[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 7 Introduced in Senate (IS)]







107th CONGRESS
  1st Session
                                  S. 7

   To improve public education for all children and support lifelong 
                               learning.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 22, 2001

  Mr. Daschle (for himself, Mr. Kennedy, Mr. Dodd, Mr. Bingaman, Mrs. 
   Murray, Mr. Wellstone, Mr. Dorgan, Ms. Mikulski, Mr. Levin, Mrs. 
 Clinton, Mr. Schumer, Mr. Rockefeller, Mr. Johnson, Mr. Corzine, Mr. 
Biden, Mr. Kerry, Mr. Reed, Mr. Dayton, and Mr. Durbin) introduced the 
 following bill; which was read twice and referred to the Committee on 
                 Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL


 
   To improve public education for all children and support lifelong 
                               learning.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Educational 
Excellence for All Learners Act of 2001''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. References.
                  TITLE I--HOLDING SCHOOLS ACCOUNTABLE

Sec. 100. Short title.
               Subtitle A--Helping Disadvantaged Children

Sec. 101. Reservations for accountability.
Sec. 102. Improved accountability.
Sec. 103. Comprehensive school reform.
                          Subtitle B--Teachers

Sec. 121. State applications.
                    Subtitle C--Innovative Education

Sec. 131. Requirements for State plans.
Sec. 132. Performance objectives.
Sec. 133. Report cards.
Sec. 134. Additional accountability provisions.
                 TITLE II--CLOSING THE ACHIEVEMENT GAP

                Subtitle A--Reauthorization of Programs

Sec. 201. Authorization of appropriations.
   Subtitle B--Options: Opportunities to Improve our Nation's Schools

Sec. 211. Options: Opportunities to Improve our Nation's Schools.
                    Subtitle C--Parental Involvement

Sec. 221. State plans.
Sec. 222. Parental assistance.
        TITLE III--NATIONAL PRIORITIES WITH PROVEN EFFECTIVENESS

            Subtitle A--Qualified Teacher in Every Classroom

Sec. 301. Teacher quality.
           Subtitle B--Safe, Healthy Schools and Communities

                Chapter 1--Grants for School Renovation

Sec. 311. Grants for school renovation.
Sec. 312. Charter school credit enhancement initiative.
                     Chapter 2--School Construction

Sec. 321. Short title.
Sec. 322. Expansion of incentives for public schools.
Sec. 323. Application of certain labor standards on construction 
                            projects financed under public school 
                            modernization program.
Sec. 324. Employment and training activities relating to construction 
                            or reconstruction of public school 
                            facilities.
Sec. 325. Indian school construction.
           Chapter 3--21st Century Community Learning Centers

Sec. 331. Reauthorization.
            Chapter 4--Enhancement of Basic Learning Skills

Sec. 341. Reducing class size.
Sec. 342. Reading excellence.
Sec. 343. Tutorial assistance grants.
        Chapter 5--Integration of Technology into the Classroom

Sec. 351. Short title.
Sec. 352. Local applications for school technology resource grants.
Sec. 353. Teacher preparation.
Sec. 354. Professional development.
         TITLE IV--INDIVIDUALS WITH DISABILITIES EDUCATION ACT

Sec. 401. Full funding of IDEA.
            TITLE V--MAKING HIGHER EDUCATION MORE AFFORDABLE

Sec. 501. Increase in maximum Pell grant.
Sec. 502. Deduction for higher education expenses.

SEC. 2. REFERENCES.

    Except as otherwise expressly provided, whenever in this Act an 
amendment or repeal is expressed in terms of an amendment to, 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.).

                  TITLE I--HOLDING SCHOOLS ACCOUNTABLE

SEC. 100. SHORT TITLE.

    This title may be cited as the ``School Improvement Accountability 
Act''.

               Subtitle A--Helping Disadvantaged Children

SEC. 101. RESERVATIONS FOR ACCOUNTABILITY.

    Section 1003 (20 U.S.C. 6303) is amended to read as follows:

``SEC. 1003. RESERVATION FOR ACCOUNTABILITY AND SCHOOL IMPROVEMENT.

    ``(a) State Reservation.--
            ``(1) In general.--Each State educational agency shall 
        reserve 3 percent of the amount the agency receives under part 
        A for each of fiscal years 2002 and 2003, and 5 percent of that 
        amount for each of fiscal years 2004 through 2006, to carry out 
        paragraph (2) and to carry out its responsibilities under 
        sections 1116 and 1117, including carrying out its statewide 
        system of technical assistance and providing support for local 
        educational agencies.
            ``(2) Local educational agencies.--Of the amount reserved 
        under paragraph (1) for any fiscal year, the State educational 
        agency shall allocate at least 80 percent directly to local 
        educational agencies. In making allocations under this 
        paragraph, the State educational agency shall give first 
        priority to agencies, and agencies serving schools, identified 
        for corrective action or improvement under section 1116(c).
            ``(3) Use of funds.--Each local educational agency 
        receiving an allotment under paragraph (2) shall use the 
        allotment to--
                    ``(A) carry out corrective action, as defined in 
                section 1116(c)(5)(A), in those schools; or
                    ``(B) achieve substantial improvement in the 
                performance of those schools.
    ``(b) National Activities.--From the total amount appropriated for 
any fiscal year to carry out this title, the Secretary may reserve not 
more than 0.30 percent to conduct evaluations and studies and to 
collect data.''.

SEC. 102. IMPROVED ACCOUNTABILITY.

    (a) State Plans.--Section 1111(b) (20 U.S.C. 6311(b)) is amended--
            (1) in the subsection heading, by striking ``and 
        Assessments'' and inserting ``, Assessments, and 
        Accountability'';
            (2) by amending paragraph (2) to read as follows:
            ``(2) Adequate yearly progress.--(A) Each State plan shall 
        specify what constitutes adequate yearly progress in student 
        achievement, under the State's accountability system described 
        in paragraph (4), for each school and each local educational 
agency receiving funds under this part, and for the State.
            ``(B) The specification of adequate yearly progress in the 
        State plan for schools--
                    ``(i) shall be based primarily on the standards 
                described in paragraph (1) and the valid and reliable 
                assessments aligned to State standards described in 
                paragraph (3);
                    ``(ii) shall include specific numerical adequate 
                yearly progress requirements in each subject and grade 
                included in the State assessments at least for each of 
                the assessments required under paragraph (3) and shall 
                base the numerical goal required for each group of 
                students specified in clause (iv) upon a timeline that 
                ensures all students meet or exceed the proficient 
                level of performance on the assessments required by 
                this section within 10 years after the effective date 
                of the School Improvement Accountability Act;
                    ``(iii) shall include other academic indicators, 
                such as school completion or dropout rates, with the 
                data for all such academic indicators disaggregated as 
                required by clause (iv), but the inclusion of such 
                indicators shall not decrease the number of schools or 
                local educational agencies that would be subject to 
                identification for improvement or corrective action if 
                the indicators were not included;
                    ``(iv) shall compare separately data for the State 
                as a whole, for each local educational agency, and for 
                each school, regarding the performance and progress of 
                students, disaggregated by each major ethnic and racial 
                group, by English proficiency status, and by 
                economically disadvantaged students as compared with 
                students who are not economically disadvantaged (except 
                that such disaggregation shall not be required in a 
                case in which the number of students in a category 
                would be insufficient to yield statistically reliable 
                information or the results would reveal individually 
                identifiable information about individual students); 
                and
                    ``(v) shall compare the proportion of students at 
                the basic, proficient, and advanced levels of 
                performance in a grade for a year with the proportion 
                of students at each of the 3 levels in the same grade 
                in the previous year.
            ``(C)(i) Adequate yearly progress for a local educational 
        agency shall be based upon both--
                    ``(I) the number or percentage of schools 
                identified for school improvement or corrective action; 
                and
                    ``(II) the progress of the local educational agency 
                in reducing the number or length of time schools are 
                identified for school improvement or corrective action.
            ``(ii) The State plan shall provide that each local 
        educational agency shall ensure that, not later than the end of 
        the fourth academic year after the effective date of the School 
        Improvement Accountability Act, the percentage of schools 
        making adequate yearly progress among schools whose 
        concentrations of poor children are greater than the average 
        concentration of such children served by the local educational 
        agency shall not be less than the percentage of schools making 
        adequate yearly progress among schools whose concentrations of 
        poor children are less than the average concentration of such 
        children served by the local educational agency.
            ``(D)(i) Adequate yearly progress for a State shall be 
        based upon both--
                    ``(I) the number or percentage of local educational 
                agencies identified for improvement or corrective 
                action; and
                    ``(II) the progress of the State in reducing the 
                number or length of time local educational agencies are 
                identified for improvement or corrective action.
            ``(ii) The State plan shall provide that the State shall 
        ensure that, not later than the end of the fourth academic year 
        after the effective date of the School Improvement 
        Accountability Act, the percentage of local educational 
        agencies making adequate yearly progress among local 
        educational agencies whose concentrations of poor children are 
        greater than the State average of such concentrations shall not 
        be less than the percentage of local educational agencies 
        making adequate yearly progress among local educational 
        agencies whose concentrations of poor children are less than 
        the State average.'';
            (3) in paragraph (3)--
                    (A) in the matter preceding subparagraph (A)--
                            (i) by striking ``developed or adopted'' 
                        and inserting ``in place''; and
                            (ii) by inserting ``, not later than the 
                        school year 2000-2001,'' after ``will be 
                        used'';
                    (B) by redesignating subparagraphs (G), (H), and 
                (I) as subparagraphs (H), (I), and (J);
                    (C) in subparagraph (F)--
                            (i) in clause (ii), by striking ``and'' 
                        after the semicolon; and
                            (ii) by adding at the end the following:
                            ``(iv) the use of assessments written in 
                        Spanish for the assessment of Spanish-speaking 
                        students with limited English proficiency, if 
                        Spanish-language assessments are more likely 
                        than English language assessments to yield 
                        accurate and reliable information regarding 
                        what those students know and can do in content 
                        areas other than English; and
                            ``(v) notwithstanding clauses (iii) and 
                        (iv), the 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 years, for purposes of school accountability;'';
                    (D) by inserting after subparagraph (F) the 
                following:
                    ``(G) result in a report from each local 
                educational agency that indicates the number and 
                percentage of students excluded from each assessment at 
                each school, including, where statistically sound, data 
                disaggregated in accordance with subparagraph (J), 
                except that a local educational agency shall be 
                prohibited from providing such information if providing 
                the information would reveal the identity of any 
                individual student.''; and
                    (E) by amending subparagraph (I) (as so 
                redesignated) to read as follows:
                    ``(I) provide individual student interpretive and 
                descriptive reports, which shall include scores and 
                other information on the attainment of student 
                performance standards that reflect the quality of daily 
                instruction and learning such as measures of student 
                coursework over time, student attendance rates, student 
                dropout rates, and rates of student participation in 
                advanced level courses; and``;
            (4) by striking paragraph (7);
            (5) by redesignating paragraphs (4), (5), (6), and (8) as 
        paragraphs (8), (9), (10), and (11), respectively;
            (6) by inserting after paragraph (3) the following:
            ``(4) Accountability.--(A) Each State plan shall 
        demonstrate that the State has developed and is implementing a 
        statewide accountability system that is or will be effective in 
        substantially increasing the numbers and percentages of all 
        students, including the lowest performing students, 
        economically disadvantaged students, and students with limited 
        proficiency in English, who meet the State's proficient and 
        advanced levels of performance within 10 years after the date 
        of enactment of the School Improvement Accountability Act. The 
        State accountability system shall--
                    ``(i) be the same accountability system the State 
                uses for all schools or all local educational agencies 
                in the State, if the State has an accountability system 
                for all schools or all local educational agencies in 
                the State;
                    ``(ii) hold local educational agencies and schools 
                accountable for student achievement in at least reading 
                and mathematics and in any other subject that the State 
                may choose; and
                    ``(iii) identify schools and local educational 
                agencies for improvement or corrective action based 
                upon failure to make adequate yearly progress as 
                defined in the State plan pursuant to paragraph (2).
            ``(B) The accountability system described in subparagraph 
        (A) and described in the State plan shall also include a 
        procedure for identifying for improvement a school or local 
        educational agency, intervening in that school or agency, and 
        (if that intervention is not effective) implementing a 
        corrective action not later than 3 years after first 
        identifying such agency or school, that--
                    ``(i) complies with sections 1116 and 1117, 
                including the provision of technical assistance, 
                professional development, and other capacity-building 
                as needed, to ensure that schools and local educational 
                agencies so identified have the resources, skills, and 
                knowledge needed to carry out their obligations under 
                sections 1114 and 1115 and to meet the requirements for 
                adequate yearly progress described in paragraph (2); 
                and
                    ``(ii) includes rigorous criteria for identifying 
                those agencies and schools based upon failure to make 
                adequate yearly progress in student achievement in 
                accordance with paragraph (2).
            ``(5) Public notice and comment.--Each State plan shall 
        contain assurances that--
                    ``(A) in developing the State plan provisions 
                relating to adequate yearly progress, the State 
                diligently sought public comment from a range of 
                institutions and individuals in the State with an 
                interest in improved student achievement; and
                    ``(B) the State will continue to make a substantial 
                effort to ensure that information regarding this part 
                is widely known and understood by citizens, parents, 
                teachers, and school administrators throughout the 
                State, and is provided in a widely read or distributed 
                medium.
            ``(6) Annual review.--The State plan shall provide an 
        assurance that the State will annually submit to the Secretary 
        information, as part of the State's consolidated plan under 
        section 14302, on the extent to which schools and local 
        educational agencies are making adequate yearly progress, 
        including the number and names of schools and local educational 
        agencies identified for improvement and corrective action under 
        section 1116, the steps taken to address the performance 
        problems of such schools and local educational agencies, and 
        the number and names of schools that are no longer so 
        identified, for purposes of determining State and local 
        compliance with section 1116.
            ``(7) Penalties.--(A) The State plan shall provide that, if 
        the State fails to meet the deadlines described in paragraphs 
        (1)(C) and (10) for demonstrating that the State has in place 
        high-quality State content and student performance standards 
        and aligned assessments, or if the State fails to establish a 
        system for measuring and monitoring adequate yearly progress, 
        for a fiscal year, including having the ability to disaggregate 
        student achievement data for the assessments as required under 
        this section at the State, local educational agency, and school 
        levels, then the State shall be ineligible to reserve a greater 
        amount of administrative funds under section 1003 for the 
        succeeding fiscal year than the State reserved for such 
        purposes for the fiscal year preceding the fiscal year in which 
the failure occurred.
            ``(B)(i) The State plan shall provide that, except as 
        described in clause (ii), if the State fails to meet the 
        deadlines described in paragraphs (1)(C) and (10) for a fiscal 
        year, then the Secretary may withhold funds made available 
        under this part for administrative expenses for the succeeding 
        fiscal year in such amount as the Secretary determines 
        appropriate.
            ``(ii) The State plan shall provide that, if the State 
        fails to meet the deadlines described in paragraphs (1)(C) and 
        (10) for the succeeding fiscal year or a subsequent fiscal 
        year, the Secretary shall withhold not less than \1/5\ of the 
        funds made available under this part for administrative 
        expenses for the fiscal year.
            ``(C) The State plan shall provide that, if the State has 
        not developed challenging State assessments that are aligned to 
        challenging State content standards in at least mathematics and 
        reading or language arts by school year 2000-2001, the State 
        shall not be eligible for designation as an Ed-Flex Partnership 
        State under the Education Flexibility Partnership Act of 1999 
        until the State develops such assessments, and the State shall 
        be subject to such other penalties as are provided in this Act 
        for failure to develop the assessments.''; and
            (7) by adding at the end the following:
            ``(12) School reports.--The State plan shall provide that 
        individual school reports publicized and disseminated under 
        section 1116(a)(2) shall include information on the total 
        number of students excluded from each assessment at each 
        school, including, where statistically sound, data 
        disaggregated in accordance with paragraph (3)(J), and shall 
        include information on why such students were excluded from the 
        assessment. In issuing this report, a local educational agency 
        may not provide any information that would violate the privacy 
        or reveal the identity of any individual student.''.
    (b) Assurances.--Section 1112(c)(1) (20 U.S.C. 6312(c)(1)) is 
amended--
            (1) in subparagraph (G), by striking ``; and'' and 
        inserting a semicolon;
            (2) in subparagraph (H), by striking the period and 
        inserting ``; and''; and
            (3) by adding at the end the following:
                    ``(I) ensure, through incentives for voluntary 
                transfers, the provision of professional development, 
                and recruitment programs, that low-income students and 
                minority students are not taught at higher rates than 
                other students by unqualified, out-of-field, or 
                inexperienced teachers.''.
    (c) Assessment and Improvement.--Section 1116 (20 U.S.C. 6317) is 
amended--
            (1) by amending subsection (a) to read as follows:
    ``(a) State and Local Review.--
            ``(1) In general.--Each local educational agency receiving 
        funds under this part shall use the State assessments and other 
        academic indicators described in the State plan or in a State-
        approved local educational agency plan to review annually the 
        progress of each school served under this part by the agency to 
        determine whether the school is making the adequate yearly 
        progress specified in section 1111(b)(2) toward enabling all 
        students to meet the State's student performance standards 
        described in the State plan.
            ``(2) Publication and dissemination; results.--Each local 
        educational agency receiving funds under this part shall--
                    ``(A) publicize and disseminate in individual 
                school reports that include statistically sound results 
                disaggregated in the same manner as results are 
                disaggregated under section 1111(b)(3)(J), to teachers 
                and other staff, parents, students, and the community, 
                the results of the annual review under paragraph (1) 
                and (if not already included in the review), graduation 
                rates, attendance rates, retention rates, and rates of 
                participation in advanced level courses, for all 
                schools served under this part; and
                    ``(B) provide the results of the annual review to 
                schools served by the agency under this part so that 
                the schools can continually refine their programs of 
                instruction to help all students served under this part 
                in those schools to meet the State's student 
                performance standards.'';
            (2) in subsection (c)--
                    (A) by amending paragraph (1) to read as follows:
            ``(1) In general.--(A) A local educational agency shall 
        identify for school improvement any school served under this 
        part that--
                    ``(i) for 2 consecutive years failed to make 
                adequate yearly progress as defined in the State's plan 
                under section 1111, except that in the case of a school 
                participating in a targeted assistance program under 
                section 1115, a local educational agency may review the 
                progress of only those students in such school who are 
                served under this part; or
                    ``(ii) was identified for school improvement under 
                this section on the day preceding the date of enactment 
                of the School Improvement Accountability Act.
            ``(B) The 2-year period described in subparagraph (A)(i) 
        shall include any continuous period of time immediately 
        preceding the date of the enactment of such Act, during which a 
        school 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 enactment.'';
                    (B) by amending paragraph (2) to read as follows:
            ``(2) Requirements.--(A)(i) Each school identified under 
        paragraph (1)(A) shall promptly notify a parent of each student 
        enrolled in the school that the school was identified for 
        improvement by the local educational agency and provide with 
the notification--
                    ``(I) the reasons for such identification; and
                    ``(II) information about opportunities for parents 
                to participate in the school improvement process.
            ``(ii) The notification under this subparagraph shall be in 
        a format and, to the extent practicable, in a language, that 
        the parents can understand.
            ``(B)(i) Before identifying a school for school improvement 
        under paragraph (1)(A), the local educational agency shall 
        inform the school that the agency proposes to identify the 
        school for school improvement and provide the school with an 
        opportunity to review the school-level data, including 
        assessment data, upon which the proposed determination 
        regarding identification is based.
            ``(ii) If the school believes that the proposed 
        identification is in error for statistical or other substantive 
        reasons, the school may provide supporting evidence to the 
        local educational agency during the review period, and the 
        agency shall consider such evidence before making a final 
        determination regarding identification.
            ``(iii) The review period under this subparagraph shall not 
        exceed 30 days. At the end of the period, the agency shall make 
        public a final determination regarding indentification of the 
        school.
            ``(C) Each school identified under paragraph (1)(A) shall, 
        within 3 months after being so identified, and in consultation 
        with parents, the local educational agency, and the school 
        support team or other outside experts, develop or revise a 
        school plan that--
                    ``(i) addresses the fundamental teaching and 
                learning needs in the school;
                    ``(ii) describes the specific achievement problems 
                to be solved;
                    ``(iii) includes the strategies, supported by valid 
                and reliable evidence of effectiveness, with specific 
                goals and objectives, that have the greatest likelihood 
                of improving the performance of participating students 
                in meeting the State's student performance standards;
                    ``(iv) explains how those strategies will work to 
                address the achievement problems identified under 
                clause (ii), including providing a summary of 
                evaluation-based evidence of student achievement after 
                implementation of those strategies in other schools;
                    ``(v) addresses the need for high-quality staff by 
                ensuring that all new teachers in the school in 
                programs supported with funds provided under this part 
                are fully qualified;
                    ``(vi) addresses the professional development needs 
                of the instructional staff of the school by describing 
                a plan for spending a minimum of 10 percent of the 
                funds received by the school under this part on 
                professional development that--
                            ``(I) does not supplant professional 
                        development services that the instructional 
                        staff would otherwise receive; and
                            ``(II) is designed to increase the content 
                        knowledge of teachers, build teachers' capacity 
                        to align classroom instruction with challenging 
                        content standards, and bring all students in 
                        the school to proficient or advanced levels of 
                        performance;
                    ``(vii) identifies specific goals and objectives 
                the school will undertake for making adequate yearly 
                progress, including specific numerical performance 
                goals and targets that are high enough to ensure that 
                all groups of students specified in section 
                1111(b)(2)(B)(iv) meet or exceed the proficient levels 
                of performance in each subject area within 10 years 
                after the date of enactment of the School Improvement 
                Accountability Act; and
                    ``(viii) specifies the responsibilities of the 
                school and the local educational agency, including how 
                the local educational agency will hold the school 
                accountable for, and assist the school in, meeting the 
                school's obligations to provide enriched and 
                accelerated curricula, effective instructional methods, 
                highly qualified professional development, and timely 
                and effective individual assistance, in partnership 
                with parents.
            ``(D)(i) The school shall submit the plan (including a 
        revised plan) to the local educational agency for approval.
            ``(ii) The local educational agency shall promptly subject 
        the plan to a peer review process, work with the school to 
        revise the plan as necessary, and approve the plan.
            ``(iii) The school shall implement the plan as soon as the 
        plan is approved.'';
                    (C) by amending paragraph (4) to read as follows:
            ``(4) Technical assistance.--(A) For each school identified 
        for school improvement under paragraph (1)(A), the local 
        educational agency shall provide technical assistance as the 
        school develops and implements the school's plan.
            ``(B) Such technical assistance--
                    ``(i) shall include information on effective 
                methods and instructional strategies that are supported 
                by valid and reliable evidence of effectiveness;
                    ``(ii) shall be designed to strengthen the core 
                academic program for the students served under this 
                part, address specific elements of student performance 
                problems, and address problems, if any, in implementing 
                the parental involvement requirements in section 1118, 
                implementing the professional development provisions in 
                section 1119, and carrying out the responsibilities of 
                the school and local educational agency under the plan; 
                and
                    ``(iii) may be provided directly by the local 
                educational agency, through mechanisms authorized under 
                section 1117, or (with the local educational agency's 
approval) by an institution of higher education whose teacher 
preparation program is not identified as low performing by its State 
and that is in full compliance with the requirements of section 207 of 
the Higher Education Act of 1965, a private nonprofit organization, an 
educational service agency, a comprehensive regional assistance center 
under part A of title XIII, or other entities with experience in 
helping schools improve achievement.
            ``(C) Technical assistance provided under this section by 
        the local educational agency or an entity approved by such 
        agency shall be supported by valid and reliable evidence of 
        effectiveness.'';
                    (D) by amending paragraph (5) to read as follows:
            ``(5) Corrective action.--In order to help students served 
        under this part meet challenging State standards, each local 
        educational agency shall implement a system of corrective 
        action in accordance with the following:
                    ``(A) In this paragraph, the term `corrective 
                action' means action, consistent with State and local 
                law, that--
                            ``(i) substantially and directly responds 
                        to the consistent academic failure that caused 
                        the local educational agency to take such 
                        action and to any underlying staffing, 
                        curricular, or other problems in the school 
                        involved; and
                            ``(ii) is designed to substantially 
                        increase the likelihood that students will 
                        perform at the proficient and advanced 
                        performance levels.
                    ``(B) After providing technical assistance under 
                paragraph (4), the local educational agency--
                            ``(i) may take corrective action at any 
                        time with respect to a school that has been 
                        identified under paragraph (1)(A);
                            ``(ii) shall take corrective action with 
                        respect to any school that fails to make 
                        adequate yearly progress, as defined by the 
                        State, for 2 consecutive years following the 
                        school's identification under paragraph (1)(A), 
                        at the end of the second year; and
                            ``(iii) shall continue to provide technical 
                        assistance while instituting any corrective 
                        action under clause (i) or (ii).
                    ``(C) In the case of a school described in 
                subparagraph (B)(ii), the local educational agency--
                            ``(i) shall take corrective action that 
                        changes the school's administration or 
                        governance by--
                                    ``(I) instituting and fully 
                                implementing a new curriculum, 
                                including providing appropriate 
                                professional development for all 
                                relevant staff, that is supported by 
                                valid and reliable evidence of 
                                effectiveness and offers substantial 
                                promise of improving educational 
                                achievement for low-performing 
                                students;
                                    ``(II) restructuring the school, 
                                such as by creating schools within 
                                schools or other small learning 
                                environments, or making alternative 
                                governance arrangements (such as the 
                                creation of a public charter school);
                                    ``(III) redesigning the school by 
                                reconstituting all or part of the 
                                school staff;
                                    ``(IV) eliminating the use of 
                                noncredentialed teachers; or
                                    ``(V) closing the school;
                            ``(ii) shall provide professional 
                        development for all relevant staff, that is 
                        supported by valid and reliable evidence of 
                        effectiveness and that offers substantial 
                        promise of improving student educational 
                        achievement and is directly related to the 
                        content area in which each teacher is providing 
                        instruction and the State's content and 
                        performance standards in that content area; and
                            ``(iii) may defer, reduce, or withhold 
                        funds provided to carry out this title.
                    ``(D)(i) When a local educational agency has 
                identified a school for corrective action under 
                subparagraph (B)(ii), the agency shall provide all 
                students enrolled in the school with the option to 
                transfer to another public school that is within the 
                area served by the local educational agency that has 
                not been identified for school improvement and provide 
                such students with transportation (or the costs of 
                transportation) to such school, subject to the 
                following requirements:
                            ``(I) Such transfer must be consistent with 
                        State or local law.
                            ``(II) If the local educational agency 
                        cannot accommodate the request of every student 
                        from the identified school, the agency shall 
                        permit as many students as possible to 
                        transfer, with such students being selected at 
                        random on a nondiscriminatory and equitable 
                        basis.
                            ``(III) The local educational agency may 
                        use not more than 10 percent of the funds the 
                        local educational agency receives through the 
                        State reservation under section 1003(a)(2) to 
                        provide transportation to students whose 
                        parents choose to transfer the students to a 
                        different school under this subparagraph.
                    ``(ii) If all public schools served by the local 
                educational agency are identified for corrective 
                action, the agency shall, to the extent practicable, 
                establish a cooperative agreement with another local 
                educational agency in the area to enable students 
                served by the agency to transfer to a school served by 
that other agency.
                    ``(E) 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.
                    ``(F) The local educational agency shall publish 
                and disseminate to parents and the public in a format 
                and, to the extent practicable, in a language the 
                parents and the public can understand, through such 
                means as the Internet, the media, and public agencies, 
                information on any corrective action the agency takes 
                under this paragraph.
                    ``(G)(i) Before taking corrective action with 
                respect to any school under this paragraph, the local 
                educational agency shall inform the school that the 
                agency proposes to take corrective action and provide 
                the school with an opportunity to review the school-
                level data, including assessment data, upon which the 
                proposed determination regarding corrective action is 
                based.
                    ``(ii) If the school believes that the proposed 
                determination is in error for statistical or other 
                substantive reasons, the school may provide supporting 
                evidence to the local educational agency during the 
                review period, and the agency shall consider such 
                evidence before making a final determination regarding 
                corrective action.
                    ``(iii) The review period under this subparagraph 
                shall not exceed 45 days. At the end of the period, the 
                local educational agency shall make public a final 
                determination regarding corrective action for the 
                school.'';
                    (E) by amending paragraph (6) to read as follows:
            ``(6) State educational agency responsibilities.--If a 
        State educational agency determines that a local educational 
        agency failed to carry out its responsibilities under this 
        section, the State educational agency shall take such action as 
        the agency finds necessary, consistent with this section, to 
        improve the affected schools and to ensure that the local 
        educational agency carries out its responsibilities under this 
        section.''; and
                    (F) by amending paragraph (7) to read as follows:
            ``(7) Waivers.--The State educational agency shall review 
        any waivers that have previously been approved for a school 
        identified for improvement or corrective action, and shall 
        terminate any waiver approved by the State, under the 
        Educational Flexibility Partnership Act of 1999, if the State 
        determines, after notice and an opportunity for a hearing, that 
        the waiver is not helping such school make adequate yearly 
        progress toward meeting the goals, objectives, and performance 
        targets in the school's improvement plan.''; and
            (3) by amending subsection (d) to read as follows:
    ``(d) State Review and Local Educational Agency Improvement.--
            ``(1) In general.--A State educational agency shall 
        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 performance standards.
            ``(2) Identification of local educational agency for 
        improvement.--A State educational agency 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 identified for improvement under this 
                section as this section was in effect on the day 
                preceding the date of enactment of the School 
                Improvement Accountability Act.
            ``(3) Transition.--The 2-year period described in paragraph 
        (2)(A) shall include any continuous period of time immediately 
        preceding the date of enactment of such Act, 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 enactment.
            ``(4) Targeted assistance schools.--For purposes of 
        reviewing the progress of targeted assistance schools served by 
        a local educational agency, a State educational agency may 
        choose to review the progress of only the students in such 
        schools who are served under this part.
            ``(5) Opportunity to review and present evidence.--(A) 
        Before identifying a local educational agency for improvement 
        under paragraph (2), a State educational agency shall inform 
        the local educational agency that the State educational agency 
        proposes to identify the local educational agency for 
        improvement and provide the local educational agency with an 
        opportunity to review the local educational agency data, 
        including assessment data, upon which the proposed 
        determination regarding identification is based.
            ``(B) If the local educational agency believes that the 
        proposed identification is in error for statistical or other 
        substantive reasons, the agency may provide supporting evidence 
        to the State educational agency during the review period, and 
        the agency shall consider such evidence before making a final 
        determination regarding identification.
            ``(C) The review period under this paragraph shall not 
        exceed 30 days. At the end of the period, the State shall make 
        public a final determination regarding identification of the 
        local educational agency.
            ``(6) Notification to parents.--(A) The local educational 
        agency shall promptly notify a parent of each student enrolled 
        in a school served by a local educational agency identified for 
        improvement that the agency was identified for improvement and 
        provide with the notification--
                            (i) the reasons for the agency's 
                        identification; and
                            (ii) information about opportunities for 
                        parents to participate in upgrading the quality 
                        of the local educational agency.
            ``(B) The notification under this paragraph shall be in a 
        format and, to the extent practicable, in a language, that the 
        parents can understand.
            ``(7) Local educational agency revisions.--(A) 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 and annual academic 
        achievement goals, in consultation with parents, school staff, 
        and others.
            ``(B) Achievement goals.--The annual academic achievement 
        goals shall be sufficiently high to ensure that all students 
        within the jurisdiction involved, including the lowest 
        performing students, economically disadvantaged students, 
        students of different races and ethnicities, and students with 
        limited English proficiency will meet or exceed the proficient 
        level of performance on the assessments required by section 
        1111 within 10 years after the date of enactment of the School 
        Improvement Accountability Act.
            ``(C) The plan shall--
                    ``(i) address the fundamental teaching and learning 
                needs in the schools served by that agency, and the 
                specific academic problems of low-performing students, 
                including stating a determination of why the local 
                educational agency's prior plan, if any, failed to 
                bring about increased achievement;
                    ``(ii) incorporate strategies that are supported by 
                valid and reliable evidence of effectiveness and that 
                strengthen the core academic program in the local 
                educational agency;
                    ``(iii) identify specific annual academic 
                achievement goals and objectives that will--
                            ``(I) have the greatest likelihood of 
                        improving the performance of participating 
                        students in meeting the State's student 
                        performance standards; and
                            ``(II) include specific numerical 
                        performance goals and targets for each of the 
                        groups of students for which data are 
                        disaggregated pursuant to section 
                        1111(b)(2)(B)(iv);
                    ``(iv) address the professional development needs 
                of the instructional staff of the schools by describing 
                a plan for spending a minimum of 10 percent of the 
                funds received by the schools under this part on 
                professional development that--
                            ``(I) does not supplant professional 
                        development services that the instructional 
                        staff would otherwise receive; and
                            ``(II) is designed to increase the content 
                        knowledge of teachers, build teachers' capacity 
                        to align classroom instruction with challenging 
                        content standards, and bring all students in 
                        the schools to proficient or advanced levels of 
                        performance;
                    ``(v) identify measures the local educational 
                agency will undertake to make adequate yearly progress;
                    ``(vi) identify how, pursuant to paragraph (6), the 
                local educational agency will provide written 
                notification to parents in a format and, to the extent 
                practicable, in a language the parents can understand;
                    ``(vii) specify the responsibilities of the State 
                educational agency and the local educational agency 
                under the plan; and
                    ``(viii) include strategies to promote effective 
                parental involvement in the schools.
            ``(D) The local educational agency shall submit the plan 
        (including a revised plan) to the State educational agency for 
        approval. The State educational agency shall, within 60 days 
        after submission of the plan, subject the plan to a peer review 
        process, work with the local educational agency to revise the 
        plan as necessary, and approve the plan.
            ``(E) The local educational agency shall implement the plan 
        (including a revised plan) as soon as the plan is approved.
            ``(8) State educational agency responsibility.--(A) For 
        each local educational agency identified under paragraph (2), 
        the State educational agency (or an entity authorized by the 
        agency) 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 the local 
                educational agency plan as approved by the State 
                educational agency consistent with the requirements of 
                this section; and
                    ``(ii) to work with schools identified for 
                improvement.
            ``(B) Technical assistance provided under this section by 
        the State educational agency or an entity authorized by the 
        agency shall be supported by valid and reliable evidence of 
        effectiveness.
            ``(9) Corrective action.--In order to help students served 
        under this part meet challenging State standards, each State 
        educational agency shall implement a system of corrective 
        action in accordance with the following:
                    ``(A) 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 educational agency to take such 
                        action and to any underlying staffing, 
                        curricular, or other problems in the schools 
                        involved; and
                            ``(ii) is designed to substantially 
                        increase the likelihood that students served 
                        under this part will perform at the proficient 
                        and advanced performance levels.
                    ``(B) After providing technical assistance under 
                paragraph (8) and subject to subparagraph (D), the 
                State educational agency--
                            ``(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, for 3 consecutive years 
                        following the agency's identification under 
                        paragraph (2), at the end of the third year; 
                        and
                            ``(iii) shall continue to provide technical 
                        assistance while instituting any corrective 
                        action under clause (i) or (ii).
                    ``(C) In the case of a local educational agency 
                described in subparagraph (B)(ii), the State 
                educational agency shall take at least 1 of the 
                following corrective actions:
                            ``(i) Withholding funds from the local 
                        educational agency.
                            ``(ii) Reconstituting school district 
                        personnel.
                            ``(iii) Removing particular schools from 
                        the jurisdiction of the local educational 
                        agency and establishing alternative 
                        arrangements for public governance and 
                        supervision of the schools.
                            ``(iv) Appointing, 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) Abolishing or restructuring the local 
                        educational agency.
                    ``(D) When a State educational agency has 
                identified a local educational agency for corrective 
                action under subparagraph (B)(ii), the State 
                educational agency shall provide all students enrolled 
                in a school served by the local educational agency with 
                a plan to transfer to a higher performing public school 
                served by another local educational agency and shall 
                provide such students with transportation (or the costs 
                of transportation) to such schools, subject to the 
                following requirements:
                            ``(i) The provision of the transfer shall 
                        be done in conjunction with at least 1 
                        additional action described in this paragraph.
                            ``(ii) If the State educational agency 
                        cannot accommodate the request of every student 
                        from the schools served by the agency, the 
                        agency shall permit as many students as 
                        possible to transfer, with such students being 
                        selected at random on a nondiscriminatory and 
                        equitable basis.
                            ``(iii) The State educational agency may 
                        use not more than 10 percent of the funds the 
                        agency receives through the State reservation 
                        under section 1003(a)(2) to provide 
                        transportation to students whose parents choose 
                        to transfer their child to a different school 
                        under this subparagraph.
                    ``(E) Prior to implementing any corrective action 
                under this paragraph, 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. The hearing shall take place 
                not later than 45 days following the decision to 
                implement the corrective action.
                    ``(F) The State educational agency shall publish 
                and disseminate to parents and the public in a format 
                and, to the extent practicable, in a language the 
                parents and the public can understand, through such 
                means as the Internet, the media, and public agencies, 
                information on any corrective action the agency takes 
                under this paragraph.
                    ``(G) A State 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.
            ``(10) Waivers.--The State educational agency shall review 
        any waivers that have previously been approved for a local 
        educational agency identified for improvement or corrective 
        action, and shall terminate any waiver approved by the State, 
        under the Educational Flexibility Partnership Act of 1999, 
if the State determines, after notice and an opportunity for a hearing, 
that the waiver is not helping such agency make adequate yearly 
progress toward meeting the goals, objectives, and performance targets 
in the agency's improvement plan.''.
    (d) State Assistance for School Support and Improvement.--Section 
1117(a) (20 U.S.C. 6318(a)) is amended to read as follows:
    ``(a) System for Support.--
            ``(1) In general.--Each State educational agency 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 served by those agencies and 
        schools to meet the State's content standards and student 
        performance standards.
            ``(2) Priorities.--In carrying out this section, a State 
        educational agency shall--
                    ``(A) provide support and assistance to local 
                educational agencies and schools identified for 
                corrective action under section 1116;
                    ``(B) provide support and assistance to other local 
                educational agencies and schools identified for 
                improvement under section 1116; and
                    ``(C) provide support and assistance to each school 
                receiving funds under this part in which the number of 
                students in poverty equals or exceeds 75 percent of the 
                total number of students enrolled in such school.
            ``(3) Approaches.--In order to achieve the objectives of 
        this subsection, each statewide system shall provide technical 
        assistance and support through approaches such as--
                    ``(A) use of school support teams, composed of 
                individuals who are knowledgeable about research on and 
                practice of teaching and learning, particularly about 
                strategies for improving educational results for low-
                achieving students;
                    ``(B) the designation and use of `Distinguished 
                Educators', chosen from schools served under this part 
                that have been especially successful in improving 
                academic achievement;
                    ``(C) assisting local educational agencies or 
                schools to implement research-based comprehensive 
                school reform models; and
                    ``(D) use of a peer review process designed to 
                increase the capacity of local educational agencies and 
                schools to develop high-quality school improvement 
                plans.
            ``(4) Funds.--Each State educational agency--
                    ``(A) shall use funds reserved under section 
                1003(a)(1), but not used under section 1003(a)(2) and 
                funds appropriated under section 1002(f) to carry out 
                this section; and
                    ``(B) may use State administrative funds authorized 
                for such purpose.
            ``(5) Alternatives.--The State educational agency may 
        devise additional approaches to providing the assistance 
        described in subparagraphs (A) and (B) of paragraph (3), other 
        than the provision of assistance under the statewide system, 
        such as providing assistance through institutions of higher 
        education, educational service agencies, or other local 
        consortia. The State educational agency may seek approval from 
        the Secretary to use funds made available under section 1003 
        for such approaches as part of the State plan.''.
    (e) Conforming Amendments.--The 1965 (20 U.S.C. 6301 et seq.) is 
amended--
            (1) in section 1111(b)(1)(C) (20 U.S.C. 6311(b)(1)(C)), by 
        striking ``paragraph (6)'' and inserting ``paragraph (10)'';
            (2) in section 1112(c)(1)(D) (20 U.S.C. 6312(c)(1)(D)), by 
        striking ``section 1116(c)(4)'' and inserting ``section 
        1116(c)(5)'';
            (3) in section 1117(c)(2)(A) (20 U.S.C. 6318(c)(2)(A)), by 
        striking ``section 1111(b)(2)(A)(i)'' and inserting ``section 
        1111(b)(2)(A)'';
            (4) in section 1118(c)(4)(B) (20 U.S.C. 6319(c)(4)(B)), by 
        striking ``school performance profiles required under section 
        1116(a)(3)'' and inserting ``individual school reports required 
        under section 1116(a)(2)(A)'';
            (5) in section 1118(e)(1) (20 U.S.C. 6319(e)(1)), by 
        striking ``section 1111(b)(8)'' and inserting ``section 
        1111(b)(11)''; and
            (6) in section 1119(h)(3) (20 U.S.C. 6320(h)(3)), by 
        striking ``section 1116(d)(6)'' and inserting ``section 
        1116(d)(9)''.

SEC. 103. COMPREHENSIVE SCHOOL REFORM.

    Title I (20 U.S.C. 6301 et seq.) is amended--
            (1) by redesignating part F as part G; and
            (2) by inserting after part E the following:

                 ``PART F--COMPREHENSIVE SCHOOL REFORM

``SEC. 1551. PURPOSE.

    ``The purpose of this part is to provide financial incentives for 
schools to develop comprehensive school reforms based upon promising 
and effective practices and research-based programs that emphasize 
basic academics and parental involvement so that all children can meet 
challenging State content and student performance standards.

``SEC. 1552. PROGRAM AUTHORIZATION.

    ``(a) Program Authorized.--
            ``(1) In general.--The Secretary may award grants to State 
        educational agencies, from allotments under paragraph (2), to 
        enable the State educational agencies to award subgrants to 
        local educational agencies to carry out the purpose described 
        in section 1551.
            ``(2) Allotments.--
                    ``(A) Reservations.--Of the amount appropriated 
                under section 1558 for a fiscal year, the Secretary may 
                reserve--
                            ``(i) not more than 1 percent to provide 
                        assistance to 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 
according to their respective needs for assistance under this part; and
                            ``(ii) not more than 1 percent to conduct 
                        national evaluation activities described in 
                        section 1557.
                    ``(B) In general.--Of the amount appropriated under 
                section 1558 that remains after making the reservation 
                under subparagraph (A) for a fiscal year, the Secretary 
                shall allot to each State for the 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 made available under section 1124 
                to all States for the preceding fiscal year.
                    ``(C) Reallotment.--If a State does not apply for 
                funds under this part, the Secretary shall reallot such 
                funds to other States in proportion to the amount 
                allotted to such other States under subparagraph (B).

``SEC. 1553. STATE APPLICATIONS.

    ``(a) In General.--Each State educational agency that desires to 
receive a grant under this part 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 such application shall describe--
            ``(1) the process and selection criteria by which the State 
        educational agency, using expert review, will select local 
        educational agencies to receive subgrants under this part;
            ``(2) how the State educational agency will ensure that 
        only comprehensive school reforms that are based upon promising 
        and effective practices and research-based programs receive 
        funds under this part;
            ``(3) how the State educational agency will disseminate 
        information on comprehensive school reforms that are based upon 
        promising and effective practices and research-based programs;
            ``(4) how the State educational agency will evaluate the 
        implementation of such reforms and measure the extent to which 
        the reforms have resulted in increased student academic 
        performance; and
            ``(5) how the State educational agency will make available 
        technical assistance to a local educational agency in 
        evaluating, developing, and implementing comprehensive school 
        reform.

``SEC. 1554. STATE USE OF FUNDS.

    ``(a) In General.--Except as provided in subsection (e), a State 
educational agency that receives a grant under this part shall use the 
grant funds to award subgrants, on a competitive basis, to local 
educational agencies (including consortia of local educational 
agencies) in the State that receive funds under part A.
    ``(b) Subgrant Requirements.--A subgrant to a local educational 
agency shall be--
            ``(1) of sufficient size and scope to support the initial 
        costs for the particular comprehensive school reform plan 
        selected or designed by each school identified in the 
        application of the local educational agency;
            ``(2) in an amount not less than $50,000 for each 
        participating school; and
            ``(3) renewable for 2 additional 1-year periods after the 
        initial 1-year grant is made, if the participating school is 
        making substantial progress in the implementation of reforms.
    ``(c) Priority.--A State educational agency, in awarding subgrants 
under this part, shall give priority to local educational agencies 
that--
            ``(1) plan to use the funds in schools identified for 
        improvement or corrective action under section 1116(c); and
            ``(2) demonstrate a commitment to assist schools with 
        budget allocation, professional development, and other 
        strategies necessary to ensure that comprehensive school 
        reforms are properly implemented and are sustained in the 
        future.
    ``(d) Grant Consideration.--In awarding subgrants under this part, 
the State educational agency shall take into consideration the 
equitable distribution of subgrants to different geographic regions 
within the State, including urban and rural areas, and to schools 
serving elementary school and secondary school students.
    ``(e) Administrative Costs.--A State educational agency that 
receives a grant under this part may reserve not more than 5 percent of 
the grant funds for administrative, evaluation, and technical 
assistance expenses.
    ``(f) Supplement.--Funds made available under this part shall be 
used to supplement, and not supplant, any other Federal, State, or 
local funds that would otherwise be available to carry out the 
activities assisted under this part.
    ``(g) Reporting.--Each State educational agency that receives a 
grant under this part shall provide to the Secretary such information 
as the Secretary may require, including the names of local educational 
agencies and schools receiving assistance under this part, the amount 
of the assistance, and a description of the comprehensive school reform 
model selected and used.

``SEC. 1555. LOCAL APPLICATIONS.

    ``(a) In General.--Each local educational agency desiring a 
subgrant under this part shall submit an application to the State 
educational agency at such time, in such manner, and containing such 
information as the State educational agency may reasonably require.
    ``(b) Contents.--Each such application shall--
            ``(1) identify the schools, that are eligible for 
        assistance under part A, that plan to implement a comprehensive 
        school reform program and include the projected costs of such 
        program;
            ``(2) describe the promising and effective practices and 
        research-based programs that such schools will implement;
            ``(3) describe how the local educational agency will 
        provide technical assistance and support for the effective 
        implementation of the promising and effective practices and 
        research-based school reforms selected by such schools; and
            ``(4) describe how the local educational agency will 
        evaluate the implementation of such reforms and measure the 
        results achieved in improving student academic performance.

``SEC. 1556. LOCAL USE OF FUNDS.

    ``(a) Use of Funds.--A local educational agency that receives a 
subgrant under this part shall provide the subgrant funds to schools, 
that are eligible for assistance under part A and served by the agency, 
to enable the schools to implement a comprehensive school reform 
program for--
            ``(1) employing innovative strategies for student learning, 
        teaching, and school management that are based upon promising 
        and effective practices and research-based programs and have 
        been replicated successfully in schools with diverse 
        characteristics;
            ``(2) integrating 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 
        student performance standards and addresses needs identified 
        through a school needs assessment;
            ``(3) providing high quality and continuous teacher and 
        staff professional development;
            ``(4) including measurable goals for student performance;
            ``(5) providing support to teachers, principals, 
        administrators, and other school personnel staff;
            ``(6) including meaningful community and parental 
        involvement initiatives that will strengthen school improvement 
        activities;
            ``(7) using high quality external technical support and 
        assistance from an entity that has experience and expertise in 
        schoolwide reform and improvement, which may include an 
        institution of higher education;
            ``(8) evaluating school reform implementation and student 
        performance; and
            ``(9) identifying other resources, including Federal, 
        State, local, and private resources, that will be used to 
        coordinate services supporting and sustaining the school reform 
        effort.
    ``(b) Special Rule.--A school that receives funds to develop a 
comprehensive school reform program shall not be limited to using the 
approaches identified or developed by the Secretary, but may develop 
the school's own comprehensive school reform programs for schoolwide 
change as described in subsection (a).

``SEC. 1557. NATIONAL EVALUATION AND REPORTS.

    ``(a) In General.--The Secretary shall develop a plan for a 
national evaluation of the programs assisted under this part.
    ``(b) Evaluation.--The national evaluation shall--
            ``(1) evaluate the implementation and results achieved by 
        schools after 3 years of implementing comprehensive school 
        reforms; and
            ``(2) assess the effectiveness of comprehensive school 
        reforms in schools with diverse characteristics.
    ``(c) Reports.--Prior to the completion of the national evaluation, 
the Secretary shall submit an interim report describing implementation 
activities for the Comprehensive School Reform Program to the Committee 
on Education and the Workforce, and the Committee on Appropriations, of 
the House of Representatives, and the Committee on Health, Education, 
Labor, and Pensions, and the Committee on Appropriations, of the 
Senate.

``SEC. 1558. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this part 
$500,000,000 for fiscal year 2002 and such sums as may be necessary for 
each of the 4 succeeding fiscal years.''.

                          Subtitle B--Teachers

SEC. 121. STATE APPLICATIONS.

    (a) Contents of State Plan.--Section 2205(b)(2) (20 U.S.C. 
6645(b)(2)) is amended--
            (1) by amending subparagraph (N) to read as follows:
                    ``(N) set specific annual, quantifiable, and 
                measurable performance goals to increase the percentage 
                of teachers participating in sustained professional 
                development activities, reduce the beginning teacher 
                attrition rate, and reduce the percentage of teachers 
                who are not certified or licensed, and the percentage 
                who are out-of-field teachers;'';
            (2) by redesignating subparagraph (O) as subparagraph (P); 
        and
            (3) by inserting after subparagraph (N) the following:
                    ``(O) describe how the State will ensure that all 
                teachers in the State will be fully qualified not later 
                than December 1, 2005; and''.
    (b) State and Local Activities.--Part B of title II (20 U.S.C. 6641 
et seq.) is amended--
            (1) by redesignating section 2211 as section 2215;
            (2) by inserting after section 2210 the following:

``SEC. 2211. LOCAL CONTINUATION OF FUNDING.

    ``(a) Agencies.--If a local educational agency applies for funds 
from a State under this part for a fourth or subsequent fiscal year, 
the agency may not receive the funds for that fiscal year unless the 
State determines that the agency has demonstrated that, in carrying out 
activities under this part during the past fiscal year, the agency has 
annual numerical performance objectives consisting of--
            ``(1) improved student performance for all groups 
        identified in section 1111;
            ``(2) an increased percentage of teachers participating in 
        sustained professional development activities;
            ``(3) a reduction in the beginning teacher attrition rate 
        for the agency; and
            ``(4) a reduction in the percentage of teachers who are not 
        certified or licensed, and the percentage who are out-of-field 
        teachers, for the agency.
    ``(b) Schools.--If a local educational agency applies for funds 
under this part on behalf of a school for a fourth or subsequent fiscal 
year (including applying for funds as part of a partnership), the 
agency may not receive the funds for the school for that fiscal year 
unless the State determines that the school has demonstrated that, in 
carrying out activities under this part during the past fiscal year, 
the school has met the requirements of paragraphs (1) through (4) of 
subsection (a).

``SEC. 2212. INFORMATION AND NOTICE TO PARENTS.

    ``(a) Parents' Right To Know Information.--
            ``(1) In general.--A local educational agency that receives 
        funds under this title shall provide, on request, in an 
        understandable and uniform format, to any parent of a student 
        attending any school served by the agency, information 
        regarding the professional qualifications of each of the 
        student's classroom teachers.
            ``(2) Contents.--The agency shall provide, at a minimum, 
        information on--
                    ``(A) whether the teacher has met State 
                certification or licensing criteria for the academic 
                subjects and grade levels in which the teacher teaches 
                the student;
                    ``(B) whether the teacher is teaching with 
                emergency or other provisional credentials, due to 
                which any State certification or licensing criteria 
                have been waived; and
                    ``(C) the academic qualifications of the teacher in 
                the academic subjects and grade levels in which the 
                teacher teaches.
    ``(b) Notice.--In addition to providing the information described 
in subsection (a), if a school that receives funds under this title 
assigns a student to a teacher who is not a fully qualified teacher or 
assigns a student, for 2 or more consecutive weeks, to a substitute 
teacher who is not a fully qualified teacher, the school shall provide 
notice of the assignment to a parent of the student, not later than 15 
school days after the assignment.

``SEC. 2213. GENERAL ACCOUNTING OFFICE STUDY.

    ``Not later than September 30, 2005, the Comptroller General of the 
United States 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 study setting 
forth information regarding the progress of States' compliance in 
increasing the percentage of fully qualified teachers for fiscal years 
2001 through 2004.

``SEC. 2214. DEFINITION OF FULLY QUALIFIED.

    ``(a) In General.--In this part, the term `fully qualified', used 
with respect to a teacher, means a teacher who--
            ``(1)(A) has demonstrated the subject matter knowledge, 
        teaching knowledge, and teaching skill necessary to teach 
        effectively in the academic subject in which the teacher 
        teaches, according to the criteria described in subsections (b) 
        and (c); and
            ``(B) is not a teacher for whom State certification or 
        licensing requirements have been waived or who is teaching 
        under an emergency or other provisional credential; or
            ``(2) meets the standards set by the National Board for 
        Professional Teaching Standards.
    ``(b) Elementary School.--For purposes of making the demonstration 
described in subsection (a)(1), each teacher who teaches elementary 
school students (other than middle school students) shall, at a 
minimum--
            ``(1) have State certification (which may include 
        certification obtained through an alternative route) or a State 
        license to teach; and
            ``(2) hold a bachelor's degree and demonstrate the subject 
        matter knowledge, teaching knowledge, and teaching skill 
        required to teach effectively in reading, writing, mathematics, 
        social studies, science, and other elements of a liberal arts 
        education.
    ``(c) Middle School and Secondary School.--For purposes of making 
the demonstration described in subsection (a)(1), each teacher who 
teaches middle school students or secondary school students shall, at a 
minimum--
            ``(1) have State certification (which may include 
        certification obtained through an alternative route) or a State 
        license to teach; and
            ``(2) hold a bachelor's degree or higher degree and 
        demonstrate a high level of competence in all academic subjects 
        in which the teacher teaches through--
                    ``(A) achievement of a high level of performance on 
                rigorous academic subject area tests;
                    ``(B) completion of an academic major (or courses 
                totaling an equivalent number of credit hours) in each 
                of the academic subjects in which the teacher teaches; 
                or
                    ``(C) in the case of teachers hired before the date 
                of enactment of the School Improvement Accountability 
                Act, completion of appropriate coursework for mastery 
                of the academic subjects in which the teacher 
                teaches.''; and
            (3) by amending section 2215 (as so redesignated)--
                    (A) in subsection (a)(3), by adding after 
                ``agency'' the following: ``for which at least 40 
                percent of the students served by the agency are 
                eligible for free or reduced price lunches under the 
                Richard B. Russell National School Lunch Act''; and
                    (B) by inserting after subsection (a)(4) the 
                following:
            ``(5) Reporting requirements.--Each institution of higher 
        education receiving assistance under paragraph (1) shall fully 
        comply with all reporting requirements of title II of the 
        Higher Education Act of 1965.''.
    (c) Conforming Amendments.--The Act (20 U.S.C. 6301 et seq.) is 
amended--
            (1) in section 2203(2) (20 U.S.C. 6643(2)), by striking 
        ``section 2211'' and inserting ``section 2215''; and
            (2) in section 2205(c)(2) (20 U.S.C. 6645(c)(2)), by 
        striking ``section 2211'' and inserting ``section 2215''.

                    Subtitle C--Innovative Education

SEC. 131. REQUIREMENTS FOR STATE PLANS.

    Part B of title VI (20 U.S.C. 7331 et seq.) is amended by adding at 
the end the following:

``SEC. 6203. REQUIREMENTS FOR STATE PLANS.

    ``(a) State Plans.--In addition to requirements relating to State 
applications under this part, the State educational agency for each 
State desiring a grant under this title shall submit a State plan that 
meets the requirements of this section to the Secretary at such time, 
in such manner, and accompanied by such information as the Secretary 
may require.
    ``(b) Consolidated Plan.--A State plan submitted under subsection 
(a) may be submitted as part of a consolidated plan under section 
14302, and as part of a State application described in section 6202.
    ``(c) Contents.--Each plan submitted under subsection (a) shall--
            ``(1) describe how the funds made available through the 
        grant will be used to increase student academic performance;
            ``(2) describe annual, quantifiable, and measurable 
        performance goals that will be used to measure the impact of 
        those funds on student performance;
            ``(3) describe the methods the State will use to measure 
        the annual impact of programs described in the plan and the 
        extent to which such goals are aligned with State standards;
            ``(4) certify that the State has in place the standards and 
        assessments required under section 1111;
            ``(5) certify that the State educational agency has a 
        system, as required under section 1111, for--
                    ``(A) holding each local educational agency and 
                school accountable for adequate yearly progress (as 
                described in section 1111(b)(2));
                    ``(B) identifying local educational agencies and 
                schools for improvement and corrective action (as 
                required in sections 1116 and 1117);
                    ``(C) assisting local educational agencies and 
                schools that are identified for improvement with the 
                development of improvement plans; and
                    ``(D) providing technical assistance, professional 
                development, and other capacity building as needed to 
                get such agencies and schools out of improvement 
                status;
            ``(6) certify that the State educational agency will use 
        the disaggregated results of student assessments required under 
        section 1111(b)(3), and other measures or indicators available, 
        to review annually the progress of each local educational 
        agency and school served under this title to determine whether 
        each such agency and school is making adequate yearly progress 
        as required under section 1111(b)(2);
            ``(7) certify that the State educational agency will take 
        action against a local educational agency that is identified 
        for corrective action and receiving funds under this title;
            ``(8) describe what, if any, State and other non-Federal 
        resources will be provided to local educational agencies and 
        schools served under this title to carry out activities 
        consistent with this title; and
            ``(9) certify that the State educational agency has a 
        system to hold local educational agencies accountable for 
        meeting the annual performance goals required under paragraph 
        (2).
    ``(d) Approval.--The Secretary, using a peer review process, shall 
approve a State plan submitted under this section if the State plan 
meets the requirements of this section.
    ``(e) Duration of the Plan.--Each State plan shall remain in effect 
for the duration of the State's participation under this title.
    ``(f) Requirement.--A State shall not be eligible to receive funds 
under this title unless the State has established the standards and 
assessments required under section 1111.
    ``(g) Public Review.--Each State educational agency will make 
publicly available the plan approved under subsection (d).

``SEC. 6204. SANCTIONS.

    ``(a) Third Fiscal Year.--If a State receiving grant funds under 
this title fails to meet performance goals established under section 
6203(c)(2) by the end of the third fiscal year for which the State 
receives such grant funds, the Secretary shall reduce by 50 percent the 
amount the State is entitled to receive for administrative expenses 
under this title.
    ``(b) Fourth Fiscal Year.--If the State fails to meet such 
performance goals by the end of the fourth fiscal year for which the 
State receives grant funds under this title, the Secretary shall reduce 
the total amount the State receives under this title by 20 percent.
    ``(c) Technical Assistance.--The Secretary shall provide technical 
assistance, at the request of a State subjected to sanctions under 
subsection (a) or (b).
    ``(d) Local Sanctions.--
            ``(1) In general.--Each State receiving assistance under 
        this title shall develop a system to hold local educational 
        agencies accountable for meeting the adequate yearly progress 
        requirements established under part A of title I and the 
        performance goals established under this title.
            ``(2) Sanctions.--A system developed under paragraph (1) 
        shall include a mechanism for sanctioning local educational 
        agencies for failure to meet such performance goals and 
        adequate yearly progress levels.

``SEC. 6205. STATE REPORTS.

    ``Each State educational agency or Chief Executive Officer of a 
State receiving funds under this title shall annually publish and 
disseminate to the public in a format and, to the extent practicable, 
in a language that the public can understand, a report on--
            ``(1) the use of such funds;
            ``(2) the impact of programs conducted with such funds and 
        an assessment of such programs' effectiveness; and
            ``(3) the progress of the State toward attaining the 
        performance goals established under section 6203(c)(2), and the 
        extent to which the programs have increased student 
        achievement.

``SEC. 6206. STANDARDS; ASSESSMENTS ENHANCEMENT.

    ``Each State educational agency receiving a grant under this title 
may use such grant funds, consistent with section 6201(a)(1)(C), to--
            ``(1) establish high quality, internationally competitive 
        content and student performance standards and strategies that 
        all students will be expected to meet;
            ``(2) provide for the establishment of high quality, 
        rigorous assessments that include multiple measures and 
        demonstrate comprehensive knowledge; or
            ``(3) develop and implement value-added assessments.''.

SEC. 132. PERFORMANCE OBJECTIVES.

    Title VII (20 U.S.C. 7401 et seq.) is amended by inserting after 
section 7105 the following:

``SEC. 7106. PERFORMANCE OBJECTIVES.

    ``(a) In General.--Each State educational agency or local 
educational agency receiving a grant under this part shall develop 
annual numerical performance objectives that are age-appropriate and 
developmentally-appropriate with respect to helping limited English 
proficient students become proficient in English and improve overall 
academic performance based upon State and local content and performance 
standards. The objectives shall include incremental percentage 
increases for each fiscal year a State educational agency or local 
educational agency receives a grant under this title, including 
increases from the preceding fiscal year in the number of limited 
English proficient students demonstrating an increase in performance on 
annual assessments concerning reading, writing, speaking, and listening 
comprehension.
    ``(b) Accountability.--Each State educational agency or local 
educational agency receiving a grant under this title shall be held 
accountable for meeting the annual numerical performance objectives 
under this title and the adequate yearly progress levels for limited 
English proficient students under clauses (ii) and (iv) of section 
1111(b)(2)(B). Any State educational agency or local educational agency 
that fails to meet the annual performance objectives shall be subject 
to sanctions described in section 14515.
    ``(c) Parental Notification.--
            ``(1) In general.--Each State educational agency or local 
        educational agency shall notify a parent of a student who is 
        participating in a language instruction educational program 
        under this title, in a manner and form understandable to the 
        parent, including, if necessary and to the extent feasible, in 
        the native language of the parent, of--
                    ``(A) the student's level of English proficiency, 
                how such level was assessed, the status of the 
                student's academic achievement, and the implications of 
                the student's educational strengths and needs for age-
                appropriate and grade-appropriate academic attainment, 
                promotion, and graduation;
                    ``(B) what programs are available to meet the 
                student's educational strengths and needs, and how such 
                programs differ in content and instructional goals from 
                other language instruction educational programs and, in 
                the case of a student with a disability, how such 
                available programs meet the objectives of the 
                individualized education program of such a student; and
                    ``(C) the instructional goals of the language 
                instruction educational program, and how the program 
                will specifically help the limited English proficient 
                student learn English and meet State and local content 
                and performance standards, including--
                            ``(i) the characteristics, benefits, and 
                        past academic results of the language 
                        instruction educational program and of 
                        instructional alternatives; and
                            ``(ii) the reasons the student was 
                        identified as being in need of a language 
                        instruction educational program.
            ``(2) Option to decline.--Each parent described in 
        paragraph (1) shall also be informed that the parent has the 
        option of declining the enrollment of a student in a language 
        instruction educational program, and shall be given an 
        opportunity to decline such enrollment if the parent so 
        chooses.
            ``(3) Special rule.--A student shall not be admitted to, or 
        excluded from, any federally assisted language instruction 
        educational program solely on the basis of a surname or 
        language-minority status.''.

SEC. 133. REPORT CARDS.

    Title XIV (20 U.S.C. 8801 et seq.) is amended by adding at the end 
the following:

                         ``PART I--REPORT CARDS

``SEC. 14901. REPORT CARDS.

    ``(a) Grants Authorized.--The Secretary shall award a grant, from 
allotments under subsection (b), to each State having a State report 
card meeting the requirements described in subsection (e), to enable 
the State, and local educational agencies and schools in the State, 
annually to publish report cards for each elementary school and 
secondary school that receives funding under this Act and is served by 
the State.
    ``(b) Reservations and Allotments.--
            ``(1) Reservations.--From the amount appropriated under 
        subsection (j) to carry out this part for each fiscal year, the 
        Secretary shall reserve--
                    ``(A) \1/2\ of 1 percent of such amount for 
                payments to the Secretary of the Interior for 
                activities approved by the Secretary of Education, 
                consistent with this part, in schools operated or 
                supported by the Bureau of Indian Affairs, on the basis 
                of their respective needs for assistance under this 
                part; and
                    ``(B) \1/2\ of 1 percent of such amount for 
                payments to outlying areas, to be allotted in 
                accordance with their respective needs for assistance 
                under this part, as determined by the Secretary, for 
                activities approved by the Secretary, consistent with 
                this part.
            ``(2) State allotments.--From the amount appropriated under 
        subsection (j) for a fiscal year and remaining after the 
Secretary makes reservations under paragraph (1), the Secretary shall 
allot to each State having a State report card meeting the requirements 
described in subsection (e) an amount that bears the same relationship 
to the remainder as the number of public school students enrolled in 
elementary schools and secondary schools in the State bears to the 
number of such students so enrolled in all States.
    ``(c) State Reservation of Funds.--Each State educational agency 
receiving a grant under subsection (a) may reserve--
            ``(1) not more than 10 percent of the grant funds to carry 
        out activities described in subsections (e) and (g)(2) for 
        fiscal year 2002; and
            ``(2) not more than 5 percent of the grant funds to carry 
        out activities described in subsections (e) and (g)(2) for 
        fiscal year 2003 and each of the 3 succeeding fiscal years.
    ``(d) Within-State Allocations.--Each State educational agency 
receiving a grant under subsection (a) shall allocate the grant funds 
that remain after making the reservation described in subsection (c) to 
each local educational agency in the State in an amount that bears the 
same relationship to the remainder as the number of public school 
students enrolled in elementary schools and secondary schools served by 
the local educational agency bears to the number of such students 
served by local educational agencies within the State.
    ``(e) Annual State Report Card.--
            ``(1) Report cards required.--Not later than the beginning 
        of the 2002-2003 school year, a State that receives assistance 
        under this Act shall prepare and disseminate an annual report 
        card for parents, the general public, teachers, and the 
        Secretary, with respect to all elementary schools and secondary 
        schools within the State.
            ``(2) Required information.--Each State described in 
        paragraph (1), at a minimum, shall include in the annual State 
        report card information regarding--
                    ``(A) student performance on statewide assessments 
                for the year for which the annual State report card is 
                prepared and the preceding year, in at least English 
                language arts and mathematics, including--
                            ``(i) a comparison of the proportions of 
                        students who performed at the basic, 
                        proficient, and advanced levels in each subject 
                        area, for each grade level for which 
                        assessments are required under title I for the 
                        year for which the report card is prepared, 
                        with proportions in each of the same 3 levels 
                        in each subject area at the same grade levels 
                        in the preceding school year;
                            ``(ii) a statement on the most recent 3-
                        year trend in the percentage of students 
                        performing at the basic, proficient, and 
                        advanced levels in each subject area, for each 
                        grade level for which assessments are required 
                        under title I; and
                            ``(iii) a statement of the percentage of 
                        students not tested and a listing of categories 
                        of the reasons why such students were not 
                        tested;
                    ``(B) student retention rates in each grade, the 
                number of students completing advanced placement 
                courses, annual school dropout rates as calculated by 
                procedures conforming with the National Center for 
                Education Statistics Common Core of Data, and 4-year 
                graduation rates; and
                    ``(C) the professional qualifications of teachers 
                in the aggregate, including the percentage of teachers 
                teaching with emergency or provisional credentials, the 
                percentage of class sections not taught by fully 
                qualified teachers, and the percentage of teachers who 
                are fully qualified.
            ``(3) Student data.--Student data in each report card shall 
        contain disaggregated results for the following categories:
                    ``(A) Racial and ethnic groups.
                    ``(B) Gender groups.
                    ``(C) Economically disadvantaged students, as 
                compared with students who are not economically 
                disadvantaged.
                    ``(D) Students with limited English proficiency, as 
                compared with students who are proficient in English.
                    ``(E) Migrant status groups.
                    ``(F) Students with disabilities, as compared with 
                students who are not disabled.
            ``(4) Optional information.--A State may include in the 
        State annual report card any other information the State 
        determines appropriate to reflect school quality and school 
        achievement, including by grade level information on the 
        following:
                    ``(A) Average class size.
                    ``(B) School safety, such as the incidence of 
                school violence and drug and alcohol abuse.
                    ``(C) The incidence of student suspensions and 
                expulsions.
                    ``(D) Student access to technology, including the 
                number of computers for educational purposes, the 
                number of computers per classroom, and the number of 
                computers connected to the Internet.
                    ``(E) Parental involvement, as determined by such 
                measures as the extent of parental participation in 
                schools, parental involvement activities, and extended 
                learning time programs, such as after-school and summer 
                programs.
    ``(f) Local Educational Agency and School Report Cards.--
            ``(1) In general.--The State shall ensure that each local 
        educational agency, elementary school, and secondary school in 
        the State, collects appropriate data and publishes an annual 
        report card consistent with this subsection.
            ``(2) Required information.--Each local educational agency, 
        elementary school, and secondary school described in paragraph 
        (1), at a minimum, shall include in its annual report card--
                    ``(A) the information described in paragraphs (2) 
                and (3) of subsection (e) for each local educational 
                agency and school;
                    ``(B) in the case of a local educational agency--
                            ``(i) information regarding the number and 
                        percentage of schools served by the local 
                        educational agency that are identified for 
                        school improvement, including schools 
                        identified under section 1116;
                            ``(ii) information on the most recent 3-
                        year trend in the number and percentage of 
                        elementary schools and secondary schools served 
                        by the local educational agency that are 
                        identified for school improvement; and
                            ``(iii) information on how students in the 
                        schools served by the local educational agency 
                        performed on the statewide assessment compared 
                        with students in the State as a whole;
                    ``(C) in the case of an elementary school or a 
                secondary school--
                            ``(i) information regarding whether the 
                        school has been identified for school 
                        improvement;
                            ``(ii) information on how the school's 
                        students performed on the statewide assessment 
                        compared with students in schools served by the 
                        same local educational agency and with all 
                        students in the State; and
                            ``(iii) information about the enrollment of 
                        students compared with the rated capacity of 
                        the schools; and
                    ``(D) other appropriate information, regardless of 
                whether the information is included in the annual State 
                report.
    ``(g) Dissemination and Accessibility of Report Cards.--
            ``(1) Report card format.--Annual report cards under this 
        part shall be--
                    ``(A) concise; and
                    ``(B) presented in a format and manner that parents 
                can understand, including, to the extent practicable, 
                in a language the parents can understand.
            ``(2) State report cards.--State annual report cards under 
        subsection (e) shall be disseminated to all elementary schools, 
        secondary schools, and local educational agencies in the State, 
        and made broadly available to the public through means such as 
        posting on the Internet and distribution to the media, and 
        through public agencies.
            ``(3) Local report cards.--Local educational agency report 
        cards under subsection (f) shall be disseminated to all 
        elementary schools and secondary schools served by the local 
        educational agency and to parents of students attending such 
        schools, and made broadly available to the public through means 
        such as posting on the Internet and distribution to the media, 
        and through public agencies.
            ``(4) School report cards.--Elementary school and secondary 
        school report cards under subsection (f) shall be disseminated 
        to parents of students attending that school, and made broadly 
        available to the public through means such as posting on the 
        Internet and distribution to the media, and through public 
        agencies.
    ``(h) Coordination of State Plan Content.--A State shall include in 
its plan under part A of title I or part B of title II, an assurance 
that the State 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.
    ``(j) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this part $5,000,000 for fiscal year 2002 and 
such sums as may be necessary for each of the 4 succeeding fiscal 
years.

     ``PART J--ADDITIONAL PERFORMANCE AND ACCOUNTABILITY PROVISIONS

``SEC. 14911. REWARDING HIGH PERFORMANCE.

    ``(a) State Rewards.--
            ``(1) In general.--From amounts appropriated under 
        subsection (d), the Secretary shall make awards to States 
        that--
                    ``(A) for 3 consecutive years have--
                            ``(i) exceeded the State performance goals 
                        and objectives established for any title under 
                        this Act;
                            ``(ii) exceeded the adequate yearly 
                        progress levels established under section 
                        1111(b)(2);
                            ``(iii) significantly narrowed the gaps 
                        between minority and nonminority students, and 
                        between economically disadvantaged students and 
                        students who are not economically 
                        disadvantaged;
                            ``(iv) raised all students to the 
                        proficient standard level prior to 10 years 
                        after the date of enactment of the School 
                        Improvement Accountability Act; or
                            ``(v) significantly increased the 
                        percentage of core classes being taught by 
                        fully qualified teachers, in schools receiving 
                        funds under part A of title I; or
                    ``(B) by not later than fiscal year 2005, ensure 
                that all teachers teaching in the State public 
                elementary schools and secondary schools are fully 
                qualified.
            ``(2) State use of funds.--
                    ``(A) Demonstration sites.--Each State receiving an 
                award under paragraph (1) shall use a portion of the 
                award funds that are not distributed under subsection 
                (b) to establish demonstration sites with respect to 
                high-performing schools (based upon achievement, or 
                performance levels and adequate yearly progress) in 
                order to help low-performing schools.
                    ``(B) Improvement of performance.--Each State 
                receiving an award under paragraph (1) shall use the 
                portion of the award funds that are not used pursuant 
                to subparagraph (A) or (C) and are not distributed 
                under subsection (b) for the purpose of improving the 
                level of performance of all elementary school and 
                secondary school students in the State, based upon 
                State content and performance standards.
                    ``(C) Reservation for administrative expenses.--
                Each State receiving an award under paragraph (1) may 
                set aside not more than \1/2\ of 1 percent of the award 
                funds for the planning and administrative costs of 
                carrying out this section, including the costs of 
                distributing awards to local educational agencies.
    ``(b) Local Educational Agency Awards.--
            ``(1) In general.--Each State receiving an award under 
        subsection (a)(1) shall distribute 80 percent of the award 
        funds to local educational agencies in the State that--
                    ``(A) for 3 consecutive years have--
                            ``(i) exceeded the State-established local 
                        educational agency performance goals and 
                        objectives established for any title under this 
                        Act;
                            ``(ii) exceeded the adequate yearly 
                        progress levels established under section 
                        1111(b)(2);
                            ``(iii) significantly narrowed the gaps 
                        between minority and nonminority students, and 
                        between economically disadvantaged students and 
                        students who are not economically 
                        disadvantaged;
                            ``(iv) raised all students enrolled in 
                        schools served by the local educational agency 
                        to the proficient standard level prior to 10 
                        years from the date of enactment of the School 
                        Improvement Accountability Act; or
                            ``(v) significantly increased the 
                        percentage of core classes being taught by 
                        fully qualified teachers, in schools receiving 
                        funds under part A of title I;
                    ``(B) not later than December 31, 2005, ensure that 
                all teachers teaching in the elementary schools and 
                secondary schools served by the local educational 
                agency are fully qualified; or
                    ``(C) have attained consistently high achievement 
                in another area that the State determines appropriate 
                to reward.
            ``(2) School-based performance awards.--A local educational 
        agency shall use funds made available under paragraph (1) for 
        activities described in subsection (c) such as school-based 
        performance awards.
            ``(3) Reservation for administrative expenses.--Each local 
        educational agency receiving an award under paragraph (1) may 
        set aside not more than \1/2\ of 1 percent of the award funds 
        for the planning and administrative costs of carrying out this 
        section, including the costs of distributing awards to eligible 
        elementary schools and secondary schools, teachers, and 
        principals.
    ``(c) School Rewards.--Each local educational agency receiving an 
award under subsection (b) shall consult with teachers and principals 
to develop a reward system, and shall use the award funds--
            ``(1) to reward individual schools that demonstrate high 
        performance with respect to--
                    ``(A) increasing the academic achievement of all 
                students;
                    ``(B) narrowing the academic achievement gap 
                described in section 1111(b)(2)(B)(iv);
                    ``(C) improving teacher quality;
                    ``(D) increasing high-quality professional 
                development for teachers, principals, and 
                administrators; or
                    ``(E) improving the English proficiency of limited 
                English proficient students;
            ``(2) to reward collaborative teams of teachers, or teams 
        of teachers and principals, that--
                    ``(A) significantly increase the annual performance 
                of low-performing students; or
                    ``(B) significantly improve in a fiscal year the 
                English proficiency of limited English proficient 
                students;
            ``(3) to reward principals who successfully raise the 
        performance of a substantial number of low-performing students 
        to high academic levels;
            ``(4) to develop or implement school district-wide programs 
        or policies to increase the level of student performance on 
        State assessments that are aligned with State content 
        standards; and
            ``(5) to reward schools for consistently high achievement 
        in another area that the local educational agency determines 
        appropriate to reward.
    ``(d) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $200,000,000 for fiscal year 
2002, and such sums as may be necessary for each of the 4 succeeding 
fiscal years.
    ``(e) Definition.--The term `low-performing student' means a 
student who is below a basic State standard level.''.

SEC. 134. ADDITIONAL ACCOUNTABILITY PROVISIONS.

    Part E of title XIV (20 U.S.C. 8891 et seq.) is amended by adding 
at the end the following:

``SEC. 14515. ADDITIONAL ACCOUNTABILITY PROVISIONS.

    ``(a) In General.--Notwithstanding any other provision of this Act, 
a recipient of funds provided for a fiscal year under part A of title 
I, part A or C of title III, part A of title IV, part A of title V, or 
title VII, shall include--
            (1) in the plans or applications required under such part 
        or title--
                    (A) the methods the recipient will use to measure 
                the annual impact of each program funded in whole or in 
                part with funds provided under such part or title and, 
                if applicable, the extent to which each such program 
                will increase student academic achievement;
                    (B) the annual, quantifiable, and measurable 
                performance goals and objectives for each such program, 
and the extent to which, if applicable, the program's performance goals 
and objectives align with State content standards and State student 
performance standards established under section 1111(b)(1)(A); and
                    (C) if the recipient is a local educational agency, 
                assurances that the local educational agency consulted, 
                at a minimum, with parents, school board members, 
                teachers, administrators, business partners, education 
                organizations, and community groups to develop the plan 
                or application submitted and that such consultation 
                will continue on a regular basis; and
            ``(2) in the reports required under such part or title, a 
        report for the preceding fiscal year regarding how the plan or 
        application submitted for such fiscal year under such part or 
        title was implemented, the recipient's progress toward 
        attaining the performance goals and objectives identified in 
        the plan or application for such year, and, if applicable, the 
        extent to which programs funded in whole or in part with funds 
        provided under such part or title increased student 
        achievement.
    ``(b) Penalties.--If a recipient of funds under a part or title 
described in subsection (a) fails to meet the performance goals and 
objectives of the part or title for 3 consecutive fiscal years, the 
Secretary shall--
            ``(1) withhold not less than 50 percent of the funds made 
        available under the relevant program for administrative 
        expenses for the succeeding fiscal year, and for each 
        consecutive fiscal year until the recipient meets such 
        performance goals and objectives; and
            ``(2) in the case of--
                    ``(A) a competitive grant (as determined by the 
                Secretary), consider the recipient ineligible for 
                grants under the part or title until the recipient 
                meets such performance goals and objectives; and
                    ``(B) a formula grant (as determined by the 
                Secretary), withhold not less than 20 percent of the 
                total amount of funds provided under title VI for the 
                succeeding fiscal year and each consecutive fiscal year 
                until the recipient meets such goals and objectives.
    ``(c) Other Penalties.--A State that has not met the requirements 
of subsection (a)(1)(B) with respect to a fiscal year--
            ``(1) shall not be eligible for designation as an Ed-Flex 
        Partnership State under the Education Flexibility Partnership 
        Act of 1999 until the State meets the requirements of 
        subsection (a)(1)(B); and
            ``(2) shall be subject to such other penalties as are 
        provided in this Act for failure to meet the requirements of 
        subsection (a)(1)(B).
    ``(d) Special Rule for Secretary Awards.--
            ``(1) In general.--Notwithstanding any other provision of 
        this Act, a recipient of funds provided under a direct award 
        made by the Secretary, or a contract or cooperative agreement 
        entered into with the Secretary, for a program shall include 
        the following information in any application or plan required 
        for such program:
                    ``(A) How funds provided under the program will be 
                used and how such use will increase student academic 
                achievement.
                    ``(B) The goals and objectives to be met, including 
                goals for dissemination and use of the information or 
                materials produced, where applicable.
                    ``(C) If the grant requires dissemination of 
                information or materials, how the recipient will track 
                and report annually to the Secretary--
                            ``(i) the successful dissemination of 
                        information or materials produced;
                            ``(ii) where information or materials 
                        produced are being used; and
                            ``(iii) the impact of such use and, if 
                        applicable, the extent to which such use 
                        increased student academic achievement or 
                        contributed to the stated goal of the program.
            ``(2) Requirement.--If no application or plan is required 
        under a program described in paragraph (1), the Secretary shall 
        require the recipient of funds to submit a plan containing the 
        information required under paragraph (1).
            ``(3) Failure to achieve goals and objectives.--
                    ``(A) In general.--The Secretary shall evaluate the 
                information submitted under this subsection to 
                determine whether the recipient has met the goals and 
                objectives described in paragraph (1)(B), where 
                applicable, assess the magnitude of dissemination 
                described in paragraph (1)(C), and, where applicable, 
                assess the effectiveness of the activity funded in 
                raising student academic achievement in places where 
                information or materials produced with such funds are 
                used.
                    ``(B) Ineligibility.--The Secretary shall consider 
                the recipient ineligible for grants, contracts, or 
                cooperative agreements under the program described in 
                paragraph (1) if--
                            ``(i) the goals and objectives described in 
                        paragraph (1)(B) have not been met;
                            ``(ii) where applicable, the dissemination 
                        has not been of a magnitude to ensure goals and 
                        objectives are being addressed; and
                            ``(iii) where applicable, the information 
                        or materials produced have not made a 
                        significant impact on raising student 
                        achievement in places where such information or 
                        materials are used.''.

                 TITLE II--CLOSING THE ACHIEVEMENT GAP

                Subtitle A--Reauthorization of Programs

SEC. 201. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--Section 1002(a) (20 U.S.C. 6302(a)) is amended by 
striking ``appropriated $7,400,000,000 for fiscal year 1995'' and all 
that follows through the period and inserting the following: 
``appropriated--
            ``(1) $11,000,000,000 for fiscal year 2002;
            ``(2) $13,000,000,000 for fiscal year 2003;
            ``(3) $15,000,000,000 for fiscal year 2004;
            ``(4) $15,000,000,000 for fiscal year 2005; and
            ``(5) $15,000,000,000 for fiscal year 2006.''.
    (b) Review of Allocations.--The Secretary of Education shall 
annually review the manner in which funds are allocated under title I 
of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 6301 
et seq.) to ensure that local education agencies with the highest need 
are receiving funds in proportion to that need as compared to other 
local education agencies.

   Subtitle B--Options: Opportunities to Improve our Nation's Schools

SEC. 211. OPTIONS: OPPORTUNITIES TO IMPROVE OUR NATION'S SCHOOLS.

    Title V (20 U.S.C. 7201 et seq.) is amended by adding at the end 
the following:

    ``PART D--OPTIONS: OPPORTUNITIES TO IMPROVE OUR NATION'S SCHOOLS

``SEC. 5401. PURPOSE.

    ``It is the purpose of this part to identify and support innovative 
approaches to high-quality public school choice by providing financial 
assistance for the demonstration, development, implementation, and 
evaluation of, and the dissemination of information about, public 
school choice programs that stimulate educational innovation for all 
public schools and contribute to standards-based school reform efforts.

``SEC. 5402. GRANTS.

    ``(a) In General.--From funds appropriated under section 5405(a) 
and not reserved under section 5405(b), the Secretary is authorized to 
make grants to State and local educational agencies to support programs 
that promote innovative approaches to high-quality public school 
choice.
    ``(b) Duration.--A grant under this part shall not be awarded for a 
period that exceeds 3 years.

``SEC. 5403. USES OF FUNDS.

    ``(a) Uses of Funds.--
            ``(1) In general.--Funds under this part may be used to 
        demonstrate, develop, implement, and evaluate, and to 
        disseminate information about, innovative approaches to broaden 
        public elementary school and secondary school choice, including 
        the design and development of new public school choice options, 
        the development of new strategies for overcoming barriers to 
        effective public school choice, and the design and development 
        of public school choice systems that promote high standards for 
        all students and the continuous improvement of all such public 
        schools.
            ``(2) Examples.--The approaches described in paragraph (1) 
        at the school, school district, and State levels may include--
                    ``(A) inter school district approaches to public 
                school choice, including approaches that increase equal 
                access to high-quality educational programs and 
                diversity in schools;
                    ``(B) public elementary and secondary programs that 
                involve partnerships with institutions of higher 
                education and that are located on the campuses of the 
                institutions;
                    ``(C) programs that allow students in public 
                secondary schools to enroll in postsecondary courses 
                and to receive both secondary and postsecondary 
                academic credit;
                    ``(D) worksite satellite schools, in which State or 
                local educational agencies form partnerships with 
                public or private employers, to create public schools 
                at parents' places of employment; and
                    ``(E) approaches to school desegregation that 
                provide students and parents choice through strategies 
                other than magnet schools.
    ``(b) Limitations.--Funds under this part--
            ``(1) shall supplement, and not supplant, non-Federal funds 
        expended for existing programs;
            ``(2) may be used for providing transportation services or 
        costs, except that not more than 10 percent of the funds 
        received under this part may be used by the local educational 
        agency to provide such services or costs;
            ``(3) may be used for improving low performing schools that 
        lose students as a result of school choice plans, except that 
        not more than 10 percent of the funds under this part may be 
        used by the local educational agency for the improvement of low 
        performing schools; and
            ``(4) shall not be used to fund programs that are 
        authorized under part C, D, or E.

``SEC. 5404. GRANT APPLICATION; PRIORITIES.

    ``(a) Application Required.--A State or local educational agency 
desiring to receive a grant under this part shall submit an application 
to the Secretary in such form and containing such information as the 
Secretary may require.
    ``(b) Application Contents.--Each application shall include--
            ``(1) a description of the program for which funds are 
        sought and the goals for such program;
            ``(2) a description of how the program funded under this 
        part will be coordinated with, and will complement and enhance, 
        programs under other related Federal and non-Federal programs;
            ``(3) if the program includes partners, the name of each 
        partner and a description of the partner's responsibilities; 
        and
            ``(4) a description of the policies and procedures the 
        agency will use to ensure--
                    ``(A) that priority is provided to parents of 
                students attending schools identified for school 
                improvement under section 1116 in exercising choice 
                among schools;
                    ``(B) that priority is provided to parents of 
                students who want to stay enrolled at a school;
                    ``(C) the agency's accountability for results, 
                including the agency's goals and performance 
                indicators;
                    ``(D) that the program is open and accessible to, 
                and will promote high academic standards for, all 
                students regardless of the achievement level or 
                disability of the students and the family income of the 
                families of the students;
                    ``(E) that all parents are provided with easily 
                comprehensible information about various school 
                options, including information on instructional 
                approaches at different schools, resources, and 
                transportation that will be provided at or for the 
                schools on an annual basis;
                    ``(F) that all parents are given timely notice 
                about opportunities to choose which school their child 
                will attend the following year and the period during 
                which the choice may be made;
                    ``(G) that limitations on transfers between schools 
                only occur because of facilities constraints, statutory 
                class size limits, and local efforts to ensure that 
                schools reflect the diversity of the communities in 
                which the schools are located;
                    ``(H) that a lottery or other random system be 
                established for parents of students wishing to attend a 
                school that cannot receive all students wishing to 
                attend; and
                    ``(I) that the program is carried out in a manner 
                consistent with Federal law, including court orders, 
                such as desegregation orders, issued to enforce Federal 
                law.
    ``(c) Priorities.--
            ``(1) In general.--The Secretary shall give a priority to 
        applications for programs that will serve high-poverty local 
        educational agencies.
            ``(2) Permissive.--The Secretary may give a priority to 
        applications demonstrating that the State or local educational 
        agency will carry out the agency's program in partnership with 
        one or more public or private agencies, organizations, or 
        institutions, including institutions of higher education and 
        public or private employers.

``SEC. 5405. AUTHORIZATION OF APPROPRIATIONS; RESERVATION; EVALUATIONS.

    ``(a) Authorization of Appropriations.--For the purpose of carrying 
out this part, there are authorized to be appropriated $100,000,000 for 
each of fiscal years 2002 through 2006.
    ``(b) Reservation for Evaluation, Technical Assistance, and 
Dissemination.--From the amount appropriated under subsection (a) for 
any fiscal year, the Secretary may reserve not more than 5 percent to 
carry out evaluations under subsection (c), to provide technical 
assistance, and to disseminate information.
    ``(c) Evaluations.--The Secretary may use funds reserved under 
subsection (b) to carry out one or more evaluations of programs 
assisted under this part, which, at a minimum, shall address--
            ``(1) how, and the extent to which, the programs supported 
        with funds under this part promote educational equity and 
        excellence; and
            ``(2) the extent to which public schools of choice 
        supported with funds under this part are--
                    ``(A) held accountable to the public;
                    ``(B) effective in improving public education; and
                    ``(C) open and accessible to all students.''.

                    Subtitle C--Parental Involvement

SEC. 221. STATE PLANS.

    Section 1111 (20 U.S.C. 6311) is amended--
            (1) by redesignating subsections (d) through (g) as 
        subsections (e) through (h), respectively; and
            (2) by inserting after subsection (c) the following:
    ``(d) Parental Involvement.--Each State plan shall demonstrate that 
the State will support, in collaboration with the regional educational 
laboratories, the collection and dissemination to local educational 
agencies and schools of effective parental involvement practices. Such 
practices shall--
            ``(1) be based on the most current research on effective 
        parental involvement that fosters achievement to high standards 
        for all children; and
            ``(2) be geared toward lowering barriers to greater 
        participation in school planning, review, and improvement 
        experienced by parents.''.

SEC. 222. PARENTAL ASSISTANCE.

    Part D of title I (20 U.S.C. 6421 et seq.) is amended to read as 
follows:

          ``PART D--PARENTAL ASSISTANCE AND CHILD OPPORTUNITY

                  ``Subpart I--Parental Assistance''.

``SEC. 1401. PARENTAL INFORMATION AND RESOURCE CENTERS.

    ``(a) Purpose.--The purpose of this part is--
            ``(1) to provide leadership, technical assistance, and 
        financial support to nonprofit organizations and local 
        educational agencies to help the organizations and agencies 
        implement successful and effective parental involvement 
        policies, programs, and activities that lead to improvements in 
        student performance;
            ``(2) to strengthen partnerships among parents (including 
        parents of preschool age children), teachers, principals, 
        administrators, and other school personnel in meeting the 
        educational needs of children;
            ``(3) to develop and strengthen the relationship between 
        parents and the school;
            ``(4) to further the developmental progress primarily of 
        children assisted under this part; and
            ``(5) to coordinate activities funded under this part with 
        parental involvement initiatives funded under section 1118 and 
        other provisions of this Act.
    ``(b) Grants Authorized.--
            ``(1) In general.--The Secretary is authorized to award 
        grants in each fiscal year to nonprofit organizations, and 
        nonprofit organizations in consortia with local educational 
        agencies, to establish school-linked or school-based parental 
        information and resource centers that provide training, 
        information, and support to--
                    ``(A) parents of children enrolled in elementary 
                schools and secondary schools;
                    ``(B) individuals who work with the parents 
                described in subparagraph (A); and
                    ``(C) State educational agencies, local educational 
                agencies, schools, organizations that support family-
                school partnerships (such as parent-teacher 
                associations), and other organizations that carry out 
                parent education and family involvement programs.
            ``(2) Award rule.--In awarding grants under this part, the 
        Secretary shall ensure that such grants are distributed in all 
        geographic regions of the United States.

``SEC. 1402. APPLICATIONS.

    ``(a) Grants Applications.--
            ``(1) In general.--Each nonprofit organization or nonprofit 
        organization in consortium with a local educational agency that 
        desires a grant under this part shall submit an application to 
        the Secretary at such time and in such manner as the Secretary 
        shall require.
            ``(2) Contents.--Each application submitted under paragraph 
        (1), at a minimum, shall include assurances that the 
        organization or consortium will--
                    ``(A)(i) be governed by a board of directors the 
                membership of which includes parents; or
                    ``(ii) be an organization or consortium that 
                represents the interests of parents;
                    ``(B) establish a special advisory committee the 
                membership of which includes--
                            ``(i) parents described in section 
                        1401(b)(1)(A);
                            ``(ii) representatives of education 
                        professionals with expertise in improving 
                        services for disadvantaged children; and
                            ``(iii) representatives of local elementary 
                        schools and secondary schools who may include 
                        students and representatives from local youth 
                        organizations;
                    ``(C) use at least \1/2\ of the funds provided 
                under this part in each fiscal year to serve areas with 
                high concentrations of low-income families in order to 
                serve parents who are severely educationally or 
                economically disadvantaged;
                    ``(D) operate a center of sufficient size, scope, 
                and quality to ensure that the center is adequate to 
                serve the parents in the area;
                    ``(E) serve both urban and rural areas;
                    ``(F) design a center that meets the unique 
                training, information, and support needs of parents 
                described in section 1401(b)(1)(A), particularly such 
                parents who are educationally or economically 
                disadvantaged;
                    ``(G) demonstrate the capacity and expertise to 
                conduct the effective training, information and support 
                activities for which assistance is sought;
                    ``(H) network with--
                            ``(i) local educational agencies and 
                        schools;
                            ``(ii) parents of children enrolled in 
                        elementary schools and secondary schools;
                            ``(iii) parent training and information 
                        centers assisted under section 682 of the 
                        Individuals with Disabilities Education Act;
                            ``(iv) clearinghouses; and
                            ``(v) other organizations and agencies;
                    ``(I) focus on serving parents described in section 
                1401(b)(1)(A) who are parents of low-income, minority, 
                and limited English proficient, children;
                    ``(J) use part of the funds received under this 
                part to establish, expand, or operate Parents as 
                Teachers programs or Home Instruction for Preschool 
                Youngsters programs;
                    ``(K) provide assistance to parents in such areas 
                as understanding State and local standards and measures 
                of student and school performance; and
                    ``(L) work with State and local educational 
                agencies to determine parental needs and delivery of 
                services.
    ``(b) Grant Renewal.--For each fiscal year after the first fiscal 
year an organization or consortium receives assistance under this part, 
the organization or consortium shall demonstrate in the application 
submitted for such fiscal year after the first fiscal year that a 
portion of the services provided by the organization or consortium is 
supported through non-Federal contributions, which contributions may be 
in cash or in kind.

``SEC. 1403. USES OF FUNDS.

    ``(a) In General.--Grant funds received under this part shall be 
used--
            ``(1) to assist parents in participating effectively in 
        their children's education and to help their children meet 
        State and local standards, such as assisting parents--
                    ``(A) to engage in activities that will improve 
                student performance, including understanding the 
                accountability systems in place within their State 
                educational agency and local educational agency and 
                understanding their children's educational performance 
                in comparison to State and local standards;
                    ``(B) to provide followup support for their 
                children's educational achievement;
                    ``(C) to communicate effectively with teachers, 
                principals, counselors, administrators, and other 
                school personnel;
                    ``(D) to become active participants in the 
                development, implementation, and review of school-
                parent compacts, parent involvement policies, and 
                school planning and improvement;
                    ``(E) to participate in the design and provision of 
                assistance to students who are not making adequate 
                educational progress;
                    ``(F) to participate in State and local 
                decisionmaking; and
                    ``(G) to train other parents;
            ``(2) to obtain information about the range of options, 
        programs, services, and resources available at the national, 
        State, and local levels to assist parents and school personnel 
        who work with parents;
            ``(3) to help the parents learn and use the technology 
        applied in their children's education;
            ``(4) to plan, implement, and fund activities for parents 
        that coordinate the education of their children with other 
        Federal programs that serve their children or their families; 
        and
            ``(5) to provide support for State or local educational 
        personnel if the participation of such personnel will further 
        the activities assisted under the grant.
    ``(b) Permissive Activities.--Grant funds received under this part 
may be used to assist schools with activities such as--
            ``(1) developing and implementing their plans or activities 
        under sections 1118 and 1119; and
            ``(2) developing and implementing school improvement plans, 
        including addressing problems that develop in the 
        implementation of sections 1118 and 1119.
            ``(3) providing information about assessment and individual 
        results to parents in a manner and a language the family can 
        understand;
            ``(4) coordinating the efforts of Federal, State, and local 
        parent education and family involvement initiatives; and
            ``(5) providing training, information, and support to--
                    ``(A) State educational agencies;
                    ``(B) local educational agencies and schools, 
                especially those local educational agencies and schools 
                that are low performing; and
                    ``(C) organizations that support family-school 
                partnerships.
    ``(c) Grandfather Clause.--The Secretary shall use funds made 
available under this part to continue to make grant or contract 
payments to each entity that was awarded a multiyear grant or contract 
under title IV of the Goals 2000: Educate America Act (as such title 
was in effect on the day before the date of enactment of the 
Educational Excellence for All Learners Act of 2001) for the duration 
of the grant or contract award.

``SEC. 1403A. LOCAL FAMILY INFORMATION CENTERS.

    ``(a) Centers Authorized.--The Secretary shall award grants to, and 
enter into contracts and cooperative agreements with, local nonprofit 
parent organizations to enable the organizations to support local 
family information centers that help ensure that parents of students in 
schools assisted under part A have the training, information, and 
support the parents need to enable the parents to participate 
effectively in helping their children to meet challenging State 
standards.
    ``(b) Definition of Local Nonprofit Parent Organization.--In this 
section, the term `local nonprofit parent organization' means a private 
nonprofit organization (other than an institution of higher education) 
that--
            ``(1) has a demonstrated record of working with low-income 
        individuals and parents;
            ``(2)(A) has a board of directors the majority of whom are 
        parents of students in schools that are assisted under part A 
        and located in the geographic area to be served by the center; 
        or
            ``(B) has a special governing committee to direct and 
        implement the center, a majority of the members of whom are 
        parents of students in schools assisted under part A; and
            ``(3) is located in a community with schools that receive 
        funds under part A, and is accessible to the families of 
        students in those schools.
    ``(c) Required Center Activities.--Each center assisted under this 
section shall be exempt from the uses of funds requirements under 
section 1403 and shall instead--
            ``(1) provide training, information, and support that meets 
        the needs of parents of children in schools assisted under part 
        A who are served through the grant, contract, or cooperative 
        agreement, particularly underserved parents, low-income 
        parents, parents of students with limited English proficiency, 
        parents of students with disabilities, and parents of students 
        in schools identified for school improvement or corrective 
        action under section 1116(c);
            ``(2) help families of students enrolled in a school 
        assisted under part A to understand and participate in all of 
        the provisions of this Act designed to improve the achievement 
        of students in the school;
            ``(3) provide information in a language and form that 
        parents understand, including taking steps to ensure that 
        underserved parents, low-income parents, parents with limited 
        English proficiency, parents of students with disabilities, or 
        parents of students in schools identified for school 
        improvement or corrective action, are effectively informed and 
        assisted;
            ``(4) assist parents to--
                    ``(A) understand what their child's school is doing 
                to enable students at the school to meet the State and 
                local standards, including understanding the curriculum 
                and instructional methods the school is using to help 
                the students meet the standards;
                    ``(B) better understand their child's educational 
                needs, where their child stands with respect to State 
                standards, how the school is addressing the child's 
                education needs, and how they can work with their child 
                to increase the child's academic achievement;
                    ``(C) participate in the decisionmaking processes 
                at the school, school district, and State levels;
                    ``(D) understand and benefit from the provisions of 
                other Federal education programs; and
                    ``(E) understand public school choice options 
                available in the local community, including magnet 
                schools, charter schools, and alternative schools;
            ``(5) be designed to meet the specific needs of families 
        who experience significant isolation from available sources of 
        information and support; and
            ``(6) report annually to the Secretary regarding measures, 
        determined by the Secretary, that indicate the program's 
        effectiveness in reaching underserved parents and developing 
        meaningful parent involvement in schools assisted under part A.
    ``(c) Application Requirements.--Each local nonprofit parent 
organization desiring assistance under this section shall submit to the 
Secretary an application (in place of the application required under 
section 1402) at such time, in such manner, and accompanied by such 
information as the Secretary may require. Each such application shall--
            ``(1) describe how the organization will use the assistance 
        to help families under this section;
            ``(2) describe what steps the organization has taken to 
        meet with school district or school personnel in the geographic 
        area to be served by the center in order to inform the 
        personnel of the plan and application for the assistance; and
            ``(3) identify with specificity the special efforts that 
        the organization will take--
                    ``(A) to ensure that the needs for training, 
                information, and support for parents of students in 
                schools assisted under part A, particularly underserved 
                parents, low-income parents, parents with limited 
                English proficiency, parents of students with 
                disabilities, and parents of students in schools 
                identified for school improvement or corrective action, 
                are effectively met; and
                    ``(B) to work with community-based organizations.
    ``(d) Distribution of Funds.--
            ``(1) Allocation of funds.--The Secretary shall make at 
        least 2 awards of assistance under this section to a local 
        nonprofit parent organization in each State, unless the 
        Secretary does not receive at least 2 applications from such 
        organizations in a State of sufficient quality to warrant 
        providing the assistance in the State.
            ``(2) Selection requirement for local family information 
        centers.--
                    ``(A) In general.--The Secretary shall select local 
                nonprofit parent organizations in a State to receive 
                assistance under this section in a manner that ensures 
                the provision of the most effective assistance to low-
                income parents of students in schools assisted under 
                part A.
                    ``(B) Priority.--The Secretary shall give priority 
                to--
                            ``(i) non-profit parent organizations that 
                        are located in rural and urban areas in the 
                        State where the percentage of students from 
                        families at or below the poverty line is 
                        greater than the median, as determined by the 
                        State; and
                            ``(ii) areas with high school dropout 
                        rates, high percentages of limited English 
                        proficient students, or schools identified for 
                        school improvement or corrective action under 
                        section 1116(c).

``SEC. 1404. TECHNICAL ASSISTANCE.

    ``The Secretary shall provide technical assistance, by grant or 
contract, for the establishment, development, and coordination of 
parent training, information, and support programs and parental 
information and resource centers.

``SEC. 1405. REPORTS.

    ``(a) Information.--Each organization or consortium receiving 
assistance under this part shall submit to the Secretary, on an annual 
basis, information concerning the parental information and resource 
centers assisted under this part, including--
            ``(1) the number of parents (including the number of 
        minority and limited English proficient parents) who receive 
        information and training;
            ``(2) the types and modes of training, information, and 
        support provided under this part;
            ``(3) the strategies used to reach and serve parents of 
        minority and limited English proficient children, parents with 
        limited literacy skills, and other parents in need of the 
        services provided under this part;
            ``(4) the parental involvement policies and practices used 
        by the center and an evaluation of whether such policies and 
        practices are effective in improving home-school communication, 
        student achievement, student and school performance, and 
        parental involvement in school planning, review, and 
        improvement; and
            ``(5) the effectiveness of the activities that local 
        educational agencies and schools are carrying out with regard 
        to parental involvement and other activities assisted under 
        this Act that lead to improved student achievement and improved 
        student and school performance.
    ``(b) Dissemination.--The Secretary annually shall disseminate, 
widely to the public and to Congress, the information that each 
organization or consortium submits under subsection (a) to the 
Secretary.

``SEC. 1406. GENERAL PROVISIONS.

    ``Notwithstanding any other provision of this part--
            ``(1) no person, including a parent who educates a child at 
        home, a public school parent, or a private school parent, shall 
        be required to participate in any program of parent education 
        or developmental screening pursuant to the provisions of this 
        part; and
            ``(2) no program or center assisted under this part shall 
        take any action that infringes in any manner on the right of a 
        parent to direct the education of their children.''.

        TITLE III--NATIONAL PRIORITIES WITH PROVEN EFFECTIVENESS

            Subtitle A--Qualified Teacher in Every Classroom

SEC. 301. TEACHER QUALITY.

    (a) In General.--Title II (20 U.S.C. 6601 et seq.) is amended by 
striking the title heading and all that follows through the end of part 
A and inserting the following:

            ``TITLE II--QUALIFIED TEACHER IN EVERY CLASSROOM

                       ``PART A--TEACHER QUALITY

``SEC. 2001. PURPOSES.

    ``The purposes of this part are the following:
            ``(1) To improve student achievement in order to help every 
        student meet State content and student performance standards.
            ``(2) To--
                    ``(A) enable States, local educational agencies, 
                and schools to improve the quality and success of the 
                teaching force by providing all teachers, including 
beginning and veteran teachers, with the support those teachers need to 
succeed and stay in teaching, by providing professional development and 
mentoring programs for teachers, by offering incentives for additional 
qualified individuals to go into teaching, by reducing out-of-field 
placement of teachers, and by reducing the number of teachers with 
emergency credentials; and
                    ``(B) hold the States, agencies, and schools 
                accountable for such improvements.
            ``(3) To support State and local efforts to recruit 
        qualified teachers to address teacher shortages, particularly 
        in communities with the greatest need.
            ``(4) To ensure that underqualified and inexperienced 
        teachers do not teach higher percentages of low-income students 
        and minority students than other students.

``SEC. 2002. DEFINITIONS.

    ``In this part:
            ``(1) Beginning teacher.--The term `beginning teacher' 
        means a fully qualified teacher who has taught for 3 years or 
        less.
            ``(2) Core academic subjects.--The term `core academic 
        subjects' means--
                    ``(A) mathematics;
                    ``(B) science;
                    ``(C) reading (or language arts) and English;
                    ``(D) social studies (consisting of history, 
                civics, government, geography, and economics);
                    ``(E) foreign languages; and
                    ``(F) fine arts (consisting of music, dance, drama, 
                and the visual arts).
            ``(3) Covered recruitment.--The term `covered recruitment' 
        means activities described in section 2017(c).
            ``(4) Fully qualified.--
                    ``(A) In general.--The term `fully qualified', used 
                with respect to a teacher, means a teacher who--
                            ``(i)(I) is certified or licensed and has 
                        demonstrated the academic subject knowledge, 
                        teaching knowledge, and teaching skills 
                        necessary to teach effectively in the academic 
                        subject in which the teacher teaches, according 
                        to the standards described in subparagraph (B) 
                        or (C), as appropriate; and
                            ``(II) shall not be a teacher for whom 
                        State certification or licensing requirements 
                        have been waived or who is teaching under an 
                        emergency; or
                            ``(ii) meets the standards of the National 
                        Board for Professional Teaching Standards.
                    ``(B) Elementary school instructional staff.--For 
                purposes of complying with subparagraph (A)(i), each 
                elementary school teacher (other than a middle school 
                teacher) in the State shall, at a minimum--
                            ``(i) have State certification or a State 
                        license to teach (which may include 
                        certification or licensing obtained through 
                        alternative routes); and
                            ``(ii) hold a bachelor's degree and 
                        demonstrate the academic subject knowledge, 
                        teaching knowledge, and teaching skills 
                        required to teach effectively in reading, 
                        writing, mathematics, social studies, science, 
                        and other academic subjects.
                    ``(C) Middle school and secondary school 
                instructional staff.--For purposes of complying with 
                subparagraph (A)(i), each middle school or secondary 
                school teacher in the State shall, at a minimum--
                            ``(i) have State certification or a State 
                        license to teach (which may include 
                        certification or licensing obtained through 
                        alternative routes); and
                            ``(ii) hold a bachelor's degree or higher 
                        degree and demonstrate a high level of 
                        competence in all academic subjects in which 
                        the teacher teaches through--
                                    ``(I) achievement of a high level 
                                of performance on rigorous academic 
                                subject tests;
                                    ``(II) completion of an academic 
                                major (or courses totaling an 
                                equivalent number of credit hours) in 
                                each of the academic subjects in which 
                                the teacher teaches; or
                                    ``(III) for a teacher hired prior 
                                to the date of enactment of the 
                                Educational Opportunities Act, 
                                completion of appropriate coursework 
                                for mastery of such academic subjects.
            ``(5) High-poverty.--The term `high-poverty', used with 
        respect to a school, means a school that serves a high number 
        or percentage of children from families with incomes below the 
        poverty line, as determined by the State in which the school is 
        located.
            ``(6) High-poverty local educational agency.--The term 
        `high-poverty local educational agency' means a local 
        educational agency for which the number of children served by 
        the agency who are age 5 through 17, and from families with 
        incomes below the poverty line--
                    ``(A) is not less than 20 percent of the number of 
                all children served by the agency; or
                    ``(B) is more than 10,000.
            ``(7) Institution of higher education.--The term 
        `institution of higher education'--
                    ``(A) has the meaning given the term in section 
                101(a) of the Higher Education Act of 1965; and
                    ``(B) if such an institution prepares teachers and 
                receives Federal funds, means such an institution 
                that--
                            ``(i) is in full compliance with the 
                        requirements of section 207 of the Higher 
                        Education Act of 1965; and
                            ``(ii) does not have a teacher preparation 
                        program identified by a State as low-
                        performing.
            ``(8) Low-performing school.--The term `low-performing 
        school' means--
                    ``(A) a school identified by a local educational 
                agency for school improvement under section 1116(c); or
                    ``(B) a school in which the great majority of 
                students, as determined by the State in which the 
                school is located, fail to meet State student 
                performance standards based on assessments the local 
                educational agency is using under part A of title I.
            ``(9) Mentoring.--The term `mentoring' means activities 
        that--
                    ``(A) consist of structured guidance and regular 
                and ongoing support for beginning teachers, that--
                            ``(i) is designed to help the teachers 
                        continue to improve their practice of teaching 
                        and to develop their instructional skills; and
                            ``(ii)(I) as part of a multiyear, 
                        developmental induction process;
                            ``(II) involves the assistance of a mentor 
                        teacher and other appropriate individuals from 
                        a school, local educational agency, or 
                        institution of higher education; and
                            ``(III) may include coaching, classroom 
                        observation, team teaching, and reduced 
                        teaching loads; and
                    ``(B) may include the establishment of a 
                partnership by a local educational agency with an 
                institution of higher education, another local 
                educational agency, teacher organization, or another 
                organization, for the purpose of carrying out the 
                activities described in subparagraph (A).
            ``(10) Mentor teacher.--The term `mentor teacher' means a 
        fully qualified teacher who--
                    ``(A) is a highly competent classroom teacher who 
                is formally selected and trained to work effectively 
                with beginning teachers (including corps members 
                described in section 2018);
                    ``(B) is full-time, and is assigned and qualified 
                to teach in the content area or grade level in which a 
                beginning teacher (including a corps member described 
                in section 2018), to whom the teacher provides 
                mentoring, intends to teach;
                    ``(C) has been consistently effective in helping 
                diverse groups of students make substantial achievement 
                gains; and
                    ``(D) has been selected to provide mentoring 
                through a peer review process that uses, as the primary 
                selection criterion for the process, the teacher's 
                ability to help students achieve academic gains.
            ``(11) Poverty line.--The term `poverty line' means the 
        income official 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.
            ``(12) Professional development.--The term `professional 
        development' means activities that are--
                    ``(A)(i) an integral part of broad schoolwide and 
                districtwide educational improvement plans and enhance 
                the ability of teachers and other staff to help all 
                students, including females, students with 
                disabilities, students with limited English 
                proficiency, and students who have economic and 
                educational disadvantages, meet high State and local 
                content and student performance standards;
                    ``(ii) sustained, intensive, school-embedded, tied 
                to State standards, and of high quality and sufficient 
                duration to have a positive and lasting impact on 
                classroom instruction (not one-time workshops); and
                    ``(iii) based on the best available research on 
                teaching and learning; and
                    ``(B) described in subparagraphs (A) through (F) of 
                section 2017(a)(1).
            ``(13) Recruitment activities.--The term `recruitment 
        activities' means activities carried out through a teacher 
        corps program as described in section 2018 to attract highly 
        qualified individuals, including individuals taking 
        nontraditional routes to teaching, to enter teaching and 
        support the individuals during necessary certification and 
        licensure activities.
            ``(14) Recruitment partnership.--The term `recruitment 
        partnership' means a partnership described in section 
        2015(b)(2).

``SEC. 2003. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this part--
            ``(1) $2,000,000,000 for fiscal year 2001, of which--
                    ``(A) $1,730,000,000 shall be made available to 
                carry out subpart 1; and
                    ``(B) $270,000,000 shall be made available to carry 
                out subpart 2, of which--
                            ``(i) $120,000,000 shall be made available 
                        to carry out chapter 1 of subpart 2;
                            ``(ii) $25,000,000 shall be made available 
                        to carry out chapter 2 of subpart 2;
                            ``(iii) $75,000,000 shall be made available 
                        to carry out chapter 3 of subpart 2; and
                            ``(iv) $50,000,000 shall be made available 
                        to carry out chapter 4 of subpart 2; and
            ``(2) such sums as may be necessary for each of fiscal 
        years 2002 through 2005.

      ``Subpart 1--Grants to States and Local Educational Agencies

                   ``Chapter 1--Grants and Activities

``SEC. 2011. ALLOTMENTS TO STATES.

    ``(a) In General.--The Secretary is authorized to make grants to 
eligible State educational agencies for the improvement of teaching and 
learning through sustained and intensive high-quality professional 
development, mentoring, and recruitment activities (and covered 
recruitment, at the election of a local educational agency) at the 
State and local levels. Each grant shall consist of the allotment 
determined for the State under subsection (b).
    ``(b) Determination of Amount of Allotment.--
            ``(1) Reservation of funds.--
                    ``(A) In general.--From the total amount made 
                available to carry out this subpart under section 
                2003(1) for any fiscal year, the Secretary shall 
                reserve--
                            ``(i) \1/2\ of 1 percent for allotments for 
                        the outlying areas to be distributed among 
                        those outlying areas on the basis of their 
                        relative need, as determined by the Secretary, 
                        for professional development and mentoring and 
                        recruitment activities carried out in 
                        accordance with the purposes of this part; and
                            ``(ii) \1/2\ of 1 percent for the Secretary 
                        of the Interior for programs carried out in 
                        accordance with the purposes of this part to 
                        provide professional development and mentoring 
                        and recruitment activities for teachers and 
                        other staff in schools operated or funded by 
                        the Bureau of Indian Affairs.
                    ``(B) Limitation.--Notwithstanding subparagraph 
                (A), the Secretary shall not reserve, for either the 
                outlying areas under subparagraph (A)(i) or the schools 
                operated or funded by the Bureau of Indian Affairs 
                under subparagraph (A)(ii), more than the amount 
                reserved for those areas or schools for fiscal year 
                2000 under the authority described in paragraph 
                (2)(A)(i).
            ``(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 amount that 
                        the State received for fiscal year 2000 under 
                        section 2202(b) of this Act (as in effect on 
                        the day before the date of enactment of the 
                        Educational Opportunities Act).
                            ``(ii) 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 made available to the 50 States, 
                        the District of Columbia, and the Commonwealth 
                        of Puerto Rico for fiscal year 2000 under the 
                        authority described in subparagraph (A)(i), the 
                        Secretary shall allot to each of those States 
                        the sum of--
                                    ``(I) an amount that bears the same 
                                relationship to 40 percent of the 
                                excess amount as the number of 
                                individuals age 5 through 17 in the 
                                State, as determined by the Secretary 
                                on the basis of the most recent 
                                satisfactory data, bears to the number 
                                of those individuals in all such 
                                States, as so determined; and
                                    ``(II) an amount that bears the 
                                same relationship to 60 percent of the 
                                excess amount as the number of 
                                individuals age 5 through 17 from 
                                families with incomes below the poverty 
                                line in the State, as determined by the 
                                Secretary on the basis of the most 
                                recent satisfactory data, bears to the 
                                number of those individuals in all such 
                                States, as so determined.
                            ``(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 clause (i) for a fiscal 
                        year.
            ``(3) Reallotment.--If any State described in paragraph (2) 
        does not apply for an allotment under paragraph (2) for any 
        fiscal year, the Secretary shall reallot such amount to the 
        remaining such States in accordance with paragraph (2).

``SEC. 2012. STATE APPLICATIONS.

    ``(a) Applications Required.--
            ``(1) In general.--Each State desiring to receive a grant 
        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.
            ``(2) Development.--The State educational agency shall 
        develop the State application--
                    ``(A) in consultation with the State agency for 
                higher education, community-based and other nonprofit 
                organizations, and institutions of higher education; 
                and
                    ``(B) with the extensive participation of teachers, 
                teacher educators, school administrators, and content 
                specialists.
    ``(b) Contents.--Each such application shall include--
            ``(1) a description of the State's shortages of fully 
        qualified teachers relating to high-poverty school districts 
        and high-need academic subjects (as such districts or subjects 
        are determined by the State);
            ``(2) an assessment of the need for professional 
        development for veteran teachers in the State and the need for 
        strong mentoring programs for beginning teachers that is--
                    ``(A) developed with the involvement of teachers; 
                and
                    ``(B) based on student achievement data in the core 
                academic subjects and other indicators of the need for 
                professional development and mentoring programs;
            ``(3) a description of how the State educational agency 
        will use funds made available under this part to improve the 
        quality of the State's teaching force, eliminate the use of 
        out-of-field placement of teachers, and eliminate the use of 
        teachers hired with emergency or other provisional credentials 
        by setting numerical, annual improvement goals, and meet the 
        requirements of this section;
            ``(4) a description of how the State educational agency 
        will align activities assisted under this subpart with State 
        content and student performance standards, and State 
        assessments by setting numerical, annual improvement goals;
            ``(5) a description of how the State educational agency 
        will coordinate activities funded under this subpart with 
        professional development and mentoring and recruitment 
        activities that are supported with funds from other relevant 
        Federal and non-Federal programs;
            ``(6) a plan, developed with the extensive participation of 
        teachers, for addressing long-term teacher recruitment, 
        retention, and professional development and mentoring needs, 
        which may include--
                    ``(A) providing technical assistance to help school 
                districts reform hiring and employment practices to 
                improve the recruitment and retention of fully 
                qualified teachers, especially with respect to high-
                poverty schools; or
                    ``(B) establishing State or regional partnerships 
                to address teacher shortages;
            ``(7) a description of how the State educational agency 
        will assist local educational agencies in implementing 
        effective and sustained professional development and mentoring 
        activities and high-quality recruitment activities under this 
        part;
            ``(8) an assurance that the State will consistently monitor 
        the progress of each local educational agency and school in the 
        State in achieving the goals specified in the information 
        submitted under paragraphs (1) through (7);
            ``(9) a description of how the State educational agency 
        will work with recipients of grants awarded for recruitment 
        activities under section 2015(b) to ensure that recruits who 
        successfully complete a teacher corps program will be certified 
        or licensed; and
            ``(10) the assurances and description referred to in 
        section 2021.
    ``(c) Approval.--The Secretary shall, using a peer-review process, 
approve a State application if the application meets the requirements 
of this section and holds reasonable promise of achieving the purposes 
of this part.

``SEC. 2013. STATE USE OF FUNDS.

    ``(a) In General.--Of the funds allotted to a State under section 
2011 for a fiscal year--
            ``(1) not more than 6 percent shall be used by the State 
        educational agency to carry out State activities described in 
        section 2014, or for the administration of this subpart (other 
        than the administration of section 2019 but including the 
        administration of State activities under chapter 2), except 
        that not more than 3 percent of the allotted funds may be used 
        for the administration of this subpart;
            ``(2) 60 percent shall be used by the State educational 
        agency to provide grants to local educational agencies under 
        section 2015(a) for professional development and mentoring 
        (except as provided in section 2017(c));
            ``(3) 30 percent shall be used by the State educational 
        agency--
                    ``(A) except as provided in subparagraph (B), to 
                provide grants to recruitment partnerships under 
                section 2015(b) for recruitment activities; or
                    ``(B) if the State educational agency determines 
                that all elementary school and secondary school 
                teachers in the State that are teaching core academic 
                subjects are fully qualified, to provide the grants 
                described in paragraph (2); and
            ``(4) 4 percent (or 4 percent of the amount the State would 
        have been allotted if the appropriation for this subpart were 
        $1,730,000,000, whichever is greater) shall be used by the 
        State agency for higher education to provide grants to 
        partnerships under section 2019.
    ``(b) Priority for Professional Development and Mentoring in 
Mathematics and Science.--
            ``(1) Priority.--
                    ``(A) Appropriations of not more than 
                $300,000,000.--Except as provided in section 2017(c), 
                for any fiscal year for which the appropriation for 
                this subpart is $300,000,000 or less, each State 
                educational agency that receives funds under this 
                subpart, working jointly with the State agency for 
                higher education, shall ensure that all funds received 
                under this subpart are used for--
                            ``(i) professional development and 
                        mentoring in mathematics and science that is 
                        aligned with State content and student 
                        performance standards; and
                            ``(ii) recruitment activities to attract 
                        fully qualified math and science teachers to 
                        high-poverty schools.
                    ``(B) Appropriation of more than $300,000,000.--
                Except as provided in section 2017(c), for any fiscal 
                year for which the appropriation for this subpart is 
                greater than $300,000,000, the State educational agency 
                and the State agency for higher education shall jointly 
                ensure that the total amount of funds that the agencies 
                receive under this subpart and that the agencies use 
                for activities described in subparagraph (A) is at 
                least as great as the allotment the State would have 
                received if that appropriation had been $300,000,000.
            ``(2) Interdisciplinary activities.--A State may use funds 
        received under this subpart for activities that focus on more 
        than 1 core academic subject, and apply the funds toward 
        meeting the requirements of paragraph (1), if the activities 
        include a strong focus on improving instruction in mathematics 
        or science.
            ``(3) Additional funds.--Except as provided in section 
        2017(c), each State educational agency that receives funds 
        under this subpart and the State agency for higher education 
        shall jointly ensure that any portion of the funds that exceeds 
        the amount required by paragraph (1) to be spent on activities 
        described in paragraph (1)(A) is used to provide--
                    ``(A) professional development and mentoring in 1 
                or more of the core academic subjects that is aligned 
                with State content and student performance standards; 
                and
                    ``(B) recruitment activities involving teachers of 
                1 or more of the core academic subjects.

``SEC. 2014. STATE LEVEL ACTIVITIES.

    ``(a) Activities.--Each State educational agency that receives a 
grant described in section 2011 shall use the funds made available 
under section 2013(a)(1) to carry out statewide strategies and 
activities to improve teacher quality, including--
            ``(1) establishing, expanding, or improving alternative 
        routes to State certification or licensing of teachers, for 
        highly qualified individuals with a baccalaureate degree, mid-
        career professionals from other occupations, or 
        paraprofessionals, that are at least as rigorous as the State's 
        standards for initial certification or licensing of teachers;
            ``(2) developing or improving evaluation systems to 
        evaluate the effectiveness of professional development and 
        mentoring and recruitment activities in improving teacher 
        quality, skills, and content knowledge, and the impact of the 
        professional development and mentoring and recruitment 
        activities on increasing student academic achievement and 
        student performance with performance measures drawn from 
        assessments that objectively measure student achievement 
        against State performance standards;
            ``(3) funding projects to promote reciprocity of teacher 
        certification or licensure between or among States;
            ``(4) providing assistance to local educational agencies to 
        reduce out-of-field placements and the use of emergency 
        credentials;
            ``(5) supporting certification by the National Board for 
        Professional Teaching Standards of teachers who are teaching or 
        will teach in high-poverty schools;
            ``(6) providing assistance to local educational agencies in 
        implementing effective programs of recruitment activities, and 
        professional development and mentoring, including supporting 
        efforts to encourage and train teachers to become mentor 
        teachers;
            ``(7) increasing the rigor and quality of State 
        certification and licensure tests for individuals entering the 
        field of teaching, including subject matter tests for 
        elementary, middle and secondary school teachers; and
            ``(8) implementing teacher recognition programs.
    ``(b) Coordination.--A State that receives a grant to carry out 
this subpart and a grant under section 202 of the Higher Education Act 
of 1965 shall coordinate the activities carried out under this section 
and the activities carried out under that section 202.

``SEC. 2015. GRANTS TO LOCAL EDUCATIONAL AGENCIES.

    ``(a) Grants for Professional Development and Mentoring 
Activities.--
            ``(1) In general.--The State educational agency of a State 
        that receives a grant described in section 2011 shall use the 
        funds made available under section 2013(a)(2) (and any funds 
        made available under section 2013(a)(3)(B)) to make grants to 
        eligible local educational agencies, from allocations made 
        under paragraph (2), to carry out the activities described in 
        section 2017(a) (except as provided in section 2017(c)).
            ``(2) Allocations.--The State educational agency shall 
        allocate to each eligible local educational agency the sum of--
                    ``(A) an amount that bears the same relationship to 
                20 percent of the funds described in paragraph (1) as 
                the number of individuals enrolled in public and 
                private nonprofit elementary schools and secondary 
                schools in the geographic area served by the agency 
                bears to the number of those individuals in the 
                geographic areas served by all the local educational 
                agencies in the State; and
                    ``(B) an amount that bears the same relationship to 
                80 percent of the funds as the number of individuals 
                age 5 through 17 from families with incomes below the 
                poverty line, in the geographic area served by the 
                agency, as determined by the Secretary on the basis of 
                the most recent satisfactory data, bears to the number 
                of those individuals in the geographic areas served by 
                all the local educational agencies in the State, as so 
                determined.
            ``(3) Eligibility.--To be eligible to receive a grant from 
        a State educational agency under this subsection, a local 
educational agency shall serve schools that include--
                    ``(A) high-poverty schools;
                    ``(B) schools that need support for improving 
                teacher quality based on low achievement of students 
                served;
                    ``(C) schools that have low teacher retention 
                rates;
                    ``(D) schools that need to improve or expand the 
                knowledge and skills of new and veteran teachers in 
                high-priority content areas;
                    ``(E) schools that have high out-of-field placement 
                rates; or
                    ``(F) high-poverty schools that have been 
                identified for improvement in accordance with section 
                1116.
            ``(4) Equitable geographic distribution.--A State 
        educational agency shall ensure an equitable distribution of 
        grants under this subsection among eligible local educational 
        agencies serving urban and rural areas.
    ``(b) Grants for Recruitment Activities.--
            ``(1) In general.--The State educational agency of a State 
        that receives a grant under section 2011 shall use the funds 
        made available under section 2013(a)(3)(A) to make grants to 
        eligible recruitment partnerships, on a competitive basis, to 
        carry out the recruitment activities and meet requirements 
        described in section 2017(b).
            ``(2) Eligibility.--
                    ``(A) In general.--To be eligible to receive a 
                grant from a State educational agency under this 
                subsection, a recruitment partnership--
                            ``(i) shall include an eligible local 
                        educational agency, or a consortium of eligible 
                        local educational agencies;
                            ``(ii) shall include an institution of 
                        higher education, a tribal college, or a 
                        community college; and
                            ``(iii) may include other members, such as 
                        a nonprofit organization or professional 
                        education organization.
                    ``(B) Eligible local educational agency.--In 
                subparagraph (A), the term `eligible local educational 
                agency' means a local educational agency that receives 
                assistance under part A of title I, and meets any 
                additional eligibility criteria that the appropriate 
                State educational agency may establish.
            ``(3) Equitable geographic distribution.--A State 
        educational agency shall ensure an equitable distribution of 
        grants under this subsection among eligible recruitment 
        partnerships serving urban and rural areas.

``SEC. 2016. LOCAL APPLICATIONS.

    ``(a) In General.--A local educational agency or a recruitment 
partnership seeking to receive a grant from a State under section 2015 
to carry out activities described in section 2017 shall submit an 
application to the State at such time, in such manner, and containing 
such information as the State may reasonably require.
    ``(b) Contents Relating to Professional Development and Mentoring 
Activities.--If the local educational agency seeks a grant under 
section 2015(a) to carry out activities described in section 2017(a), 
the local application described in subsection (a) shall include, at a 
minimum, the following:
            ``(1) A description of how the local educational agency 
        intends to use the funds provided through the grant to carry 
        out activities that meet requirements described in section 
        2017(a).
            ``(2) An assurance that the local educational agency will 
        target the funds to high-poverty, low-performing schools served 
        by the local educational agency that--
                    ``(A) have the lowest proportions of qualified 
                teachers;
                    ``(B) are identified for school improvement and 
                corrective action under section 1116; or
                    ``(C) are identified for school improvement in 
                accordance with other measures of school quality as 
                determined and documented by the local educational 
                agency.
            ``(3) A description of how the local educational agency 
        will coordinate professional development and mentoring 
        activities described in section 2017(a) with professional 
        development and mentoring activities provided through other 
        Federal, State, and local programs, including programs 
        authorized under--
                    ``(A) titles I, IV, and V, and part A of title VII; 
                and
                    ``(B) where applicable, the Individuals with 
                Disabilities Education Act, the Carl D. Perkins 
                Vocational and Technical Education Act of 1998, and 
                title II of the Higher Education Act of 1965.
            ``(4) A description of how the local educational agency 
        will integrate funds received to carry out activities described 
in section 2017(a) with funds received under title V that are used for 
professional development and mentoring in order to carry out 
professional development and mentoring activities that--
                    ``(A) train teachers, paraprofessionals, 
                counselors, pupil services personnel, administrators, 
                and other school staff, including school library media 
                specialists, in how to use technology to improve 
                learning and teaching; and
                    ``(B) take into special consideration the different 
                learning needs for, and exposures to, technology for 
                all students, including females, students with 
                disabilities, students with limited English 
                proficiency, and students who have economic and 
                educational disadvantages.
            ``(5) A description of how the local application was 
        developed with extensive participation of teachers, 
        paraprofessionals, principals, and parents.
            ``(6) A description of how the professional development and 
        mentoring activities described in section 2017(a) will address 
        the ongoing professional development and mentoring of teachers, 
        paraprofessionals, counselors, pupil services personnel, 
        administrators, and other school staff, including school 
        library media specialists.
            ``(7) A description of how the professional development and 
        mentoring activities described in section 2017(a) will have a 
        substantial, measurable, and positive impact on student 
        achievement and how the activities will be used as part of a 
        broader strategy to eliminate the achievement gap that 
        separates low-income and minority student from other students.
            ``(8) A description of how the local educational agency 
        will address the needs of teachers of students with 
        disabilities, students with limited English proficiency, and 
        other students with special needs.
            ``(9) A description of how the local educational agency 
        will provide training to teachers to enable the teachers to 
        work with parents, involve parents in their child's education, 
        and encourage parents to become collaborators with schools in 
        promoting their child's education.
            ``(10) The assurances and description referred to in 
        section 2023, with respect to professional development and 
        mentoring activities.
    ``(c) Development and Contents Relating to Recruitment 
Activities.--If an eligible local educational agency (as defined in 
section 2015(b)) seeks a grant under section 2015(b) to carry out 
activities described in section 2017(b)--
            ``(1) the eligible local educational agency shall enter 
        into a recruitment partnership, which shall jointly prepare and 
        submit the local application described in subsection (a); and
            ``(2) at a minimum, the application shall include--
                    ``(A) a description of how the recruitment 
                partnership will meet the teacher corps program 
                requirements described in section 2018;
                    ``(B) a description of the individual and 
                collective responsibilities of members of the 
                recruitment partnership in meeting the requirements and 
                goals of a teacher corps program described in section 
                2018;
                    ``(C) information demonstrating that the State 
                agency responsible for teacher licensure or 
                certification in the State in which a recruitment 
                partnership is established will--
                            ``(i) ensure that a corps member who 
                        successfully completes a teacher corps program 
                        will have the academic requirements necessary 
                        for initial certification or licensure as a 
                        teacher in the State; and
                            ``(ii) work with the recruitment 
                        partnership to ensure the partnership uses 
                        high-quality methods and establishes high-
                        quality requirements concerning alternative 
                        routes to certification or licensing, in order 
                        to meet State requirements for certification or 
                        licensure; and
                    ``(D) the assurances and description referred to in 
                section 2023, with respect to recruitment activities.
    ``(d) Contents Relating to Covered Recruitment.--If the local 
educational agency seeks a grant under section 2015(a) to carry out 
activities described in section 2017(c), the local application 
described in subsection (a) shall include, at a minimum, a description 
of the activities and the manner in which the activities will 
contribute to accomplishing the objectives of section 2023, and how the 
activities are in compliance with the requirements of this Act.
    ``(e) Approval.--A State educational agency shall approve a local 
educational agency's or recruitment partnership's application under 
this section only if the State educational agency determines that the 
application is of high quality and holds reasonable promise of 
achieving the purposes of this part.

``SEC. 2017. LOCAL ACTIVITIES.

    ``(a) Professional Development and Mentoring Activities.--Except as 
provided in subsection (c), each local educational agency receiving a 
grant under section 2015(a) shall use the funds made available through 
the grant to carry out activities (and only activities) that--
            ``(1) are professional development activities (as defined 
        in section 2002(12)(A)) that--
                    ``(A) improve teacher knowledge of--
                            ``(i) 1 or more of the core academic 
                        subjects;
                            ``(ii) effective instructional strategies, 
                        methods, and skills for improving student 
                        achievement in core academic subjects, 
                        including strategies for identifying and 
                        eliminating gender and racial bias;
                            ``(iii) the use of data and assessments to 
                        inform teachers about and thereby help teachers 
                        to improve classroom practice; and
                            ``(iv) innovative instructional 
                        methodologies designed to meet the 
diverse learning needs of individual students, including methodologies 
that integrate academic and technical skills and applied learning (such 
as service learning), methodologies for interactive and 
interdisciplinary team teaching, and other alternative teaching 
strategies, such as strategies for experiential learning, career-
related education, and environmental education, that integrate real 
world applications into the core academic subjects;
                    ``(B) provide teachers and paraprofessionals (and 
                other staff as appropriate) with information on recent 
                research findings on how children learn to read and 
                with staff development on research-based instructional 
                strategies for the teaching of reading;
                    ``(C) replicate effective instructional practices 
                that involve collaborative groups of teachers and 
                administrators from the same school or district, using 
                strategies such as--
                            ``(i) provision of dedicated time for 
                        collaborative lesson planning and curriculum 
                        development meetings;
                            ``(ii) provision of collaborative 
                        professional development experiences for 
                        veteran teachers based on the standards in the 
                        core academic subjects of the National Board 
                        for Professional Teaching Standards;
                            ``(iii) consultation with exemplary 
                        teachers;
                            ``(iv) provision of short-term and long-
                        term visits to classrooms and schools;
                            ``(v) participation of teams of teachers in 
                        summer institutes and summer immersion 
                        activities that are focused on preparing 
                        teachers to enable all students to meet high 
                        standards in 1 or more of the core academic 
                        subjects; and
                            ``(vi) establishment and maintenance of 
                        local professional networks that provide a 
                        forum for interaction among teachers and 
                        administrators and that allow for the exchange 
                        of information on advances in content knowledge 
                        and teaching skills;
                    ``(D) provide for the participation of 
                paraprofessionals, pupil services personnel, and other 
                school staff;
                    ``(E) include strategies for fostering meaningful 
                parental involvement and relations with parents to 
                encourage parents to become collaborators in their 
                children's education, for improving classroom 
                management and discipline, and for integrating 
                technology into a curriculum;
                    ``(F) as a whole, are regularly evaluated for their 
                impact on increased teacher effectiveness and improved 
                student achievement, with the findings of the 
                evaluations used to improve the quality of activities 
                described in this paragraph;
                    ``(G) include, to the extent practicable, the 
                establishment of a partnership with an institution of 
                higher education, another local educational agency, a 
                teacher organization, or another organization, for the 
                purpose of carrying out activities described in this 
                paragraph; and
                    ``(H) include ongoing and school-based support for 
                activities described in this paragraph, such as support 
                for peer review, coaching, or study groups, and the 
                provision of release time as needed for the activities;
            ``(2) are mentoring activities; and
            ``(3) include local activities carried out under chapter 2.
    ``(b) Recruitment Activities.--Each recruitment partnership 
receiving a grant under section 2015(b) shall use the funds made 
available through the grant to carry out recruitment activities (and 
only recruitment activities) described in section 2018.
    ``(c) Covered Recruitment.--A local educational agency receiving a 
grant under section 2015(a) for a fiscal year may elect to use a 
portion of the funds made available through the grant, but not more 
than the agency's share of 10 percent of the funds allotted to the 
State involved under section 2011 for the fiscal year, to carry out 
recruitment (including recruitment through the use of signing bonuses 
and other financial incentives) and hiring of fully qualified teachers.

``SEC. 2018. RECRUITMENT ACTIVITIES THROUGH A TEACHER CORPS PROGRAM.

    ``(a) Teacher Corps Program Requirements.--
            ``(1) Recruitment.--A recruitment partnership that receives 
        a grant under section 2015(b) shall broadly recruit and screen 
        for a teacher corps a highly qualified pool of candidates who 
        demonstrate the potential to become effective teachers. Each 
        candidate shall meet--
                    ``(A) standards to ensure that--
                            ``(i) each corps member possesses 
                        appropriate, high-level credentials and 
                        presents the likelihood of becoming an 
                        effective teacher; and
                            ``(ii) each group of corps members includes 
                        people who have expertise in academic subjects 
                        and otherwise meet the specific needs of the 
                        district to be served; and
                    ``(B) any additional standard that the recruitment 
                partnership establishes to enhance the quality and 
                diversity of candidates and to meet the academic and 
                grade level needs of the partnership.
            ``(2) Required curriculum and placement.--Members of the 
        recruitment partnership shall work together to plan and develop 
        a program that includes--
                    ``(A) a rigorous curriculum that includes a 
                preservice training program (incorporating innovative 
                approaches to preservice training, such as distance 
                learning), for a period not to exceed 1 year, that 
                provides corps members with the skills and knowledge 
                necessary to become effective teachers, by--
                            ``(i) requiring completed course work in 
                        basic areas of teaching, such as principles of 
                        learning and child development, effective 
                        teaching strategies, assessments, and classroom 
                        management, and in the pedagogy related to the 
                        academic subjects in which a corps member 
                        intends to teach;
                            ``(ii) providing extensive preparation in 
                        the pedagogy of reading to corps members, 
                        including preparation components that focus 
                        on--
                                    ``(I) understanding the psychology 
                                of reading, and human growth and 
                                development;
                                    ``(II) understanding the structure 
                                of the English language; and
                                    ``(III) learning and applying the 
                                best teaching methods to all aspects of 
                                reading instruction;
                            ``(iii) providing training in the use of 
                        technology as a tool to enhance a corps 
                        member's effectiveness as a teacher and improve 
                        the achievement of the corps member's students; 
                        and
                            ``(iv) focusing on the teaching skills and 
                        knowledge that corps members need to enable all 
                        students to meet the State's highest 
                        challenging content and student performance 
                        standards;
                    ``(B) placement of a corps member with the local 
                educational agency participating in the recruitment 
                partnership, in a teaching internship that--
                            ``(i) includes intensive mentoring;
                            ``(ii) provides a reduced teaching load; 
                        and
                            ``(iii) provides regular opportunities for 
                        the corps member to co-teach with a mentor 
                        teacher, observe other teachers, and be 
                        observed and coached by other teachers;
                    ``(C) individualized inservice training over the 
                course of the corps member's first 2 years of full-time 
                teaching that provides--
                            ``(i) high-quality professional 
                        development, coordinated jointly by members of 
                        the recruitment partnership, and the course 
                        work necessary to provide additional or 
                        supplementary knowledge to meet the specific 
                        needs of the corps member; and
                            ``(ii) ongoing mentoring by a teacher who 
                        meets the criteria for a mentor teacher 
                        described in paragraph (4)(B), including the 
                        requirements of section 2002(10); and
                    ``(D) collaboration between the recruitment 
                partnership, and local community student and parent 
                groups, to assist corps members in enhancing their 
                understanding of the community in which the members are 
                placed.
            ``(3) Evaluation.--A recruitment partnership shall evaluate 
        a corps member's progress in course study and classroom 
        practice at regular intervals. Each recruitment partnership 
        shall have a formal process to identify corps members who seem 
        unlikely to become effective teachers and terminate their 
        participation in the program.
            ``(4) Mentor teachers.--
                    ``(A) In general.--A recruitment partnership shall 
                develop a plan for the program, which shall include 
                strategies for identifying, recruiting, training, and 
                providing ongoing support to individuals who will serve 
                as mentor teachers to corps members.
                    ``(B) Mentor teacher requirements.--The plan 
                described in subparagraph (A) shall specify the 
                criteria that the recruitment partnership will use to 
                identify and select mentor teachers and, at a minimum, 
                shall--
                            ``(i) require a mentor teacher to meet the 
                        requirements of section 2002(10); and
                            ``(ii) require that consideration be given 
                        to teachers with national board certification.
                    ``(C) Compensation.--The plan shall specify the 
                compensation--
                            ``(i) for mentor teachers, including 
                        monetary compensation, release time, or a 
                        reduced work load to ensure that mentor 
                        teachers can provide ongoing support for corps 
                        members; and
                            ``(ii) for corps members, including salary 
                        levels and the stipends, if any, that will be 
                        provided during a corps member's preservice 
                        training.
            ``(5) Assurances.--The plan shall include assurances that--
                    ``(A) a corps member will be assigned to teach only 
                academic subjects and grade levels for which the member 
                is fully qualified;
                    ``(B) corps members, to the extent practicable, 
                will be placed in schools with teams of corps members; 
                and
                    ``(C) every mentor teacher will be provided 
                sufficient time to meet the needs of the corps members 
                assigned to the mentor teacher.
    ``(b) Corps Member Qualifications.--
            ``(1) Candidates intending to teach in elementary 
        schools.--At a minimum, to be accepted by a teacher corps 
        program, a candidate who intends to teach at the elementary 
        school level shall--
                    ``(A) have a bachelor's degree;
                    ``(B) possess an outstanding commitment to working 
                with children and youth;
                    ``(C) possess a strong professional or 
                postsecondary record of achievement; and
                    ``(D) pass all basic skills and subject matter 
                tests required by the State for teacher certification 
                or licensure.
            ``(2) Candidates intending to teach in secondary schools.--
        At a minimum, to be accepted by a teacher corps program, a 
        candidate who intends to teach at the secondary school level 
        shall--
                    ``(A) meet the requirements described in paragraph 
                (1); and
                    ``(B)(i) possess at least an academic major or 
                postsecondary degree in each academic subject in which 
                the candidate intends to teach; or
                    ``(ii) if the candidate did not major or earn a 
                postsecondary degree in an academic subject in which 
                the candidate intends to teach, have completed a 
                rigorous course of instruction in that subject that is 
                equivalent to having majored in the subject.
            ``(3) Special rule.--Notwithstanding paragraph (2)(B), the 
        recruitment partnership may consider the candidate to be an 
        eligible corps member and accept the candidate for a teacher 
        corps program if the candidate has worked successfully and 
        directly in a field and in a position that provided the 
        candidate with direct and substantive knowledge in the academic 
        subject in which the candidate intends to teach.
    ``(c) Three-Year Commitment to Teaching in Eligible Districts.--
            ``(1) In general.--In return for acceptance to a teacher 
        corps program, a corps member shall commit to 3 years of full-
        time teaching in a school or district served by a local 
        educational agency participating in a recruitment partnership 
        receiving funds under this subpart.
            ``(2) Reimbursement.--
                    ``(A) In general.--If a corps member leaves the 
                school district to which the corps member has been 
                assigned prior to the end of the 3-year period 
                described in paragraph (1), the corps member shall be 
                required to reimburse the Secretary for the amount of 
                the Federal share of the cost of the corps member's 
                participation in the teacher corps program.
                    ``(B) Partnership claims.--A recruitment 
                partnership that provides a teacher corps program to a 
                corps member who leaves the school district, as 
                discussed in subparagraph (A), may submit a claim to 
                the corps member requiring the corps member to 
                reimburse the recruitment partnership for the amount of 
                the partnership's share of the cost described in 
                subparagraph (A).
                    ``(C) Reduction.--Reimbursements required under 
                this paragraph may be reduced proportionally based on 
                the amount of time a corps member remained in the 
                teacher corps program beyond the corps member's initial 
                2 years of service.
                    ``(D) Waiver.--The Secretary may waive 
                reimbursements required under subparagraph (A) in the 
                case of severe hardship to a corps member who leaves 
                the school district, as described in subparagraph (A).
    ``(d) Federal Share; Non-Federal Share.--
            ``(1) Payment of federal share.--The Secretary shall pay to 
        each recruitment partnership carrying out a teacher corps 
        program under this section the Federal share of the cost of the 
        activities described in the partnership's application under 
        section 2016(c).
            ``(2) Non-federal share.--A recruitment partnership's share 
        of the cost of the activities described in the partnership's 
        application under section 2016(c)--
                    ``(A) may be provided in cash or in kind, fairly 
                evaluated, including plant, equipment, or services; and
                    ``(B)(i) for the first year for which the 
                partnership receives assistance under this subpart, 
                shall be not less than 10 percent;
                    ``(ii) for the second such year, shall be not less 
                than 20 percent;
                    ``(iii) for the third year such year, shall be not 
                less than 30 percent;
                    ``(iv) for the fourth such year, shall be not less 
                than 40 percent; and
                    ``(v) for the fifth such year, shall be not less 
                than 50 percent.

``SEC. 2019. GRANTS TO PARTNERSHIPS OF INSTITUTIONS OF HIGHER EDUCATION 
              AND LOCAL EDUCATIONAL AGENCIES.

    ``(a) Administration.--A State agency for higher education may use, 
from the funds made available to the agency under section 2013(a)(4) 
for any fiscal year, not more than 3\1/3\ percent for the expenses of 
the agency in administering this section, including conducting 
evaluations of activities on the performance measures described in 
section 2014(a)(2).
    ``(b) Grants to Partnerships.--
            ``(1) In general.--The State agency for higher education 
        shall use the remainder of the funds, in cooperation with the 
        State educational agency, to make grants to (including entering 
into contracts or cooperative agreements with) partnerships of--
                    ``(A) institutions of higher education that are in 
                full compliance with all reporting requirements of 
                title II of the Higher Education Act of 1965 or 
                nonprofit organizations of demonstrated effectiveness 
                in providing professional development and mentoring in 
                the core academic subjects; and
                    ``(B) eligible local educational agencies (as 
                defined in section 2015(b)(2)),
        to carry out activities (and only activities) described in 
        subsection (e).
            ``(2) Size; duration.--Each grant made under this section 
        shall be--
                    ``(A) in a sufficient amount to carry out the 
                objectives of this section effectively; and
                    ``(B) for a period of 3 years, which the State 
                agency for higher education may extend for an 
                additional 2 years if the agency determines that the 
                partnership is making substantial progress toward 
                meeting the specific goals set out in the written 
                agreement required in subsection (c) and on the 
                performance measures described in section 2014(a)(2).
            ``(3) Applications.--To be eligible to receive a grant 
        under this section, a partnership shall submit an application 
        to the State agency for higher education at such time, in such 
        manner, and containing such information as the agency may 
        reasonably require.
            ``(4) Award process and basis.--The State agency for higher 
        education shall make the grants on a competitive basis, using a 
        peer review process.
            ``(5) Priority.--In making the grants, the State agency for 
        higher education shall give priority to partnerships submitting 
        applications for projects that focus on mentoring programs for 
        beginning teachers.
            ``(6) Considerations.--In making such a grant for a 
        partnership, the State agency for higher education shall 
        consider--
                    ``(A) the need of the local educational agency 
                involved for the professional development and mentoring 
                activities proposed in the application;
                    ``(B) the quality of the program proposed in the 
                application and the likelihood of success of the 
                program in improving classroom instruction and student 
                academic achievement; and
                    ``(C) such other criteria as the agency finds to be 
                appropriate.
    ``(c) Agreements.--
            ``(1) In general.--No partnership may receive a grant under 
        this section unless the institution of higher education or 
        nonprofit organization involved enters into a written agreement 
        with at least 1 eligible local educational agency (as defined 
        in section 2015(b)(2)) to provide professional development and 
        mentoring for elementary and secondary school teachers in the 
        schools served by that agency in the core academic subjects.
            ``(2) Goals.--Each such agreement shall identify specific 
        measurable annual goals concerning how the professional 
        development and mentoring that the partnership provides will 
        enhance the ability of the teachers to prepare all students to 
        meet challenging State and local content and student 
        performance standards.
    ``(d) Joint Efforts Within Institutions of Higher Education.--Each 
professional development and mentoring activity assisted under this 
section by a partnership containing an institution of higher education 
shall involve the joint effort of the institution of higher education's 
school or department of education and the schools or departments of the 
institution in the specific disciplines in which the professional 
development and mentoring will be provided.
    ``(e) Uses of Funds.--A partnership that receives funds under this 
section shall use the funds for activities (and only for activities) 
that consist of--
            ``(1) professional development and mentoring in the core 
        academic subjects, aligned with State or local content 
        standards, for teams of teachers from a school or school 
        district and, where appropriate, administrators and 
        paraprofessionals;
            ``(2) research-based professional development and mentoring 
        programs to assist beginning teachers, which may include--
                    ``(A) mentoring and coaching by trained mentor 
                teachers that lasts at least 2 years;
                    ``(B) team teaching with veteran teachers who have 
                a consistent record of helping their students make 
                substantial academic gains;
                    ``(C) provision of time for observation of, and 
                consultation with, veteran teachers;
                    ``(D) provision of reduced teaching loads; and
                    ``(E) provision of additional time for preparation;
            ``(3) the provision of technical assistance to school and 
        agency staff for planning, implementing, and evaluating 
        professional development and mentoring;
            ``(4) the provision of training for teachers to help the 
        teachers develop the skills necessary to work most effectively 
        with parents; and
            ``(5) in appropriate cases, the provision of training to 
        address areas of teacher and administrator shortages.
    ``(f) Coordination.--Any partnership that carries out professional 
development and mentoring activities under this section shall 
coordinate the activities with activities carried out under title II of 
the Higher Education Act of 1965, if a local educational agency or 
institution of higher education in the partnership is participating in 
programs funded under that title.
    ``(g) Annual Reports.--
            ``(1) In general.--Beginning with fiscal year 2002, each 
        partnership that receives a grant under this section shall 
        prepare and submit to the appropriate State agency for higher 
        education, by a date set by that agency, an annual report on 
        the progress of the partnership on the performance measures 
        described in section 2014(a)(2).
            ``(2) Contents.--Each such report shall--
                    ``(A) include a copy of each written agreement 
                required by subsection (c) that is entered into by the 
                partnership; and
                    ``(B) describe how the members of the partnership 
                have collaborated to achieve the specific goals set out 
                in the agreement, and the results of that 
                collaboration.
            ``(3) Copy.--The State agency for higher education shall 
        provide the State educational agency with a copy of each such 
        report.

                      ``Chapter 2--Accountability

``SEC. 2021. STATE APPLICATION ACCOUNTABILITY PROVISIONS.

    ``(a) Assurances.--Each State application submitted under section 
2012 shall contain assurances that--
            ``(1) beginning on the date of enactment of the Educational 
        Opportunities Act, no school in the State that is served under 
        this subpart will use funds received under this subpart to hire 
        a teacher who is not a fully qualified teacher; and
            ``(2) not later than 4 years after the date of enactment of 
        the Educational Opportunities Act, each teacher in the State 
        who provides services to students served under this subpart 
        shall be a fully qualified teacher.
    ``(b) Withholding.--If a State fails to meet the requirements 
described in subsection (a)(2) for a fiscal year in which the 
requirements apply--
            ``(1) the Secretary shall withhold, for the following 
        fiscal year, a portion of the funds that would otherwise be 
        available to the State under section 2013(a)(1) for the 
        administration of this subpart; and
            ``(2) the State shall be subject to such other penalties as 
        are provided by law for a violation of this Act.
    ``(c) Assistance by State Educational Agency.--Each State 
application submitted under section 2012 shall describe how the State 
educational agency will help each local educational agency and school 
in the State develop the capacity to comply with the requirements of 
this section.

``SEC. 2022. STATE REPORTS.

    ``(a) Report to Secretary.--
            ``(1) In General.--Each State that receives funds under 
        this subpart shall annually prepare and submit to the Secretary 
        a report containing--
                    ``(A) information on the activities of the State 
                under this subpart, including statewide information, 
                and information on the activities of each grant 
                recipient in the State;
                    ``(B) information on the effectiveness of the 
                activities, and the progress of recipients of grants 
                under this subpart, on performance measures, including 
                measures described in section 2014(a)(2) and goals 
                described in paragraphs (3) and (4) of section 2012(b); 
                and
                    ``(C) such other information as the Secretary may 
                reasonably require.
            ``(2) Deadlines.--The State shall submit the reports 
        described in paragraph (1) by such deadlines as the Secretary 
        may establish.
    ``(b) Public Accountability.--
            ``(1) In general.--Each State that receives funds under 
        this subpart--
                    ``(A) in the event the State provides public State 
                report cards on education, shall include in such report 
                cards--
                            ``(i) the percentage of middle school and 
                        other secondary school classes in core academic 
                        subjects that are taught by out-of-field 
                        teachers;
                            ``(ii) the percentage of middle school, 
                        other elementary school, and other secondary 
                        school classes taught by individuals holding 
                        only emergency credentials, or for whom any 
                        State certification or licensing standards for 
                        teachers have been waived;
                            ``(iii) the average statewide class size; 
                        or
                    ``(B) in the event the State provides no such 
                report card, shall disseminate to the public the 
                information described in clauses (i) through (iii) of 
                subparagraph (A) through other means.
            ``(2) Public availability.--Such information shall be made 
        widely available to the public, including parents and students, 
        throughout the State.
    ``(c) General Accounting Office.--Not later than September 30, 
2004, the Comptroller General of the United States shall--
            ``(1) conduct a study of the progress of the States in 
        increasing the percentage of teachers who are fully qualified 
        teachers for fiscal years 2001 through 2003; and
            ``(2) prepare and submit to the Committee on Education and 
        Workforce of the House of Representatives and the Committee on 
        Health, Education, Labor, and Pensions of the Senate a report 
        containing the results of the study.

``SEC. 2023. LOCAL APPLICATION ACCOUNTABILITY PROVISIONS.

    ``Each local application submitted under section 2016 shall contain 
assurances that--
            ``(1) the agency will not hire a teacher with funds made 
        available to the agency under this subpart, unless the teacher 
        is a fully qualified teacher;
            ``(2) the local educational agency and schools served by 
        the agency will work to ensure, through voluntary agreements 
        and incentive programs, that elementary school and secondary 
        school teachers in high-poverty schools served by the local 
        educational agency will be at least as well qualified, in terms 
        of experience and credentials, as the instructional staff in 
        schools served by the same local educational agency that are 
        not high-poverty schools;
            ``(3) any teacher who receives certification from the 
        National Board for Professional Teaching Standards will be 
        considered fully qualified to teach, in the academic subjects 
        in which the teacher is certified, in high-poverty schools in 
        any school district or community served by the local 
        educational agency; and
            ``(4) the agency will--
                    ``(A) make available, on request and in an 
                understandable and uniform format, to any parent of a 
                student attending any school served by the local 
                educational agency, information regarding the 
                professional qualifications of the student's classroom 
                teachers with regard to--
                            ``(i) whether the teacher has met State 
                        certification or licensing criteria for the 
                        academic subjects and grade level in which the 
                        teacher teaches the student;
                            ``(ii) whether the teacher is teaching with 
                        emergency or whether any State certification or 
                        licensing standard has been waived for the 
                        teacher; and
                            ``(iii) the academic qualifications of the 
                        teacher in the academic subjects and grade 
                        levels in which the teacher teaches; and
                    ``(B) inform parents that the parents are entitled 
                to receive the information upon request.

``SEC. 2024. LOCAL CONTINUATION OF FUNDING.

    ``(a) Agencies.--If a local educational agency applies for funds 
under this subpart for a 4th or subsequent fiscal year (including 
applying for funds as part of a partnership), the agency may receive 
the funds for that fiscal year only if the State determines that the 
agency has demonstrated that the agency, in carrying out activities 
under this subpart during the past fiscal year, has met annual 
numerical performance objectives for--
            ``(1) improved student performance for all groups described 
        in section 1111(b)(2);
            ``(2) increased participation in sustained professional 
        development and mentoring programs;
            ``(3) reduced the beginning teacher attrition rate for the 
        agency; and
            ``(4) reduced the number of teachers who are not certified 
        or licensed, and the number who are out-of-field teachers, for 
        the agency.
    ``(b) Schools.--If a local educational agency applies for funds 
under this subpart on behalf of a school for a 4th or subsequent fiscal 
year (including applying for funds as part of a partnership), the 
agency may receive the funds for the school for that fiscal year only 
if the State determines that the school has demonstrated that the 
school, in carrying out activities under this subpart during the past 
fiscal year, has met the requirements of paragraphs (1) through (4) of 
subsection (a).
    ``(c) Recruitment Partnerships.--
            ``(1) In general.--If not more than 90 percent of the 
        graduates of a teacher corps program assisted under this 
        subpart for a fiscal year pass applicable State or local 
        initial teacher licensing or certification examinations, the 
        recruitment partnership providing the teacher corps program 
        shall be ineligible to receive grant funds for the succeeding 
        fiscal year.
            ``(2) Waiver.--The State in which the partnership is 
        located may waive the requirement described in paragraph (1) 
        for a recruitment partnership serving a school district that 
        has special circumstances, such as a district with a small 
        number of corps members.

``SEC. 2025. LOCAL REPORTS.

    ``(a) In General.--Each local educational agency that receives 
funds under this subpart (including funds received through a 
partnership) shall prepare, make publicly available, and submit to the 
State educational agency, every year, beginning in fiscal year 2002, a 
report on the activities of the agency under this subpart, in such form 
and containing such information as the State educational agency may 
reasonably require.
    ``(b) Contents.--The report shall contain, at a minimum--
            ``(1) information on progress throughout the schools served 
        by the local educational agency on the performance measures 
        described in section 2014(a)(2) and goals described in 
        paragraphs (3) and (4) of section 2012(b);
            ``(2) information on progress throughout the schools served 
        by the local educational agency toward achieving the objectives 
        of, and carrying out the activities described in, this subpart;
            ``(3) data on the progress described in paragraphs (1) and 
        (2), disaggregated by school poverty level, as defined by the 
        State; and
            ``(4) a description of the methodology used to gather the 
        information and data described in paragraphs (1) through (3).

 ``Subpart 2--National Activities for the Improvement of Teaching and 
                           School Leadership

           ``Chapter 1--National Activities and Clearinghouse

``SEC. 2031. PROGRAM AUTHORIZED.

    ``(a) In General.--The Secretary is authorized to make grants to, 
and to enter into contracts and cooperative agreements with, local 
educational agencies, educational service agencies, State educational 
agencies, State agencies for higher education, institutions of higher 
education, and other public and private nonprofit agencies, 
organizations, and institutions to carry out subsection (b).
    ``(b) Activities.--In making the grants, and entering into the 
contracts and cooperative agreements, the Secretary--
            ``(1) may support activities of national significance that 
        are not supported through other sources and that the Secretary 
        determines will contribute to the improvement of teaching and 
        school leadership in the Nation's schools, such as--
                    ``(A) supporting collaborative efforts by States, 
                or consortia of States, to review and measure the 
                quality, rigor, and alignment of State standards and 
                assessments;
                    ``(B) supporting State and local efforts to develop 
                curricula aligned with State standards and assessments;
                    ``(C) supporting collaborative efforts by States, 
                or consortia of States, to review and measure the 
                quality and rigor of standards for entry into the field 
                of teaching, including the alignment of such standards 
                with State standards for students in elementary school 
                and secondary school, and the alignment of initial 
                teacher licensing and certification assessments with 
State standards for entry into the field of teaching;
                    ``(D) supporting the development of models, at the 
                State and local levels, of innovative compensation 
                systems that--
                            ``(i) provide incentives for talented 
                        individuals who have a strong knowledge of 
                        academic content to enter teaching; and
                            ``(ii) reward veteran teachers who acquire 
                        new knowledge and skills that are needed in the 
                        schools and districts in which the teachers 
                        teach; and
                    ``(E) supporting collaborative efforts by States, 
                or consortia of States, to develop performance-based 
                systems for assessing content knowledge and teaching 
                skills of teachers prior to initial certification or 
                licensure of the teachers;
            ``(2) may support activities of national significance that 
        the Secretary determines will contribute to the recruitment and 
        retention of highly qualified teachers and principals in 
        schools served by high-poverty local educational agencies, such 
        as--
                    ``(A) the development and implementation of a 
                national teacher recruitment clearinghouse and job 
                bank, which shall be coordinated and, to the extent 
                feasible, integrated with the America's Job Bank 
                administered by the Secretary of Labor, to--
                            ``(i) disseminate information and resources 
                        nationwide on entering the teaching profession, 
                        to persons interested in becoming teachers;
                            ``(ii) serve as a national resource center 
                        regarding effective practices for teacher 
                        professional development and mentoring, 
                        recruitment, and retention;
                            ``(iii) link prospective teachers to local 
                        educational agencies and training resources;
                            ``(iv) provide information and technical 
                        assistance to prospective teachers about 
                        certification and licensing and other State and 
                        local requirements related to teaching; and
                            ``(v) provide data projections concerning 
                        teacher and administrator supply and demand and 
                        available teaching and administrator 
                        opportunities;
                    ``(B) the development and implementation, or 
                expansion, of programs that recruit talented 
                individuals to become principals, including such 
                programs that employ alternative routes to State 
                certification or licensing that are at least as 
                rigorous as the State's standards for initial 
                certification or licensing of teachers, and that 
                prepare both new and experienced principals to serve as 
                instructional leaders, which may include the creation 
                and operation of a national center or regional centers 
                for the preparation and support of principals as 
                leaders of school reform;
                    ``(C) efforts to increase the portability of 
                teacher pensions and reciprocity of teaching 
                credentials across State lines;
                    ``(D) research, evaluation, and dissemination 
                activities related to effective strategies for 
                increasing the portability of teachers' credited years 
                of experience across State and school district lines;
                    ``(E) the development and implementation of 
                national or regional programs to--
                            ``(i) recruit highly talented individuals 
                        to become teachers, through alternative routes 
                        to certification or licensing that are at least 
                        as rigorous as the State's standards for 
                        initial certification or licensing of teachers, 
                        in schools served by high-poverty local 
                        educational agencies; and
                            ``(ii) help retain the individuals for more 
                        than 3 years as classroom teachers in schools 
                        served by the local educational agencies; and
                    ``(F) the establishment of partnerships of high-
                poverty local educational agencies, teacher 
                organizations, and local businesses, in order to help 
                the agencies attract and retain high-quality teachers 
                and principals through provision of increased pay, 
                combined with reforms to raise teacher performance 
                including use of regular, rigorous peer evaluations and 
                (where appropriate) student evaluations of every 
                teacher;
            ``(3) may support the National Board for Professional 
        Teaching Standards;
            ``(4)(A) shall carry out a national evaluation, not sooner 
        than 3 years and not later than 4 years after the date of 
        enactment of the Educational Opportunities Act, of the effect 
        of activities carried out under this title, including an 
        assessment of changes in instructional practice and objective 
measures of student achievement; and
            ``(B) shall submit a report containing the results of the 
        evaluation to Congress; and
            ``(5) shall annually submit to Congress a report on the 
        information contained in the State reports described in section 
        2022.

``SEC. 2032. EISENHOWER NATIONAL CLEARINGHOUSE FOR MATHEMATICS AND 
              SCIENCE EDUCATION.

    ``(a) Establishment of Clearinghouse.--The Secretary shall award a 
grant or contract, on a competitive basis, to an entity to establish 
and operate an Eisenhower National Clearinghouse for Mathematics and 
Science Education (referred to in this section as `the Clearinghouse').
    ``(b) Authorized Activities.--
            ``(1) Application and award basis.--
                    ``(A) In general.--An entity desiring to establish 
                and operate the Clearinghouse shall submit an 
                application to the Secretary at such time, in such 
                manner, and containing such information as the 
                Secretary may reasonably require.
                    ``(B) Peer review.--The Secretary shall establish a 
                peer review panel to make recommendations on the 
                recipient of the award for the Clearinghouse.
                    ``(C) Basis.--The Secretary shall make the award 
                for the Clearinghouse on the basis of merit.
            ``(2) Duration.--The Secretary shall award the grant or 
        contract for the Clearinghouse for a period of 5 years.
            ``(3) Activities.--The award recipient shall use the award 
        funds to--
                    ``(A) maintain a permanent collection of such 
                mathematics and science education instructional 
                materials and programs for elementary schools and 
                secondary schools as the Secretary finds appropriate, 
                and give priority to maintaining such materials and 
                programs that have been identified as promising or 
                exemplary, through a systematic approach such as the 
                use of expert panels required under the Educational 
                Research, Development, Dissemination, and Improvement 
                Act of 1994;
                    ``(B) disseminate the materials and programs 
                described in subparagraph (A) to the public, State 
                educational agencies, local educational agencies, and 
                schools (particularly high-poverty, low-performing 
                schools), including dissemination through the 
                maintenance of an interactive national electronic 
                information management and retrieval system accessible 
                through the World Wide Web and other advanced 
                communications technologies;
                    ``(C) coordinate activities with entities operating 
                other databases containing mathematics and science 
                curriculum and instructional materials, including 
                Federal, non-Federal, and, where feasible, 
                international databases;
                    ``(D) using not more than 10 percent of the amount 
                awarded under this section for any fiscal year, 
                participate in collaborative meetings of 
                representatives of the Clearinghouse and regional 
                mathematics and science education consortia to--
                            ``(i) discuss issues of common interest and 
                        concern;
                            ``(ii) foster effective collaboration and 
                        cooperation in acquiring and distributing 
                        instructional materials and programs; and
                            ``(iii) coordinate and enhance computer 
                        network access to the Clearinghouse and the 
                        resources of the regional consortia;
                    ``(E) support the development and dissemination of 
                model professional development and mentoring materials 
                for mathematics and science education;
                    ``(F) contribute materials or information, as 
                appropriate, to other national repositories or 
                networks; and
                    ``(G) gather qualitative and evaluative data on 
                submissions to the Clearinghouse, and disseminate that 
                data widely, including through the use of electronic 
                dissemination networks.
            ``(4) Submission to clearinghouse.--Each Federal agency or 
        department that develops mathematics or science education 
        instructional materials or programs, including the National 
        Science Foundation and the Department, shall submit copies of 
        that materials or those programs to the Clearinghouse.
            ``(5) Steering committee.--The Secretary may appoint a 
        steering committee to recommend policies and activities for the 
        Clearinghouse.
            ``(6) Application of copyright laws.--
                    ``(A) Construction.--Nothing in this section shall 
                be construed to allow the use or copying, in any 
                medium, of any material collected by the Clearinghouse 
                that is protected under the copyright laws of the 
                United States unless the Clearinghouse obtains the 
                permission of the owner of the copyright.
                    ``(B) Compliance.--In carrying out this section, 
                the Clearinghouse shall ensure compliance with title 
                17, United States Code.

                  ``Chapter 2--Transition to Teaching

``SEC. 2041. PURPOSE.

    ``The purpose of this chapter is to address the need of high-
poverty local educational agencies for highly qualified teachers in 
particular academic subjects, such as mathematics, science, foreign 
languages, bilingual education, and special education needed by the 
agencies, by--
            ``(1) continuing and enhancing the Troops to Teachers model 
        for recruiting and supporting the placement of such teachers; 
        and
            ``(2) recruiting, preparing, placing, and supporting 
        career-changing professionals who have knowledge and experience 
        that will help the professionals become such teachers.

``SEC. 2042. DEFINITIONS.

    ``In this chapter:
            ``(1) Program participant.--The term `program participant' 
        means a career-changing professional who--
                    ``(A) demonstrates interest in, and commitment to, 
                becoming a teacher; and
                    ``(B) has knowledge and experience that is relevant 
                to teaching a high-need academic subject for a high-
                poverty local educational agency.
            ``(2) Secretary.--The term `Secretary' means the Secretary 
        of Education, except as otherwise determined in accordance with 
        the agreements described in section 2043(b).

``SEC. 2043. PROGRAM AUTHORIZED.

    ``(a) Authority.--Subject to subsection (b), using funds made 
available to carry out this chapter under section 2003(2)(A) for each 
fiscal year, 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 
under this chapter.
    ``(b) Implementation.--
            ``(1) Consultation.--Before making awards under subsection 
        (a) for any fiscal year, the Secretary of Education shall--
                    ``(A) consult with the Secretary of Defense and the 
                Secretary of Transportation regarding the appropriate 
                amount of funding needed to carry out this chapter; and
                    ``(B) upon agreement, transfer that amount to the 
                Department of Defense to carry out this chapter.
            ``(2) Agreement.--The Secretary of Education may enter into 
        a written agreement with the Secretary of Defense and the 
        Secretary of Transportation, or take such other steps as the 
        Secretary of Education determines are appropriate, to ensure 
        effective implementation of this chapter.

``SEC. 2044. APPLICATION.

    ``Each entity that desires an award under section 2043(a) shall 
submit an application to the Secretary at such time, in such manner, 
and containing such information as the Secretary may require, 
including--
            ``(1) a description of the target group of career-changing 
        professionals on which the entity will focus in carrying out a 
        program under this chapter, including a description of the 
        characteristics of that target group that shows how the 
        knowledge and experience of the members of the group are 
        relevant to meeting the purpose of this chapter;
            ``(2) a description of how the entity will identify and 
        recruit program participants;
            ``(3) a description of the training that program 
        participants will receive and how that training will relate to 
        their certification or licensing as teachers;
            ``(4) a description of how the entity will ensure that 
        program participants are placed with, and teach for, high-
        poverty local educational agencies;
            ``(5) a description of the teacher induction services 
        (which may be provided through induction programs in existence 
        on the date of submission of the application) the program 
        participants will receive throughout at least their first year 
        of teaching;
            ``(6) a description of how the entity will collaborate, as 
        needed, with other institutions, agencies, or organizations to 
        recruit, train, place, and support program participants under 
        this chapter, including evidence of the commitment of the 
        institutions, agencies, or organizations to the entity's 
        program;
            ``(7) a description of how the entity will evaluate the 
        progress and effectiveness of the entity's program, including a 
        description of--
                    ``(A) the program's goals and objectives;
                    ``(B) the performance indicators the entity will 
                use to measure the program's progress; and
                    ``(C) the outcome measures that the entity will use 
                to determine the program's effectiveness; and
            ``(8) an assurance that the entity will provide to the 
        Secretary such information as the Secretary determines to be 
        necessary to determine the overall effectiveness of programs 
        carried out under this chapter.

``SEC. 2045. USES OF FUNDS AND PERIOD OF SERVICE.

    ``(a) Authorized Activities.--Funds made available under this 
chapter may be used for--
            ``(1) recruiting program participants, including informing 
        individuals who are potential participants of opportunities 
        available under the program and putting the individuals in 
        contact with other institutions, agencies, or organizations 
        that would train, place, and support the individuals;
            ``(2) providing training stipends and other financial 
        incentives for program participants, such as paying for moving 
        expenses, not to exceed $5,000, in the aggregate, per 
        participant;
            ``(3) 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;
            ``(4) providing placement activities, including identifying 
        high-poverty local educational agencies with needs for the 
        particular skills and characteristics of the newly trained 
        program participants and assisting the participants to obtain 
        employment with the local educational agencies; and
            ``(5) providing post-placement induction or support 
        activities for program participants.
    ``(b) Period of Service.--A program participant in a program under 
carried out under this chapter who completes the participant's training 
shall serve in a high-poverty local educational agency for at least 3 
years.
    ``(c) Repayment.--The Secretary shall establish such requirements 
as the Secretary determines to be appropriate to ensure that program 
participants who receive a training stipend or other financial 
incentive under subsection (a)(2), but fail to complete their service 
obligation under subsection (b), repay all or a portion of such stipend 
or other incentive.

``SEC. 2046. EQUITABLE DISTRIBUTION.

    ``To the extent practicable, the Secretary shall make awards under 
this chapter that support programs in different geographic regions of 
the Nation.

                     ``Chapter 3--Hometown Teachers

``SEC. 2051. PURPOSE.

    ``The purpose of this chapter is to support the efforts of high-
need local educational agencies to develop and implement comprehensive 
approaches to recruiting and retaining highly qualified teachers, 
including recruiting such teachers through Hometown Teacher programs 
that carry out long-term strategies to expand the capacity of the 
communities served by the agencies to produce local teachers.

``SEC. 2052. DEFINITION.

    ``The term `high-need local educational agency' means a local 
educational agency that serves an elementary school or secondary school 
located in an area in which there is--
            ``(1) a high percentage (as determined by the State in 
        which the agency is located) of individuals from families with 
        incomes below the poverty line;
            ``(2) a high percentage (as determined by the State in 
        which the agency is located) of secondary school teachers not 
        teaching in the core academic subjects in which the teachers 
        were trained to teach; or
            ``(3) a high percentage (as determined by the State in 
        which the agency is located) of elementary school and secondary 
        school teachers who are not fully qualified teachers.

``SEC. 2053. PROGRAM AUTHORIZED.

    ``From funds made available to carry out this chapter under section 
2003(2)(B) for each fiscal year, the Secretary may award grants to 
high-need local educational agencies to carry out Hometown Teacher 
programs and other activities described in this chapter.

``SEC. 2054. APPLICATIONS.

    ``Each high-need local educational agency that desires to receive a 
grant under section 2053 shall submit an application to the Secretary 
at such time, in such manner, and containing such information as the 
Secretary may require, including--
            ``(1) a description of the local educational agency's 
        assessment of the agency's needs for teachers, such as the 
        agency's projected shortage of qualified teachers and the 
        percentage of teachers serving the agency who lack 
        certification or licensure or who are teaching out of field;
            ``(2) a description of a Hometown Teacher program that the 
        local educational agency plans to develop and implement with 
        the funds made available through the grant, including a 
        description of--
                    ``(A) strategies the agency will use to--
                            ``(i) encourage secondary school and middle 
                        school students in schools served by the local 
                        educational agency to consider pursuing careers 
                        in the teaching profession; and
                            ``(ii) provide support at the undergraduate 
                        level to those students who intend to become 
                        teachers; and
                    ``(B) the agency's plans to streamline the hiring 
                timelines in the hiring policies and practices of the 
                agency for participants in the Hometown Teacher 
                program;
            ``(3) a description of the long-term strategies that the 
        agency will use, if any, to reduce the agency's teacher 
        attrition rate, including providing mentoring programs and 
        making efforts to raise teacher salaries and create more 
        desirable working conditions for teachers;
            ``(4) a description of the agency's strategy for ensuring 
        that all secondary school teachers and middle school teachers 
        in the school district are fully certified or licensed in an 
        academic subject and are teaching the majority of their classes 
        in the subject in which the teachers are certified or licensed;
            ``(5) a description of the short-term strategies the agency 
        will use, if any, to address the agency's teacher shortage 
        problem, including the strategies the agency will use to ensure 
        that the teachers that the local educational agency is 
        targeting for employment are fully certified or licensed;
            ``(6) a description of the agency's long-term plan for 
        ensuring that the agency's teachers have opportunities for 
        sustained, high-quality professional development;
            ``(7) a description of the ways in which the activities 
        proposed to be carried out through the grant are part of the 
        agency's overall plan for improving the quality of teaching and 
        student achievement;
            ``(8) a description of how the agency will collaborate, as 
        needed, with other institutions, agencies, or organizations to 
        develop and implement the strategies the agency proposes in the 
        application, including evidence of the commitment of the 
        institutions, agencies, or organizations to the agency's 
        activities;
            ``(9) a description of the strategies the agency will use 
        to coordinate activities funded under the program carried out 
        under this chapter with activities funded through other Federal 
        programs that address teacher shortages, including programs 
        carried out through grants to local educational agencies under 
        title I or this title, including chapter 2, if the applicant 
        receives funds from the programs;
            ``(10) a description of how the agency will evaluate the 
        progress and effectiveness of the Hometown Teacher program, 
        including a description of--
                    ``(A) the agency's goals and objectives for the 
                program;
                    ``(B) the performance indicators that the agency 
                will use to measure the program's effectiveness; and
                    ``(C) the measurable outcome measures, such as 
                increased percentages of fully certified or licensed 
                teachers, that the agency will use to determine the 
                program's effectiveness; and
            ``(11) an assurance that the agency will provide to the 
        Secretary such information as the Secretary determines to be 
        necessary to determine the overall effectiveness of programs 
        carried out under this chapter.

``SEC. 2055. PRIORITY.

    ``In awarding grants under this chapter, the Secretary may give 
priority to agencies submitting applications that--
            ``(1) focus on increasing the percentage of qualified 
        teachers in particular teaching fields, such as mathematics, 
        science, and bilingual education; and
            ``(2) focus on recruiting qualified teachers for certain 
        types of communities, such as urban and rural communities.

``SEC. 2056. USE OF FUNDS.

    ``(a) Mandatory Use of Funds.--A local educational agency that 
receives a grant under this chapter shall use the funds made available 
through the grant to develop and implement long-term strategies to 
address the agency's teacher shortage, including carrying out Hometown 
Teacher programs such as the programs described in section 2051.
    ``(b) Permissible Use of Funds.--A local educational agency that 
receives a grant under this chapter may use the funds made available 
through the grant to--
            ``(1) develop and implement strategies to reduce the local 
        educational agency's teacher attrition rate, including 
        providing mentoring programs, increasing teacher salaries, and 
        creating more desirable working conditions for teachers; and
            ``(2) develop and implement short-term strategies to 
        address the agency's teacher shortage, including providing 
        scholarships to undergraduates who agree to teach in the school 
        district served by the agency for a certain number of years, 
        providing signing bonuses for teachers, and implementing 
        streamlined hiring practices.
    ``(c) Supplement, Not Supplant.--Funds made available under this 
chapter shall be used to supplement, and shall not supplant, State and 
local funds expended to carry out programs and activities authorized 
under this chapter.

``SEC. 2057. SERVICE REQUIREMENTS.

    ``(a) In General.--The Secretary shall establish such requirements 
as the Secretary finds to be necessary to ensure that a recipient of a 
scholarship under this chapter who completes a teacher education 
program subsequently--
            ``(1) teaches in a school district served by a high-need 
        local educational agency, for a period of time equivalent to 
        the period for which the recipient received the scholarship; or
            ``(2) repays the amount of the funds provided through the 
        scholarship.
    ``(b) Use of Repaid Funds.--The Secretary shall deposit any such 
repaid funds in an account, and use the funds to carry out additional 
activities under this chapter.

     ``Chapter 4--Early Childhood Educator Professional Development

``SEC. 2061. PURPOSE.

    ``In support of the national effort to attain the first of 
America's Education Goals, the purpose of this chapter is to enhance 
the school readiness of young children, particularly disadvantaged 
young children, and to prevent them from encountering reading 
difficulties once they enter school, by improving the knowledge and 
skills of early childhood educators who work in communities that have 
high concentrations of children living in poverty.

``SEC. 2062. PROGRAM AUTHORIZED.

    ``(a) Grants to Partnerships.--The Secretary shall carry out the 
purpose of this chapter by awarding grants, on a competitive basis, to 
partnerships consisting of--
            ``(1)(A) one or more institutions of higher education that 
        provide professional development for early childhood educators 
        who work with children from low-income families in high-need 
        communities; or
            ``(B) another public or private, nonprofit entity that 
        provides such professional development;
            ``(2) one or more public agencies (including local 
        educational agencies, State educational agencies, State human 
        services agencies, and State and local agencies administering 
        programs under the Child Care and Development Block Grant Act 
        of 1990), Head Start agencies, or private, nonprofit 
        organizations; and
            ``(3) to the extent feasible, an entity with demonstrated 
        experience in providing violence prevention education training 
        to educators in early childhood education programs.
    ``(b) Priority.--In awarding grants under this chapter, the 
Secretary shall give priority to partnerships that include 1 or more 
local educational agencies which operate early childhood education 
programs for children from low-income families in high-need 
communities.
    ``(c) Duration and Number of Grants.--
            ``(1) Duration.--Each grant under this chapter shall be 
        awarded for not more than 4 years.
            ``(2) Number.--No partnership may receive more than 1 grant 
        under this chapter.

``SEC. 2063. APPLICATIONS.

    ``(a) Applications Required.--Any partnership 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 require.
    ``(b) Contents.--Each such application shall include--
            ``(1) a description of the high-need community to be served 
        by the project, including such demographic and socioeconomic 
        information as the Secretary may request;
            ``(2) information on the quality of the early childhood 
        educator professional development program currently conducted 
        by the institution of higher education or other provider in the 
        partnership;
            ``(3) the results of the assessment that the entities in 
        the partnership have undertaken to determine the most critical 
        professional development needs of the early childhood educators 
        to be served by the partnership and in the broader community, 
        and a description of how the proposed project will address 
        those needs;
            ``(4) a description of how the proposed project will be 
        carried out, including--
                    ``(A) how individuals will be selected to 
                participate;
                    ``(B) the types of research-based professional 
                development activities that will be carried out;
                    ``(C) how research on effective professional 
                development and on adult learning will be used to 
                design and deliver project activities;
                    ``(D) how the project will coordinate with and 
                build on, and will not supplant or duplicate, early 
                childhood education professional development activities 
                that exist in the community;
                    ``(E) how the project will train early childhood 
                educators to provide services that are based on 
                developmentally appropriate practices and the best 
                available research on child, language, and literacy 
                development and on early childhood pedagogy;
                    ``(F) how the program will train early childhood 
                educators to meet the diverse educational needs of 
                children in the community, including children who have 
                limited English proficiency, disabilities, or other 
                special needs; and
                    ``(G) how the project will train early childhood 
                educators in identifying and preventing behavioral 
                problems or violent behavior in children;
            ``(5) a description of--
                    ``(A) the specific objectives that the partnership 
                will seek to attain through the project, and how the 
                partnership will measure progress toward attainment of 
                those objectives; and
                    ``(B) how the objectives and the measurement 
                activities align with the performance indicators 
                established by the Secretary under section 2066(a);
            ``(6) a description of the partnership's plan for 
        institutionalizing the activities carried out under the 
        project, so that the activities continue once Federal funding 
        ceases;
            ``(7) an assurance that, where applicable, the project will 
        provide appropriate professional development to volunteer 
        staff, as well as to paid staff; and
            ``(8) an assurance that, in developing its application and 
        in carrying out its project, the partnership has consulted 
        with, and will consult with, relevant agencies and early 
        childhood educator organizations described in section 
        2062(a)(2) that are not members of the partnership.

``SEC. 2064. SELECTION OF GRANTEES.

    ``(a) Criteria.--The Secretary shall select partnerships to receive 
funding on the basis of the community's need for assistance and the 
quality of the applications.
    ``(b) Geographic Distribution.--In selecting partnerships, the 
Secretary shall seek to ensure that communities in different regions of 
the Nation, as well as both urban and rural communities, are served.

``SEC. 2065. USES OF FUNDS.

    ``(a) In General.--Each partnership receiving a grant under this 
chapter shall use the grant funds to carry out activities that will 
improve the knowledge and skills of early childhood educators who are 
working in early childhood programs that are located in high-need 
communities and serve concentrations of children from low-income 
families.
    ``(b) Allowable Activities.--Such activities may include--
            ``(1) professional development for individuals working as 
        early childhood educators, particularly to familiarize those 
        individuals with the application of recent research on child, 
        language, and literacy development and on early childhood 
        pedagogy;
            ``(2) professional development for early childhood 
        educators in working with parents, based on the best current 
        research on child, language, and literacy development and 
        parent involvement, so that the educators can prepare their 
        children to succeed in school;
            ``(3) professional development for early childhood 
        educators to work with children who have limited English 
        proficiency, disabilities, and other special needs;
            ``(4) professional development to train early childhood 
        educators in identifying and preventing behavioral problems or 
        violent behavior in children;
            ``(5) activities that assist and support early childhood 
        educators during their first three years in the field;
            ``(6) development and implementation of early childhood 
        educator professional development programs that make use of 
        distance learning and other technologies;
            ``(7) professional development activities related to the 
        selection and use of research-based diagnostic assessments to 
        improve teaching and learning; and
            ``(8) data collection, evaluation, and reporting needed to 
        meet the requirements of this chapter relating to 
        accountability.

``SEC. 2066. ACCOUNTABILITY.

    ``(a) Performance Indicators.--Simultaneously with the publication 
of any application notice for grants under this chapter, the Secretary 
shall announce performance indicators for this chapter, which shall be 
designed to measure--
            ``(1) the quality and assessability of the professional 
        development provided;
            ``(2) the impact of that professional development on the 
        early childhood education provided by the individuals who are 
        trained; and
            ``(3) such other measures of program impact as the 
        Secretary determines appropriate.
    ``(b) Annual Reports; Termination.--
            ``(1) Annual reports.--Each partnership receiving a grant 
        under this chapter shall report annually to the Secretary on 
        the partnership's progress against the performance indicators.
            ``(2) Termination.--The Secretary may terminate a grant 
        under this chapter at any time if the Secretary determines that 
        the partnership is not making satisfactory progress against the 
        indicators.

``SEC. 2067. COST-SHARING.

    ``(a) In General.--Each partnership shall provide, from other 
sources, which may include other Federal sources--
            ``(1) at least 50 percent of the total cost of its project 
        for the grant period; and
            ``(2) at least 20 percent of the project cost in each year.
    ``(b) Acceptable Contributions.--A partnership may meet the 
requirement of subsection (a) through cash or in-kind contributions, 
fairly valued.
    ``(c) Waivers.--The Secretary may waive or modify the requirements 
of subsection (a) in cases of demonstrated financial hardship.

``SEC. 2068. FEDERAL COORDINATION.

    ``The Secretary and the Secretary of Health and Human Services 
shall coordinate activities under this chapter and other early 
childhood programs administered by the two Secretaries.

``SEC. 2069. DEFINITIONS.

    ``In this chapter:
            ``(1) High-need community.--
                    ``(A) In general.--The term `high-need community' 
                means--
                            ``(i) a municipality, or a portion of a 
                        municipality, in which at least 50 percent of 
                        the children are from low-income families; or
                            ``(ii) a municipality that is one of the 10 
                        percent of municipalities within the State 
                        having the greatest numbers of such children.
                    ``(B) Determination.--In determining which 
                communities are described in subparagraph (A), the 
                Secretary shall use such data as the Secretary 
                determines are most accurate and appropriate.
            ``(2) Low-income family.--The term `low-income family' 
        means a family with an income 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) applicable to a family of the size 
        involved for the most recent fiscal year for which satisfactory 
        data are available.
            ``(3) Early childhood educator.--The term `early childhood 
        educator' means a person who provides care and education to 
        children at any age from birth through kindergarten.''.
    (b) Conforming Amendment.--The Troops-to-Teachers Program Act of 
1999 (20 U.S.C. 9301 et seq.) is repealed.

           Subtitle B--Safe, Healthy Schools and Communities

                CHAPTER 1--GRANTS FOR SCHOOL RENOVATION

SEC. 311. GRANTS FOR SCHOOL RENOVATION.

    Title X (20 U.S.C. 8001 et seq.) is amended by adding at the end 
the following:

                      ``PART L--SCHOOL RENOVATION

``SEC. 10995. GRANTS FOR SCHOOL RENOVATION.

    ``(a) In General.--
            ``(1) Allocation of funds.--Of the amount appropriated for 
        each fiscal year under subsection (k), the Secretary of 
        Education shall allocate--
                    ``(A) 6.0 percent of such amount for grants to 
                impacted local educational agencies (as defined in 
                paragraph (3)) for school repair, renovation, and 
                construction;
                    ``(B) 0.25 percent of such amount for grants to 
                outlying areas for school repair and renovation in 
                high-need schools and communities, allocated on such 
                basis, and subject to such terms and conditions, as the 
                Secretary determines appropriate;
                    ``(C) 2 percent of such amount for grants to public 
                entities, private nonprofit entities, and consortia of 
                such entities, for use in accordance with subpart 2 of 
                part C of this title X; and
                    ``(D) the remainder to State educational agencies 
                in proportion to the amount each State received under 
                part A of title I for fiscal year 2001, except that no 
                State shall receive less than 0.5 percent of the amount 
                allocated under this subparagraph.
            ``(2) Determination of grant amount.--
                    ``(A) Determination of weighted student units.--For 
                purposes of computing the grant amounts under paragraph 
                (1)(A) for fiscal year 2001, the Secretary shall 
                determine the results obtained by the computation made 
                under section 8003 with respect to children described 
                in subsection (a)(1)(C) of such section and computed 
                under subsection (a)(2)(B) of such section for such 
                year--
                            ``(i) for each impacted local educational 
                        agency that receives funds under this section; 
                        and
                            ``(ii) for all such agencies together.
                    ``(B) Computation of payment.--For fiscal year 
                2002, the Secretary shall calculate the amount of a 
                grant to an impacted local educational agency by--
                            ``(i) dividing the amount described in 
                        paragraph (1)(A) by the results of the 
                        computation described in subparagraph (A)(ii); 
                        and
                            ``(ii) multiplying the number derived under 
                        clause (i) by the results of the computation 
                        described in subparagraph (A)(i) for such 
                        agency.
            ``(3) Definition.--For purposes of this section, the term 
        `impacted local educational agency' means, for fiscal year 
        2001--
                    ``(A) a local educational agency that receives a 
                basic support payment under section 8003(b) for such 
                fiscal year; and
                    ``(B) with respect to which the number of children 
                determined under section 8003(a)(1)(C) for the 
                preceding school year constitutes at least 50 percent 
                of the total student enrollment in the schools of the 
                agency during such school year.
    ``(b) Within-State Allocations.--
            ``(1) Administrative costs.--
                    ``(A) State educational agency administration.--
                Except as provided in subparagraph (B), each State 
                educational agency may reserve not more than 1 percent 
                of its allocation under subsection (a)(1)(D) for the 
                purpose of administering the distribution of grants 
                under this subsection.
                    ``(B) State entity administration.--If the State 
                educational agency transfers funds to a State entity 
                described in paragraph (2)(A), the agency shall 
                transfer to such entity 0.75 of the amount reserved 
                under this paragraph for the purpose of administering 
                the distribution of grants under this subsection.
            ``(2) Reservation for competitive school repair and 
        renovation grants to local educational agencies.--
                    ``(A) In general.--Subject to the reservation under 
                paragraph (1), of the funds allocated to a State 
                educational agency under subsection (a)(1)(D), the 
                State educational agency shall distribute 75 percent of 
                such funds to local educational agencies or, if such 
                State educational agency is not responsible for the 
                financing of education facilities, the agency shall 
                transfer such funds to the State entity responsible for 
                the financing of education facilities (referred to in 
                this section as the `State entity') for distribution by 
                such entity to local educational agencies in accordance 
                with this paragraph, to be used, consistent with 
                subsection (c), for school repair and renovation.
                    ``(B) Competitive grants to local educational 
                agencies.--
                            ``(i) In general.--The State educational 
                        agency or State entity shall carry out a 
                        program of competitive grants to local 
                        educational agencies for the purpose described 
                        in subparagraph (A). Of the total amount 
                        available for distribution to such agencies 
                        under this paragraph, the State educational 
                        agency or State entity, shall, in carrying out 
                        the competition--
                                    ``(I) award to high poverty local 
                                educational agencies described in 
                                clause (ii), in the aggregate, at least 
                                an amount which bears the same 
                                relationship to such total amount as 
                                the aggregate amount such local 
                                educational agencies received under 
                                part A of title I for fiscal year 2002 
                                bears to the aggregate amount received 
                                for such fiscal year under such part by 
                                all local educational agencies in the 
                                State;
                                    ``(II) award to rural local 
                                educational agencies in the State, in 
                                the aggregate, at least an amount which 
                                bears the same relationship to such 
                                total amount as the aggregate amount 
                                such rural local educational agencies 
                                received under part A of title I for 
                                fiscal year 2001 bears to the aggregate 
                                amount received for such fiscal year 
                                under such part by all local 
                                educational agencies in the State; and
                                    ``(III) award the remaining funds 
                                to local educational agencies not 
                                receiving an award under subclause (I) 
                                or (II), including high poverty and 
                                rural local educational agencies that 
                                did not receive such an award.
                            ``(ii) High poverty local educational 
                        agencies.--A local educational agency is 
                        described in this clause if--
                                    ``(I) the percentage described in 
                                subparagraph (C)(i) with respect to the 
                                agency is 30 percent or greater; or
                                    ``(II) the number of children 
                                described in such subparagraph with 
                                respect to the agency is at least 
                                10,000.
                    ``(C) Criteria for awarding grants.--In awarding 
                competitive grants under this paragraph, a State 
                educational agency or State entity shall take into 
                account the following criteria:
                            ``(i) The percentage of poor children 5 to 
                        17 years of age, inclusive, in a local 
                        educational agency.
                            ``(ii) The need of a local educational 
                        agency for school repair and renovation, as 
                        demonstrated by the condition of its public 
                        school facilities.
                            ``(iii) The fiscal capacity of a local 
                        educational agency to meet its needs for repair 
                        and renovation of public school facilities 
                        without assistance under this section, 
                        including its ability to raise funds through 
                        the use of local bonding capacity and 
                        otherwise.
                            ``(iv) In the case of a local educational 
                        agency that proposes to fund a repair or 
                        renovation project for a charter school or 
                        schools, the extent to which the school or 
                        schools have access to funding for the project 
                        through the financing methods available to 
                        other public schools or local educational 
                        agencies in the State.
                            ``(v) The likelihood that the local 
                        educational agency will maintain, in good 
                        condition, any facility whose repair or 
                        renovation is assisted under this section.
                    ``(D) Possible matching requirement.--
                            ``(i) In general.--A State educational 
                        agency or State entity may require local 
                        educational agencies to match funds awarded 
                        under this subsection.
                            ``(ii) Match amount.--The amount of a match 
                        described in clause (i) may be established by 
                        using a sliding scale that takes into account 
                        the relative poverty of the population served 
                        by the local educational agency.
            ``(3) Reservation for competitive idea or technology grants 
        to local educational agencies.--
                    ``(A) In general.--Subject to the reservation under 
                paragraph (1), of the funds allocated to a State 
                educational agency under subsection (a)(1)(D), the 
                State educational agency shall distribute 25 percent of 
                such funds to local educational agencies through 
                competitive grant processes, to be used for the 
                following:
                            ``(i) To carry out activities under part B 
                        of the Individuals with Disabilities Education 
                        Act (20 U.S.C. 1411 et seq.).
                            ``(ii) For technology activities that are 
                        carried out in connection with school repair 
                        and renovation, including--
                                    ``(I) wiring;
                                    ``(II) acquiring hardware and 
                                software;
                                    ``(III) acquiring connectivity 
                                linkages and resources; and
                                    ``(IV) acquiring microwave, fiber 
                                optics, cable, and satellite 
                                transmission equipment.
                    ``(B) Criteria for awarding idea grants.--In 
                awarding competitive grants under subparagraph (A) to 
                be used to carry out activities under part B of the 
                Individuals with Disabilities Education Act (20 U.S.C. 
                1411 et seq.), a State educational agency shall take 
                into account the following criteria:
                            ``(i) The need of a local educational 
                        agency for additional funds for a student whose 
                        individually allocable cost for expenses 
                        related to the Individuals with Disabilities 
                        Education Act substantially exceeds the State's 
                        average per-pupil expenditure (as defined in 
                        section 14101(2)).
                            ``(ii) The need of a local educational 
                        agency for additional funds for special 
                        education and related services under part B of 
                        the Individuals with Disabilities Education Act 
                        (20 U.S.C. 1411 et seq.).
                            ``(iii) The need of a local educational 
                        agency for additional funds for assistive 
                        technology devices (as defined in section 602 
                        of the Individuals with Disabilities Education 
                        Act (20 U.S.C. 1401)) or assistive technology 
                        services (as so defined) for children being 
                        served under part B of the Individuals with 
                        Disabilities Education Act (20 U.S.C. 1411 et 
                        seq.).
                            ``(iv) The need of a local educational 
                        agency for additional funds for activities 
                        under part B of the Individuals with 
                        Disabilities Education Act (20 U.S.C. 1411 et 
                        seq.) in order for children with disabilities 
                        to make progress toward meeting the performance 
                        goals and indicators established by the State 
                        under section 612(a)(16) of such Act (20 U.S.C. 
                        1412).
                    ``(C) Criteria for awarding technology grants.--In 
                awarding competitive grants under subparagraph (A) to 
                be used for technology activities that are carried out 
                in connection with school repair and renovation, a 
                State educational agency shall take into account the 
                need of a local educational agency for additional funds 
                for such activities, including the need for the 
                activities described in subclauses (I) through (IV) of 
                subparagraph (A)(ii).
    ``(c) Rules Applicable to School Repair and Renovation.--With 
respect to funds made available under this section that are used for 
school repair and renovation, the following rules shall apply:
            ``(1) Permissible uses of funds.--School repair and 
        renovation shall be limited to one or more of the following:
                    ``(A) Emergency repairs or renovations to public 
                school facilities only to ensure the health and safety 
                of students and staff, including--
                            ``(i) repairing, replacing, or installing 
                        roofs, electrical wiring, plumbing systems, or 
                        sewage systems;
                            ``(ii) repairing, replacing, or installing 
                        heating, ventilation, or air conditioning 
                        systems (including insulation); and
                            ``(iii) bringing public schools into 
                        compliance with fire and safety codes.
                    ``(B) School facilities modifications necessary to 
                render public school facilities accessible in order to 
                comply with the Americans with Disabilities Act of 1990 
                (42 U.S.C. 12101 et seq.).
                    ``(C) School facilities modifications necessary to 
                render public school facilities accessible in order to 
                comply with section 504 of the Rehabilitation Act of 
                1973 (29 U.S.C. 794).
                    ``(D) Asbestos abatement or removal from public 
                school facilities.
                    ``(E) Renovation, repair, and acquisition needs 
                related to the building infrastructure of a charter 
                school.
            ``(2) Impermissible uses of funds.--No funds received under 
        this section may be used for--
                    ``(A) payment of maintenance costs in connection 
                with any projects constructed in whole or part with 
                Federal funds provided under this section;
                    ``(B) the construction of new facilities, except 
                for facilities for an impacted local educational agency 
                (as defined in subsection (a)(3)); or
                    ``(C) stadiums or other facilities primarily used 
                for athletic contests or exhibitions or other events 
                for which admission is charged to the general public.
            ``(3) Charter schools.--A public charter school that 
        constitutes a local educational agency under State law shall be 
        eligible for assistance under the same terms and conditions as 
        any other local educational agency (as defined in section 
        14101(18)).
            ``(4) Supplement, not supplant.--Excluding the uses 
        described in subparagraphs (B) and (C) of paragraph (1), a 
        local educational agency shall use Federal funds subject to 
        this subsection only to supplement the amount of funds that 
        would, in the absence of such Federal funds, be made available 
        from non-Federal sources for school repair and renovation.
    ``(d) Special Rule.--Each local educational agency that receives 
funds under this section shall ensure that, if it carries out repair or 
renovation through a contract, any such contract process ensures the 
maximum number of qualified bidders, including small, minority, and 
women-owned businesses, through full and open competition.
    ``(e) Public Comment.--Each local educational agency receiving 
funds under paragraph (2) or (3) of subsection (b)--
            ``(1) shall provide parents, educators, and all other 
        interested members of the community the opportunity to consult 
        on the use of funds received under such paragraph;
            ``(2) shall provide the public with adequate and efficient 
        notice of the opportunity described in paragraph (1) in a 
        widely read and distributed medium; and
            ``(3) shall provide the opportunity described in paragraph 
        (1) in accordance with any applicable State and local law 
        specifying how the comments may be received and how the 
        comments may be reviewed by any member of the public.
    ``(f) Reporting.--
            ``(1) Local reporting.--Each local educational agency 
        receiving funds under subsection (a)(1)(D) shall submit a 
        report to the State educational agency, at such time as the 
        State educational agency may require, describing the use of 
        such funds for--
                    ``(A) school repair and renovation (and 
                construction, in the case of an impacted local 
                educational agency (as defined in subsection (a)(3)));
                    ``(B) activities under part B of the Individuals 
                with Disabilities Education Act (20 U.S.C. 1411 et 
                seq.); and
                    ``(C) technology activities that are carried out in 
                connection with school repair and renovation, including 
                the activities described in subclauses (I) through (IV) 
                of subsection (b)(3)(A)(ii).
            ``(2) State reporting.--Each State educational agency shall 
        submit to the Secretary of Education, not later than December 
        31, 2003, a report on the use of funds received under 
        subsection (a)(1)(D) by local educational agencies for--
                    ``(A) school repair and renovation (and 
                construction, in the case of an impacted local 
                educational agency (as defined in subsection (a)(3)));
                    ``(B) activities under part B of the Individuals 
                with Disabilities Education Act (20 U.S.C. 1411 et 
                seq.); and
                    ``(C) technology activities that are carried out in 
                connection with school repair and renovation, including 
                the activities described in subclauses (I) through (IV) 
                of subsection (b)(3)(A)(ii).
            ``(3) Additional reports.--Each entity receiving funds 
        allocated under subsection (a)(1) (A) of (B) shall submit to 
        the Secretary, not later than December 31, 2003, a report on 
        its uses of funds under this section, in such form and 
        containing such information as the Secretary may require.
    ``(g) Applicability of Part B of IDEA.--If a local educational 
agency uses funds received under this section to carry out activities 
under part B of the Individuals with Disabilities Education Act (20 
U.S.C. 1411 et seq.), such part (including provisions respecting the 
participation of private school children), and any other provision of 
law that applies to such part, shall apply to such use.
    ``(h) Reallocation.--If a State educational agency does not apply 
for an allocation of funds under subsection (a)(1)(D) for fiscal year 
2002, or does not use its entire allocation for such fiscal year, the 
Secretary may reallocate the amount of the State educational agency's 
allocation (or the remainder thereof, as the case may be) to the 
remaining State educational agencies in accordance with subsection 
(a)(1)(D).
    ``(i) Participation of Private Schools.--
            ``(1) In general.--Section 6402 shall apply to subsection 
        (b)(2) in the same manner as it applies to activities under 
        title VI, except that--
                    ``(A) such section shall not apply with respect to 
                the title to any real property renovated or repaired 
                with assistance provided under this section;
                    ``(B) the term `services' as used in section 6402 
                with respect to funds under this section shall be 
                provided only to private, nonprofit elementary or 
                secondary schools with a rate of child poverty of at 
                least 40 percent and may include for purposes of 
                subsection (b)(2) only--
                            ``(i) modifications of school facilities 
                        necessary to meet the standards applicable to 
                        public schools under the Americans with 
                        Disabilities Act of 1990 (42 U.S.C. 12101 et 
                        seq.);
                            ``(ii) modifications of school facilities 
                        necessary to meet the standards applicable to 
                        public schools under section 504 of the 
                        Rehabilitation Act of 1973 (29 U.S.C. 794); and
                            ``(iii) asbestos abatement or removal from 
                        school facilities; and
                    ``(C) notwithstanding the requirements of section 
                6402(b), expenditures for services provided using funds 
                made available under subsection (b)(2) shall be 
                considered equal for purposes of such section if the 
                per-pupil expenditures for services described in 
                subparagraph (B) for students enrolled in private 
                nonprofit elementary and secondary schools that have 
                child poverty rates of at least 40 percent are 
                consistent with the per-pupil expenditures under this 
section for children enrolled in the public schools in the school 
district of the local educational agency receiving funds under this 
section.
            ``(2) Remaining funds.--If the expenditure for services 
        described in paragraph (1)(B) is less than the amount 
        calculated under paragraph (1)(C) because of insufficient need 
        for such services, the remainder shall be available to the 
        local educational agency for renovation and repair of public 
        school facilities.
            ``(3) Application.--If any provision of this section, or 
        the application thereof, to any person or circumstances is 
        judicially determined to be invalid, the provisions of the 
        remainder of the section and the application to other persons 
        or circumstances shall not be affected thereby.
    ``(j) Definitions.--For purposes of this section:
            ``(1) Charter school.--The term `charter school' has the 
        meaning given such term in section 10310(1).
            ``(2) Poor children and child poverty.--The terms `poor 
        children' and `child poverty' refer to children 5 to 17 years 
        of age, inclusive, who are 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 (42 U.S.C. 9902(2)) applicable 
        to a family of the size involved for the most recent fiscal 
        year for which data satisfactory to the Secretary are 
        available.
            ``(3) Rural local educational agency.--The term `rural 
        local educational agency' means a local educational agency that 
        the State determines is located in a rural area using objective 
        data and a commonly employed definition of the term `rural'.
            ``(4) State.--The term `State' means each of the 50 states, 
        the District of Columbia, and the Commonwealth of Puerto Rico.
    ``(k) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section, $1,600,000,000 for fiscal year 
2002, and such sums as may be necessary for each of fiscal years 2003 
through 2006.''.

SEC. 312. CHARTER SCHOOL CREDIT ENHANCEMENT INITIATIVE.

    Section 10331, as added by section 322 of the Departments of Labor, 
Health and Human Services, and Education, and Related Agencies 
Appropriations Act, 2001 (as enacted into law by section 1(a)(1) of 
Public Law 106-554) is amended by inserting before the period the 
following: ``, and such sums as may be necessary for each of fiscal 
years 2002 through 2006''.

                     CHAPTER 2--SCHOOL CONSTRUCTION

SEC. 321. SHORT TITLE.

    This chapter may be cited as the ``America's Better Classrooms Act 
of 2001''.

SEC. 322. EXPANSION OF INCENTIVES FOR PUBLIC SCHOOLS.

    (a) In General.--Chapter 1 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new subchapter:

         ``Subchapter X--Public School Modernization Provisions

                              ``Sec. 1400F. Credit to holders of 
                                        qualified public school 
                                        modernization bonds.
                              ``Sec. 1400G. Qualified school 
                                        construction bonds.
                              ``Sec. 1400H. Qualified zone academy 
                                        bonds.

``SEC. 1400F. CREDIT TO HOLDERS OF QUALIFIED PUBLIC SCHOOL 
              MODERNIZATION BONDS.

    ``(a) Allowance of Credit.--In the case of a taxpayer who holds a 
qualified public school modernization bond on a credit allowance date 
of such bond which occurs during the taxable year, there shall be 
allowed as a credit against the tax imposed by this chapter for such 
taxable year an amount equal to the sum of the credits determined under 
subsection (b) with respect to credit allowance dates during such year 
on which the taxpayer holds such bond.
    ``(b) Amount of Credit.--
            ``(1) In general.--The amount of the credit determined 
        under this subsection with respect to any credit allowance date 
        for a qualified public school modernization bond is 25 percent 
        of the annual credit determined with respect to such bond.
            ``(2) Annual credit.--The annual credit determined with 
        respect to any qualified public school modernization bond is 
        the product of--
                    ``(A) the applicable credit rate, multiplied by
                    ``(B) the outstanding face amount of the bond.
            ``(3) Applicable credit rate.--For purposes of paragraph 
        (1), the applicable credit rate with respect to an issue is the 
        rate equal to an average market yield (as of the day before the 
        date of issuance of the issue) on outstanding long-term 
        corporate debt obligations (determined under regulations 
        prescribed by the Secretary).
            ``(4) Special rule for issuance and redemption.--In the 
        case of a bond which is issued during the 3-month period ending 
        on a credit allowance date, the amount of the credit determined 
        under this subsection with respect to such credit allowance 
        date shall be a ratable portion of the credit otherwise 
        determined based on the portion of the 3-month period during 
        which the bond is outstanding. A similar rule shall apply when 
        the bond is redeemed.
    ``(c) Limitation Based on Amount of Tax.--
            ``(1) In general.--The credit allowed under subsection (a) 
        for any taxable year shall not exceed the excess of--
                    ``(A) the sum of the regular tax liability (as 
                defined in section 26(b)) plus the tax imposed by 
                section 55, over
                    ``(B) the sum of the credits allowable under part 
                IV of subchapter A (other than subpart C thereof, 
                relating to refundable credits).
            ``(2) Carryover of unused credit.--If the credit allowable 
        under subsection (a) exceeds the limitation imposed by 
        paragraph (1) for such taxable year, such excess shall be 
        carried to the succeeding taxable year and added to the credit 
        allowable under subsection (a) for such taxable year.
    ``(d) Qualified Public School Modernization Bond; Credit Allowance 
Date.--For purposes of this section--
            ``(1) Qualified public school modernization bond.--The term 
        `qualified public school modernization bond' means--
                    ``(A) a qualified zone academy bond, and
                    ``(B) a qualified school construction bond.
            ``(2) Credit allowance date.--The term `credit allowance 
        date' means--
                    ``(A) March 15,
                    ``(B) June 15,
                    ``(C) September 15, and
                    ``(D) December 15.
        Such term includes the last day on which the bond is 
        outstanding.
    ``(e) Other Definitions.--For purposes of this subchapter--
            ``(1) Local educational agency.--The term `local 
        educational agency' has the meaning given to such term by 
        section 14101 of the Elementary and Secondary Education Act of 
        1965. Such term includes the local educational agency that 
        serves the District of Columbia but does not include any other 
        State agency.
            ``(2) Bond.--The term `bond' includes any obligation.
            ``(3) State.--The term `State' includes the District of 
        Columbia and any possession of the United States.
            ``(4) Public school facility.--The term `public school 
        facility' shall not include--
                    ``(A) any stadium or other facility primarily used 
                for athletic contests or exhibitions or other events 
                for which admission is charged to the general public, 
                or
                    ``(B) any facility which is not owned by a State or 
                local government or any agency or instrumentality of a 
                State or local government.
    ``(f) Credit Included in Gross Income.--Gross income includes the 
amount of the credit allowed to the taxpayer under this section 
(determined without regard to subsection (c)) and the amount so 
included shall be treated as interest income.
    ``(g) Bonds Held by Regulated Investment Companies.--If any 
qualified public school modernization bond is held by a regulated 
investment company, the credit determined under subsection (a) shall be 
allowed to shareholders of such company under procedures prescribed by 
the Secretary.
    ``(h) Credits May Be Stripped.--Under regulations prescribed by the 
Secretary--
            ``(1) In general.--There may be a separation (including at 
        issuance) of the ownership of a qualified public school 
        modernization bond and the entitlement to the credit under this 
        section with respect to such bond. In case of any such 
        separation, the credit under this section shall be allowed to 
        the person who on the credit allowance date holds the 
        instrument evidencing the entitlement to the credit and not to 
        the holder of the bond.
            ``(2) Certain rules to apply.--In the case of a separation 
        described in paragraph (1), the rules of section 1286 shall 
        apply to the qualified public school modernization bond as if 
        it were a stripped bond and to the credit under this section as 
        if it were a stripped coupon.
    ``(i) Treatment for Estimated Tax Purposes.--Solely for purposes of 
sections 6654 and 6655, the credit allowed by this section to a 
taxpayer by reason of holding a qualified public school modernization 
bonds on a credit allowance date shall be treated as if it were a 
payment of estimated tax made by the taxpayer on such date.
    ``(j) Credit May Be Transferred.--Nothing in any law or rule of law 
shall be construed to limit the transferability of the credit allowed 
by this section through sale and repurchase agreements.
    ``(k) Reporting.--Issuers of qualified public school modernization 
bonds shall submit reports similar to the reports required under 
section 149(e).
    ``(l) Termination.--This section shall not apply to any bond issued 
after September 30, 2006.

``SEC. 1400G. QUALIFIED SCHOOL CONSTRUCTION BONDS.

    ``(a) Qualified School Construction Bond.--For purposes of this 
subchapter, the term `qualified school construction bond' means any 
bond issued as part of an issue if--
            ``(1) 95 percent or more of the proceeds of such issue are 
        to be used for the construction, rehabilitation, or repair of a 
        public school facility or for the acquisition of land on which 
        such a facility is to be constructed with part of the proceeds 
        of such issue,
            ``(2) the bond is issued by a State or local government 
        within the jurisdiction of which such school is located,
            ``(3) the issuer designates such bond for purposes of this 
        section, and
            ``(4) the term of each bond which is part of such issue 
        does not exceed 15 years.
    ``(b) Limitation on Amount of Bonds Designated.--The maximum 
aggregate face amount of bonds issued during any calendar year which 
may be designated under subsection (a) by any issuer shall not exceed 
the sum of--
            ``(1) the limitation amount allocated under subsection (d) 
        for such calendar year to such issuer, and
            ``(2) if such issuer is a large local educational agency 
        (as defined in subsection (e)(4)) or is issuing on behalf of 
        such an agency, the limitation amount allocated under 
        subsection (e) for such calendar year to such agency.
    ``(c) National Limitation on Amount of Bonds Designated.--There is 
a national qualified school construction bond limitation for each 
calendar year. Such limitation is--
            ``(1) $11,000,000,000 for 2002,
            ``(2) $11,000,000,000 for 2003, and
            ``(3) except as provided in subsection (f), zero after 
        2003.
    ``(d) 60 Percent of Limitation Allocated Among States.--
            ``(1) In general.--60 percent of the limitation applicable 
        under subsection (c) for any calendar year shall be allocated 
by the Secretary among the States in proportion to the respective 
numbers of children in each State who have attained age 5 but not age 
18 for the most recent fiscal year ending before such calendar year. 
The limitation amount allocated to a State under the preceding sentence 
shall be allocated by the State to issuers within such State and such 
allocations may be made only if there is an approved State application.
            ``(2) Minimum allocations to states.--
                    ``(A) In general.--The Secretary shall adjust the 
                allocations under this subsection for any calendar year 
                for each State to the extent necessary to ensure that 
                the sum of--
                            ``(i) the amount allocated to such State 
                        under this subsection for such year, and
                            ``(ii) the aggregate amounts allocated 
                        under subsection (e) to large local educational 
                        agencies in such State for such year,
                is not less than an amount equal to such State's 
                minimum percentage of the amount to be allocated under 
                paragraph (1) for the calendar year.
                    ``(B) Minimum percentage.--A State's minimum 
                percentage for any calendar year is the minimum 
                percentage described in section 1124(d) of the 
                Elementary and Secondary Education Act of 1965 (20 
                U.S.C. 6334(d)) for such State for the most recent 
                fiscal year ending before such calendar year.
            ``(3) Allocations to certain possessions.--The amount to be 
        allocated under paragraph (1) to any possession of the United 
        States other than Puerto Rico shall be the amount which would 
        have been allocated if all allocations under paragraph (1) were 
        made on the basis of respective populations of individuals 
        below the poverty line (as defined by the Office of Management 
        and Budget). In making other allocations, the amount to be 
        allocated under paragraph (1) shall be reduced by the aggregate 
        amount allocated under this paragraph to possessions of the 
        United States.
            ``(4) Allocations for indian schools.--The provisions of 
        section 1400J shall apply with respect to the construction, 
        rehabilitation, and repair of schools funded by the Bureau of 
        Indian Affairs. No funds may be allocated under this section 
        for such schools.
            ``(5) Approved state application.--For purposes of 
        paragraph (1), the term `approved State application' means an 
        application which is approved by the Secretary of Education and 
        which includes--
                    ``(A) the results of a recent publicly-available 
                survey (undertaken by the State with the involvement of 
                local education officials, members of the public, and 
                experts in school construction and management) of such 
                State's needs for public school facilities, including 
                descriptions of--
                            ``(i) health and safety problems at such 
                        facilities,
                            ``(ii) the capacity of public schools in 
                        the State to house projected enrollments, and
                            ``(iii) the extent to which the public 
                        schools in the State offer the physical 
                        infrastructure needed to provide a high-quality 
                        education to all students, and
                    ``(B) a description of how the State will allocate 
                to local educational agencies, or otherwise use, its 
                allocation under this subsection to address the needs 
                identified under subparagraph (A), including a 
                description of how it will--
                            ``(i) ensure that the needs of both rural 
                        and urban areas will be recognized,
                            ``(ii) give highest priority to localities 
                        with the greatest needs, as demonstrated by 
                        inadequate school facilities coupled with a low 
                        level of resources to meet those needs,
                            ``(iii) use its allocation under this 
                        subsection to assist localities that lack the 
                        fiscal capacity to issue bonds on their own, 
                        and
                            ``(iv) ensure that its allocation under 
                        this subsection is used only to supplement, and 
                        not supplant, the amount of school 
                        construction, rehabilitation, and repair in the 
                        State that would have occurred in the absence 
                        of such allocation.
        Any allocation under paragraph (1) by a State shall be binding 
        if such State reasonably determined that the allocation was in 
        accordance with the plan approved under this paragraph.
    ``(e) 40 Percent of Limitation Allocated Among Largest School 
Districts.--
            ``(1) In general.--40 percent of the limitation applicable 
        under subsection (c) for any calendar year shall be allocated 
        under paragraph (2) by the Secretary among local educational 
        agencies which are large local educational agencies for such 
        year. No qualified school construction bond may be issued by 
        reason of an allocation to a large local educational agency 
        under the preceding sentence unless such agency has an approved 
        local application.
            ``(2) Allocation formula.--The amount to be allocated under 
        paragraph (1) for any calendar year shall be allocated among 
        large local educational agencies in proportion to the 
        respective amounts each such agency received for Basic Grants 
        under subpart 2 of part A of title I of the Elementary and 
        Secondary Education Act of 1965 (20 U.S.C. 6331 et seq.) for 
        the most recent fiscal year ending before such calendar year.
            ``(3) Allocation of unused limitation to state.--The amount 
        allocated under this subsection to a large local educational 
        agency for any calendar year may be reallocated by such agency 
        to the State in which such agency is located for such calendar 
        year. Any amount reallocated to a State under the preceding 
sentence may be allocated as provided in subsection (d)(1).
            ``(4) Large local educational agency.--For purposes of this 
        section, the term `large local educational agency' means, with 
        respect to a calendar year, any local educational agency if 
        such agency is--
                    ``(A) among the 100 local educational agencies with 
                the largest numbers of children aged 5 through 17 from 
                families living below the poverty level, as determined 
                by the Secretary using the most recent data available 
                from the Department of Commerce that are satisfactory 
                to the Secretary, or
                    ``(B) 1 of not more than 25 local educational 
                agencies (other than those described in subparagraph 
                (A)) that the Secretary of Education determines (based 
                on the most recent data available satisfactory to the 
                Secretary) are in particular need of assistance, based 
                on a low level of resources for school construction, a 
                high level of enrollment growth, or such other factors 
                as the Secretary deems appropriate.
            ``(5) Approved local application.--For purposes of 
        paragraph (1), the term `approved local application' means an 
        application which is approved by the Secretary of Education and 
        which includes--
                    ``(A) the results of a recent publicly-available 
                survey (undertaken by the local educational agency or 
                the State with the involvement of school officials, 
                members of the public, and experts in school 
                construction and management) of such agency's needs for 
                public school facilities, including descriptions of--
                            ``(i) the overall condition of the local 
                        educational agency's school facilities, 
                        including health and safety problems,
                            ``(ii) the capacity of the agency's schools 
                        to house projected enrollments, and
                            ``(iii) the extent to which the agency's 
                        schools offer the physical infrastructure 
                        needed to provide a high-quality education to 
                        all students,
                    ``(B) a description of how the local educational 
                agency will use its allocation under this subsection to 
                address the needs identified under subparagraph (A), 
                and
                    ``(C) a description of how the local educational 
                agency will ensure that its allocation under this 
                subsection is used only to supplement, and not 
                supplant, the amount of school construction, 
                rehabilitation, or repair in the locality that would 
                have occurred in the absence of such allocation.
        A rule similar to the rule of the last sentence of subsection 
        (d)(6) shall apply for purposes of this paragraph.
    ``(f) Carryover of Unused Limitation.--If for any calendar year--
            ``(1) the amount allocated under subsection (d) to any 
        State, exceeds
            ``(2) the amount of bonds issued during such year which are 
        designated under subsection (a) pursuant to such allocation,
the limitation amount under such subsection for such State for the 
following calendar year shall be increased by the amount of such 
excess. A similar rule shall apply to the amounts allocated under 
subsection (d)(5) or (e).
    ``(g) Special Rules Relating to Arbitrage.--
            ``(1) In general.--A bond shall not be treated as failing 
        to meet the requirement of subsection (a)(1) solely by reason 
        of the fact that the proceeds of the issue of which such bond 
        is a part are invested for a temporary period (but not more 
        than 36 months) until such proceeds are needed for the purpose 
        for which such issue was issued.
            ``(2) Binding commitment requirement.--Paragraph (1) shall 
        apply to an issue only if, as of the date of issuance, there is 
        a reasonable expectation that--
                    ``(A) at least 10 percent of the proceeds of the 
                issue will be spent within the 6-month period beginning 
                on such date for the purpose for which such issue was 
                issued, and
                    ``(B) the remaining proceeds of the issue will be 
                spent with due diligence for such purpose.
            ``(3) Earnings on proceeds.--Any earnings on proceeds 
        during the temporary period shall be treated as proceeds of the 
        issue for purposes of applying subsection (a)(1) and paragraph 
        (1) of this subsection.

``SEC. 1400H. QUALIFIED ZONE ACADEMY BONDS.

    ``(a) Qualified Zone Academy Bond.--For purposes of this 
subchapter--
            ``(1) In general.--The term `qualified zone academy bond' 
        means any bond issued as part of an issue if--
                    ``(A) 95 percent or more of the proceeds of such 
                issue are to be used for a qualified purpose with 
                respect to a qualified zone academy established by a 
                local educational agency,
                    ``(B) the bond is issued by a State or local 
                government within the jurisdiction of which such 
                academy is located,
                    ``(C) the issuer--
                            ``(i) designates such bond for purposes of 
                        this section,
                            ``(ii) certifies that it has written 
                        assurances that the private business 
                        contribution requirement of paragraph (2) will 
                        be met with respect to such academy, and
                            ``(iii) certifies that it has the written 
                        approval of the local educational agency for 
                        such bond issuance, and
                    ``(D) the term of each bond which is part of such 
                issue does not exceed 15 years.
        Rules similar to the rules of section 1400G(g) shall apply for 
        purposes of paragraph (1).
            ``(2) Private business contribution requirement.--
                    ``(A) In general.--For purposes of paragraph (1), 
                the private business contribution requirement of this 
                paragraph is met with respect to any issue if the local 
                educational agency that established the qualified zone 
                academy has written commitments from private entities 
                to make qualified contributions having a present value 
                (as of the date of issuance of the issue) of not less 
                than 10 percent of the proceeds of the issue.
                    ``(B) Qualified contributions.--For purposes of 
                subparagraph (A), the term `qualified contribution' 
                means any contribution (of a type and quality 
                acceptable to the local educational agency) of--
                            ``(i) equipment for use in the qualified 
                        zone academy (including state-of-the-art 
                        technology and vocational equipment),
                            ``(ii) technical assistance in developing 
                        curriculum or in training teachers in order to 
                        promote appropriate market driven technology in 
                        the classroom,
                            ``(iii) services of employees as volunteer 
                        mentors,
                            ``(iv) internships, field trips, or other 
                        educational opportunities outside the academy 
                        for students, or
                            ``(v) any other property or service 
                        specified by the local educational agency.
            ``(3) Qualified zone academy.--The term `qualified zone 
        academy' means any public school (or academic program within a 
        public school) which is established by and operated under the 
        supervision of a local educational agency to provide education 
        or training below the postsecondary level if--
                    ``(A) such public school or program (as the case 
                may be) is designed in cooperation with business to 
                enhance the academic curriculum, increase graduation 
                and employment rates, and better prepare students for 
                the rigors of college and the increasingly complex 
                workforce,
                    ``(B) students in such public school or program (as 
                the case may be) will be subject to the same academic 
                standards and assessments as other students educated by 
                the local educational agency,
                    ``(C) the comprehensive education plan of such 
                public school or program is approved by the local 
                educational agency, and
                    ``(D)(i) such public school is located in an 
                empowerment zone or enterprise community (including any 
                such zone or community designated after the date of the 
                enactment of this section), or
                    ``(ii) there is a reasonable expectation (as of the 
                date of issuance of the bonds) that at least 35 percent 
                of the students attending such school or participating 
                in such program (as the case may be) will be eligible 
                for free or reduced-cost lunches under the school lunch 
                program established under the National School Lunch 
                Act.
            ``(4) Qualified purpose.--The term `qualified purpose' 
        means, with respect to any qualified zone academy--
                    ``(A) constructing, rehabilitating, or repairing 
                the public school facility in which the academy is 
                established,
                    ``(B) acquiring the land on which such facility is 
                to be constructed with part of the proceeds of such 
                issue,
                    ``(C) providing equipment for use at such academy,
                    ``(D) developing course materials for education to 
                be provided at such academy, and
                    ``(E) training teachers and other school personnel 
                in such academy.
    ``(b) Limitations on Amount of Bonds Designated.--
            ``(1) In general.--There is a national zone academy bond 
        limitation for each calendar year. Such limitation is--
                    ``(A) $400,000,000 for 1999,
                    ``(B) $400,000,000 for 2000,
                    ``(C) $400,000,000 for 2001,
                    ``(D) $1,400,000,000 for 2002,
                    ``(E) $1,400,000,000 for 2003, and
                    ``(F) except as provided in paragraph (3), zero 
                after 2003.
            ``(2) Allocation of limitation.--
                    ``(A) Allocation among states.--
                            ``(i) 1999, 2000, and 2001 limitations.--
                        The national zone academy bond limitations for 
                        calendar years 1999, 2000, and 2001 shall be 
                        allocated by the Secretary among the States on 
                        the basis of their respective populations of 
                        individuals below the poverty line (as defined 
                        by the Office of Management and Budget).
                            ``(ii) Limitation after 2001.--The national 
                        zone academy bond limitation for any calendar 
                        year after 2001 shall be allocated by the 
                        Secretary among the States in proportion to the 
                        respective amounts each such State received for 
                        Basic Grants under subpart 2 of part A of title 
                        I of the Elementary and Secondary Education Act 
                        of 1965 (20 U.S.C. 6331 et seq.) for the most 
                        recent fiscal year ending before such calendar 
                        year.
                    ``(B) Allocation to local educational agencies.--
                The limitation amount allocated to a State under 
                subparagraph (A) shall be allocated by the State to 
                qualified zone academies within such State.
                    ``(C) Designation subject to limitation amount.--
                The maximum aggregate face amount of bonds issued 
                during any calendar year which may be designated under 
                subsection (a) with respect to any qualified zone 
                academy shall not exceed the limitation amount 
                allocated to such academy under subparagraph (B) for 
                such calendar year.
            ``(3) Carryover of unused limitation.--If for any calendar 
        year--
                    ``(A) the limitation amount under this subsection 
                for any State, exceeds
                    ``(B) the amount of bonds issued during such year 
                which are designated under subsection (a) (or the 
                corresponding provisions of prior law) with respect to 
                qualified zone academies within such State,
        the limitation amount under this subsection for such State for 
        the following calendar year shall be increased by the amount of 
        such excess.''
    (b) Reporting.--Subsection (d) of section 6049 of such Code 
(relating to returns regarding payments of interest) is amended by 
adding at the end the following new paragraph:
            ``(8) Reporting of credit on qualified public school 
        modernization bonds.--
                    ``(A) In general.--For purposes of subsection (a), 
                the term `interest' includes amounts includible in 
                gross income under section 1400F(f) and such amounts 
                shall be treated as paid on the credit allowance date 
                (as defined in section 1400F(d)(2)).
                    ``(B) Reporting to corporations, etc.--Except as 
                otherwise provided in regulations, in the case of any 
                interest described in subparagraph (A) of this 
                paragraph, subsection (b)(4) of this section shall be 
                applied without regard to subparagraphs (A), (H), (I), 
                (J), (K), and (L)(i).
                    ``(C) Regulatory authority.--The Secretary may 
                prescribe such regulations as are necessary or 
                appropriate to carry out the purposes of this 
                paragraph, including regulations which require more 
                frequent or more detailed reporting.''
    (c) Conforming Amendments.--
            (1) Subchapter U of chapter 1 of such Code is amended by 
        striking part IV, by redesignating part V as part IV, and by 
        redesignating section 1397F as section 1397E.
            (2) The table of subchapters for chapter 1 of such Code is 
        amended by adding at the end the following new item:

                              ``Subchapter X. Public school 
                                        modernization provisions.''
            (3) The table of parts of subchapter U of chapter 1 of such 
        Code is amended by striking the last 2 items and inserting the 
        following item:

                              ``Part IV. Regulations.''
    (e) Effective Dates.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        obligations issued after December 31, 2001.
            (2) Repeal of restriction on zone academy bond holders.--In 
        the case of bonds to which section 1397E of the Internal 
        Revenue Code of 1986 (as in effect before the date of the 
        enactment of this Act) applies, the limitation of such section 
        to eligible taxpayers (as defined in subsection (d)(6) of such 
        section) shall not apply after the date of the enactment of 
        this Act.

SEC. 323. APPLICATION OF CERTAIN LABOR STANDARDS ON CONSTRUCTION 
              PROJECTS FINANCED UNDER PUBLIC SCHOOL MODERNIZATION 
              PROGRAM.

    Section 439 of the General Education Provisions Act (relating to 
labor standards) is amended--
            (1) by inserting ``(a)'' before ``All laborers and 
        mechanics'', and
            (2) by adding at the end the following:
    ``(b)(1) For purposes of this section, the term `applicable 
program' also includes the qualified zone academy bond provisions 
enacted by section 226 of the Taxpayer Relief Act of 1997 and the 
program established by section 322 of the America's Better Classroom 
Act of 2001.
    ``(2) A State or local government participating in a program 
described in paragraph (1) shall--
            ``(A) in the awarding of contracts, give priority to 
        contractors with substantial numbers of employees residing in 
        the local education area to be served by the school being 
        constructed; and
            ``(B) include in the construction contract for such school 
        a requirement that the contractor give priority in hiring new 
        workers to individuals residing in such local education area.
    ``(3) In the case of a program described in paragraph (1), nothing 
in this subsection or subsection (a) shall be construed to deny any tax 
credit allowed under such program. If amounts are required to be 
withheld from contractors to pay wages to which workers are entitled, 
such amounts shall be treated as expended for construction purposes in 
determining whether the requirements of such program are met.''.

SEC. 324. EMPLOYMENT AND TRAINING ACTIVITIES RELATING TO CONSTRUCTION 
              OR RECONSTRUCTION OF PUBLIC SCHOOL FACILITIES.

    (a) In General.--Section 134 of the Workforce Investment Act of 
1998 (29 U.S.C. 2864) is amended by adding at the end the following:
    ``(f) Local Employment and Training Activities Relating to 
Construction or Reconstruction of Public School Facilities.--
            ``(1) In general.--In order to provide training services 
        related to construction or reconstruction of public school 
        facilities receiving funding assistance under an applicable 
        program, each State shall establish a specialized program of 
        training meeting the following requirements:
                    ``(A) The specialized program provides training for 
                jobs in the construction industry.
                    ``(B) The program provides trained workers for 
                projects for the construction or reconstruction of 
                public school facilities receiving funding assistance 
                under an applicable program.
                    ``(C) The program ensures that skilled workers 
                (residing in the area to be served by the school 
                facilities) will be available for the construction or 
                reconstruction work.
            ``(2) Coordination.--The specialized program established 
        under paragraph (1) shall be integrated with other activities 
        under this Act, with the activities carried out under the 
        National Apprenticeship Act of 1937 by the State Apprenticeship 
        Council or through the Bureau of Apprenticeship and Training in 
        the Department of Labor, as appropriate, and with activities 
        carried out under the Carl D. Perkins Vocational and Technical 
        Education Act of 1998. Nothing in this subsection shall be 
        construed to require services duplicative of those referred to 
        in the preceding sentence.
            ``(3) Applicable program.--In this subsection, the term 
        `applicable program' has the meaning given the term in section 
        439(b) of the General Education Provisions Act (relating to 
        labor standards).''.
    (b) State Plan.--Section 112(b)(17)(A) of the Workforce Investment 
Act of 1998 (29 U.S.C. 2822(b)(17)(A)) is amended--
            (1) in clause (iii), by striking ``and'' at the end;
            (2) by redesignating clause (iv) as clause (v); and
            (3) by inserting after clause (iii) the following:
                            ``(iv) how the State will establish and 
                        carry out a specialized program of training 
                        under section 134(f); and''.

SEC. 325. INDIAN SCHOOL CONSTRUCTION.

    (a) Definitions.--In this section:
            (1) Bureau.--The term ``Bureau'' means the Bureau of Indian 
        Affairs of the Department of the Interior.
            (2) Indian.--The term ``Indian'' means any individual who 
        is a member of a tribe.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.
            (4) Tribal school.--The term ``tribal school'' means an 
        elementary school, secondary school, or dormitory that is 
        operated by a tribal organization or the Bureau for the 
        education of Indian children and that receives financial 
        assistance for its operation under an appropriation for the 
        Bureau under section 102, 103(a), or 208 of the Indian Self-
        Determination and Education Assistance Act (25 U.S.C. 450f, 
        450h(a), and 458d) or under the Tribally Controlled Schools Act 
        of 1988 (25 U.S.C. 2501 et seq.) under a contract, a grant, or 
        an agreement, or for a Bureau-operated school.
            (5) Tribe.--The term ``tribe'' has the meaning given the 
        term ``Indian tribal government'' by section 7701(a)(40) of the 
        Internal Revenue Code of 1986, including the application of 
        section 7871(d) of such Code. Such term includes any consortium 
        of tribes approved by the Secretary.
    (b) Issuance of Bonds.--
            (1) In general.--The Secretary shall establish a pilot 
        program under which eligible tribes have the authority to issue 
        qualified tribal school modernization bonds to provide funding 
        for the construction, rehabilitation, or repair of tribal 
        schools, including the advance planning and design thereof.
            (2) Eligibility.--
                    (A) In general.--To be eligible to issue any 
                qualified tribal school modernization bond under the 
                program under paragraph (1), a tribe shall--
                            (i) prepare and submit to the Secretary a 
                        plan of construction that meets the 
                        requirements of subparagraph (B);
                            (ii) provide for quarterly and final 
                        inspection of the project by the Bureau; and
                            (iii) pledge that the facilities financed 
                        by such bond will be used primarily for 
                        elementary and secondary educational purposes 
                        for not less than the period such bond remains 
                        outstanding.
                    (B) Plan of construction.--A plan of construction 
                meets the requirements of this subparagraph if such 
                plan--
                            (i) contains a description of the 
                        construction to be undertaken with 
funding provided under a qualified tribal school modernization bond;
                            (ii) demonstrates that a comprehensive 
                        survey has been undertaken concerning the 
                        construction needs of the tribal school 
                        involved;
                            (iii) contains assurances that funding 
                        under the bond will be used only for the 
                        activities described in the plan;
                            (iv) contains response to the evaluation 
                        criteria contained in Instructions and 
                        Application for Replacement School 
                        Construction, Revision 6, dated February 6, 
                        1999; and
                            (v) contains any other reasonable and 
                        related information determined appropriate by 
                        the Secretary.
                    (C) Priority.--In determining whether a tribe is 
                eligible to participate in the program under this 
                subsection, the Secretary shall give priority to tribes 
                that, as demonstrated by the relevant plans of 
                construction, will fund projects--
                            (i) described in the Education Facilities 
                        Replacement Construction Priorities List as of 
                        FY 2000 of the Bureau of Indian Affairs (65 
                        Fed. Reg. 4623-4624);
                            (ii) described in any subsequent priorities 
                        list published in the Federal Register; or
                            (iii) which meet the criteria for ranking 
                        schools as described in Instructions and 
                        Application for Replacement School 
                        Construction, Revision 6, dated February 6, 
                        1999.
                    (D) Advance planning and design funding.--A tribe 
                may propose in its plan of construction to receive 
                advance planning and design funding from the tribal 
                school modernization escrow account established under 
                paragraph (6)(B). Before advance planning and design 
                funds are allocated from the escrow account, the tribe 
                shall agree to issue qualified tribal school 
                modernization bonds after the receipt of such funds and 
                agree as a condition of each bond issuance that the 
                tribe will deposit into such account or a fund managed 
                by the trustee as described in paragraph (4)(C) an 
                amount equal to the amount of such funds received from 
                the escrow account.
            (3) Permissible activities.--In addition to the use of 
        funds permitted under paragraph (1), a tribe may use amounts 
        received through the issuance of a qualified tribal school 
        modernization bond to--
                    (A) enter into and make payments under contracts 
                with licensed and bonded architects, engineers, and 
                construction firms in order to determine the needs of 
                the tribal school and for the design and engineering of 
                the school;
                    (B) enter into and make payments under contracts 
                with financial advisors, underwriters, attorneys, 
                trustees, and other professionals who would be able to 
                provide assistance to the tribe in issuing bonds; and
                    (C) carry out other activities determined 
                appropriate by the Secretary.
            (4) Bond trustee.--
                    (A) In general.--Notwithstanding any other 
                provision of law, any qualified tribal school 
                modernization bond issued by a tribe under this 
                subsection shall be subject to a trust agreement 
                between the tribe and a trustee.
                    (B) Trustee.--Any bank or trust company that meets 
                requirements established by the Secretary may be 
                designated as a trustee under subparagraph (A).
                    (C) Content of trust agreement.--A trust agreement 
                entered into by a tribe under this paragraph shall 
                specify that the trustee, with respect to any bond 
                issued under this subsection shall--
                            (i) act as a repository for the proceeds of 
                        the bond;
                            (ii) make payments to bondholders;
                            (iii) receive, as a condition to the 
                        issuance of such bond, a transfer of funds from 
                        the tribal school modernization escrow account 
                        established under paragraph (6)(B) or from 
                        other funds furnished by or on behalf of the 
                        tribe in an amount, which together with 
                        interest earnings from the investment of such 
                        funds in obligations of or fully guaranteed by 
                        the United States or from other investments 
                        authorized by paragraph (10), will produce 
                        moneys sufficient to timely pay in full the 
                        entire principal amount of such bond on the 
                        stated maturity date therefore;
                            (iv) invest the funds received pursuant to 
                        clause (iii) as provided by such clause; and
                            (v) hold and invest the funds in a 
                        segregated fund or account under the agreement, 
                        which fund or account shall be applied solely 
                        to the payment of the costs of items described 
                        in paragraph (3).
                    (D) Requirements for making direct payments.--
                            (i) In general.--Notwithstanding any other 
                        provision of law, the trustee shall make any 
                        payment referred to in subparagraph (C)(v) in 
                        accordance with requirements that the tribe 
                        shall prescribe in the trust agreement entered 
                        into under subparagraph (C). Before making a 
                        payment to a contractor under subparagraph 
                        (C)(v), the trustee shall require an inspection 
                        of the project by a local financial institution 
                        or an independent inspecting architect or 
                        engineer, to ensure the completion of the 
                        project.
                            (ii) Contracts.--Each contract referred to 
                        in paragraph (3) shall specify, or be 
renegotiated to specify, that payments under the contract shall be made 
in accordance with this paragraph.
            (5) Payments of principal and interest.--
                    (A) Principal.--No principal payments on any 
                qualified tribal school modernization bond shall be 
                required until the final, stated maturity of such bond, 
                which stated maturity shall be within 15 years from the 
                date of issuance. Upon the expiration of such period, 
                the entire outstanding principal under the bond shall 
                become due and payable.
                    (B) Interest.--In lieu of interest on a qualified 
                tribal school modernization bond there shall be awarded 
                a tax credit under section 1400F of the Internal 
                Revenue Code of 1986.
            (6) Bond guarantees.--
                    (A) In general.--Payment of the principal portion 
                of a qualified tribal school modernization bond issued 
                under this subsection shall be guaranteed solely by 
                amounts deposited with each respective bond trustee as 
                described in paragraph (4)(C)(iii).
                    (B) Establishment of account.--
                            (i) In general.--Notwithstanding any other 
                        provision of law, beginning in fiscal year 
                        2002, from amounts made available for school 
                        replacement under the construction account of 
                        the Bureau, the Secretary is authorized to 
                        deposit not more than $30,000,000 each fiscal 
                        year into a tribal school modernization escrow 
                        account.
                            (ii) Payments.--The Secretary shall use any 
                        amounts deposited in the escrow account under 
                        clauses (i) and (iii) to make payments to 
                        trustees appointed and acting pursuant to 
                        paragraph (4) or to make payments described in 
                        paragraph (2)(D).
                            (iii) Transfers of excess proceeds.--Excess 
                        proceeds held under any trust agreement that 
                        are not needed for any of the purposes 
                        described in clauses (iii) and (v) of paragraph 
                        (4)(C) shall be transferred, from time to time, 
                        by the trustee for deposit into the tribal 
                        school modernization escrow account.
            (7) Limitations.--
                    (A) Obligation to repay.--Notwithstanding any other 
                provision of law, the principal amount on any qualified 
                tribal school modernization bond issued under this 
                subsection shall be repaid only to the extent of any 
                escrowed funds furnished under paragraph (4)(C)(iii). 
                No qualified tribal school modernization bond issued by 
                a tribe shall be an obligation of, nor shall payment of 
                the principal thereof be guaranteed by, the United 
                States.
                    (B) Land and facilities.--Any land or facilities 
                purchased or improved with amounts derived from 
                qualified tribal school modernization bonds issued 
                under this subsection shall not be mortgaged or used as 
                collateral for such bonds.
            (8) Sale of bonds.--Qualified tribal school modernization 
        bonds may be sold at a purchase price equal to, in excess of, 
        or at a discount from the par amount thereof.
            (9) Treatment of trust agreement earnings.--Any amounts 
        earned through the investment of funds under the control of a 
        trustee under any trust agreement described in paragraph (4) 
        shall not be subject to Federal income tax.
            (10) Investment of sinking funds.--Any sinking fund 
        established for the purpose of the payment of principal on a 
        qualified tribal school modernization bond shall be invested in 
        obligations issued by or guaranteed by the United States or in 
        such other assets as the Secretary of the Treasury may by 
        regulation allow.
    (c) Expansion of Incentives for Tribal Schools.--Chapter 1 of the 
Internal Revenue Code of 1986 (as amended by section 322) is further 
amended by adding at the end the following new subchapter:

        ``Subchapter XI--Tribal School Modernization Provisions

``Sec. 1400J. Credit to holders of qualified tribal school 
                            modernization bonds.

``SEC. 1400J. CREDIT TO HOLDERS OF QUALIFIED TRIBAL SCHOOL 
              MODERNIZATION BONDS.

    ``(a) Allowance of Credit.--In the case of a taxpayer who holds a 
qualified tribal school modernization bond on a credit allowance date 
of such bond which occurs during the taxable year, there shall be 
allowed as a credit against the tax imposed by this chapter for such 
taxable year an amount equal to the sum of the credits determined under 
subsection (b) with respect to credit allowance dates during such year 
on which the taxpayer holds such bond.
    ``(b) Amount of Credit.--
            ``(1) In general.--The amount of the credit determined 
        under this subsection with respect to any credit allowance date 
        for a qualified tribal school modernization bond is 25 percent 
        of the annual credit determined with respect to such bond.
            ``(2) Annual credit.--The annual credit determined with 
        respect to any qualified tribal school modernization bond is 
        the product of--
                    ``(A) the applicable credit rate, multiplied by
                    ``(B) the outstanding face amount of the bond.
            ``(3) Applicable credit rate.--For purposes of paragraph 
        (1), the applicable credit rate with respect to an issue is the 
        rate equal to an average market yield (as of the date of sale 
        of the issue) on outstanding long-term corporate obligations 
        (as determined by the Secretary).
            ``(4) Special rule for issuance and redemption.--In the 
        case of a bond which is issued during the 3-month period ending 
        on a credit allowance date, the amount of the credit determined 
        under this subsection with respect to such credit allowance 
        date shall be a ratable portion of the credit otherwise 
        determined based on the portion of the 3-month period during 
        which the bond is outstanding. A similar rule shall apply when 
the bond is redeemed.
    ``(c) Limitation Based on Amount of Tax.--
            ``(1) In general.--The credit allowed under subsection (a) 
        for any taxable year shall not exceed the excess of--
                    ``(A) the sum of the regular tax liability (as 
                defined in section 26(b)) plus the tax imposed by 
                section 55, over
                    ``(B) the sum of the credits allowable under part 
                IV of subchapter A (other than subpart C thereof, 
                relating to refundable credits).
            ``(2) Carryover of unused credit.--If the credit allowable 
        under subsection (a) exceeds the limitation imposed by 
        paragraph (1) for such taxable year, such excess shall be 
        carried to the succeeding taxable year and added to the credit 
        allowable under subsection (a) for such taxable year.
    ``(d) Qualified Tribal School Modernization Bond; Other 
Definitions.--For purposes of this section--
            ``(1) Qualified tribal school modernization bond.--
                    ``(A) In general.--The term `qualified tribal 
                school modernization bond' means, subject to 
                subparagraph (B), any bond issued as part of an issue 
                under section 2(c) of the Indian School Construction 
                Act, as in effect on the date of the enactment of this 
                section, if--
                            ``(i) 95 percent or more of the proceeds of 
                        such issue are to be used for the construction, 
                        rehabilitation, or repair of a school facility 
                        funded by the Bureau of Indian Affairs of the 
                        Department of the Interior or for the 
                        acquisition of land on which such a facility is 
                        to be constructed with part of the proceeds of 
                        such issue,
                            ``(ii) the bond is issued by a tribe,
                            ``(iii) the issuer designates such bond for 
                        purposes of this section, and
                            ``(iv) the term of each bond which is part 
                        of such issue does not exceed 15 years.
                    ``(B) National limitation on amount of bonds 
                designated.--
                            ``(i) National limitation.--There is a 
                        national qualified tribal school modernization 
                        bond limitation for each calendar year. Such 
                        limitation is--
                                    ``(I) $200,000,000 for 2002,
                                    ``(II) $200,000,000 for 2003, and
                                    ``(III) zero after 2003.
                            ``(ii) Allocation of limitation.--The 
                        national qualified tribal school modernization 
                        bond limitation shall be allocated to tribes by 
                        the Secretary of the Interior subject to the 
                        provisions of section 2 of the Indian School 
                        Construction Act, as in effect on the date of 
                        the enactment of this section.
                            ``(iii) Designation subject to limitation 
                        amount.--The maximum aggregate face amount of 
                        bonds issued during any calendar year which may 
                        be designated under subsection (d)(1) with 
                        respect to any tribe shall not exceed the 
                        limitation amount allocated to such government 
                        under clause (ii) for such calendar year.
                            ``(iv) Carryover of unused limitation.--If 
                        for any calendar year--
                                    ``(I) the limitation amount under 
                                this subparagraph, exceeds
                                    ``(II) the amount of qualified 
                                tribal school modernization bonds 
                                issued during such year,
                        the limitation amount under this subparagraph 
                        for the following calendar year shall be 
                        increased by the amount of such excess. The 
                        preceding sentence shall not apply if such 
                        following calendar year is after 2010.
            ``(2) Credit allowance date.--The term `credit allowance 
        date' means--
                    ``(A) March 15,
                    ``(B) June 15,
                    ``(C) September 15, and
                    ``(D) December 15.
        Such term includes the last day on which the bond is 
        outstanding.
            ``(3) Bond.--The term `bond' includes any obligation.
            ``(4) Tribe.--The term ``tribe'' has the meaning given the 
        term ``Indian tribal government'' by section 7701(a)(40), 
        including the application of section 7871(d). Such term 
        includes any consortium of tribes approved by the Secretary of 
        the Interior.
    ``(e) Credit Included in Gross Income.--Gross income includes the 
amount of the credit allowed to the taxpayer under this section 
(determined without regard to subsection (c)) and the amount so 
included shall be treated as interest income.
    ``(f) Bonds Held by Regulated Investment Companies.--If any 
qualified tribal school modernization bond is held by a regulated 
investment company, the credit determined under subsection (a) shall be 
allowed to shareholders of such company under procedures prescribed by 
the Secretary.
    ``(g) Credits May Be Stripped.--Under regulations prescribed by the 
Secretary--
            ``(1) In general.--There may be a separation (including at 
        issuance) of the ownership of a qualified tribal school 
        modernization bond and the entitlement to the credit under this 
        section with respect to such bond. In case of any such 
        separation, the credit under this section shall be allowed to 
        the person who on the credit allowance date holds the 
        instrument evidencing the entitlement to the credit and not to 
        the holder of the bond.
            ``(2) Certain rules to apply.--In the case of a separation 
        described in paragraph (1), the rules of section 1286 shall 
        apply to the qualified tribal school modernization bond as if 
        it were a stripped bond and to the credit under this section as 
if it were a stripped coupon.
    ``(h) Treatment for Estimated Tax Purposes.--Solely for purposes of 
sections 6654 and 6655, the credit allowed by this section to a 
taxpayer by reason of holding a qualified tribal school modernization 
bonds on a credit allowance date shall be treated as if it were a 
payment of estimated tax made by the taxpayer on such date.
    ``(i) Credit May Be Transferred.--Nothing in any law or rule of law 
shall be construed to limit the transferability of the credit allowed 
by this section through sale and repurchase agreements.
    ``(j) Credit Treated as Allowed Under Part IV of Subchapter A.--For 
purposes of subtitle F, the credit allowed by this section shall be 
treated as a credit allowable under part IV of subchapter A of this 
chapter.
    ``(k) Reporting.--Issuers of qualified tribal school modernization 
bonds shall submit reports similar to the reports required under 
section 149(e).''.
    (d) Additional Provisions.--
            (1) Sovereign immunity.--This section and the amendments 
        made by this section shall not be construed to impact, limit, 
        or affect the sovereign immunity of the Federal Government or 
        any State or tribal government.
            (2) Application.--This section and the amendments made by 
        this section shall take effect on the date of the enactment of 
        this Act with respect to bonds issued after December 31, 2001, 
        regardless of the status of regulations promulgated thereunder.

           CHAPTER 3--21ST CENTURY COMMUNITY LEARNING CENTERS

SEC. 331. REAUTHORIZATION.

    Section 10907 (20 U.S.C. 8247) is amended by striking ``$20,000,000 
for fiscal year 1995'' and all that follows through the period and 
inserting ``$1,000,000,000 for each of fiscal years 2002 through 2006, 
to carry out this part.''.

            CHAPTER 4--ENHANCEMENT OF BASIC LEARNING SKILLS

SEC. 341. REDUCING CLASS SIZE.

    Title X (20 U.S.C. 8001 et seq.), as amended by section 311, is 
further amended by adding at the end the following:

                     ``PART M--CLASS SIZE REDUCTION

``SEC. 10998. GRANTS FOR CLASS SIZE REDUCTION.

    ``(a) In General.--From the amount appropriated for a fiscal year 
under subsection (i), the Secretary of Education--
            ``(1) shall make available 1 percent of such amount to the 
        Secretary of the Interior (on behalf of the Bureau of Indian 
        Affairs) and the outlying areas for activities under this 
        section; and
            ``(2) shall allocate the remainder by providing each State 
        the same percentage of that remainder as it received of the 
        funds allocated to States under section 307(a)(2) of the 
        Department of Education Appropriations Act, 1999.
    ``(b) Allocation of Funds.--
            ``(1) In general.--Each State that receives funds under 
        this section shall distribute 100 percent of such funds to 
        local educational agencies, of which--
                    ``(A) 80 percent of such amount shall be allocated 
                to such local educational agencies in proportion to the 
                number of children, aged 5 to 17, who reside in the 
                school district served by such local educational 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 school districts served 
                by all the local educational agencies in the State for 
                that fiscal year; and
                    ``(B) 20 percent of such amount shall be allocated 
                to such local educational agencies in accordance with 
                the relative enrollments of children, aged 5 to 17, in 
                public and private nonprofit elementary and secondary 
                schools within the boundaries of such agencies.
            ``(2) Exception.--Notwithstanding paragraph (1), if the 
        award to a local educational agency under this section is less 
        than the starting salary for a new fully qualified teacher in 
        that agency, who is certified within the State (which may 
        include certification through State or local alternative 
        routes), has a baccalaureate degree, and demonstrates the 
        general knowledge, teaching skills, and subject matter 
        knowledge required to teach in his or her content areas, that 
        agency may use funds under this section to--
                    ``(A) help pay the salary of a full- or part-time 
                teacher hired to reduce class size, which may be in 
                combination with other Federal, State, or local funds; 
                or
                    ``(B) pay for activities described in subsection 
                (c)(2)(A)(iii) which may be related to teaching in 
                smaller classes.
    ``(c) Use of Funds.--
            ``(1) Purpose, intent, and general use.--The basic purpose 
        and intent of this section is to reduce class size with fully 
        qualified teachers. Each local educational agency that receives 
        funds under this section shall use such funds to carry out 
        effective approaches to reducing class size with fully 
        qualified teachers who are certified within the State, 
        including teachers certified through State or local alternative 
        routes, and who demonstrate competency in the areas in which 
        they teach, to improve educational achievement for both regular 
        and special needs children, with particular consideration given 
        to reducing class size in the early elementary grades for which 
        some research has shown class size reduction is most effective.
            ``(2) Specific uses.--
                    ``(A) In general.--Each such local educational 
                agency may use funds under this section for--
                            ``(i) recruiting (including through the use 
                        of signing bonuses, and other financial 
                        incentives), hiring, and training fully 
                        qualified regular and special education 
                        teachers (which may include hiring special 
                        education teachers to team-teach with regular 
                        teachers in classrooms that contain both 
                        children with disabilities and non-disabled 
                        children) and teachers of special-needs 
                        children who are certified within the State, 
                        including teachers certified through State or 
                        local alternative routes, have a baccalaureate 
                        degree and demonstrate the general knowledge, 
                        teaching skills, and subject matter knowledge 
                        required to teach in their content areas;
                            ``(ii) testing new teachers for academic 
                        content knowledge and to meet State 
                        certification requirements that are consistent 
                        with title II of the Higher Education Act of 
                        1965; and
                            ``(iii) providing professional development 
                        (which may include such activities as those 
                        described in section 2210, opportunities for 
                        teachers to attend multi-week institutes, such 
                        as those made available during the summer 
                        months that provide intensive professional 
                        development in partnership with local 
                        educational agencies and initiatives that 
                        promote retention and mentoring), to teachers, 
                        including special education teachers and 
                        teachers of special-needs children, in order to 
                        meet the goal of ensuring that all 
                        instructional staff have the subject matter 
                        knowledge, teaching knowledge, and teaching 
                        skills necessary to teach effectively in the 
                        content area or areas in which they provide 
                        instruction, consistent with title II of the 
                        Higher Education Act of 1965.
                    ``(B) Limitation.--
                            ``(i) In general.--Except as provided under 
                        clause (ii), a local educational agency may use 
                        not more than a total of 25 percent of the 
                        award received under this section for 
                        activities described in clauses (ii) and (iii) 
                        of subparagraph (A).
                            ``(ii) Exception.--A local educational 
                        agency in which 10 percent or more of teachers 
                        in elementary schools, as defined by section 
                        14101(14), have not met applicable State and 
                        local certification requirements (including 
                        certification through State or local 
                        alternative routes), or if such requirements 
                        have been waived, may use more than 25 percent 
                        of the funds it receives under this section for 
                        activities described in subparagraph (A)(iii) 
                        to help teachers who are not certified by the 
                        State become certified, including through State 
                        or local alternative routes, or to help 
                        teachers affected by class size reduction who 
                        lack sufficient content knowledge to teach 
                        effectively in the areas they teach to obtain 
                        that knowledge, if the local educational agency 
                        notifies the State educational agency of the 
                        percentage of the funds that it will use for 
                        the purpose described in this clause.
                    ``(C) Use for further reductions.--A local 
                educational agency that has already reduced class size 
                in the early grades to 18 or less children (or has 
                already reduced class size to a State or local class 
                size reduction goal that was in effect on the day 
                before the enactment of the Department of Education 
                Appropriations Act, 2000, if that State or local 
                educational agency goal is 20 or fewer children) may 
                use funds received under this section--
                            ``(i) to make further class size reductions 
                        in grades kindergarten through 3;
                            ``(ii) to reduce class size in other 
                        grades; or
                            ``(iii) to carry out activities to improve 
                        teacher quality including professional 
                        development.
                    ``(D) Professional development.--If a local 
                educational agency has already reduced class size in 
                the early grades to 18 or fewer children and intends to 
                use funds provided under this section to carry out 
                professional development activities, including 
                activities to improve teacher quality, then the State 
                shall make the award under subsection (b) to the local 
                educational agency.
            ``(3) Supplement not supplant.--Each such agency shall use 
        funds under this section only to supplement, and not to 
        supplant, State and local funds that, in the absence of such 
        funds, would otherwise be spent for activities under this 
        section.
            ``(4) Limitation.--No funds made available under this 
        section may be used to increase the salaries or provide 
        benefits, other than participation in professional development 
        and enrichment programs, to teachers who are not hired under 
        this section. Funds under this section may be used to pay the 
        salary of teachers hired under section 307 of the Department of 
        Education Appropriations Act, 1999, or under section 310 of the 
        Department of Education Appropriations Act, 2000.
    ``(d) Reporting.--
            ``(1) In general.--Each State receiving funds under this 
        section shall report on activities in the State under this 
        section, consistent with section 6202(a)(2).
            ``(2) Reporting to parents.--Each State and local 
        educational agency receiving funds under this section shall 
        publicly report to parents on its progress in reducing class 
size, increasing the percentage of classes in core academic areas 
taught by fully qualified teachers who are certified within the State 
and demonstrate competency in the content areas in which they teach, 
and on the impact that hiring additional highly qualified teachers and 
reducing class size, has had, if any, on increasing student academic 
achievement.
            ``(3) Provision of qualification to parents.--Each school 
        receiving funds under this section shall provide to parents, 
        upon request, the professional qualifications of their child's 
        teacher.
    ``(e) Professional Development.--If a local educational agency uses 
funds made available under this section for professional development 
activities, the agency shall ensure for the equitable participation of 
private nonprofit elementary and secondary schools in such activities. 
Section 6402 shall not apply to other activities under this section.
    ``(f) Limitation on Administrative Costs.--A local educational 
agency that receives funds under this section may use not more than 3 
percent of such funds for local administrative costs.
    ``(g) Application.--Each local educational agency that desires to 
receive funds under this section shall include in the application 
required under section 6303 a description of the agency's program to 
reduce class size by hiring additional highly qualified teachers.
    ``(h) No Use of Funds for Payments to Certain Teachers.--No funds 
under this section may be used to pay the salary of any teacher hired 
with funds under section 307 of the Department of Education 
Appropriations Act, 1999, unless, by the start of the 2001-2002 school 
year, the teacher is certified within the State (which may include 
certification through State or local alternative routes) and 
demonstrates competency in the subject areas in which he or she 
teaches.
    ``(i) Notification.--Not later than 30 days after the date of the 
enactment of this section, the Secretary shall provide specific 
notification to each local educational agency eligible to receive funds 
under this part regarding the flexibility provided under subsection 
(c)(2)(B)(ii) and the ability to use such funds to carry out activities 
described in subsection (c)(2)(A)(iii).
    ``(j) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section--
            ``(1) $2,317,507,723 for fiscal year 2002;
            ``(2) $3,012,015,447 for fiscal year 2003;
            ``(3) $3,706,523,170 for fiscal year 2004; and
            ``(4) $4,401,030,983 for fiscal year 2005.''.

SEC. 342. READING EXCELLENCE.

    Part C of title II (20 U.S.C. 6661 et seq.) is amended--
            (1) by inserting after the part heading the following:

``SEC. 2250. SHORT TITLE.

    ``This part may be cited as the `Reading Excellence Act'.'';
            (2) in section 2253(a) (20 U.S.C. 6661b(a)) by adding at 
        the end the following:
            ``(3) Amount of grants.--From the amount appropriated for 
        each fiscal year under section 2260(a), the Secretary shall 
        award to each State educational agency a grant under this part 
        in an amount that is in proportion to the amount the State 
        received under part A of title I for the previous fiscal 
        year.'';
            (3) in section 2255 (20 U.S.C. 6661d) by adding at the end 
        the following:
    ``(f) Other Uses.--With respect to a State educational agency that 
has used amounts received under a grant under section 2253 in a 
previous fiscal year to sufficiently serve schools described in 
subsection (a)(1), such State agency may use amounts received under 
such a grant in succeeding fiscal years to provide subgrants to local 
educational agencies to assist other schools that may receive 
assistance under title I.''; and
            (4) in section 2260(a) (20 U.S.C. 6661i(a)) by adding at 
        the end the following:
            ``(3) Other fiscal years.--There are authorized to be 
        appropriated to carry out this part and section 1202(c)--
                    ``(A) $500,000,000 for fiscal year 2002;
                    ``(B) $600,000,000 for fiscal year 2003;
                    ``(C) $700,000,000 for fiscal year 2004;
                    ``(D) $850,000,000 for fiscal year 2005; and
                    ``(E) $1,000,000,000 for fiscal year 2006.''.

SEC. 343. TUTORIAL ASSISTANCE GRANTS.

    (a) In General.--Section 2256 (20 U.S.C. 6661e) is repealed.
    (b) Conforming Amendments.--Part C of title II (20 U.S.C. 6661 et 
seq.) is amended--
            (1) in section 2253 (20 U.S.C. 6661b)--
                    (A) in subsection (a)(1), by striking ``sections 
                2254 through 2256'' and inserting ``sections 2254 and 
                2255''; and
                    (B) in subsection (b)(2)--
                            (i) in subparagraph (A)(ii), by striking 
                        ``sections 2255 and 2256'' and inserting 
                        ``section 2255'';
                            (ii) in subparagraph (B)--
                                    (I) in clause (ii), by striking 
                                ``section 2255 and 2256'' and inserting 
                                ``section 2255''; and
                                    (II) in clause (vi), , by striking 
                                ``sections 2255 and 2256'' and 
                                inserting ``section 2255''; and
                            (iii) in subparagraph (E)(iii)--
                                    (I) by striking ``sections 
                                2255(a)(1) and 2256(a)(1)'' and 
                                inserting ``section 2255(a)(1)''; and
                                    (II) by striking ``sections 2255 
                                and 2256'' and inserting ``section 
                                2255'';
            (2) in section 2254 (20 U.S.C. 6661c)--
                    (A) in paragraph (1)--
                            (i) by striking ``(excluding section 
                        2256)''; and
                            (ii) by striking ``; and'' and inserting a 
                        period;
                    (B) by striking ``2253--'' and all that follows 
                through ``shall use'' in paragraph (1) and inserting 
                ``2253 shall use''; and
                    (C) by striking in paragraph (2); and
            (3) in section 2258(a) (20 U.S.C. 6661h(a)), by striking 
        ``or 2256''.

        CHAPTER 5--INTEGRATION OF TECHNOLOGY INTO THE CLASSROOM

SEC. 351. SHORT TITLE.

    This chapter may be cited as the ``Training for Technology Act of 
2001''.

SEC. 352. LOCAL APPLICATIONS FOR SCHOOL TECHNOLOGY RESOURCE GRANTS.

    Section 3135 (20 U.S.C. 6845) is amended--
            (1) in the first sentence, by inserting ``(a) In General.--
        '' before ``Each local educational agency'';
            (2) in subsection (a) (as so redesignated)--
                    (A) in paragraph (3)(B), by striking ``; and'' and 
                inserting a semicolon;
                    (B) in paragraph (4), by striking the period and 
                inserting ``; and''; and
                    (C) by inserting after paragraph (4) the following:
            ``(5) demonstrate the manner in which the local educational 
        agency will utilize at least 30 percent of the amounts provided 
        to the agency under this subpart in each fiscal year to provide 
        for in-service teacher training, or that the agency is using at 
        least 30 percent of its total technology funding available to 
        the agency from all sources (including Federal, State, and 
        local sources) to provide in-service teacher training.'';
            (3) by redesignating subsections (d) and (e) as subsections 
        (b) and (c) respectively; and
            (4) in subsection (c) (as so redesignated), by striking 
        ``subsection (e)'' and inserting ``subsection (a)''.

SEC. 353. TEACHER PREPARATION.

    Part A of title III (20 U.S.C. 6811 et seq.) is amended by adding 
at the end the following:

      ``Subpart 5--Preparing Tomorrow's Teachers To Use Technology

``SEC. 3161. PURPOSE; PROGRAM AUTHORITY.

    ``(a) Purpose.--It is the purpose of this subpart to assist 
consortia of public and private entities in carrying out programs that 
prepare prospective teachers to use advanced technology to foster 
learning environments conducive to preparing all students to achieve to 
challenging State and local content and student performance standards.
    ``(b) Program Authority.--
            ``(1) In general.--The Secretary is authorized, through the 
        Office of Educational Technology, to award grants, contracts, 
        or cooperative agreements on a competitive basis to eligible 
        applicants in order to assist them in developing or redesigning 
        teacher preparation programs to enable prospective teachers to 
        use technology effectively in their classrooms.
            ``(2) Period of award.--The Secretary may award grants, 
        contracts, or cooperative agreements under this subpart for a 
        period of not more than 5 years.

``SEC. 3162. ELIGIBILITY.

    ``(a) Eligible Applicants.--In order to receive an award under this 
subpart, an applicant shall be a consortium that includes--
            ``(1) at least 1 institution of higher education that 
        offers a baccalaureate degree and prepares teachers for their 
        initial entry into teaching;
            ``(2) at least 1 State educational agency or local 
        educational agency; and
            ``(3) 1 or more of the following entities:
                    ``(A) an institution of higher education (other 
                than the institution described in paragraph (1));
                    ``(B) a school or department of education at an 
                institution of higher education;
                    ``(C) a school or college of arts and sciences at 
                an institution of higher education;
                    ``(D) a professional association, foundation, 
                museum, library, for-profit business, public or private 
                nonprofit organization, community-based organization, 
                or other entity with the capacity to contribute to the 
                technology-related reform of teacher preparation 
                programs.
    ``(b) Application Requirements.--In order to receive an award under 
this subpart, an eligible applicant shall submit an application to the 
Secretary at such time, and containing such information, as the 
Secretary may require. Such application shall include--
            ``(1) a description of the proposed project, including how 
        the project would ensure that individuals participating in the 
        project would be prepared to use technology to create learning 
        environments conducive to preparing all students, including 
        girls and students who have economic and educational 
        disadvantages, to achieve to challenging State and local 
        content and student performance standards;
            ``(2) a demonstration of--
                    ``(A) the commitment, including the financial 
                commitment, of each of the members of the consortium; 
                and
                    ``(B) the active support of the leadership of each 
                member of the consortium for the proposed project;
            ``(3) a description of how each member of the consortium 
        would be included in project activities;
            ``(4) a description of how the proposed project would be 
        continued once the Federal funds awarded under this subpart 
        end; and
            ``(5) a plan for the evaluation of the program, which shall 
        include benchmarks to monitor progress toward specific project 
        objectives.
    ``(c) Matching Requirements.--
            ``(1) In general.--The Federal share of the cost of any 
        project funded under this subpart shall not exceed 50 percent. 
        Except as provided in paragraph (2), the non-Federal share of 
        such project may be in cash or in kind, fairly evaluated, 
        including services.
            ``(2) Acquisition of equipment.--Not more than 10 percent 
        of the funds awarded for a project under this subpart may be 
        used to acquire equipment, networking capabilities, or 
        infrastructure, and the non-Federal share of the cost of any 
        such acquisition shall be in cash.

``SEC. 3163. USE OF FUNDS.

    ``(a) Required Uses.--A recipient shall use funds under this 
subpart for--
            ``(1) creating programs that enable prospective teachers to 
        use advanced technology to create learning environments 
        conducive to preparing all students, including girls and 
        students who have economic and educational disadvantages, to 
        achieve to challenging State and local content and student 
        performance standards; and
            ``(2) evaluating the effectiveness of the project.
    ``(b) Permissible Uses.--A recipient may use funds under this 
subpart for activities, described in its application, that carry out 
the purposes of this subpart, such as--
            ``(1) developing and implementing high-quality teacher 
        preparation programs that enable educators to--
                    ``(A) learn the full range of resources that can be 
                accessed through the use of technology;
                    ``(B) integrate a variety of technologies into the 
                classroom in order to expand students' knowledge;
                    ``(C) evaluate educational technologies and their 
                potential for use in instruction; and
                    ``(D) help students develop their own technical 
                skills and digital learning environments;
            ``(2) developing alternative teacher development paths that 
        provide elementary schools and secondary schools with well-
        prepared, technology-proficient educators;
            ``(3) developing performance-based standards and aligned 
        assessments to measure the capacity of prospective teachers to 
        use technology effectively in their classrooms;
            ``(4) providing technical assistance to other teacher 
        preparation programs;
            ``(5) developing and disseminating resources and 
        information in order to assist institutions of higher education 
        to prepare teachers to use technology effectively in their 
        classrooms; and
            ``(6) subject to section 3162(c)(2), acquiring equipment, 
        networking capabilities, and infrastructure to carry out the 
        project.

``SEC. 3164. AUTHORIZATION OF APPROPRIATIONS.

    ``For purposes of carrying out this subpart, there is authorized to 
be appropriated $150,000,000 for fiscal year 2002, and such sums as may 
be necessary for each of the 4 succeeding fiscal years.''.

SEC. 354. PROFESSIONAL DEVELOPMENT.

    Section 3141(b)(2)(A) (20 U.S.C. 6861(b)(2)(A)) is amended--
            (1) in clause (i), by striking ``and'' at the end;
            (2) in clause (ii)(V), by adding ``and'' after the 
        semicolon; and
            (3) by adding at the end the following:
                            ``(iii) the provision of incentives, 
                        including bonus payments, to recognized 
                        educators who achieve the National Education 
                        Technology Standards, or an information 
                        technology certification that is directly 
                        related to the curriculum or content area in 
                        which the teacher provides instruction;''.

         TITLE IV--INDIVIDUALS WITH DISABILITIES EDUCATION ACT

SEC. 401. FULL FUNDING OF IDEA.

    (a) Full Funding.--In additional to any amounts otherwise 
appropriated, there are appropriated to carry out part B of the 
Individuals with Disabilities Education Act (20 U.S.C. 1411 et seq.), 
$2,000,000,000 for fiscal year 2002.
    (b) Sense of the Senate.--
            (1) Findings.--The Senate makes the following findings:
                    (A) Before the Individuals with Disabilities 
                Education Act (20 U.S.C. 1400 et seq.) (referred to in 
                this subsection as ``IDEA'') was enacted in 1975, as 
                many as 4,000,000 children were denied appropriate 
                educational services. Few disabled preschoolers 
                received services. 1,000,000 children with disabilities 
                were excluded from public school. Courts ruled this 
                practice was unconstitutional.
                    (B) States asked the Federal Government to help 
                them fund educational services to disabled children. 
                Congress responded by enacting IDEA to ensure that 
                disabled children received appropriate services and to 
                provide financial support to the States for providing 
                these services.
                    (C) Since the enactment of IDEA, schools have been 
                serving disabled children, helping them develop their 
                skills and abilities and go on to lead productive and 
                independent lives. Today, IDEA serves 5,400,000 
                children with disabilities from birth through age 21. 
                Every State offers public education and early 
                intervention services for children with disabilities. 
                Fewer than 6,000 disabled children now live in 
                institutional settings away from their families, 
                compared to 95,000 such children in 1969. The number of 
                disabled students completing high school with a diploma 
                or certificate has increased by 10 percent in the last 
                decade. The number of students with disabilities 
                entering higher education has more than tripled since 
                the implementation of IDEA.
                    (D) When IDEA was enacted, the legislation included 
                a goal to provide 40 percent of the cost of providing 
                services for these students.
                    (E) The cost of providing special education has 
                increased significantly for school districts across the 
                country. The Federal Government currently provides 
about 15 percent of the national average per pupil expenditure for IDEA 
students.
                    (F) IDEA will be up for reauthorization for fiscal 
                year 2003.
            (2) Sense of the senate.--It is the sense of the Senate 
        that--
                    (A) when Congress reauthorizes the IDEA program, it 
                should ensure that the Federal Government will reach 
                the goal of providing 40 percent of the national 
                average per pupil expenditure under IDEA; and
                    (B) disabled children will benefit from efforts to 
                help schools hire and train high quality teachers and 
                principals, reduce class size, renovate overcrowded and 
                crumbling buildings, integrate technology into the 
                classroom, strengthen early literacy programs, and 
                increase the availability of after-school learning 
                opportunities.

            TITLE V--MAKING HIGHER EDUCATION MORE AFFORDABLE

SEC. 501. INCREASE IN MAXIMUM PELL GRANT.

    (a) Findings.--Congress makes the following findings:
            (1) A college education has become increasingly important, 
        not just to the individual beneficiary, but to the nation as a 
        whole. The growth and continued expansion of the nation's 
        economy is heavily dependent on an educated and highly skilled 
        workforce.
            (2) The opportunity to gain a college education also is 
        important to the nation as a means to help advance the American 
        ideals of progress and equality.
            (3) The Federal Government plays an invaluable role in 
        making student financial aid available to ensure that qualified 
        students are able to attend college, regardless of their 
        financial means. Since the inception of the Pell Grant program 
        in 1973, nearly 80,000,000 grants have helped low- and middle-
        income students go to college, enrich their lives, and become 
        productive members of society.
            (4) Nationwide, almost 70 percent of high school graduates 
        continue on to higher education. This degree of college 
        participation would not exist without the Federal investment in 
        student aid, especially the Pell Grant program. Nearly 25 
        percent of low- and middle-income students receive some amount 
        of Pell Grant funding.
            (5) In the next 10 years, the number of undergraduate 
        students enrolled in the nation's colleges and universities 
        will increase by 11 percent to more than 11,000,000 students. 
        Many of these students will be the first in their families to 
        attend college. One in 5 of these students will be from 
        families with incomes below the poverty level. The continued 
        investment in the Pell Grant program is essential if college is 
        to remain an achievable part of the American dream.
            (6) Increasing the maximum Pell Grant to $4,700 would allow 
        approximately 430,000 additional students to benefit from the 
        program.
            (7) Increasing the maximum Pell Grant to $4,700 would 
        result in an $800 increase in the average grant award.
            (8) Because Pell Grant recipients are more likely to 
        graduate with student loan debt and to amass more debt than 
        other student borrowers, increasing the maximum Pell Grant to 
        $4,700 by fiscal year 2004 will help remedy this disparity.
    (b) Sense of the Senate.--It is the sense of the Senate the maximum 
Pell Grant should be increased to $4,700.

SEC. 502. DEDUCTION FOR HIGHER EDUCATION EXPENSES.

    (a) Deduction Allowed.--Part VII of subchapter B of chapter 1 of 
the Internal Revenue Code of 1986 (relating to additional itemized 
deductions for individuals) is amended by redesignating section 222 as 
section 223 and by inserting after section 221 the following:

``SEC. 222. HIGHER EDUCATION EXPENSES.

    ``(a) Allowance of Deduction.--
            ``(1) In general.--In the case of an individual, there 
        shall be allowed as a deduction an amount equal to the 
        applicable dollar amount of the qualified higher education 
        expenses paid by the taxpayer during the taxable year.
            ``(2) Applicable dollar amount.--The applicable dollar 
        amount for any taxable year shall be determined as follows:

                                                             Applicable
``Taxable year:                                          dollar amount:
    2002..........................................              $4,000 
    2003..........................................              $8,000 
    2004 and thereafter...........................             $12,000.
    ``(b) Limitation Based on Modified Adjusted Gross Income.--
            ``(1) In general.--The amount which would (but for this 
        subsection) be taken into account under subsection (a) shall be 
        reduced (but not below zero) by the amount determined under 
        paragraph (2).
            ``(2) Amount of reduction.--The amount determined under 
        this paragraph equals the amount which bears the same ratio to 
        the amount which would be so taken into account as--
                    ``(A) the excess of--
                            ``(i) the taxpayer's modified adjusted 
                        gross income for such taxable year, over
                            ``(ii) $62,450 ($104,050 in the case of a 
                        joint return, $89,150 in the case of a return 
                        filed by a head of household, and $52,025 in 
                        the case of a return by a married individual 
                        filing separately), bears to
                    ``(B) $15,000.
            ``(3) Modified adjusted gross income.--For purposes of this 
        subsection, the term `modified adjusted gross income' means the 
        adjusted gross income of the taxpayer for the taxable year 
        determined--
                    ``(A) without regard to this section and sections 
                911, 931, and 933, and
                    ``(B) after the application of sections 86, 135, 
                219, 220, and 469.
        For purposes of the sections referred to in subparagraph (B), 
        adjusted gross income shall be determined without regard to the 
        deduction allowed under this section.
    ``(c) Qualified Higher Education Expenses.--For purposes of this 
section--
            ``(1) Qualified higher education expenses.--
                    ``(A) In general.--The term `qualified higher 
                education expenses' means tuition and fees charged by 
                an educational institution and required for the 
                enrollment or attendance of--
                            ``(i) the taxpayer,
                            ``(ii) the taxpayer's spouse,
                            ``(iii) any dependent of the taxpayer with 
                        respect to whom the taxpayer is allowed a 
                        deduction under section 151, or
                            ``(iv) any grandchild of the taxpayer,
                as an eligible student at an institution of higher 
                education.
                    ``(B) Eligible courses.--Amounts paid for qualified 
                higher education expenses of any individual shall be 
                taken into account under subsection (a) only to the 
                extent such expenses--
                            ``(i) are attributable to courses of 
                        instruction for which credit is allowed toward 
                        a baccalaureate degree by an institution of 
                        higher education or toward a certificate of 
                        required course work at a vocational school, 
                        and
                            ``(ii) are not attributable to any graduate 
                        program of such individual.
                    ``(C) Exception for nonacademic fees.--Such term 
                does not include any student activity fees, athletic 
                fees, insurance expenses, or other expenses unrelated 
                to a student's academic course of instruction.
                    ``(D) Eligible student.--For purposes of 
                subparagraph (A), the term `eligible student' means a 
                student who--
                            ``(i) meets the requirements of section 
                        484(a)(1) of the Higher Education Act of 1965 
                        (20 U.S.C. 1091(a)(1)), as in effect on the 
                        date of the enactment of this section, and
                            ``(ii) is carrying at least one-half the 
                        normal full-time work load for the course of 
                        study the student is pursuing, as determined by 
                        the institution of higher education.
                    ``(E) Identification requirement.--No deduction 
                shall be allowed under subsection (a) to a taxpayer 
                with respect to an eligible student unless the taxpayer 
                includes the name, age, and taxpayer identification 
                number of such eligible student on the return of tax 
                for the taxable year.
            ``(2) Institution of higher education.--The term 
        `institution of higher education' means an institution which--
                    ``(A) is described in section 481 of the Higher 
                Education Act of 1965 (20 U.S.C. 1088), as in effect on 
                the date of the enactment of this section, and
                    ``(B) is eligible to participate in programs under 
                title IV of such Act.
    ``(d) Special Rules.--
            ``(1) No double benefit.--
                    ``(A) In general.--No deduction shall be allowed 
                under subsection (a) for any expense for which a 
                deduction is allowable to the taxpayer under any other 
                provision of this chapter unless the taxpayer 
                irrevocably waives his right to the deduction of such 
                expense under such other provision.
                    ``(B) Denial of deduction if credit elected.--No 
                deduction shall be allowed under subsection (a) for a 
                taxable year with respect to the qualified higher 
                education expenses of an individual if the taxpayer 
                elects to have section 25A apply with respect to such 
                individual for such year.
                    ``(C) Dependents.--No deduction shall be allowed 
                under subsection (a) to any individual with respect to 
                whom a deduction under section 151 is allowable to 
                another taxpayer for a taxable year beginning in the 
                calendar year in which such individual's taxable year 
                begins.
                    ``(D) Coordination with exclusions.--A deduction 
                shall be allowed under subsection (a) for qualified 
                higher education expenses only to the extent the amount 
                of such expenses exceeds the amount excludable under 
                section 135 or 530(d)(2) for the taxable year.
            ``(2) Limitation on taxable year of deduction.--
                    ``(A) In general.--A deduction shall be allowed 
                under subsection (a) for qualified higher education 
                expenses for any taxable year only to the extent such 
                expenses are in connection with enrollment at an 
institution of higher education during the taxable year.
                    ``(B) Certain prepayments allowed.--Subparagraph 
                (A) shall not apply to qualified higher education 
                expenses paid during a taxable year if such expenses 
                are in connection with an academic term beginning 
                during such taxable year or during the first 3 months 
                of the next taxable year.
            ``(3) Adjustment for certain scholarships and veterans 
        benefits.--The amount of qualified higher education expenses 
        otherwise taken into account under subsection (a) with respect 
        to the education of an individual shall be reduced (before the 
        application of subsection (b)) by the sum of the amounts 
        received with respect to such individual for the taxable year 
        as--
                    ``(A) a qualified scholarship which under section 
                117 is not includable in gross income,
                    ``(B) an educational assistance allowance under 
                chapter 30, 31, 32, 34, or 35 of title 38, United 
                States Code, or
                    ``(C) a payment (other than a gift, bequest, 
                devise, or inheritance within the meaning of section 
                102(a)) for educational expenses, or attributable to 
                enrollment at an eligible educational institution, 
                which is exempt from income taxation by any law of the 
                United States.
            ``(4) No deduction for married individuals filing separate 
        returns.--If the taxpayer is a married individual (within the 
        meaning of section 7703), this section shall apply only if the 
        taxpayer and the taxpayer's spouse file a joint return for the 
        taxable year.
            ``(5) Nonresident aliens.--If the taxpayer is a nonresident 
        alien individual for any portion of the taxable year, this 
        section shall apply only if such individual is treated as a 
        resident alien of the United States for purposes of this 
        chapter by reason of an election under subsection (g) or (h) of 
        section 6013.
            ``(6) Regulations.--The Secretary may prescribe such 
        regulations as may be necessary or appropriate to carry out 
        this section, including regulations requiring recordkeeping and 
        information reporting.''.
    (b) Deduction Allowed in Computing Adjusted Gross Income.--Section 
62(a) of the Internal Revenue Code of 1986 is amended by inserting 
after paragraph (17) the following:
            ``(18) Higher education expenses.--The deduction allowed by 
        section 222.''.
    (c) Conforming Amendment.--The table of sections for part VII of 
subchapter B of chapter 1 of the Internal Revenue Code of 1986 is 
amended by striking the item relating to section 222 and inserting the 
following:

                              ``Sec. 222. Higher education expenses.
                              ``Sec. 223. Cross reference.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to payments made in taxable years beginning after December 31, 
2001.
                                 <all>