terms have the following meanings:
                ``(1) Average daily attendance--
                        ``(A) Except as provided otherwise by State law or
                    this paragraph, the term `average daily attendance'
                    means--
                                ``(i) the aggregate number of days of
                            attendance of all students during a school
                            year; divided by
                                ``(ii) the number of days school is in
                            session during such school year.
                        ``(B) The Secretary shall permit the conversion of
                    average daily membership (or other similar data) to
                    average daily attendance for local educational agencies
                    in States that provide State aid to local educational
                    agencies on the basis of average daily membership or
                    such other data.
                        ``(C) If the local educational agency in which a
                    child resides makes a tuition or other payment for the
                    free public education of the child in a school located
                    in another school district, the Secretary shall, for
                    purposes of this Act--
                                ``(i) consider the child to be in
                            attendance at a school of the agency making
                            such payment; and
                                ``(ii) not consider the child to be in
                            attendance at a school of the agency receiving
                            such payment.
                        ``(D) If a local educational agency makes a tuition
                    payment to a private school or to a public school of
                    another local educational agency for a child with
                    disabilities, as defined in paragraph (5), the
                    Secretary shall, for the purposes of this Act, consider
                    such child to be in attendance at a school of the
                    agency making such payment.
                ``(2) Average per-pupil expenditure.--The term `average
            per-pupil expenditure' means, in the case of a State or of the
            United States--
                        ``(A) without regard to the source of funds--
                                ``(i) the aggregate current expenditures,
                            during the third fiscal year preceding the
                            fiscal year for which the determination is made
                            (or, if satisfactory data for that year are not
                            available, during the most recent preceding
                            fiscal year for which satisfactory data are
                            available) of all local educational agencies in
                            the State or, in the case of the United States
                            for all States (which, for the purpose of this
                            paragraph, means the 50 States and the District
                            of Columbia); plus
                                ``(ii) any direct current expenditures by
                            the State for the operation of such agencies;
                            divided by
                        ``(B) the aggregate number of children in average
                    daily attendance to whom such agencies provided free
                    public education during such preceding year.
                ``(3) Beginning teacher.--The term `beginning teacher'
            means an educator in a public school who has been teaching less
            than a total of 3 complete school years.
                ``(4) Child.--The term `child' means any person within the
            age limits for which the State provides free public education.
                ``(5) Child with disability.--The term `child with a
            disability' means a child--
                        ``(A) with mental retardation, hearing impairments
                    (including deafness), speech or language impairments,
                    visual impairments (including blindness), serious
                    emotional disturbance (hereinafter referred to as
                    `emotional disturbance'), orthopedic impairments,
                    autism, traumatic brain injury, other health
                    impairments, or specific learning disabilities; and
                        ``(B) who, by reason thereof, needs special
                    education and related services.
                ``(6) Community-based organization.--The term `community-
            based organization' means a public or private nonprofit
            organization of demonstrated effectiveness that--
                        ``(A) is representative of a community or
                    significant segments of a community; and
                        ``(B) provides educational or related services to
                    individuals in the community.
                ``(7) Consolidated local application.--The term
            `consolidated local application' means an application submitted
            by a local educational agency pursuant to section 14305.
                ``(8) Consolidated local plan.--The term `consolidated
            local plan' means a plan submitted by a local educational
            agency pursuant to section 14305.
                ``(9) Consolidated state application.--The term
            `consolidated State application' means an application submitted
            by a State educational agency pursuant to section 14302.
                ``(10) Consolidated state plan.--The term `consolidated
            State plan' means a plan submitted by a State educational
            agency pursuant to section 14302.
                ``(11) County.--The term `county' means one of the
            divisions of a State used by the Secretary of Commerce in
            compiling and reporting data regarding counties.
                ``(12) Covered program.--The term `covered program' means
            each of the programs authorized by--
                        ``(A) part A of title I;
                        ``(B) part B of title I;
                        ``(C) part C of title I;
                        ``(D) part D of title I;
                        ``(E) part F of title I;
                        ``(F) part G of title I;
                        ``(G) part A of title II;
                        ``(H) part A of title III;
                        ``(I) part A of title V;
                        ``(J) part B of title V; and
                        ``(K) part A of title IV:
                ``(13) Current expenditures.--The term `current
            expenditures' means expenditures for free public education--
                        ``(A) including expenditures for administration,
                    instruction, attendance, pupil transportation services,
                    operation and maintenance of plant, fixed charges, and
                    net expenditures to cover deficits for food services
                    and student body activities; but
                        ``(B) not including expenditures for community
                    services, capital outlay, and debt service, or any
                    expenditures made from funds received under title I and
                    part A of title IV.
                ``(14) Department.--The term `Department' means the
            Department of Education.
                ``(15) Educational service agency.--The term `educational
            service agency' means a regional public multiservice agency
            authorized by State statute to develop, manage, and provide
            services or programs to local educational agencies.
                ``(16) Effective schools program.--The term `effective
            schools program' means a school-based program that may
            encompass preschool through secondary school levels and that
            has the objectives of--
                        ``(A) promoting school-level planning,
                    instructional improvement, and staff development;
                        ``(B) increasing the academic achievement levels of
                    all children and particularly educationally
                    disadvantaged children; and
                        ``(C) achieving as ongoing conditions in the school
                    the following factors identified through scientifically
                    based research as distinguishing effective from
                    ineffective schools:
                                ``(i) Strong and effective administrative
                            and instructional leadership that creates
                            consensus on instructional goals and
                            organizational capacity for instructional
                            problem solving.
                                ``(ii) Emphasis on the acquisition of basic
                            and advanced academic skills.
                                ``(iii) A safe and orderly school
                            environment that allows teachers and pupils to
                            focus their energies on academic achievement.
                                ``(iv) Continuous review of students and
                            programs to evaluate the effects of
                            instruction.
                ``(17) Elementary school.--The term `elementary school'
            means a nonprofit institutional day or residential school,
            including a public elementary charter school, that provides
            elementary education, as determined under State law.
                ``(18) Essential components of reading instruction.--The
            term `essential components of reading instruction' means
            explicit and systematic instruction in--
                        ``(A) phonemic awareness;
                        ``(B) phonics;
                        ``(C) vocabulary development;
                        ``(D) reading fluency; and
                        ``(E) reading comprehension strategies.
                ``(19) 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, and that integrate all of the following
            activities:
                        ``(A) Interactive literacy activities between
                    parents and their children.
                        ``(B) Training for parents regarding how to be the
                    primary teacher for their children and full partners in
                    the education of their children.
                        ``(C) Parent literacy training that leads to
                    economic self-sufficiency.
                        ``(D) An age-appropriate education to prepare
                    children for success in school and life experiences.
                ``(20) Free public education.--The term `free public
            education' means education that is provided--
                        ``(A) at public expense, under public supervision
                    and direction, and without tuition charge; and
                        ``(B) as elementary or secondary school education
                    as determined under applicable State law, except that
                    such term does not include any education provided
                    beyond grade 12.
                ``(21) Fully qualified.--The term `fully qualified'--
                        ``(A) when used with respect to a public elementary
                    or secondary school teacher means that the teacher has
                    obtained State certification as a teacher (including
                    certification obtained through alternative routes to
                    certification) or passed the State teacher licensing
                    exam and holds a license to teach in such State, except
                    that when used with respect to any teacher teaching in
                    a public charter school, means that the teacher meets
                    the requirements set forth in the State's public
                    charter school law; and
                        ``(B) when used with respect to--
                                ``(i) an elementary school teacher, means
                            that the teacher holds a bachelor's degree and
                            demonstrates knowledge and teaching skills in
                            reading, writing, mathematics, science, and
                            other areas of the elementary school
                            curriculum; and
                                ``(ii) a middle or secondary school
                            teacher, means that the teacher holds a
                            bachelor's degree and demonstrates a high level
                            of competency in all subject areas in which he
                            or she teaches through--
                                        ``(I) a passing level of
                                    performance on a rigorous State or
                                    local academic subject areas test; or
                                        ``(II) completion of an academic
                                    major in each of the subject areas in
                                    which he or she provides instruction.
                ``(22) Gifted and talented.--The term `gifted and
            talented', when used with respect to students, children or
            youth, means students, children or youth who give evidence of
            high performance capability in areas such as intellectual,
            creative, artistic, or leadership capacity, or in specific
            academic fields, and who require services or activities not
            ordinarily provided by the school in order to fully develop
            such capabilities.
                ``(23) Institution of higher education.--The term
            `institution of higher education' has the meaning given that
            term in section 101 of the Higher Education Act of 1965.
                ``(24) Limited english proficient student.--The term
            `limited English proficient student' means an individual aged 5
            through 17 enrolled in an elementary school or secondary
            school--
                        ``(A) who--
                                ``(i) was not born in the United States or
                            whose native language is a language other than
                            English;
                                ``(ii)(I) is a Native American or Alaska
                            Native, or a native resident of the outlying
                            areas; and
                                ``(II) comes from an environment where a
                            language other than English has had a
                            significant impact on such individual's level
                            of English language proficiency; or
                                ``(iii) is migratory, whose native language
                            is a language other than English, and who comes
                            from an environment where a language other than
                            English is dominant; and
                        ``(B) who has sufficient difficulty speaking,
                    reading, writing, or understanding the English
                    language, and whose difficulties may deny the
                    individual--
                                ``(i) the ability to meet the State's
                            proficient level of performance on State
                            assessments described in section 1111(b)(4) in
                            core academic subjects; or
                                ``(ii) the opportunity to participate fully
                            in society.
                ``(25) Local educational agency.--(A) The term `local
            educational agency' means a public board of education or other
            public authority legally constituted within a State for either
            administrative control or direction of, or to perform a service
            function for, public elementary or secondary schools in a city,
            county, township, school district, or other political
            subdivision of a State, or for such combination of school
            districts or counties as are recognized in a State as an
            administrative agency for its public elementary or secondary
            schools.
                ``(B) The term includes any other public institution or
            agency having administrative control and direction of a public
            elementary or secondary school.
                ``(C) The term includes an elementary or secondary school
            funded by the Bureau of Indian Affairs but only to the extent
            that such inclusion makes such school eligible for programs for
            which specific eligibility is not provided to such school in
            another provision of law and such school does not have a
            student population that is smaller than the student population
            of the local educational agency receiving assistance under this
            Act with the smallest student population, except that such
            school shall not be subject to the jurisdiction of any State
            educational agency other than the Bureau of Indian Affairs.
                ``(D) The term includes educational service agencies and
            consortia of such agencies.
                ``(26) Mentoring.--The term `mentoring' means a program in
            which an adult works with a child or youth on a 1-to-1 basis,
            establishing a supportive relationship, providing academic
            assistance, and introducing the child or youth to new
            experiences that enhance the child or youth's ability to excel
            in school and become a responsible citizen.
                ``(27) Native american and native american language.--The
            terms `Native American' and `Native American language' shall
            have the same meaning given such terms in section 103 of the
            Native American Languages Act of 1990.
                ``(28) Other staff.--The term `other staff' means pupil
            services personnel, librarians, career guidance and counseling
            personnel, education aides, and other instructional and
            administrative personnel.
                ``(29) Outlying area.--The term `outlying area' means the
            United States Virgin Islands, Guam, American Samoa, and the
            Commonwealth of the Northern Mariana Islands, and through
            fiscal year 2003 and for the purpose of any discretionary grant
            program, includes the freely associated states of the Republic
            of the Marshall Islands, the Federated States of Micronesia,
            and the Republic of Palau.
                ``(30) Parent.--The term `parent' includes a legal
            guardian, or other person standing in loco parentis (such as a
            grandparent or stepparent with whom the child lives, or a
            person who is legally responsible for the child's welfare).
                ``(31) Pupil services personnel; pupil services.--(A) The
            term `pupil services personnel' means school counselors, school
            social workers, school psychologists, and other qualified
            professional personnel involved in providing assessment,
            diagnosis, counseling, educational, therapeutic, and other
            necessary services (including related services as such term is
            defined in section 602(22) of the Individuals with Disabilities
            Education Act) as part of a comprehensive program to meet
            student needs.
                ``(B) The term `pupil services' means the services provided
            by pupil services personnel.
                ``(32) Reading.--The term `reading' means a complex system
            of deriving meaning from print that requires all of the
            following:
                        ``(A) Skills and knowledge to understand how
                    phonemes, or speech sounds are connected in print.
                        ``(B) Ability to decode unfamiliar words.
                        ``(C) Ability to read fluently.
                        ``(D) Sufficient background information and
                    vocabulary to foster reading comprehensions.
                        ``(E) Development of appropriate active strategies
                    to construct meaning from print.
                        ``(F) Development and maintenance of a motivation
                    to read.
                ``(33) Rigorous diagnostic reading and screening assessment
            tools.--The term `rigorous diagnostic reading and screening
            assessment tools' means a diagnostic reading assessment that--
                        ``(A) is valid, reliable, and grounded on
                    scientifically based reading research;
                        ``(B) measures progress in developing phonemic
                    awareness and phonics skills, vocabulary, reading
                    fluency, and reading comprehension;
                        ``(C) identifies students who may be at risk for
                    reading failure or who are having difficulty reading;
                    and
                        ``(D) are used to improve instruction.
                ``(34) Scientifically based research.--The term
            `scientifically based research'--
                        ``(A) means the application of rigorous,
                    systematic, and objective procedures to obtain valid
                    knowledge relevant to education activities and
                    programs; and
                        ``(B) shall include research that--
                                ``(i) employs systematic, empirical methods
                            that draw on observation or experiment;
                                ``(ii) involves rigorous data analyses that
                            are adequate to test the stated hypotheses and
                            justify the general conclusions drawn;
                                ``(iii) relies on measurements or
                            observational methods that provide valid data
                            across evaluators and observers and across
                            multiple measurements and observations;
                                ``(iv) is evaluated using randomized
                            experiments in which individuals, entities,
                            programs, or activities are randomly assigned
                            to different variations (including a control
                            condition) to compare the relative effects of
                            the variations; and
                                ``(v) has been accepted by a peer-reviewed
                            journal or approved by a panel of independent
                            experts through a comparably rigorous,
                            objective, and scientific review.
                ``(35) Secondary school.--The term `secondary school' means
            a nonprofit institutional day or residential school, including
            a public secondary charter school, that provides secondary
            education, as determined under State law, except that such term
            does not include any education beyond grade 12.
                ``(36) Secretary.--The term `Secretary' means the Secretary
            of Education.
                ``(37) State.--The term `State' means each of the 50
            States, the District of Columbia, the Commonwealth of Puerto
            Rico, and each of the outlying areas.
                ``(38) State educational agency.--The term `State
            educational agency' means the agency primarily responsible for
            the State supervision of public elementary and secondary
            schools.
                ``(39) Technology.--The term `technology' means the latest
            state-of-the-art technology products and services.

    ``SEC. 8102. APPLICABILITY OF TITLE.

        ``Parts B, C, D, and E of this title do not apply to title VI of
    this Act.

    ``SEC. 8103. APPLICABILITY TO BUREAU OF INDIAN AFFAIRS OPERATED
                  SCHOOLS.

        ``For purposes of any competitive program under this Act, a
    consortia of schools operated by the Bureau of Indian Affairs, a school
    operated under a contract or grant with the Bureau of Indian Affairs in
    consortia with another contract or grant school or tribal or community
    organization, or a Bureau of Indian Affairs school in consortia with an
    institution of higher education, a contract or grant school and tribal
    or community organization shall be given the same consideration as a
    local educational agency.

       ``PART B--FLEXIBILITY IN THE USE OF ADMINISTRATIVE AND OTHER FUNDS

    ``SEC. 8201. CONSOLIDATION OF STATE ADMINISTRATIVE FUNDS FOR ELEMENTARY
                  AND SECONDARY EDUCATION PROGRAMS.

        ``(a) Consolidation of Administrative Funds.--
                ``(1) In general.--A State educational agency may
            consolidate the amounts specifically made available to such
            agency for State administration under one or more of the
            programs under paragraph (2) if such State educational agency
            can demonstrate that the majority of such agency's resources
            are derived from non-Federal sources.
                ``(2) Applicability.--This section applies to any program
            under this Act under which funds are authorized to be used for
            administration, and such other programs as the Secretary may
            designate.
        ``(b) Use of funds.--
                ``(1) In general.--A State educational agency shall use the
            amount available under this section for the administration of
            the programs included in the consolidation under subsection
            (a).
                ``(2) Additional uses.--A State educational agency may also
            use funds available under this section for administrative
            activities designed to enhance the effective and coordinated
            use of funds under programs included in the consolidation under
            subsection (a), such as--
                        ``(A) the coordination of such programs with other
                    Federal and non-Federal programs;
                        ``(B) the establishment and operation of peer-
                    review mechanisms under this Act;
                        ``(C) the administration of this title;
                        ``(D) the dissemination of information regarding
                    model programs and practices;
                        ``(E) technical assistance under any program under
                    this Act;
                        ``(F) State level activities designed to carry out
                    this title;
                        ``(G) training personnel engaged in audit and other
                    monitoring activities; and
                        ``(H) implementation of the Cooperative Audit
                    Resolution and Oversight Initiative of the Department
                    of Education.
        ``(c) Records.--A State educational agency that consolidates
    administrative funds under this section shall not be required to keep
    separate records, by individual program, to account for costs relating
    to the administration of programs included in the consolidation under
    subsection (a).
        ``(d) Review.--To determine the effectiveness of State
    administration under this section, the Secretary may periodically
    review the performance of State educational agencies in using
    consolidated administrative funds under this section and take such
    steps as the Secretary finds appropriate to ensure the effectiveness of
    such administration.
        ``(e) Unused administrative funds.--If a State educational agency
    does not use all of the funds available to such agency under this
    section for administration, such agency may use such funds during the
    applicable period of availability as funds available under one or more
    programs included in the consolidation under subsection (a).

    ``SEC. 8202. SINGLE LOCAL EDUCATIONAL AGENCY STATES.

        ``A State educational agency that also serves as a local
    educational agency, in such agency's applications or plans under this
    Act, shall describe how such agency will eliminate duplication in the
    conduct of administrative functions.

    ``SEC. 8203. CONSOLIDATION OF FUNDS FOR LOCAL ADMINISTRATION.

        ``(a) General Authority.--In accordance with regulations of the
    Secretary and for any fiscal year, a local educational agency, with the
    approval of its State educational agency, may consolidate and use for
    the administration of one or more programs under this Act (or such
    other programs as the Secretary shall designate) not more than the
    percentage, established in each such program, of the total available
    for the local educational agency under such programs.
        ``(b) State Procedures.--Within one-year from the date of enactment
    of the No Child Left Behind Act of 2001, a State educational agency
    shall, in collaboration with local educational agencies in the State,
    establish procedures for responding to requests from local educational
    agencies to consolidate administrative funds under subsection (a) and
    for establishing limitations on the amount of funds under such programs
    that may be used for administration on a consolidated basis.
        ``(c) Conditions.--A local educational agency that consolidates
    administrative funds under this section for any fiscal year shall not
    use any other funds under the programs included in the consolidation
    for administration for that fiscal year.
        ``(d) Uses of Administrative Funds.--A local educational agency
    that consolidates administrative funds under this section may use such
    consolidated funds for the administration of such programs and for
    uses, at the school district and school levels, comparable to those
    described in section 8201(b)(2).
        ``(e) Records.--A local educational agency that consolidates
    administrative funds under this section shall not be required to keep
    separate records, by individual program, to account for costs relating
    to the administration of such programs included in the consolidation.

    ``SEC. 8204. CONSOLIDATED SET-ASIDE FOR DEPARTMENT OF THE INTERIOR
                  FUNDS.

        ``(a) General Authority.--
                ``(1) Transfer.--The Secretary shall transfer to the
            Department of the Interior, as a consolidated amount for
            covered programs, the Indian education programs under subpart 1
            of part B of title III, and the education for homeless children
            and youth program under subtitle B of title VII of the Stewart
            B. McKinney Homeless Assistance Act, the amounts allotted to
            the Department of the Interior under those programs.
                ``(2) Agreement.--(A) The Secretary and the Secretary of
            the Interior shall enter into an agreement, consistent with the
            requirements of the programs specified in paragraph (1), for
            the distribution and use of those program funds under terms
            that the Secretary determines best meet the purposes of those
            programs.
                ``(B) The agreement shall--
                        ``(i) set forth the plans of the Secretary of the
                    Interior for the use of the amount transferred and the
                    performance measures to assess program effectiveness,
                    including measurable goals and objectives; and
                        ``(ii) be developed in consultation with Indian
                    tribes.
        ``(b) Administration.--The Department of the Interior may use not
    more than 1.5 percent of the funds consolidated under this section for
    such department's costs related to the administration of the funds
    transferred under this section.

    ``PART C--COORDINATION OF PROGRAMS; CONSOLIDATED STATE AND LOCAL PLANS
                                AND APPLICATIONS

    ``SEC. 8301. PURPOSE.

        ``The purposes of this part are to improve teaching and learning
    through greater coordination between programs and to provide greater
    flexibility to State and local authorities by allowing the
    consolidation of State and local plans, applications, and reporting.

    ``SEC. 8302. OPTIONAL CONSOLIDATED STATE PLANS OR APPLICATIONS.

        ``(a) General Authority.--
                ``(1) Simplification.--In order to simplify application
            requirements and reduce the burden for States under this Act,
            the Secretary, in accordance with subsection (b), shall
            establish procedures and criteria under which a State
            educational agency, in consultation with the State's Governor,
            may submit a consolidated State plan or a consolidated State
            application meeting the requirements of this section for--
                        ``(A) any programs under this Act in which the
                    State participates; and
                        ``(B) such other programs as the Secretary may
                    designate.
                ``(2) Consolidated applications and plans.--A State
            educational agency, in consultation with the State's Governor,
            that submits a consolidated State plan or a consolidated State
            application under this section shall not be required to submit
            a separate State plan or application for a program included in
            the consolidated State plan or application.
        ``(b) Collaboration.--
                ``(1) In general.--In establishing criteria and procedures
            under this section, the Secretary shall collaborate with
            Governors, State educational agencies and, as appropriate, with
            other State agencies, local educational agencies, public and
            private nonprofit agencies, organizations, and institutions,
            private schools, and representatives of parents, students, and
            teachers.
                ``(2) Contents.--Through the collaborative process
            described in paragraph (1), the Secretary shall establish, for
            each program under the Act to which this section applies, the
            descriptions, information, assurances, and other material
            required to be included in a consolidated State plan or
            consolidated State application.
                ``(3) Necessary materials.--The Secretary shall require
            only descriptions, information, assurances, and other materials
            that are absolutely necessary for the consideration of the
            consolidated State plan or consolidated State application.

    ``SEC. 8303. CONSOLIDATED REPORTING.

        ``In order to simplify reporting requirements and reduce reporting
    burdens, the Secretary shall establish procedures and criteria under
    which a State educational agency, in consultation with the State's
    Governor, may submit a consolidated State annual report. Such report
    shall contain information about the programs included in the report,
    including the State's performance under those programs, and other
    matters as the Secretary determines, such as monitoring activities.
    Such a report shall take the place of separate individual annual
    reports for the programs subject to it.

    ``SEC. 8304. GENERAL APPLICABILITY OF STATE EDUCATIONAL AGENCY
                  ASSURANCES.

        ``(a) Assurances.--A State educational agency, in consultation with
    the State's Governor, that submits a consolidated State plan or
    consolidated State application under this Act, whether separately or
    under section 8302, shall have on file with the Secretary a single set
    of assurances, applicable to each program for which such plan or
    application is submitted, that provides that--
                ``(1) each such program will be administered in accordance
            with all applicable statutes, regulations, program plans, and
            applications;
                ``(2)(A) the control of funds provided under each such
            program and title to property acquired with program funds will
            be in a public agency, in a nonprofit private agency,
            institution, or organization, or in an Indian tribe if the law
            authorizing the program provides for assistance to such
            entities; and
                ``(B) the public agency, nonprofit private agency,
            institution, or organization, or Indian tribe will administer
            such funds and property to the extent required by the
            authorizing law;
                ``(3) the State will adopt and use proper methods of
            administering each such program, including--
                        ``(A) the enforcement of any obligations imposed by
                    law on agencies, institutions, organizations, and other
                    recipients responsible for carrying out each program;
                        ``(B) the correction of deficiencies in program
                    operations that are identified through audits,
                    monitoring, or evaluation; and
                        ``(C) the adoption of written procedures for the
                    receipt and resolution of complaints alleging
                    violations of law in the administration of such
                    programs;
                ``(4) the State will cooperate in carrying out any
            evaluation of each such program conducted by or for the
            Secretary or other Federal officials;
                ``(5) the State will use such fiscal control and fund
            accounting procedures as will ensure proper disbursement of,
            and accounting for, Federal funds paid to the State under each
            such program;
                ``(6) the State will--
                        ``(A) make reports to the Secretary as may be
                    necessary to enable the Secretary to perform the
                    Secretary's duties under each such program; and
                        ``(B) maintain such records, provide such
                    information to the Secretary, and afford access to the
                    records as the Secretary may find necessary to carry
                    out the Secretary's duties; and
                ``(7) before the plan or application was submitted to the
            Secretary, the State has afforded a reasonable opportunity for
            public comment on the plan or application and has considered
            such comment.
        ``(b) GEPA Provision.--Section 441 of the General Education
    Provisions Act shall not apply to programs under this Act.

    ``SEC. 8305. CONSOLIDATED LOCAL PLANS OR APPLICATIONS.

        ``(a) General Authority.--A local educational agency receiving
    funds under more than one program under this Act may submit plans or
    applications to the Governor and State educational agency under such
    programs on a consolidated basis.
        ``(b) Required Consolidated Plans or Applications.--A State that
    has an approved consolidated State plan or application under section
    8302 may require local educational agencies in the State receiving
    funds under more than one program included in the consolidated State
    plan or consolidated State application to submit consolidated local
    plans or applications under such programs, but may not require such
    agencies to submit separate plans.
        ``(c) Collaboration.--A Governor and State educational agency shall
    collaborate with local educational agencies in the State in
    establishing procedures for the submission of the consolidated State
    plans or consolidated State applications under this section.
        ``(d) Necessary Materials.--The State shall require only
    descriptions, information, assurances, and other material that are
    absolutely necessary for the consideration of the local educational
    agency plan or application.

    ``SEC. 8306. OTHER GENERAL ASSURANCES.

        ``(a) Assurances.--Any applicant other than a State that submits a
    plan or application under this Act, shall have on file with the State a
    single set of assurances, applicable to each program for which a plan
    or application is submitted, that provides that--
                ``(1) each such program will be administered in accordance
            with all applicable statutes, regulations, program plans, and
            applications;
                ``(2)(A) the control of funds provided under each such
            program and title to property acquired with program funds will
            be in a public agency or in a nonprofit private agency,
            institution, organization, or Indian tribe, if the law
            authorizing the program provides for assistance to such
            entities; and
                ``(B) the public agency, nonprofit private agency,
            institution, or organization, or Indian tribe will administer
            such funds and property to the extent required by the
            authorizing statutes;
                ``(3) the applicant will adopt and use proper methods of
            administering each such program, including--
                        ``(A) the enforcement of any obligations imposed by
                    law on agencies, institutions, organizations, and other
                    recipients responsible for carrying out each program;
                    and
                        ``(B) the correction of deficiencies in program
                    operations that are identified through audits,
                    monitoring, or evaluation;
                ``(4) the applicant will cooperate in carrying out any
            evaluation of each such program conducted by or for the State
            educational agency, the Secretary or other Federal officials;
                ``(5) the applicant will use such fiscal control and fund
            accounting procedures as will ensure proper disbursement of,
            and accounting for, Federal funds paid to such applicant under
            each such program;
                ``(6) the applicant will--
                        ``(A) make reports to the Governor and State
                    educational agency and the Secretary as may be
                    necessary to enable such agency and the Secretary to
                    perform their duties under each such program; and
                        ``(B) maintain such records, provide such
                    information, and afford access to the records as the
                    Governor and State educational agency or the Secretary
                    may find necessary to carry out the State's or the
                    Secretary's duties; and
                ``(7) before the application was submitted, the applicant
            afforded a reasonable opportunity for public comment on the
            application and has considered such comment.
        ``(b) GEPA Provision.--Section 442 of the General Education
    Provisions Act shall not apply to programs under this Act.

                               ``PART D--WAIVERS

    ``SEC. 8401. WAIVERS OF STATUTORY AND REGULATORY REQUIREMENTS.

        ``(a) In General.--Except as provided in subsection (c), the
    Secretary may waive any statutory or regulatory requirement of this Act
    or the Carl D. Perkins Vocational and Technical Education Act of 1998
    for a State educational agency, local educational agency, Indian tribe,
    or school through a local educational agency, that--
                ``(1) receives funds under a program authorized by this
            Act; and
                ``(2) requests a waiver under subsection (b).
        ``(b) Request for Waiver.--
                ``(1) In general.--A State educational agency, local
            educational agency, or Indian tribe which desires a waiver
            shall submit a waiver application to the Secretary that--
                        ``(A) indicates each Federal program affected and
                    each statutory or regulatory requirement requested to
                    be waived;
                        ``(B) describes the purpose and overall expected
                    results of waiving each such requirement;
                        ``(C) describes, for each school year, specific,
                    measurable, educational goals for the State educational
                    agency and for each local educational agency, Indian
                    tribe, or school that would be affected by the waiver;
                    and
                        ``(D) explains why the waiver will assist the State
                    educational agency and each affected local educational
                    agency, Indian tribe, or school in reaching such goals.
                ``(2) Additional information.--Such requests--
                        ``(A) may provide for waivers of requirements
                    applicable to State educational agencies, local
                    educational agencies, Indian tribes, and schools; and
                        ``(B) shall be developed and submitted--
                                ``(i)(I) by local educational agencies (on
                            behalf of such agencies and schools) to State
                            educational agencies; and
                                ``(II) by State educational agencies (on
                            behalf of, and based upon the requests of,
                            local educational agencies) to the Secretary;
                            or
                                ``(ii) by Indian tribes (on behalf of
                            schools operated by such tribes) to the
                            Secretary.
                ``(3) General requirements.--
                        ``(A) In the case of a waiver request submitted by
                    a State educational agency acting in its own behalf,
                    the State educational agency shall--
                                ``(i) provide all interested local
                            educational agencies in the State with notice
                            and a reasonable opportunity to comment on the
                            request;
                                ``(ii) submit the comments to the
                            Secretary; and
                                ``(iii) provide notice and information to
                            the public regarding the waiver request in the
                            manner that the applying agency customarily
                            provides similar notices and information to the
                            public.
                        ``(B) In the case of a waiver request submitted by
                    a local educational agency that receives funds under
                    this Act--
                                ``(i) such request shall be reviewed by the
                            State educational agency and be accompanied by
                            the comments, if any, of such State educational
                            agency; and
                                ``(ii) notice and information regarding the
                            waiver request shall be provided to the public
                            by the agency requesting the waiver in the
                            manner that such agency customarily provides
                            similar notices and information to the public.
        ``(c) Restrictions.--The Secretary shall not waive under this
    section any statutory or regulatory requirements relating to--
                ``(1) the allocation or distribution of funds to States,
            local educational agencies, or other recipients of funds under
            this Act;
                ``(2) maintenance of effort;
                ``(3) comparability of services;
                ``(4) use of Federal funds to supplement, not supplant,
            non-Federal funds;
                ``(5) equitable participation of private school students
            and teachers;
                ``(6) parental participation and involvement;
                ``(7) applicable civil rights requirements;
                ``(8) the requirement for a charter school under part B of
            title IV; or
                ``(9) the prohibitions regarding--
                        ``(A) State aid in section 8502;
                        ``(B) use of funds for religious worship or
                    instruction in section 8507; and
                        ``(C) activities in section 8513.
        ``(d) Duration and Extension of Waiver.--
                ``(1) In general.--Except as provided in paragraph (2), the
            duration of a waiver approved by the Secretary under this
            section may be for a period not to exceed 5 years.
                ``(2) Extension.--The Secretary may extend the period
            described in paragraph (1) if the Secretary determines that--
                        ``(A) the waiver has been effective in enabling the
                    State or affected recipients to carry out the
                    activities for which the waiver was requested and the
                    waiver has contributed to improved student performance;
                    and
                        ``(B) such extension is in the public interest.
        ``(e) Reports.--
                ``(1) Local waiver.--A local educational agency that
            receives a waiver under this section shall at the end of the
            second year for which a waiver is received under this section,
            and each subsequent year, submit a report to the State
            educational agency that--
                        ``(A) describes the uses of such waiver by such
                    agency or by schools;
                        ``(B) describes how schools continued to provide
                    assistance to the same populations served by the
                    programs for which waivers are requested; and
                        ``(C) evaluates the progress of such agency and of
                    schools in improving the quality of instruction or the
                    academic performance of students.
                ``(2) State waiver.--A State educational agency that
            receives reports required under paragraph (1) shall annually
            submit a report to the Secretary that is based on such reports
            and contains such information as the Secretary may require.
                ``(3) Indian tribe waiver.--An Indian tribe that receives a
            waiver under this section shall annually submit a report to the
            Secretary that--
                        ``(A) describes the uses of such waiver by schools
                    operated by such tribe; and
                        ``(B) evaluates the progress of such schools in
                    improving the quality of instruction or the academic
                    performance of students.
                ``(4) Report to congress.--Beginning in fiscal year 2002
            and each subsequent year, the Secretary shall submit to the
            Committee on Education and the Workforce of the House of
            Representatives and the Committee on Health, Education, Labor
            and Pensions of the Senate a report--
                        ``(A) summarizing the uses of waivers by State
                    educational agencies, local educational agencies,
                    Indian tribes, and schools; and
                        ``(B) describing whether such waivers--
                                ``(i) increased the quality of instruction
                            to students; or
                                ``(ii) improved the academic performance of
                            students.
        ``(f) Termination of Waivers.--The Secretary shall terminate a
    waiver under this section if the Secretary determines, after notice and
    an opportunity for a hearing, that the performance of the State or
    other recipient affected by the waiver has been inadequate to justify a
    continuation of the waiver or if the waiver is no longer necessary to
    achieve its original purposes.
        ``(g) Publication.--A notice of the Secretary's decision to grant
    each waiver under subsection (a) shall be published in the Federal
    Register and the Secretary shall provide for the dissemination of such
    notice to State educational agencies, interested parties, including
    educators, parents, students, advocacy and civil rights organizations,
    and the public.

                          ``PART E--UNIFORM PROVISIONS

    ``SEC. 8501. MAINTENANCE OF EFFORT.

        ``(a) In General.--A local educational agency may receive funds
    under a covered program for any fiscal year only if the State
    educational agency finds that either the combined fiscal effort per
    student or the aggregate expenditures of such agency and the State with
    respect to the provision of free public education by such agency for
    the preceding fiscal year was not less than 90 percent of such combined
    fiscal effort or aggregate expenditures for the second preceding fiscal
    year.
        ``(b) Reduction in Case of Failure To Meet.--
                ``(1) In general.--The State educational agency shall
            reduce the amount of the allocation of funds under a covered
            program in any fiscal year in the exact proportion to which a
            local educational agency fails to meet the requirement of
            subsection (a) of this section by falling below 90 percent of
            both the combined fiscal effort per student and aggregate
            expenditures (using the measure most favorable to such local
            agency).
                ``(2) Special rule.--No such lesser amount shall be used
            for computing the effort required under subsection (a) of this
            section for subsequent years.
        ``(c) Waiver.--The Secretary may waive the requirements of this
    section if the Secretary determines that such a waiver would be
    equitable due to--
                ``(1) exceptional or uncontrollable circumstances such as a
            natural disaster; or
                ``(2) a precipitous decline in the financial resources of
            the local educational agency.

    ``SEC. 8502. PROHIBITION REGARDING STATE AID.

        ``A State shall not take into consideration payments under this Act
    (other than under title VI) in determining the eligibility of any local
    educational agency in such State for State aid, or the amount of State
    aid, with respect to free public education of children.

    ``SEC. 8503. PARTICIPATION BY PRIVATE SCHOOL CHILDREN AND TEACHERS.

        ``(a) Private School Participation.--
                ``(1) In general.--Except as otherwise provided in this
            Act, to the extent consistent with the number of eligible
            children in areas served by a State educational agency, local
            educational agency, educational service agency, consortium of
            such agencies, or another entity receiving financial assistance
            under a program specified in subsection (b), who are enrolled
            in private elementary and secondary schools in areas served by
            such agency, consortium or entity, such agency, consortium or
            entity shall, after timely and meaningful consultation with
            appropriate private school officials, provide such children and
            their teachers or other educational personnel, on an equitable
            basis, special educational services or other benefits that
            address their needs under such program.
                ``(2) Secular, neutral, and nonideological services or
            benefits.--Educational services or other benefits, including
            materials and equipment, provided under this section, shall be
            secular, neutral, and nonideological.
                ``(3) Special rule.--Educational services and other
            benefits provided under this section for such private school
            children, teachers, and other educational personnel shall be
            equitable in comparison to services and other benefits for
            public school children, teachers, and other educational
            personnel participating in such program and shall be provided
            in a timely manner.
                ``(4) Expenditures.--Expenditures for educational services
            and other benefits provided under this section to eligible
            private school children, their teachers, and other educational
            personnel serving such children shall be equal, taking into
            account the number and educational needs of the children to be
            served, to the expenditures for participating public school
            children.
                ``(5) Provision of services.--Such agency, consortium or
            entity described in subsection (a)(1) of this section may
            provide such services directly or through contracts with public
            and private agencies, organizations, and institutions.
        ``(b) Applicability.--
                ``(1) In general.--This section applies to programs under--
                        ``(A) part B, subpart 1 of title I;
                        ``(B) part C of title I;
                        ``(C) part A of title II;
                        ``(D) part A of title III.
                        ``(E) part A of title V; and
                        ``(F) part B of title V;
                ``(2) Definition.--For the purposes of this section, the
            term `eligible children' means children eligible for services
            under a program described in paragraph (1).
        ``(c) Consultation.--
                ``(1) In general.--To ensure timely and meaningful
            consultation, a State educational agency, local educational
            agency, educational service agency, consortium of such agencies
            or entity shall consult with appropriate private school
            officials during the design and development of the programs
            under this Act, on issues such as--
                        ``(A) how the children's needs will be identified;
                        ``(B) what services will be offered;
                        ``(C) how, where, and by whom the services will be
                    provided;
                        ``(D) how the services will be assessed and how the
                    results of the assessment will be used to improve such
                    services;
                        ``(E) the size and scope of the equitable services
                    to be provided to the eligible private school children,
                    teachers, and other educational personnel and the
                    amount of funds available for such services; and
                        ``(F) how and when the agency, consortium, or
                    entity will make decisions about the delivery of
                    services, including a thorough consideration and
                    analysis of the views of the private school officials
                    on the provision of contract services through potential
                    third party providers.
                ``(2) Disagreement.--If the agency, consortium or entity
            disagrees with the views of the private school officials on the
            provision of services through a contract, the agency,
            consortium, or entity shall provide in writing to such private
            school officials an analysis of the reasons why the local
            educational agency has chosen not to use a contractor.
                ``(3) Timing.--Such consultation shall occur before the
            agency, consortium, or entity makes any decision that affects
            the opportunities of eligible private school children,
            teachers, and other educational personnel to participate in
            programs under this Act, and shall continue throughout the
            implementation and assessment of activities under this section.
                ``(4) Discussion required.--Such consultation shall include
            a discussion of service delivery mechanisms that the agency,
            consortium, or entity could use to provide equitable services
            to eligible private school children, teachers, administrators,
            and other staff.
        ``(d) Public Control of Funds.--
                ``(1) In general.--The control of funds used to provide
            services under this section, and title to materials, equipment,
            and property purchased with such funds, shall be in a public
            agency for the uses and purposes provided in this Act, and a
            public agency shall administer such funds and property.
                ``(2) Provision of services.--
                        ``(A) The provision of services under this section
                    shall be provided--
                                ``(i) by employees of a public agency; or
                                ``(ii) through contract by such public
                            agency with an individual, association, agency,
                            organization, or other entity.
                        ``(B) In the provision of such services, such
                    employee, person, association, agency, organization or
                    other entity shall be independent of such private
                    school and of any religious organization, and such
                    employment or contract shall be under the control and
                    supervision of such public agency.
                        ``(C) Funds used to provide services under this
                    section shall not be commingled with non-Federal funds.

    ``SEC. 8504. STANDARDS FOR BY-PASS.

        ``If, by reason of any provision of law, a State educational
    agency, local educational agency, educational service agency,
    consortium, or other entity of such agencies, is prohibited from
    providing for the participation in programs of children enrolled in, or
    teachers or other educational personnel from, private elementary and
    secondary schools, on an equitable basis, or if the Secretary
    determines that such agency consortium or entity has substantially
    failed or is unwilling to provide for such participation, as required
    by section 8503, the Secretary shall--
                ``(1) waive the requirements of that section for such
            agency, consortium, or entity;
                ``(2) arrange for the provision of equitable services to
            such children, teachers, or other educational personnel through
            arrangements that shall be subject to the requirements of this
            section and of sections 8503, 8505, and 8506; and
                ``(3) in making the determination, consider one or more
            factors, including the quality, size, scope, location of the
            program and the opportunity of private school children,
            teachers, and other educational personnel to participate.

    ``SEC. 8505. COMPLAINT PROCESS FOR PARTICIPATION OF PRIVATE SCHOOL
                  CHILDREN.

        ``(a) Procedures for Complaints.--The Secretary shall develop and
    implement written procedures for receiving, investigating, and
    resolving complaints from parents, teachers, or other individuals and
    organizations concerning violations of section 8503 by a State
    educational agency, local educational agency, educational service
    agency, consortium of such agencies or entity. Such individual or
    organization shall submit such complaint to the State educational
    agency for a written resolution by the State educational agency within
    a reasonable period of time.
        ``(b) Appeals to Secretary.--Such resolution may be appealed by an
    interested party to the Secretary not later than 30 days after the
    State educational agency resolves the complaint or fails to resolve the
    complaint within a reasonable period of time. Such appeal shall be
    accompanied by a copy of the State educational agency's resolution, and
    a complete statement of the reasons supporting the appeal. The
    Secretary shall investigate and resolve each such appeal not later than
    120 days after receipt of the appeal.

    ``SEC. 8506. BY-PASS DETERMINATION PROCESS.

        ``(a) Review.--
                ``(1) In general.--
                        ``(A) The Secretary shall not take any final action
                    under section 8504 until the State educational agency,
                    local educational agency, educational service agency,
                    consortium of such agencies or entity affected by such
                    action has had an opportunity, for not less than 45
                    days after receiving written notice thereof, to submit
                    written objections and to appear before the Secretary
                    to show cause why that action should not be taken.
                        ``(B) Pending final resolution of any investigation
                    or complaint that could result in a determination under
                    this section, the Secretary may withhold from the
                    allocation of the affected State or local educational
                    agency the amount estimated by the Secretary to be
                    necessary to pay the cost of those services.
                ``(2) Petition for review.--
                        ``(A) If such affected agency consortium or entity
                    is dissatisfied with the Secretary's final action after
                    a proceeding under paragraph (1), such agency
                    consortium or entity may, within 60 days after notice
                    of such action, file with the United States court of
                    appeals for the circuit in which such State is located
                    a petition for review of that action.
                        ``(B) A copy of the petition shall be forthwith
                    transmitted by the clerk of the court to the Secretary.
                        ``(C) The Secretary upon receipt of the copy of the
                    petition shall file in the court the record of the
                    proceedings on which the Secretary based this action,
                    as provided in section 2112 of title 28, United States
                    Code.
                ``(3) Findings of fact.--
                        ``(A) The findings of fact by the Secretary, if
                    supported by substantial evidence, shall be conclusive,
                    but the court, for good cause shown, may remand the
                    case to the Secretary to take further evidence and the
                    Secretary may then make new or modified findings of
                    fact and may modify the Secretary's previous action,
                    and shall file in the court the record of the further
                    proceedings.
                        ``(B) Such new or modified findings of fact shall
                    likewise be conclusive if supported by substantial
                    evidence.
                ``(4) Jurisdiction.--
                        ``(A) Upon the filing of such petition, the court
                    shall have jurisdiction to affirm the action of the
                    Secretary or to set such action aside, in whole or in
                    part.
                        ``(B) The judgment of the court shall be subject to
                    review by the Supreme Court of the United States upon
                    certiorari or certification as provided in section 1254
                    of title 28, United States Code.
        ``(b) Determination.--Any determination by the Secretary under this
    section shall continue in effect until the Secretary determines, in
    consultation with such agency, consortium or entity and representatives
    of the affected private school children, teachers, or other educational
    personnel that there will no longer be any failure or inability on the
    part of such agency or consortium to meet the applicable requirements
    of section 8503 or any other provision of this Act.
        ``(c) Payment From State allotment.--When the Secretary arranges
    for services pursuant to this section, the Secretary shall, after
    consultation with the appropriate public and private school officials,
    pay the cost of such services, including the administrative costs of
    arranging for those services, from the appropriate allocation or
    allocations under this Act.
        ``(d) Prior Determination.--Any by-pass determination by the
    Secretary under this Act as in effect on the day preceding the date of
    enactment of the No Child Left Behind Act of 2001 shall remain in
    effect to the extent the Secretary determines that such determination
    is consistent with the purpose of this section.

    ``SEC. 8507. PROHIBITION AGAINST FUNDS FOR RELIGIOUS WORSHIP OR
                  INSTRUCTION.

        ``Nothing contained in this Act shall be construed to authorize the
    making of any payment under this Act for religious worship or
    instruction.

    ``SEC. 8508. APPLICABILITY.

        ``Nothing in this Act shall be construed to affect home schools,
    whether or not a home school is treated as a home school or a private
    school under State law (consistent with section 8509), nor shall any
    home schooled student be required to participate in any assessment
    referenced in this Act.

    ``SEC. 8509. PRIVATE SCHOOLS.

        ``Nothing in this Act shall be construed to affect any private
    school that does not receive funds or services under this Act nor shall
    any student who attends a private school that does not receive funds or
    services under this Act be required to participate in any assessment
    referenced in this Act.

    ``SEC. 8510. PRIVACY OF ASSESSMENT RESULTS.

        ``Any results from individual assessments referenced in this Act
    which become part of the education records of the student shall have
    the protections as provided in section 444 of the General Education
    Provisions Act.

    ``SEC. 8511. GENERAL PROVISION REGARDING NONRECIPIENT NONPUBLIC
                  SCHOOLS.

        ``Nothing in this Act, or any other Act administered by the
    Department, shall be construed to permit, allow, encourage, or
    authorize any Federal control over any aspect of any private,
    religious, or home school, whether or not a home school is treated as a
    private school or home school under State law. This section shall not
    be construed to bar private, religious, or home schools from
    participation in programs or services under this Act.

    ``SEC. 8512. SCHOOL PRAYER.

        ``As a condition for receipt of funds under this Act, a local
    educational agency shall certify in writing to the Secretary that no
    policy of the agency prevents or otherwise denies participation in
    constitutionally protected prayer in public schools.

    ``SEC. 8513. GENERAL PROHIBITIONS.

        ``(a) Prohibition.--None of the funds authorized under this Act
    shall be used--
                ``(1) to develop or distribute materials, or operate
            programs or courses of instruction directed at youth that are
            designed to promote or encourage, sexual activity, whether
            homosexual or heterosexual;
                ``(2) to distribute or to aid in the distribution by any
            organization of legally obscene materials to minors on school
            grounds;
                ``(3) to provide sex education or HIV prevention education
            in schools unless such instruction is age appropriate and
            emphasizes the health benefits of abstinence; or
                ``(4) to operate a program of contraceptive distribution in
            schools.
        ``(b) Local control.--Nothing in this section shall be construed
    to--
                ``(1) authorize an officer or employee of the Federal
            Government to direct, review, or control a State, local
            educational agency, or schools' instructional content,
            curriculum, and related activities;
                ``(2) limit the application of the General Education
            Provisions Act (20 U.S.C.A. 1221 et seq.);
                ``(3) require the distribution of scientifically or
            medically false or inaccurate materials or to prohibit the
            distribution of scientifically or medically true or accurate
            materials; or
                ``(4) create any legally enforceable right.

    ``SEC. 8514. PROHIBITION ON FEDERAL MANDATES, DIRECTION, AND CONTROL.

        ``(a) General Prohibition.--Officers and employees of the Federal
    Government are prohibited from mandating, directing, or controlling a
    State, local educational agency, or school's curriculum, program of
    instruction, or allocation of State or local resources, or mandating a
    State or any subdivision thereof to spend any funds or incur any costs
    not paid for under this Act.
        ``(b) Prohibition of Federal Mandates, Direction, or Control.--
    Nothing in this Act shall be construed to authorize an officer or
    employee of the Federal Government to mandate, direct, or control a
    State, local educational agency, or school's specific instructional
    content or academic achievement standards and assessments, curriculum,
    or program of instruction as a condition of eligibility to receive
    funds under this Act.
        ``(c) Equalized Spending.--Nothing in this Act shall be construed
    to mandate equalized spending per pupil for a State, local educational
    agency, or school.
        ``(d) Building Standards.--Nothing in this Act shall be construed
    to mandate national school building standards for a State, local
    agency, or school.

    ``SEC. 8515. RULEMAKING.

        ``The Secretary shall issue regulations under this Act only to the
    extent that such regulations are necessary to ensure that there is
    compliance with the specific requirements and assurances required by
    this Act.

    ``SEC. 8516. REPORT.

        ``The Secretary shall report to the Congress not later than 180
    days after the date of enactment of the No Child Left Behind Act of
    2001 regarding how the Secretary shall ensure that audits conducted by
    Department employees of activities assisted under this Act comply with
    changes to this Act made by the No Child Left Behind Act of 2001,
    particularly with respect to permitting children with similar
    educational needs to be served in the same educational settings, where
    appropriate.

    ``SEC. 8517. REQUIRED APPROVAL OR CERTIFICATION PROHIBITED.

        ``(a) In General.--Notwithstanding any other provision of Federal
    law, no State shall be required to have academic content standards or
    student academic achievement standards approved or certified by the
    Federal Government, in order to receive assistance under this Act.
        ``(b) Construction.--Nothing in this section shall be construed to
    affect requirements under title I of this Act.

    ``SEC. 8518. PROHIBITION ON ENDORSEMENT OF CURRICULUM.

        ``Notwithstanding any other prohibition of Federal law, no funds
    provided to the Department of Education or to any applicable program
    may be used by the Department to endorse, approve, or sanction any
    curriculum designed to be used in an elementary or secondary school.

    ``SEC. 8519. RULE OF CONSTRUCTION ON PERSONALLY IDENTIFIABLE
                  INFORMATION.

        ``Nothing in this Act shall be construed to permit the development
    of a national database of personally identifiable information on
    individuals involved in studies or in data collection efforts under
    this Act.

    ``SEC. 8520. SEVERABILITY.

        ``If any provision of this Act is held invalid, the remainder of
    this Act shall be unaffected thereby.

                          ``PART F--SENSE OF CONGRESS

    ``SEC. 8601. PAPERWORK REDUCTION.

        ``(a) Findings.--The Congress finds that--
                ``(1) instruction and other classroom activities provide
            the greatest opportunity for students, especially at-risk and
            disadvantaged students, to attain high standards and achieve
            academic success;
                ``(2) one of the greatest obstacles to establishing an
            effective, classroom-centered education system is the cost of
            paperwork compliance;
                ``(3) paperwork places a burden on teachers and
            administrators who must complete Federal and State forms to
            apply for Federal funds and absorbs time and money which
            otherwise would be spent on students;
                ``(4) the Education at a Crossroads Report released in 1998
            by the Education Subcommittee on Oversight and Investigations
            states that requirements by the Department of Education result
            in more than 48,600,000 hours of paperwork per year; and
                ``(5) paperwork distracts from the mission of schools,
            encumbers teachers, and administrators with nonacademic
            responsibilities, and competes with teaching and classroom
            activities which promote learning and achievement.
        ``(b) Sense of Congress.--It is the sense of Congress that Federal
    and State educational agencies should reduce the paperwork requirements
    placed on schools, teachers, principles, and other administrators.

    ``SEC. 8602. PROHIBITION ON MANDATORY NATIONAL CERTIFICATION OF
                  TEACHERS AND PARAPROFESSIONALS.

        ``(a) Prohibition on Mandatory Testing or Certification.--
    Notwithstanding any other provision of law, the Secretary is prohibited
    from using Federal funds to plan, develop, implement, or administer any
    mandatory national teacher or paraprofessional test or certification.
        ``(b) Prohibition on Withholding Funds.--The Secretary is
    prohibited from withholding funds from any State or local educational
    agency if such State or local educational agency fails to adopt a
    specific method of teacher or paraprofessional certification.

    ``SEC. 8603. PROHIBITION ON FEDERALLY SPONSORED TESTING.

        ``Notwithstanding any other provision of Federal law, no funds
    provided under this Act to the Secretary or to the recipient of any
    award may be used to develop, pilot test, field test, implement,
    administer, or distribute any federally sponsored national test in
    reading, mathematics, or any other subject, unless specifically and
    explicitly authorized by law.

    ``SEC. 8604. SENSE OF CONGRESS REGARDING MEMORIALS.

        ``It is the sense of Congress that--
                ``(1) the saying of a prayer, the reading of a scripture,
            or the performance of religious music, as part of a memorial
            service that is held on the campus of a public elementary or
            secondary school in order to honor the memory of any person
            slain on that campus is not objectionable under this Act; and
                ``(2) the design and construction of any memorial which
            includes religious symbols, motifs, or sayings that is placed
            on the campus of a public elementary or secondary school in
            order to honor the memory of any person slain on that campus is
            not objectionable under this Act.

                             ``PART G--EVALUATIONS

    ``SEC. 8651. EVALUATIONS.

        ``(a) Reservation of Funds.--Except as provided in subsections (b)
    and (c), the Secretary may reserve not more than 0.5 percent of the
    amount appropriated to carry out each categorical program and
    demonstration project authorized under this Act--
                ``(1) to conduct--
                        ``(A) comprehensive evaluations of the program or
                    project; and
                        ``(B) studies of the effectiveness of the programs
                    or project and its administrative impact on schools and
                    local educational agencies;
                ``(2) to evaluate the aggregate short- and long-term
            effects and cost efficiencies across Federal programs assisted
            or authorized under this Act and related Federal preschool,
            elementary and secondary programs under any other Federal law;
            and
                ``(3) to increase the usefulness of evaluations of grant
            recipients in order to ensure the continuous progress of the
            program or project by improving the quality, timeliness,
            efficiency, and utilization of information relating to
            performance under the program or project.
        ``(b) Title I Excluded.--The Secretary may not reserve under
    subsection (a) funds appropriated to carry out any program authorized
    under title I.
        ``(c) Evaluation Activities Authorized Elsewhere.--If, under any
    other provision of this Act (other than title I), funds are authorized
    to be reserved or used for evaluation activities with respect to a
    program or project, the Secretary may not reserve additional funds
    under this section for the evaluation of such program or project.''.

    SEC. 802. COMPREHENSIVE REGIONAL ASSISTANCE CENTERS.

        (a) In General.--Part A of title XIII (20 U.S.C. 8621 et seq.)--
                (1) is transferred to the end of title VIII, as amended by
            section 801; and
                (2) is redesignated as part H.
        (b) Redesignation of Sections.--Sections 13101 through 13105 are
    redesignated as sections 8701 through 8705, respectively.
        (c) Conforming Amendments.--
                (1) Requirements.--Section 8702(a) (as redesignated by
            subsection (b)) is amended--
                        (A) by striking ``section 13101(a)'' and inserting
                    ``section 8701(a)''; and
                        (B) in paragraph (7), by striking ``section 13201''
                    and inserting ``section 8751''.
                (2) Maintenance of service.--Section 8703(b) (as
            redesignated by subsection (b)) is amended--
                        (A) in paragraph (1), by striking ``section 13102''
                    and inserting ``section 8702''; and
                        (B) in paragraph (2)--
                                (i) by striking ``section 13201'' and
                            inserting ``section 8751''; and
                                (ii) by striking ``section 13401'' and
                            inserting ``section 8851''.
                (3) Transition.--Section 8704(b)(1) (as redesignated by
            subsection (b)) is amended by striking ``section 13105'' and
            inserting ``section 8705''.

    SEC. 803. NATIONAL DIFFUSION NETWORK.

        (a) In General.--Part B of title XIII (20 U.S.C. 8651 et seq.)--
                (1) is transferred to the end of title VIII, as amended by
            section 802; and
                (2) is redesignated as part I.
        (b) Redesignation of Sections.--Sections 13201 and 13202 are
    redesignated as sections 8751 and 8752, respectively.
        (c) Conforming Amendment.--Section 8751 (as redesignated by
    subsection (b)) is amended--
                (1) in subsection (e)(3), by striking ``under part C''
            through the end thereof and inserting ``under part F; and'';
            and
                (2) in subsection (f)(4), by striking ``section 13401'' and
            inserting ``section 8851''.

    SEC. 804. EISENHOWER REGIONAL MATHEMATICS AND SCIENCE EDUCATION
                  CONSORTIA.

        (a) In General.--Part C of title XIII (20 U.S.C. 8671 et seq.)--
                (1) is transferred to the end of title VIII, as amended by
            section 803; and
                (2) is redesignated as part J.
        (b) Redesignation of Sections.--Sections 13301 through 13308 are
    redesignated as sections 8801 through 8808, respectively.
        (c) Conforming Amendments.--
                (1) Grant authorization.--Section 8801(a)(3) (as
            redesignated by subsection (b)) is amended by striking
            ``section 13308'' and inserting ``section 8808''.
                (2) Use of funds.--Section 8802 (as redesignated by
            subsection (b)) is amended--
                        (A) by striking ``section 13304'' and inserting
                    ``section 8804'';
                        (B) in paragraph (2), by striking ``13301(a)(1)''
                    and inserting ``8801(a)(1)''; and
                        (C) in paragraph (3), by striking ``13301(a)(1)''
                    and inserting ``8801(a)(1)''.
                (3) Payments.--Section 8805 (as redesignated by subsection
            (b)) is amended in each of subsections (a) and (c) by striking
            ``section 13303'' and inserting ``section 8803''.
                (4) Evaluation.--Section 8806(a) (as redesignated by
            subsection (b)) is amended by striking ``section 14701'' and
            inserting ``section 8651''.
                (5) Definitions.--Section 8807(4) (as redesignated by
            subsection (b)) is amended by striking ``section 13301'' and
            inserting ``section 8801''.

    SEC. 805. TECHNOLOGY-BASED TECHNICAL ASSISTANCE.

        (a) In General.--Part D of title XIII (20 U.S.C. 8701)--
                (1) is transferred to the end of title VIII, as amended by
            section 804; and
                (2) is redesignated as part K.
        (b) Redesignation of Section.--Section 13401 is redesignated as
    section 8851.

    SEC. 806. REGIONAL TECHNICAL SUPPORT AND PROFESSIONAL DEVELOPMENT.

        (a) In General.--Subpart 3 of part A of title III (20 U.S.C. 6861
    et seq.)--
                (1) is transferred to the end of title VIII, as amended by
            section 805; and
                (2) is redesignated as part L.
        (b) Redesignation of Section.--Section 3141 is redesignated as
    section 8901.
        (c) Conforming Amendment.--Section 8901 (as redesignated by
    subsection (b)) is amended by striking ``part C of title XIII'' and
    inserting ``part J''.

                       TITLE IX--MISCELLANEOUS PROVISIONS

                        PART A--AMENDMENTS TO OTHER ACTS

                  Subpart 1--National Education Statistics Act

    SEC. 901. AMENDMENT TO NESA.

        Section 411 of the National Education Statistics Act of 1994 (20
    U.S.C. 9010) is amended--
                (1) by amending subsection (b)(2) to read as follows:
                ``(2) State assessments.--(A) The Commissioner, in carrying
            out the National Assessment--
                        ``(i) may conduct State assessments of student
                    achievement in grades 4, 8, and 12; and
                        ``(ii) shall conduct annual State assessments of
                    student achievement in reading and mathematics in
                    grades 4 and 8 in order for States to carry out section
                    1111(c)(2) of the Elementary and Secondary Education
                    Act of 1965.
                ``(B)(i) Except as provided in clause (ii), a participating
            State shall review and give permission for the release of
            results from any test of its students administered as a part of
            a State assessment prior to the release of the data. Refusal by
            a State to release its data shall not restrict the release of
            data from other States that have approved the release of that
            data.
                ``(ii) A State participating in the annual State
            assessments of its students in reading and mathematics in
            grades 4 and 8 shall be deemed to have given its permission to
            release its data if it has an approved plan under section 1111
            of the Elementary and Secondary Education Act of 1965.''; and
                (2) by amending subsection (d) to read as follows:
        ``(d) Participation.--
                ``(1) National and regional participation.--Participation
            in the national and regional assessments by State and local
            educational agencies shall be voluntary.
                ``(2) State participation.--Participation in assessments
            made on a State basis shall be voluntary.''.

                         Subpart 2--Homeless Education

    SEC. 911. SHORT TITLE.

        This subpart may be cited as the ``McKinney-Vento Homeless
    Education Assistance Improvements Act of 2001''.

    SEC. 912. FINDINGS.

        Congress makes the following findings:
                (1) An estimated 1,000,000 children in the United States
            will experience homelessness in 2001.
                (2) Homelessness has a devastating impact on the
            educational opportunities of children and youth. Homeless
            children go hungry at more than twice the rate of other
            children, have four times the rate of delayed development, and
            are twice as likely to repeat a grade.
                (3) Despite steady progress in school enrollment and
            attendance resulting from the passage in 1987 of the Stewart B.
            McKinney Homeless Assistance Act (42 U.S.C. 11301 et seq.),
            homeless students still face numerous barriers to education,
            including residency, guardianship and registration
            requirements, delays in the transfer of school records, and
            inadequate transportation service.
                (4) School is one of the few secure factors in the lives of
            homeless children and youth, providing stability, structure,
            and accomplishment during a time of great upheaval.
                (5) Homeless children and youth require educational
            stability and the opportunity to maintain regular and
            consistent attendance in school, so that they acquire the
            skills necessary to escape poverty and lead productive, healthy
            lives as adults.
                (6) In the 14 years since the passage of the Stewart B.
            McKinney Homeless Assistance Act (42 U.S.C. 11301 et seq.),
            educators and service providers have learned much about
            policies and practices which help remove the barriers
            described.

    SEC. 913. PURPOSE.

        The purpose of this subpart is to strengthen subtitle B of title
    VII of Public Law 100-77 (42 U.S.C. 11431 et seq.) by amending it--
                (1) to include innovative practices, proven to be effective
            in helping homeless children and youth enroll, attend, and
            succeed in school; and
                (2) to help ensure that all children and youth impacted by
            the loss of fixed, regular, and adequate housing receive a
            quality education and secure their chance for a brighter
            future.

    SEC. 914. EDUCATION FOR HOMELESS CHILDREN AND YOUTH.

        Subtitle B of title VII of Public Law 100-77 (42 U.S.C. 11431 et
    seq.) is amended to read as follows:

            ``Subtitle B--Education for Homeless Children and Youth

    ``SEC. 721. STATEMENT OF POLICY.

        ``It is the policy of the Congress that--
                ``(1) each State educational agency ensure that each child
            of a homeless individual and each homeless youth has equal
            access to the same free, public education, including a public
            preschool education, as provided to other children and youth;
                ``(2) in any State that has a compulsory residency
            requirement as a component of the State's compulsory school
            attendance laws or other laws, regulations, practices, or
            policies that may act as a barrier to the enrollment,
            attendance, or success in school of homeless children and
            youth, the State review and undertake steps to revise such
            laws, regulations, practices, or policies to ensure that
            homeless children and youth are afforded the same free, public
            education as provided to other children and youth;
                ``(3) homelessness alone is not sufficient reason to
            separate students from the mainstream school environment; and
                ``(4) homeless children and youth must have access to the
            education and other services that such children and youth need
            to ensure that such children and youth have an opportunity to
            meet the same challenging State student academic achievement
            standards to which all students are held.

    ``SEC. 722. GRANTS FOR STATE AND LOCAL ACTIVITIES FOR THE EDUCATION OF
                  HOMELESS CHILDREN AND YOUTH.

        ``(a) General Authority.--The Secretary is authorized to make
    grants to States in accordance with the provisions of this section to
    enable such States to carry out the activities described in subsections
    (d), (e), (f), and (g).
        ``(b) Application.--No State may receive a grant under this section
    unless the State educational agency submits an application to the
    Secretary at such time, in such manner, and containing or accompanied
    by such information as the Secretary may reasonably require.
        ``(c) Allocation and Reservations.--
                ``(1) In general.--Subject to paragraph (2) and section
            724(d), from the amounts appropriated for each fiscal year
            under section 726, the Secretary is authorized to allot to each
            State an amount that bears the same ratio to the amount
            appropriated for such year under section 726 as the amount
            allocated under section 1122 of the Elementary and Secondary
            Education Act of 1965 to the State for that year bears to the
            total amount allocated under section 1122 of such Act to all
            States for that year, except that no State shall receive less
            than $125,000 or \1/2\ of 1 percent of the amount appropriated
            under section 726, whichever is greater.
                ``(2) Reservation.--(A) The Secretary is authorized to
            reserve 0.1 percent of the amount appropriated for each fiscal
            year under section 726 to be allocated by the Secretary among
            the United States Virgin Islands, Guam, American Samoa, and the
            Commonwealth of the Northern Mariana Islands, according to
            their respective need for assistance under this subtitle, as
            determined by the Secretary.
                ``(B)(i) The Secretary shall transfer one percent of the
            amount appropriated for each fiscal year under section 726 to
            the Department of the Interior for programs for Indian students
            served by schools funded by the Secretary of the Interior, as
            determined under the Indian Self-Determination and Education
            Assistance Act (25 U.S.C. 450 et seq.), that are consistent
            with the purposes of this Act.
                ``(ii) The Secretary and the Secretary of the Interior
            shall enter into an agreement, consistent with the requirements
            of this part, for the distribution and use of the funds
            described in clause (i) under terms that the Secretary
            determines best meet the purposes of the programs described in
            such clause. Such agreement shall set forth the plans of the
            Secretary of the Interior for the use of the amounts
            transferred, including appropriate goals, objectives, and
            milestones.
                ``(3) State Defined.--As used in this subsection, the term
            `State' shall not include the United States Virgin Islands,
            Guam, American Samoa, and the Commonwealth of the Northern
            Mariana Islands.
        ``(d) Activities.--Grants under this section shall be used--
                ``(1) to carry out the policies set forth in section 721 in
            the State;
                ``(2) to provide activities for, and services to, homeless
            children, including preschool-aged homeless children, and youth
            that enable such children and youth to enroll in, attend, and
            succeed in school, or, if appropriate, in preschool programs;
                ``(3) to establish or designate an Office of Coordinator of
            Education of Homeless Children and Youth in the State
            educational agency in accordance with subsection (f);
                ``(4) to prepare and carry out the State plan described in
            subsection (g); and
                ``(5) to develop and implement professional development
            programs for school personnel to heighten their awareness of,
            and capacity to respond to, specific problems in the education
            of homeless children and youth.
        ``(e) State and Local Grants.--
                ``(1) Minimum disbursements by states.--From the sums made
            available each year to carry out this subtitle, the State
            educational agency shall distribute not less than 75 percent in
            grants to local educational agencies for the purposes of
            carrying out section 723, except that States funded at the
            minimum level set forth in subsection (c)(1) shall distribute
            not less than 50 percent in grants to local educational
            agencies for the purposes of carrying out section 723.
                ``(2) Use by state educational agency.--A State educational
            agency may use funds made available for State use under this
            subtitle to conduct activities under subsection (f) directly or
            through grants.
                ``(3) Prohibition on segregating homeless students.--
                        ``(A) In general.--Except as provided in
                    subparagraph (B) and section 723(a)(2)(B)(ii), in
                    providing a free public education to a homeless child
                    or youth, no State receiving funds under this subtitle
                    shall segregate such child or youth, either in a
                    separate school or in a separate program within a
                    school, based solely on such child's or youth's status
                    as homeless.
                        ``(B) Exception.--A State that operates a separate
                    school for homeless children as of the day preceding
                    the date of enactment of the McKinney-Vento Homeless
                    Education Assistance Improvements Act of 2001--
                                ``(i) shall remain eligible to receive, and
                            to distribute to local educational agencies,
                            funds under this subtitle for such school; and
                                ``(ii) shall not distribute to local
                            educational agencies in the State any funds
                            received under this subtitle for use by any
                            such schools not in operation as of such date
                            of enactment.
        ``(f) Functions of the Office of Coordinator.--The Coordinator of
    Education of Homeless Children and Youth established in each State
    shall--
                ``(1) gather, to the extent possible, reliable, valid, and
            comprehensive information on the nature and extent of the
            problems homeless children and youth have in gaining access to
            public preschool programs and to public elementary and
            secondary schools, the difficulties in identifying the special
            needs of such children and youth, any progress made by the
            State educational agency and local educational agencies in the
            State in addressing such problems and difficulties, and the
            success of the program under this subtitle in assisting
            homeless children and youth to enroll in, attend, and succeed
            in, school;
                ``(2) develop and carry out the State plan described in
            subsection (g);
                ``(3) collect and transmit to the Secretary information
            gathered pursuant to paragraphs (1) and (2) at such time and in
            such manner as the Secretary may require;
                ``(4) facilitate coordination between the State educational
            agency, the State social services agency, and other agencies
            providing services to homeless children and youth, including
            homeless children, including preschool-aged homeless children,
            and youth, and families of such children and youth;
                ``(5) in order to improve the provision of comprehensive
            education and related services to homeless children and youth
            and their families, coordinate and collaborate with--
                        ``(A) educators, including child development and
                    preschool program personnel;
                        ``(B) State and local providers of services to
                    homeless and runaway children and youth and homeless
                    families (including domestic violence agencies, shelter
                    operators, transitional housing facilities, runaway and
                    homeless youth centers, and transitional living
                    programs for homeless youth);
                        ``(C) local educational agency liaisons for
                    homeless children and youth; and
                        ``(D) State and local community organizations and
                    groups representing homeless children and youth and
                    their families; and
                ``(6) provide technical assistance to local educational
            agencies, in coordination with local liaisons designated under
            subsection (g)(1)(J)(ii), to ensure that local educational
            agencies comply with the requirements of paragraphs (3) through
            (7) of subsection (g).
        ``(g) State Plan.--
                ``(1) In general.--Each State shall submit to the Secretary
            a plan to provide for the education of homeless children and
            youth within the State, which plan shall--
                        ``(A) describe how such children and youth are or
                    will be given the opportunity to meet the same
                    challenging State student academic achievement
                    standards all students are expected to meet;
                        ``(B) describe the procedures the State educational
                    agency will use to identify such children and youth in
                    the State and to assess their special needs;
                        ``(C) describe procedures for the prompt resolution
                    of disputes regarding the educational placement of
                    homeless children and youth;
                        ``(D) describe programs for school personnel
                    (including principals, attendance officers, teachers,
                    enrollment personnel, and pupil services personnel) to
                    heighten the awareness of such personnel of the
                    specific needs of runaway and homeless youth;
                        ``(E) describe procedures that ensure that homeless
                    children and youth who meet the relevant eligibility
                    criteria are able to participate in Federal, State, or
                    local food programs;
                        ``(F) describe procedures that ensure that--
                                ``(i) homeless children have equal access
                            to the same public preschool programs,
                            administered by the State agency, as provided
                            to other children;
                                ``(ii) homeless youth and youth separated
                            from the public schools are identified and
                            accorded equal access to appropriate secondary
                            education and support services; and
                                ``(iii) homeless children and youth who
                            meet the relevant eligibility criteria are able
                            to participate in Federal, State, or local
                            before- and after-school care programs;
                        ``(G) address problems set forth in the report
                    provided to the Secretary under subsection (f)(3);
                        ``(H) address other problems with respect to the
                    education of homeless children and youth, including
                    problems caused by enrollment delays that are caused
                    by--
                                ``(i) immunization and medical records
                            requirements;
                                ``(ii) residency requirements;
                                ``(iii) lack of birth certificates, school
                            records, or other documentation;
                                ``(iv) guardianship issues; or
                                ``(v) uniform or dress code requirements;
                        ``(I) demonstrate that the State educational agency
                    and local educational agencies in the State have
                    developed, and shall review and revise, policies to
                    remove barriers to the enrollment and retention of
                    homeless children and youth in schools in the State;
                    and
                        ``(J) contain assurances that--
                                ``(i) except as provided in subsection
                            (e)(3)(B), State and local educational agencies
                            will adopt policies and practices to ensure
                            that homeless children and youth are not
                            segregated solely on the basis of their status
                            as homeless;
                                ``(ii) local educational agencies will
                            designate an appropriate staff person, who may
                            also be a coordinator for other Federal
                            programs, as a liaison for homeless children
                            and youth, to carry out the duties described in
                            paragraph (6)(A); and
                                ``(iii) the State and its local educational
                            agencies will adopt policies and practices to
                            ensure that transportation is provided, at the
                            request of the parent or guardian (or in the
                            case of an unaccompanied youth, the liaison) to
                            and from the school of origin, as determined in
                            paragraph (3)(A), in accordance with the
                            following, as applicable:
                                        ``(I) If the homeless child or
                                    youth continues to live in the area
                                    served by the local educational agency
                                    in which the school of origin is
                                    located, the child's or youth's
                                    transportation to and from the school
                                    of origin shall be provided or arranged
                                    by the local educational agency in
                                    which the school of origin is located.
                                        ``(II) If the homeless child's or
                                    youth's living arrangements in the area
                                    served by the local educational agency
                                    of origin terminate and the child or
                                    youth, though continuing his or her
                                    education in the school of origin,
                                    begins living in the area served by
                                    another local educational agency, the
                                    local educational agency of origin and
                                    the local educational agency in which
                                    the homeless child or youth is living
                                    shall agree upon a method to apportion
                                    the responsibility and costs for
                                    providing the child with transportation
                                    to and from the school or origin. If
                                    the local educational agencies are
                                    unable to agree upon such method, the
                                    responsibility and costs for
                                    transportation shall be shared equally.
                ``(2) Compliance.--
                        ``(A) In general.--Each plan adopted under this
                    subsection shall also describe how the State will
                    ensure that local educational agencies in the State
                    will comply with the requirements of paragraphs (3)
                    through (7).
                        ``(B) Coordination.--Such plan shall indicate what
                    technical assistance the State will furnish to local
                    educational agencies and how compliance efforts will be
                    coordinated with the local liaisons established under
                    this subchapter.
                ``(3) Local educational agency requirements.--
                        ``(A) In general.--The local educational agency
                    serving each child or youth to be assisted under this
                    subtitle shall, according to the child's or youth's
                    best interest, either--
                                ``(i) continue the child's or youth's
                            education in the school of origin for the
                            duration of homelessness--
                                        ``(I) in any case in which a family
                                    becomes homeless between academic years
                                    or during the academic year; or
                                        ``(II) for the remainder of the
                                    academic year, if the child becomes
                                    permanently housed during the academic
                                    year; or
                                ``(ii) enroll the child or youth in any
                            public school that nonhomeless students who
                            live in the attendance area in which the child
                            or youth is actually living are eligible to
                            attend.
                        ``(B) Best interest.--In determining the best
                    interest of the child or youth under subparagraph (A),
                    the local educational agency shall--
                                ``(i) to the extent feasible, keep a
                            homeless child or youth in the school of
                            origin, except when doing so is contrary to the
                            wishes of the child's or youth's parent or
                            guardian;
                                ``(ii) provide a written explanation,
                            including a statement regarding the right to
                            appeal under subparagraph (E), to the homeless
                            child's or youth's parent or guardian if the
                            local educational agency sends such child or
                            youth to a school other than the school of
                            origin or a school requested by the parent or
                            guardian; and
                                ``(iii) in the case of an unaccompanied
                            youth, ensure that the homeless liaison
                            designated under paragraph (1)(J)(2) assists in
                            placement or enrollment decisions under this
                            subparagraph and provides notice to such youth
                            of the right to appeal under subparagraph (E).
                        ``(C) Enrollment.--(i) The school selected in
                    accordance with this paragraph shall immediately enroll
                    pursuant to section 725(3) the homeless child or youth,
                    even if the child or youth is unable to produce records
                    normally required for enrollment, such as previous
                    academic records, medical records, proof of residency,
                    or other documentation.
                        ``(ii) The enrolling school shall immediately
                    contact the school last attended by the child or youth
                    to obtain relevant academic and other records.
                        ``(iii) If the child or youth needs to obtain
                    immunizations or immunization or medical records, the
                    enrolling school shall immediately refer the parent or
                    guardian of the child or youth to the liaison who shall
                    assist in obtaining necessary immunizations or
                    immunization or medical records in accordance with
                    subparagraph (E).
                        ``(D) Records.--Any record ordinarily kept by the
                    school, including immunization or medical records,
                    academic records, birth certificates, guardianship
                    records, and evaluations for special services or
                    programs, of each homeless child or youth shall be
                    maintained--
                                ``(i) so that the records are available, in
                            a timely fashion, when a child or youth enters
                            a new school or school district; and
                                ``(ii) in a manner consistent with section
                            444 of the General Education Provisions Act (20
                            U.S.C. 1232g).
                        ``(E) Enrollment disputes.--If a dispute arises
                    over school selection or enrollment in a school--
                                ``(i) the child or youth shall be
                            immediately admitted to the school in which
                            enrollment is sought, pending resolution of the
                            dispute;
                                ``(ii) the parent or guardian of the child
                            or youth shall be provided with a written
                            explanation of the school's decision regarding
                            school selection or enrollment, including the
                            rights of the parent, guardian, or youth to
                            appeal the decision;
                                ``(iii) the child, youth, parent, or
                            guardian shall be referred to the local liaison
                            designated under paragraph (1)(J)(ii), who
                            shall carry out the dispute resolution process
                            as described in paragraph (1)(A) as
                            expeditiously as possible after receiving
                            notice of the dispute; and
                                ``(iv) in the case of an unaccompanied
                            youth, the homeless liaison shall ensure that
                            the youth is immediately enrolled in school
                            pending resolution of the dispute.
                        ``(F) Placement choice.--The choice regarding
                    placement shall be made regardless of whether the child
                    or youth lives with the homeless parents or has been
                    temporarily placed elsewhere.
                        ``(G) School of origin defined.--In this paragraph,
                    the term `school of origin' means the school that the
                    child or youth attended when permanently housed or the
                    school in which the child or youth was last enrolled.
                        ``(H) Contact information.--Nothing in this
                    subtitle shall prohibit a local educational agency from
                    requiring a parent or guardian of a homeless child to
                    submit contact information required by the local
                    educational agency of a parent or guardian of a
                    nonhomeless child.
                ``(4) Comparable services.--Each homeless child or youth to
            be assisted under this subtitle shall be provided services
            comparable to services offered to other students in the school
            selected under paragraph (3), including--
                        ``(A) transportation services;
                        ``(B) educational services for which the child or
                    youth meets the eligibility criteria, such as services
                    provided under title I of the Elementary and Secondary
                    Education Act of 1965 or similar State or local
                    programs, educational programs for children with
                    disabilities, and educational programs for students
                    with limited-English proficiency;
                        ``(C) programs in vocational and technical
                    education;
                        ``(D) programs for gifted and talented students;
                    and
                        ``(E) school nutrition programs.
                ``(5) Coordination.--
                        ``(A) In general.--Each local educational agency
                    serving homeless children and youth that receives
                    assistance under this subtitle shall coordinate--
                                ``(i) the provision of services under this
                            subtitle with local social services agencies
                            and other agencies or programs providing
                            services to homeless children and youth and
                            their families, including services and programs
                            funded under the Runaway and Homeless Youth Act
                            (42 U.S.C. 5701 et seq.); and
                                ``(ii) with other local educational
                            agencies on interdistrict issues, such as
                            transportation or transfer of school records.
                        ``(B) Housing assistance.--If applicable, each
                    State and local educational agency that receives
                    assistance under this subtitle shall coordinate with
                    State and local housing agencies responsible for
                    developing the comprehensive housing affordability
                    strategy described in section 105 of the Cranston-
                    Gonzales National Affordable Housing Act (42 U.S.C.
                    12705) to minimize educational disruption for children
                    and youth who become homeless.
                        ``(C) Coordination purpose.--The coordination
                    required under subparagraphs (A) and (B) shall be
                    designed to--
                                ``(i) ensure that homeless children and
                            youth have access and reasonable proximity to
                            available education and related support
                            services; and
                                ``(ii) raise the awareness of school
                            personnel and service providers of the effects
                            of short-term stays in a shelter and other
                            challenges associated with homelessness.
                ``(6) Liaison.--
                        ``(A) Duties.--Each local liaison for homeless
                    children and youth, designated under paragraph
                    (1)(J)(ii), shall ensure that--
                                ``(i) homeless children and youth are
                            identified by school personnel and through
                            coordination activities with other entities and
                            agencies;
                                ``(ii) homeless children and youth enroll
                            in, and have an equal opportunity to succeed
                            in, schools of that agency;
                                ``(iii) homeless families, children, and
                            youth receive educational services for which
                            such families, children, and youth are
                            eligible, including Head Start and Even Start
                            programs and preschool programs administered by
                            the local educational agency, and referrals to
                            health care services, dental services, mental
                            health services, and other appropriate
                            services;
                                ``(iv) the parents or guardians of homeless
                            children and youth are informed of the
                            education and related opportunities available
                            to their children and are provided with
                            meaningful opportunities to participate in the
                            education of their children;
                                ``(v) public notice of the educational
                            rights of homeless children and youth is
                            disseminated where such children and youth
                            receive services under this Act, such as
                            schools, family shelters, and soup kitchens;
                                ``(vi) enrollment disputes are mediated in
                            accordance with subsection (g)(3)(E); and
                                ``(vii) the parent or guardian of a
                            homeless child or youth, and any unaccompanied
                            youth, is fully informed of all transportation
                            services, including transportation to the
                            school of origin, as described in paragraph
                            (1)(J)(ii), and is assisted in accessing
                            transportation to the school selected in
                            accordance with paragraph (3)(A).
                        ``(B) Notice.--State coordinators whose duties are
                    described under subsection (d) and local educational
                    agencies shall inform school personnel, service
                    providers, and advocates working with homeless families
                    of the duties of the liaisons.
                        ``(C) Local and state coordination.--Local
                    educational agency liaisons for homeless children and
                    youth shall, as a part of their duties, coordinate and
                    collaborate with State coordinators and community and
                    school personnel responsible for the provision of
                    education and related services to homeless children and
                    youth.
                ``(7) Review and revisions.--
                        ``(A) In general.--Each State educational agency
                    and local educational agency that receives assistance
                    under this subtitle, shall review and revise any
                    policies that may act as barriers to the enrollment of
                    homeless children and youth in schools selected in
                    accordance with paragraph (3).
                        ``(B) Consideration.--In reviewing and revising
                    such policies, consideration shall be given to issues
                    concerning transportation, immunization, residency,
                    birth certificates, school records and other
                    documentation, and guardianship.
                        ``(C) Special attention.--Special attention shall
                    be given to ensuring the enrollment and attendance of
                    homeless children and youth who are not currently
                    attending school.

    ``SEC. 723. LOCAL EDUCATIONAL AGENCY GRANTS FOR THE EDUCATION OF
                  HOMELESS CHILDREN AND YOUTH.

        ``(a) General Authority.--
                ``(1) In general.--The State educational agency shall, in
            accordance with section 722(e) and from amounts made available
            to such agency under section 726, make grants to local
            educational agencies for the purpose of facilitating the
            enrollment, attendance, and success in school of homeless
            children and youth.
                ``(2) Services.--
                        ``(A) In general.--Services under paragraph (1)--
                                ``(i) may be provided through programs on
                            school grounds or at other facilities;
                                ``(ii) shall, to the maximum extent
                            practicable, be provided through existing
                            programs and mechanisms that integrate homeless
                            children and youth with nonhomeless children
                            and youth; and
                                ``(iii) shall be designed to expand or
                            improve services provided as part of a school's
                            regular academic program, but not to replace
                            such services provided under such program.
                        ``(B) Services on school grounds.--If services
                    under paragraph (1) are provided on school grounds,
                    schools--
                                ``(i) may use funds under this subtitle to
                            provide the same services to other children and
                            youth who are determined by the local
                            educational agency to be at risk of failing in,
                            or dropping out of, schools, subject to the
                            requirements of clause (ii); and
                                ``(ii) except as otherwise provided in
                            section 722(e)(3)(B), shall not provide
                            services in settings within a school that
                            segregates homeless children and youth from
                            other children and youth, except as is
                            necessary for short periods of time--
                                        ``(I) for health and safety
                                    emergencies; or
                                        ``(II) to provide temporary,
                                    special, and supplementary services to
                                    meet the unique needs of homeless
                                    children and youth.
                ``(3) Requirement.--Services provided under this section
            shall not replace the regular academic program and shall be
            designed to expand upon or improve services provided as part of
            the school's regular academic program.
        ``(b) Application.--A local educational agency that desires to
    receive a grant under this section shall submit an application to the
    State educational agency at such time, in such manner, and containing
    or accompanied by such information as the State educational agency may
    reasonably require. Each such application shall include--
                ``(1) an assessment of the educational and related needs of
            homeless children and youth, as defined in section 725(1) and
            (2), in the area served by such agency (which may be undertaken
            as part of needs assessments for other disadvantaged groups);
                ``(2) a description of the services and programs for which
            assistance is sought to address the needs identified in
            paragraph (1);
                ``(3) an assurance that the local educational agency's
            combined fiscal effort per student, or the aggregate
            expenditures of that agency and the State with respect to the
            provision of free public education by such agency for the
            fiscal year preceding the fiscal year for which the
            determination is made, was not less than 90 percent of such
            combined fiscal effort or aggregate expenditures for the second
            fiscal year preceding the fiscal year for which the
            determination is made;
                ``(4) an assurance that the applicant complies with, or
            will use requested funds to comply with, paragraphs (3) through
            (7) of section 722(g); and
                ``(5) a description of policies and procedures, consistent
            with section 722(e)(3)(B), that the agency will implement to
            ensure that activities carried out by the agency will not
            isolate or stigmatize homeless children and youth.
        ``(c) Awards.--
                ``(1) In general.--The State educational agency shall, in
            accordance with the requirements of this subtitle and from
            amounts made available to it under section 726, make
            competitive subgrants to local educational agencies that submit
            applications under subsection (b). Such subgrants shall be
            awarded on the basis of the need of such agencies for
            assistance under this subtitle and the quality of the
            applications submitted.
                ``(2) Need.--In determining need under paragraph (1), the
            State educational agency may consider the number of homeless
            children and youth enrolled in preschool, elementary, and
            secondary schools within the area served by the agency, and
            shall consider the needs of such children and youth and the
            ability of the agency to meet such needs. Such agency may also
            consider--
                        ``(A) the extent to which the proposed use of funds
                    would facilitate the enrollment, retention, and
                    educational success of homeless children and youth;
                        ``(B) the extent to which the application--
                                ``(i) reflects coordination with other
                            local and State agencies that serve homeless
                            children and youth; and
                                ``(ii) meets the requirements of section
                            722(g)(3);
                        ``(C) the extent to which the applicant exhibits in
                    the application and in current practice a commitment to
                    education for all homeless children and youth; and
                        ``(D) such other criteria as the State agency
                    determines appropriate.
                ``(3) Quality.--In determining the quality of applications
            under paragraph (1), the State educational agency shall
            consider--
                        ``(A) the applicant's needs assessment under
                    subsection (b)(1) and the likelihood that the program
                    presented in the application will meet such needs;
                        ``(B) the types, intensity, and coordination of the
                    services to be provided under the program;
                        ``(C) the involvement of parents or guardians;
                        ``(D) the extent to which homeless children and
                    youth will be integrated within the regular education
                    program;
                        ``(E) the quality of the applicant's evaluation
                    plan for the program;
                        ``(F) the extent to which services provided under
                    this subtitle will be coordinated with other available
                    services; and
                        ``(G) such other measures as the State educational
                    agency considers indicative of a high-quality program.
                ``(4) Duration of grants.--Grants awarded under this
            section shall be for terms not to exceed 3 years.
        ``(d) Authorized Activities.--A local educational agency may use
    funds awarded under this section for activities to carry out the
    purpose of this subtitle, including--
                ``(1) the provision of tutoring, supplemental instruction,
            and enriched educational services that are linked to the
            achievement of the same challenging State academic content
            standards and challenging State student academic achievement
            standards the State establishes for other children and youth;
                ``(2) the provision of expedited evaluations of the
            strengths and needs of homeless children and youth, including
            needs and eligibility for programs and services (such as
            educational programs for gifted and talented students, children
            with disabilities, and students with limited-English
            proficiency, services provided under title I of the Elementary
            and Secondary Education Act of 1965 or similar State or local
            programs, programs in vocational and technical education, and
            school nutrition programs);
                ``(3) professional development and other activities for
            educators and pupil services personnel that are designed to
            heighten the understanding and sensitivity of such personnel to
            the needs of homeless children and youth, the rights of such
            children and youth under this Act, and the specific educational
            needs of runaway and homeless youth;
                ``(4) the provision of referral services to homeless
            children and youth for medical, dental, mental, and other
            health services;
                ``(5) the provision of assistance to defray the excess cost
            of transportation for students pursuant to section
            722(g)(4)(A), not otherwise provided through Federal, State, or
            local funding, where necessary to enable students to attend the
            school selected under section 722(g)(3);
                ``(6) the provision of developmentally appropriate early
            childhood education programs, not otherwise provided through
            Federal, State, or local funding, for preschool-aged children;
                ``(7) the provision of services and assistance to attract,
            engage, and retain homeless youth (as described in paragraphs
            (1) and (2) of section 725) in public school programs and
            services provided to nonhomeless youth;
                ``(8) the provision for homeless children and youth of
            before- and after-school, mentoring, and summer programs in
            which a teacher or other qualified individual provides
            tutoring, homework assistance, and supervision of educational
            activities;
                ``(9) if necessary, the payment of fees and other costs
            associated with tracking, obtaining, and transferring records
            necessary to enroll homeless children and youth in school,
            including birth certificates, immunization or medical records,
            academic records, guardianship records, and evaluations for
            special programs or services;
                ``(10) the provision of education and training to the
            parents of homeless children and youth about the rights of, and
            resources available to, such children and youth;
                ``(11) the development of coordination between schools and
            agencies providing services to homeless children and youth, as
            described in section 722(g)(5);
                ``(12) the provision of pupil services (including violence
            prevention counseling) and referrals for such services;
                ``(13) activities to address the particular needs of
            homeless children and youth that may arise from domestic
            violence;
                ``(14) the adaptation of space and purchase of supplies for
            nonschool facilities made available under subsection (a)(2) to
            provide services under this subsection;
                ``(15) the provision of school supplies, including those
            supplies to be distributed at shelters or temporary housing
            facilities, or other appropriate locations; and
                ``(16) the provision of other extraordinary or emergency
            assistance needed to enable homeless children and youth to
            attend school.

    ``SEC. 724. SECRETARIAL RESPONSIBILITIES.

        ``(a) Review of Plans.--In reviewing the State plan submitted by a
    State educational agency under section 722(g), the Secretary shall use
    a peer review process and shall evaluate whether State laws, policies,
    and practices described in such plans adequately address the problems
    of homeless children and youth relating to access to education and
    placement as described in such plans.
        ``(b) Technical Assistance.--The Secretary shall provide support
    and technical assistance to the State educational agencies to assist
    such agencies to carry out their responsibilities under this subtitle,
    if requested by the State educational agency.
        ``(c) Notice.--The Secretary shall, before the next school year
    that begins after the date of the enactment of the McKinney-Vento
    Homeless Education Assistance Improvements Act of 2001, create and
    disseminate nationwide a public notice of the educational rights of
    homeless children and youth and disseminate such notice to other
    Federal agencies, programs, and grantees, including Head Start
    grantees, Health Care for the Homeless grantees, Emergency Food and
    Shelter grantees, and homeless assistance programs administered by the
    Department of Housing and Urban Development.
        ``(d) Evaluation and Dissemination.--The Secretary shall conduct
    evaluation and dissemination activities of programs designed to meet
    the educational needs of homeless elementary and secondary school
    students, and may use funds appropriated under section 726 to conduct
    such activities.
        ``(e) Submission and Distribution.--The Secretary shall require
    applications for grants under this subtitle to be submitted to the
    Secretary not later than the expiration of the 60-day period beginning
    on the date that funds are available for purposes of making such grants
    and shall make such grants not later than the expiration of the 120-day
    period beginning on such date.
        ``(f) Determination by Secretary.--The Secretary, based on the
    information received from the States and information gathered by the
    Secretary under subsection (e), shall determine the extent to which
    State educational agencies are ensuring that each homeless child and
    homeless youth has access to a free appropriate public education as
    described in section 721(1).
        ``(g) Information.--
                ``(1) In general.--From funds appropriated under section
            726, the Secretary shall, either directly or through grants,
            contracts, or cooperative agreements, periodically collect and
            disseminate data and information regarding--
                        ``(A) the number and location of homeless children
                    and youth;
                        ``(B) the education and related services such
                    children and youth receive;
                        ``(C) the extent to which such needs are being met;
                    and
                        ``(D) such other data and information as the
                    Secretary deems necessary and relevant to carry out
                    this subtitle.
                ``(2) Coordination.--The Secretary shall coordinate such
            collection and dissemination with other agencies and entities
            that receive assistance and administer programs under this
            subtitle.
        ``(h) Report.--Not later than 4 years after the date of the
    enactment of the McKinney-Vento Homeless Education Assistance
    Improvements Act of 2001, the Secretary shall prepare and submit to the
    President and the Committee on Education and the Workforce of the House
    of Representatives and the Committee on Health, Education, Labor, and
    Pensions of the Senate a report on the status of education of homeless
    children and youth, which shall include information on--
                ``(1) the education of homeless children and youth; and
                ``(2) the actions of the Department and the effectiveness
            of the programs supported under this subtitle.

    ``SEC. 725. DEFINITIONS.

        ``In this subtitle:
                ``(1) The term `homeless children and youth'--
                        ``(A) means individuals who lack a fixed, regular,
                    and adequate nighttime residence (within the meaning of
                    section 103(a)(1));
                        ``(B) includes--
                                ``(i) children and youth who are living in
                            doubled-up accommodations sharing the housing
                            of another due to loss of housing, economic
                            hardship or a similar reason, are living in
                            motels, hotels, trailer parks, or camping
                            grounds due to the lack of alternative adequate
                            accommodations, are living in emergency or
                            transitional shelters, are abandoned in
                            hospitals, or are awaiting foster care
                            placement;
                                ``(ii) individuals who have a primary
                            nighttime residence that is a public or private
                            place not designed for or ordinarily used as a
                            regular sleeping accommodation for human beings
                            (within the meaning of section 103(a)(2)(C));
                            and
                                ``(iii) children and youth who are living
                            in cars, parks, public spaces, abandoned
                            buildings or substandard housing, bus or train
                            stations, or similar settings; and
                        ``(C) does not include migratory children (as such
                    term is defined in section 1309(2) of the Elementary
                    and Secondary Education Act of 1965), unless such
                    children are staying in accommodations not fit for
                    habitation.
                ``(2) The term `unaccompanied youth' includes youth not in
            the physical custody of a parent or guardian.
                ``(3) The terms `enroll' and `enrollment' include within
            their meaning the right to attend classes and to participate
            fully in school activities.
                ``(4) The terms `local educational agency' and `State
            educational agency' have the meanings given such terms in
            section 8101 of the Elementary and Secondary Education Act of
            1965.
                ``(5) The term `Secretary' means the Secretary of
            Education.
                ``(6) The term `State' means each of the 50 States, the
            District of Columbia, and the Commonwealth of Puerto Rico.

    ``SEC. 726. AUTHORIZATION OF APPROPRIATIONS.

        ``For the purpose of carrying out this subtitle, there are
    authorized to be appropriated $60,000,000 for fiscal year 2002 and such
    sums as may be necessary for each of the fiscal years 2003 through
    2006.''.

    SEC. 915. TECHNICAL AMENDMENT.

        (a) In General.--Section 1 of Public Law 106-400 (42 U.S.C. 11301)
    is amended by striking ``Section 1 of'' and inserting ``Section 101
    of''.
        (b) Effective Date.--The amendment made by subsection (a) shall be
    deemed to be effective on the date of enactment of Public Law 106-400.

                                PART B--REPEALS

    SEC. 921. REPEALS.

        The following provisions are repealed:
                (1) Goals.--Parts A and C of title II and title VI of Goals
            2000: Educate America Act.
                (2) Troops-to-teachers program act of 1999.--The Troops-to-
            Teachers Program Act of 1999 (title XVII of Public Law 106-65;
            20 U.S.C. 9301 et seq.).
                (3) ESEA.--
                        (A) Title IX, relating to Indian, Native Hawaiian,
                    and Alaska Native education.
                        (B) Parts A, B, C, D, F, G, I, J, L, of title X,
                    relating to programs of national significance.
                        (C) Title XI, relating to coordinated services.
                        (D) Title XII, relating to education
                    infrastructure.
                        (E) The title heading of title XIII and sections
                    13001 and 13002.
                        (F) Title XIV, relating to general provisions.

    107th CONGRESS

      1st Session

                                    H. R. 1

                          [Report No. 107-63, Part I]

    _______________________________________________________________________

                                     A BILL

      To close the achievement gap with accountability, flexibility, and
                    choice, so that no child is left behind.

    _______________________________________________________________________

                                  May 14, 2001

        Reported with an amendment and referred to the Committee on the
        Judiciary for a period ending not later than May 15, 2001, for
      consideration of such provisions of the bill and amendment as fall
    within the jurisdiction of that committee pursuant to clause 1(k), rule
                          X, and ordered to be printed