Congressional Record, Volume 147 Issue 20 (Tuesday, February 13, 2001)

[Congressional Record Volume 147, Number 20 (Tuesday, February 13, 2001)]
[Senate]
[Pages S1271-S1347]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

By Mr. SHELBY:
S. 302. A bill to amend the Internal Revenue Code of 1986 to reduce
the maximum capital gain tax rate for gains from property held for more
than 5 or 10 years; to the Committee on Finance.
Mr. SHELBY. Mr. President, I rise today to introduce legislation that
would reduce the capital gains tax for properties held for more than
five or ten years. Such legislation is needed to help increase
investment and to decrease inefficient economic behavior.
Under current law, people holding capital property are often
discouraged from selling their property because of the large
anticipated tax liability. Such a ``lock-in'' of assets is economically
undesirable. Economists have estimated that perhaps as much as 7.5
trillion dollars are ``locked-in'' the portfolios of American
taxpayers. By reducing the tax on certain long term capital gains, we
would decrease the ``lock-in'' effect and allow investors to liquidate
or hold capital assets based on market factors rather than the tax
code.
Opponents to lower taxation of capital gains argue that reducing
capital gains tax rates would result in a revenue shortfall. Such an
argument fails to recognize the effect that reduced taxes will have on
investment behavior. By lowering taxes on capital gains, we will
encourage, rather than discourage, capital investment. I believe the
resulting situation would be a rise in the number of investment
transactions and in the amount of gain realized in each taxable year
which will in turn lead to an increase in tax revenue. This trend has
been well-documented as evidenced by the fact that every capital gains
tax reduction in the last forty years has resulted in increased federal
revenue. In addition to increasing federal revenue, a cut in the
capital gain tax rates would benefit individual states, as a vast
majority of them also tax capital gains.
The current capital gains tax dissuades investment and economic
growth. By lowering the capital gains tax rates, my bill would help
lower the cost of capital and spur economic growth. I urge my
colleagues to join me in support of the bill. I ask unanimous consent
that the text of the bill be printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 302

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

SECTION 1. REDUCTION IN MAXIMUM CAPITAL GAIN RATES FOR 5-YEAR
AND 10-YEAR GAINS.

(a) In General.--Paragraph (2) of section 1(h) of the
Internal Revenue Code of 1986 (relating to maximum capital
gains rate) is amended to read as follows:
``(2) Reduced capital gain rates for qualified 5-year and
10-year gain.--
``(A) Reduction in 10-percent rate.--In the case of any
taxable year beginning after December 31, 2001, the rate
under paragraph (1)(B) shall be--
``(i) 8 percent with respect to so much of the amount to
which the 10-percent rate would otherwise apply as does not
exceed qualified 5-year gain,
``(ii) 5 percent with respect to so much of the amount to
which the 10-percent rate would otherwise apply as does not
exceed qualified 10-year gain, and
``(iii) 10 percent with respect to the remainder of such
amount.
``(B) Reduction in 20-percent rate.--The rate under
paragraph (1)(C) shall be--
``(i) 10 percent with respect to so much of the amount to
which the 20-percent rate would otherwise apply as does not
exceed the lesser of--

``(I) the excess of qualified 5-year gain over the amount
of such gain taken into account under subparagraph (A) of
this paragraph, or
``(II) the amount of qualified 5-year gain (determined by
taking into account only property the holding period for
which begins after December 31, 2001),

``(ii) 5 percent with respect to so much of the amount to
which the 20-percent rate would otherwise apply as does not
exceed the lesser of--

``(I) the excess of qualified 10-year gain over the amount
of such gain taken into account under subparagraph (A) of
this paragraph, or
``(II) the amount of qualified 10-year gain (determined by
taking into account only property the holding period for
which begins after December 31, 2001), and

``(iii) 20 percent with respect to the remainder of such
amount.
For purposes of determining under the preceding sentence
whether the holding period of property begins after December
31, 2001, the holding period of property acquired pursuant to
the exercise of an option (or other right or obligation to
acquire property) shall include the period such option (or
other right or obligation) was held.''.
(b) Qualified 5-year and 10-year Gain.--Paragraph (9) of
section 1(h) of the Internal Revenue Code of 1986 is amended
to read as follows:
``(9) Qualified 5-year and 10-year gain.--For purposes of
this subsection--
``(A) Qualified 5-year gain.--The term `qualified 5-year
gain' means the aggregate long-term capital gain from
property held for more than 5 years but not more than 10
years.
``(B) Qualified 10-year gain.--The term `qualified 10-year
gain' means the aggregate long-term capital gain from
property held for more than 10 years.
``(C) Determination of gain.--The determination under
subparagraph (A) or (B) shall be made without regard to
collectibles gain, gain described in paragraph (7)(A)(i), and
section 1202 gain.''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2001.
______

By Mr. LIEBERMAN (for himself, Mr. Bayh, Ms. Landrieu, Mrs.
Lincoln, Mr. Kohl, Mr. Graham, Mr. Breaux, Mr. Kerry, Mrs.
Feinstein, Mr. Carper, and Mr. Nelson of Florida):
S. 303. A bill to amend the Elementary and Secondary Education Act of
1965, to reauthorize and make improvements to that Act, and for other
purposes; to the Committee on Health, Education, Labor, and Pensions.
Mr. LIEBERMAN. Mr. President, I rise today to join with several of my
colleagues in offering a comprehensive education reform proposal that I
believe can serve as the foundation for building a bipartisan
legislative consensus and ultimately a better future for our children.
It is a common-sense strategy that we believe can be the basis for a
common ground solution--reinvest in our public schools, reinvent the
way we administer them, and restore a sense of responsibility to the
children we are supposed to be serving. Hence the title of our bill:
the Public Education Reinvention, Reinvestment, and Responsibility Act,
or the Three R's for short.
Our Senate New Democrat Coalition originally proposed this plan,
which seeks to bring together the best ideas of both parties into a
whole new approach to federal education policy, during the debate last
year on the reauthorization of the Elementary and Secondary Education
Act. We drew significant interest from Members on both sides of the
aisle, as well as from a number of voices in the education reform
community, but not enough to overcome the partisan tensions of an
election year.
We return to this cause now, at the start of this new session, with
the same sense of urgency and a new sense of optimism. Our urgency is
driven by the growing public concern about the state of public schools
and the consequences of continued inactions. Our optimism is driven by
the growing policy consensus about how we in Washington can help our
public schools meet the

[[Page S1272]]

new challenges of this new age and help every student learn at a high
level.
We feel strongly that we cannot afford to wait any longer to craft a
serious national response to what is a serious national problem, not
when millions of our children are being denied the education they
deserve and the New Economy demands. International math and science
tests indicate that our students, even the best of the best, are
struggling to keep pace with children in other nations. In fact, the
most advanced American 12th-graders ranked 15 out of 16 on the advanced
math test and 16th out of 16th on the physics test.
Far more troubling, millions of poor children, particularly children
of color, are failing to learn even the most basic of skills, which is
to say we are failing them. Thirty five years after we passed the
Elementary and Secondary Education Act (ESEA) specifically to aid
disadvantaged students, black and Hispanic 12th graders are reading and
doing math on average at the same level of white 8th-graders.
This pernicious achievement gap cannot be allowed to persist in this
land of opportunity. It is not only a matter of equity, but of
economics as well. We simply cannot compete in a knowledge-based global
marketplace if so much of our future labor force doesn't know how to
read, write, and reason. As one report states, ``Students are being
unconsciously eliminated from the candidate pool of Information
Technology, IT, workers by the knowledge and attitudes they acquire in
their K-12 years. Many students do not learn the basic skills of
reasoning, mathematics, and communication that provide the foundation
for higher education or entry-level jobs in IT work.''

We also have to acknowledge that we have not done a very good job in
recent years in providing every child with a well-qualified teacher,
which goes a long way toward explaining why this achievement gap
persists. Specifically, we are failing to deliver teachers to the
classroom who truly know their subject matter. One national survey
found that one-fourth of all secondary school teachers did not major in
their core area of instruction. What is particularly troubling is that
we are failing those children who need our help the most--in the school
districts with the highest concentration of minorities, students have
less than a 50 percent chance of getting a math or science teacher who
has a license or a degree in their field.
We are far from alone in feeling strongly about this problem, Mr.
President, and we are encouraged by the bold and innovative reforms
that many states and local districts are pursuing to raise standards
and expectations and improve the quality of education our children are
receiving. They are helping to show us what works and how we in
Washington can help.
This is not something we talk enough about, in large part because we
do have some serious problems with our schools, but there are in fact
plenty of positive developments to highlight in public education today.
Over the past year, I have visited a broad range of schools and
programs in Connecticut and around the country, and I can tell you that
there is much happening in our public schools that we can be heartened
by, proud of, and learn from.
There is the exemplary Kennelly School in Hartford, Connecticut,
which has to contend with a high-poverty, high-mobility student
population, but through intervention programs has had real success
improving the reading, writing and math skills of many of its students.
In addition, there is the Side by Side Charter School in Norwalk, one
of 17 charter schools in Connecticut, which has created an exemplary
multiracial program in response to the challenge of Sheff v. O'Neill to
diminish racial isolation. Side by Side is experimenting with a
different approach to classroom assignments, having students stay with
teachers for two consecutive years to take advantage of the
relationships that develop, and by all indications it is working quite
well for those kids.
And there is the nationally-recognized BEST program, which, building
on previous efforts in Connecticut to raise teacher skills and
salaries, is now targeting additional state aid, training, and
mentoring support to help local districts nurture new teachers and
prepare them to excel. The result is that Connecticut's blueprint is
touted by some, including the National Commission on Teaching and
America's Future, as a national model for others to follow.
A number of other states, led by Texas and North Carolina, are moving
in this same direction--refocusing their education systems not on
process but on performance, not on prescriptive rules and regulations
but on results. More and more of them are in fact adopting a simple
formula--investing in reform, and insisting on results. They are
setting high standards, dedicating more resources to help schools meet
those new demands, providing more flexibility to experiment with
innovative practices, and holding schools responsible for improving
their performance.
We as New Democrats believe the best thing we can do to encourage and
accelerate this movement, and spur every state to pursue these bold
reforms, is to adapt this new approach to the federal level--which is
to say, to lead by following. And that is just what our Three R's
proposal aims to do. We want to redefine the federal role in education
and refocus it on helping states and local districts raise academic
achievement, putting the priority for federal programs on performance
instead of process, and on delivering results instead of developing
rules.
In particular, our plan calls on states and local districts to enter
into a new compact with the federal government to work together to
strengthen standards and improve educational opportunities,
particularly for America's poorest children. It would provide states
and local educators with significantly more federal funding and
significantly more flexibility in targeting those dollars to meet their
specific needs. In exchange, it would demand real accountability, and
for the first time impose consequences on schools that continually fail
to show progress.
Part of changing our focus means narrowing our focus. We agree with
many critics of the status quo that the current maze of federal
education programs is too unwieldy, too bureaucratic, and ultimately
too diffuse. That is why we eliminate dozens of federally
microtargeted, micromanaged programs that are redundant or incidental
to our core mission of raising academic achievement. But we also
believe that we have a great national interest in promoting broad
national educational goals, chief among them delivering on the promise
of equal opportunity. It is not only foolish but irresponsible to hand
out federal dollars with no questions asked and no thought of national
priorities. That is why we carve out separate titles in those areas
that we think are critical to helping every child learn at a high
level.

The first of our restructured titles would strengthen our
longstanding commitment to providing additional aid to disadvantaged
children through the Title I program. It would increase funding by 50
percent, up to $13 billion annually, and, perhaps more importantly,
target those new funds to schools with the highest concentrations of
poverty. The second would combine various teacher training and
professional development programs into a single teacher quality grant,
increase funding to #2 billion annually, and challenge each state to
pursue the kind of bold, performance-based reforms that my own state of
Connecticut has undertaken with great success.
The third title would reform the Federal bilingual education program
and hopefully defuse the ongoing controversy surrounding it by making
absolutely clear that our national mission is to help immigrant
children learn and master English and ultimately to meet the same high
academic standards as other students. First, recognizing that may
limited English proficient students are not being served at all today,
we call for dramatically increasing our investment in English
acquisition programs, doubling funding to $1 billion a year, which
would for the first time be distributed to states and local districts
through a reliable formula, based on their LEP student population. As a
result, school districts serving large LEP and high poverty student
populations would be guaranteed federal funding, and would not be
penalized because of their inability to hire savvy proposal writers for
competitive grants.

[[Page S1273]]

The fourth title would respond to the public demands for greater
choice within the public school framework, by providing additional
resources for charter school start-ups and new incentives for expanding
local, intradistrict choice programs. And the fifth would radically
restructure the remaining ESEA programs and provide local districts
broad flexibility to address their specific needs. We consolidate more
than 20 different programs into a single High Performance Initiatives
title, with a focus on supporting and encouraging bold new ideas,
expanding access to summer school and after school programs, improving
school safety, and building technological literacy. We increase overall
funding by more than $200 million to $3.5 billion, and distribute this
aid through a formula that targets more resources to the highest
poverty areas.
The boldest change we are proposing is to create a new accountability
title. As of today, we have plenty of rules and requirements on inputs,
on how funding is to be allocated and who must be served, but little if
any attention to outcomes, on how schools ultimately perform in
educating children. This bill would reverse that imbalance by linking
Federal funding to the progress states and local districts make in
raising academic achievement. It would call on state and local leaders
to set specific performance standards and adopt rigorous assessments
for measuring how each district is faring in meeting those goals. In
turn, states that exceed those goals would be rewarded with additional
funds, and those that fail repeatedly to show progress would be
sanctioned. In other words, for the first time, there would be
consequences for poor performance.
In considering how exactly to impose those consequences, we have run
into understandable concerns about whether you can penalize failing
schools without also penalizing children. The truth is that we are
punishing many children right now, especially the most vulnerable of
them, by forcing them to attend chronically troubled schools that are
accountable to no one, a situation that is just not acceptable anymore.
We believe there must be consequences for failure, but we make a
concerted effort through this bill to minimize the potential negative
impact on students. It requires states to set annual performance-based
goals and put in place a monitoring system for gauging how local
districts are progressing, and also provides additional resources for
states to help school districts identify and improve low-performing
schools. If after three years a state fails to meet its goals, the
state would be penalized by cutting its administrative funding by 50
percent. Only after four years of under performance would dollars
targeted for the classroom be put in jeopardy. At that point,
protecting kids by continuing to subsidize bad schools becomes more
like punishing them.
Although money alone won't improve the quality of our public
education, we must invest significantly more resources if we expect to
close the achievement gap and truly ``leave no child behind.'' That is
why we would boost ESEA funding by $35 billion over the next five
years. But we also believe that the impact of this funding will be
severely diluted if it is not better targeted to the worst-performing
schools and if it is not coupled with a rigorous and vigorous demand
for accountability. That is why we narrow the federal focus to a few
select national priorities, all of them tied to raising student
achievement, and match our investment in reform with an insistence on
results.
Judging by what President Bush has said to date, along with
Congressional leaders, we believe that there is a lot of room for
collaboration and a lot of reason to be hopeful that we can reach
bipartisan agreement on a bold, progressive, comprehensive education
reform bill this year. We still have some serious differences with the
President--not just on vouchers, but on the targeting of federal
dollars to the nation's poorest communities, which is critical to our
hopes of closing the achievement gap. But we do share a commitment to
closing that gap as a national goal, just as we share a commitment to
strengthening accountability, broadening flexibility for local schools,
spurring innovation, and promoting public school choice. And as some of
our colleagues have noted, the framework of our plan shares much in
common with the reform blueprint President Bush recently unveiled.
Our bottom line is principles, not programs. We believe we have some
good new ideas to realize some great old ideals, chief among them the
promise of equal opportunity. But we don't pretend to have a monopoly
on them and we are eager to work with both our fellow Democrats and
Republicans to find the right balance. There is no one roadmap to
reform. But we believe the third way we have charted with our Three R's
plan is a good place to start--and hopefully end.
I ask unanimous consent that the text of the bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 303

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 ``Public
Education Reinvestment, Reinvention, and Responsibility Act''
or the ``Three R's Act''.
(b) Table of Contents.--The table of contents of this Act
is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. References.
Sec. 3. Declaration of priorities.

TITLE I--STUDENT PERFORMANCE

Sec. 101. Heading.
Sec. 102. Findings, policy, and purpose.
Sec. 103. Authorization of appropriations.
Sec. 104. Reservation for school improvement.

Subtitle A--Improving Basic Programs Operated by Local Educational
Agencies

Sec. 111. State plans.
Sec. 112. Local educational agency plans.
Sec. 113. Schoolwide programs.
Sec. 114. School choice.
Sec. 115. Assessment and local educational agency and school
improvement.
Sec. 116. State assistance for school support and improvement.
Sec. 117. Parental involvement.
Sec. 118. Qualifications for teachers and paraprofessionals.
Sec. 119. Professional development.
Sec. 120. Fiscal requirements.
Sec. 121. Coordination requirements.
Sec. 122. Limitations on funds.
Sec. 123. Grants for the outlying areas and the Secretary of the
Interior.
Sec. 124. Amounts for grants.
Sec. 125. Basic grants to local educational agencies.
Sec. 126. Concentration grants.
Sec. 127. Targeted grants.
Sec. 128. Education finance incentive program.
Sec. 129. Special allocation procedures.

Subtitle B--Even Start Family Literacy Programs

Sec. 131. Program authorized.
Sec. 132. Applications.
Sec. 133. Research.

Subtitle C--Education of Migratory Children

Sec. 141. Comprehensive needs assessment and service-delivery plan;
authorized activities.

Subtitle D--Prevention and Intervention Programs for Children and Youth
who are Neglected, Delinquent, or at Risk of Dropping Out

Sec. 151. State plan and State agency applications.
Sec. 152. Use of funds.

Subtitle E--Federal Evaluations, Demonstrations, and Transition
Projects

Sec. 161. Evaluations.
Sec. 162. Demonstrations of innovative practices.

Subtitle F--Rural Education Development Initiative

Sec. 171. Rural education development initiative.

Subtitle G--General Provisions

Sec. 181. State administration.
Sec. 182. Definitions.

TITLE II--TEACHER AND PRINCIPAL QUALITY, PROFESSIONAL DEVELOPMENT, AND
CLASS SIZE

Sec. 201. Teacher and principal quality, professional development, and
class size.

TITLE III--LANGUAGE MINORITY STUDENTS AND INDIAN, NATIVE HAWAIIAN, AND
ALASKA NATIVE EDUCATION

Sec. 301. Language minority students.
Sec. 302. Emergency immigrant education program.
Sec. 303. Indian, Native Hawaiian, and Alaska Native education.

TITLE IV--PUBLIC SCHOOL CHOICE

Sec. 401. Public school choice.
Sec. 402. Development of public school choice programs; report cards.

TITLE V--IMPACT AID

Sec. 501. Payments relating to Federal acquisition of real property.
Sec. 502. Repeal of special rule relating to the computation of
payments for eligible federally connected children.

[[Page S1274]]

Sec. 503. Extension of authorization of appropriations.
Sec. 504. Repeals, transfers, and redesignations.

TITLE VI--HIGH PERFORMANCE AND QUALITY EDUCATION INITIATIVES

Sec. 601. High performance and quality education initiatives.

TITLE VII--ACCOUNTABILITY

Sec. 701. Accountability.

TITLE VIII--GENERAL PROVISIONS AND REPEALS

Sec. 801. Repeals, transfers, and redesignations regarding title XIV.
Sec. 802. Other repeals.

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.).

SEC. 3. DECLARATION OF PRIORITIES.

Congress declares that the national educational priorities
are to--
(1) introduce real accountability by making public
elementary school and secondary school education funding
performance-based rather than a guaranteed source of revenue
for States and local educational agencies;
(2) require State educational agencies and local
educational agencies to establish high student performance
objectives, and provide the State educational agencies and
local educational agencies with flexibility in using Federal
resources to ensure that the performance objectives are met;
(3) concentrate Federal funding on a small number of
central education goals, including providing compensatory
education for disadvantaged children and youth, improving
teacher quality and providing professional development,
providing programs for limited English proficient students,
public school choice programs, and innovative educational
programs, and promoting student safety and the incorporation
of educational technology into education;
(4) concentrate Federal education funding on impoverished
areas where elementary schools and secondary schools are most
likely to be in distress;
(5) sanction State educational agencies and local
educational agencies that consistently fail to meet
established benchmarks; and
(6) reward State educational agencies, local educational
agencies, and elementary schools and secondary schools that
demonstrate high performance.

TITLE I--STUDENT PERFORMANCE

SEC. 101. HEADING.

The heading for title I (20 U.S.C. 6301 et seq.) is amended
to read as follows:

``TITLE I--STUDENT PERFORMANCE''.

SEC. 102. FINDINGS, POLICY, AND PURPOSE.

Section 1001 (20 U.S.C. 6301) is amended to read as
follows:

``SEC. 1001. FINDINGS, POLICY AND PURPOSE.

``(a) Findings.--Congress makes the following findings:
``(1) Despite more than 3 decades of Federal assistance, a
sizable achievement gap remains between economically
disadvantaged and affluent students.
``(2) The 1994 reauthorization of the Elementary and
Secondary Education Act of 1965 was an important step in
focusing the Nation's priorities on closing the achievement
gap between economically disadvantaged and affluent students
in the United States. The Federal Government must continue to
build on the improvements made in 1994 by holding States and
local educational agencies accountable for student
achievement.
``(3) States can help close the achievement gap by
developing challenging curriculum content and student
performance standards so that all elementary school and
secondary school students perform at an advanced level.
States should implement rigorous and comprehensive student
performance assessments, such as the National Assessment of
Educational Progress, so as to measure fully the progress of
the Nation's students.
``(4) In order to ensure that no child is left behind in
the new economy, the Federal Government must better target
Federal resources on those children who are most at risk for
falling behind academically.
``(5) Funds made available under this title (referred to in
this section as `title I funds') have been targeted on high-
poverty areas, but not to the degree the funds should be
targeted on those areas, as demonstrated by the following:
``(A) Although 95 percent of schools with poverty levels of
75 percent to 100 percent receive title I funds, 20 percent
of schools with poverty levels of 50 to 74 percent do not
receive any title I funds.
``(B) Only 64 percent of schools with poverty levels of 35
percent to 49 percent receive title I funds.
``(6) Title I funding should be significantly increased and
more effectively targeted to ensure that all economically
disadvantaged students have an opportunity to excel
academically.
``(7) The Federal Government should provide greater
decisionmaking authority and flexibility to schools and
teachers in exchange for requiring the schools and teachers
to assume greater responsibility for student performance.
Federal, State, and local efforts should be focused on
raising the academic achievement of all students. The
Nation's children deserve nothing less than a policy that
holds accountable those responsible for shaping the
children's future and the Nation's future.
``(b) Policy.--It is the policy of the United States to
ensure that all students receive a high-quality education by
holding States, local educational agencies, and elementary
schools and secondary schools accountable for increased
student academic performance results, and by facilitating
improved classroom instruction.
``(c) Purposes.--The purposes of this title are as follows:
``(1) To eliminate the existing 2-tiered educational
system, which sets lower academic expectations for
economically disadvantaged students than for affluent
students.
``(2) To require all States to have challenging content and
student performance standards and assessment measures in
place.
``(3) To require all States to ensure adequate yearly
progress for all students by establishing annual, numerical
performance objectives.
``(4) To ensure that all students receiving services under
this title receive educational instruction from a fully
qualified teacher.
``(5) To support State educational agencies and local
educational agencies in identifying, assisting, and
correcting low-performing schools.
``(6) To increase Federal funding for programs carried out
under part A for economically disadvantaged students in
return for increased academic performance of all students.
``(7) To target Federal funding to local educational
agencies serving the highest percentages of economically
disadvantaged students.''.

SEC. 103. AUTHORIZATION OF APPROPRIATIONS.

Section 1002 (20 U.S.C. 6302) is amended to read as
follows:

``SEC. 1002. AUTHORIZATION OF APPROPRIATIONS.

``(a) Local Educational Agency Grants.--For the purpose of
carrying out part A, other than section 1120(e), there are
authorized to be appropriated $13,000,000,000 for fiscal year
2002 and such sums as may be necessary for each of the 4
succeeding fiscal years.
``(b) Even Start.--For the purpose of carrying out part B,
there are authorized to be appropriated such sums as may be
necessary for fiscal year 2002 and each of the 4 succeeding
fiscal years.
``(c) Education of Migratory Children.--For the purpose of
carrying out part C, there are authorized to be appropriated
such sums as may be necessary for fiscal year 2002 and each
of the 4 succeeding fiscal years.
``(d) Prevention and Intervention Programs for Youth Who
Are Neglected, Delinquent, or At Risk of Dropping Out.--For
the purpose of carrying out part D, there are authorized to
be appropriated such sums as may be necessary for fiscal year
2002 and each of the 4 succeeding fiscal years.
``(e) Capital Expenses.--For the purpose of carrying out
section 1120(e), there is authorized to be appropriated
$5,000,000 for fiscal year 2002.
``(f) Federal Activities.--For the purpose of carrying out
sections 1501 and 1502, there are authorized to be
appropriated such sums as may be necessary for fiscal year
2002 and each of the 4 succeeding fiscal years.''.

SEC. 104. RESERVATION FOR SCHOOL IMPROVEMENT.

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

``SEC. 1003. RESERVATION FOR SCHOOL IMPROVEMENT.

``(a) State Reservations.--Each State educational agency
shall reserve 2.5 percent of the amount the State educational
agency receives under part A for fiscal years 2002 and 2003,
and 3.5 percent of that amount for fiscal years 2004 through
2006, to carry out subsection (b) and to carry out the State
educational agency's responsibilities under sections 1116 and
1117, including carrying out the State educational agency's
statewide system of technical assistance and support for
local educational agencies.
``(b) Uses.--Of the amount reserved under subsection (a)
for any fiscal year, the State educational agency shall make
available at least 80 percent of such amount directly to
local educational agencies for school improvement and
corrective action.''.

Subtitle A--Improving Basic Programs Operated by Local Educational
Agencies

SEC. 111. STATE PLANS.

Section 1111 (20 U.S.C. 6311) is amended to read as
follows:

``SEC. 1111. STATE PLANS.

``(a) Plans Required.--
``(1) In general.--Any State educational agency desiring a
grant under this part shall submit to the Secretary a plan
that--
``(A) is developed in consultation with local educational
agencies, teachers, pupil services personnel, administrators
(including administrators of programs described in other
parts of this title), local school boards, other staff,
parents, and other entities in the community involved such as
institutions of higher education;
``(B) satisfies the requirements of this section; and
``(C) coordinates activities with other programs carried
out under this Act, the Individuals with Disabilities
Education Act, the Carl D. Perkins Vocational and Technical
Education Act of 1998, and the Head Start Act.

[[Page S1275]]

``(2) Consolidated plan.--A State plan submitted under
paragraph (1) may be submitted as part of a consolidated plan
under section 8302.
``(b) Standards, Assessments, and Accountability.--
``(1) Challenging standards.--
``(A) In general.--Each State plan shall demonstrate that
the State has adopted challenging content standards and
challenging student performance standards that will be used
by the State, and the local educational agencies, and
elementary schools and secondary schools, within the State to
carry out this part.
``(B) Uniformity.--The standards required by subparagraph
(A) shall be the same as the standards that the State applies
to all elementary schools and secondary schools within the
State and all students attending such schools.
``(C) Subjects.--The State shall have such standards for
elementary school and secondary school students served under
this part in academic subjects determined by the State, but
including at least mathematics, science, and English language
arts. The standards shall include the same specifications
concerning knowledge, skills, and levels of performance for
all students.
``(D) Standards.--Standards adopted under this paragraph
shall include--
``(i) challenging content standards in academic subjects
that--

``(I) specify what students are expected to know and be
able to do;
``(II) contain coherent and rigorous content; and
``(III) encourage the teaching of advanced skills; and

``(ii) challenging student performance standards that--

``(I) are aligned with the State's content standards;
``(II) describe 2 levels of high performance, proficient
and advanced levels of performance, that determine how well
students are mastering the material in the State content
standards; and
``(III) describe a third level of performance, a basic
level of performance, to provide complete information about
the progress of the lower performing students toward meeting
the proficient and advanced levels of performance.

``(E) Additional subjects.--For the academic subjects for
which students will receive services under this part, but for
which a State is not required under subparagraphs (A), (B),
and (C) to develop, and has not otherwise developed,
challenging content and student performance standards, the
State plan shall describe a strategy for ensuring that
economically disadvantaged students acquire the same
knowledge, are taught the same skills, and are held to the
same expectations as are all students.
``(F) Special rule.--In the case of a State that allows
local educational agencies to adopt more rigorous standards
than the standards set by the State, local educational
agencies shall be allowed to implement such rigorous
standards.
``(2) Adequate yearly progress.--
``(A) In general.--Each State plan shall demonstrate what
constitutes adequate yearly progress (based on assessments
described in paragraph (4)) of--
``(i) any school that receives assistance under this part
toward enabling all students to meet the State's challenging
student performance standards;
``(ii) any local educational agency that receives
assistance under this part toward enabling all students in
schools served by the local educational agency and receiving
assistance under this part to meet the State's challenging
student performance standards; and
``(iii) the State toward enabling all students in schools
in the State and receiving assistance under this part to meet
the State's challenging student performance standards.
``(B) Definition.--The adequate yearly progress shall be
defined by the State in a manner that--
``(i) applies the same high standards of academic
performance to all students in the State;
``(ii) takes into account the progress of all students in
the State and served by each local educational agency and
school served under section 1114 or 1115;
``(iii) uses the State challenging content and challenging
student performance standards and assessments described in
paragraphs (1) and (4);
``(iv) compares separately, for each State, local
educational agency, and school, the performance and progress
of students, disaggregated by each major ethnic and racial
group, by gender, by English proficiency status, and by
classification as economically disadvantaged students as
compared to 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 is
insufficient to yield statistically reliable information or
the results would reveal individually identifiable
information about an individual student);
``(v) compares the proportions of students at the basic,
proficient, and advanced levels of performance in a grade in
a school year with the proportions of students at each of the
3 performance levels in the same grade in the previous school
year;
``(vi) endeavors to include other academic measures such as
promotion, attendance, drop-out rates, completion of college
preparatory courses, college admission tests taken, and
secondary school completion, except that failure to meet
another academic measure, other than student performance on
State assessments aligned with State standards, shall not
provide the sole basis for designating a local educational
agency or school for improvement;
``(vii) includes annual numerical objectives for improving
the performance of all groups described in clause (iv) and
narrowing gaps in achievement between those groups in, at
least, the areas of mathematics and English language arts;
and
``(viii) includes a timeline for ensuring that each group
of students described in clause (iv) meets or exceeds the
State's proficient level of performance on each State
assessment described in paragraph (4) not later than 10 years
after the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act.
``(C) Accountability.--Each State plan shall demonstrate
that the State has developed and is implementing a statewide
State accountability system that has been or will be
effective in ensuring that all local educational agencies,
elementary schools, and secondary schools are making adequate
yearly progress as defined under section 1111(b)(2). Each
State accountability system shall--
``(i) be based on the standards and assessments adopted
under paragraphs (1) and (4) and take into account the
performance of all students required by law to be included in
such assessments;
``(ii) be the same as the 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 the
schools or all the local educational agencies;
``(iii) provide for the identification of schools or local
educational agencies receiving funds under this part that for
3 consecutive years have exceeded such schools' or agencies'
adequate yearly progress goals so that information about the
practices and strategies of such schools or agencies can be
disseminated to other schools served by the local educational
agency and other schools in the State and the schools and
agencies that have exceeded the goals can be considered for
rewards provided under title VII;
``(iv) provide for the identification of schools and local
educational agencies for improvement, as required by section
1116, and for the provision of technical assistance,
professional development, and other capacity-building as
needed, including those measures specified in sections
1116(d)(9) and 1117, 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 this paragraph; and
``(v) provide for the identification of schools and local
educational agencies for corrective action as required by
section 1116, and for the implementation of corrective action
against schools and local educational agencies in cases in
which such actions are required under such section.
``(D) Annual improvement for states.--
``(i) 90 percent requirement.--Each State plan shall
specify that, for a State to make adequate yearly progress
under subparagraph (A)(iii), not less than 90 percent of the
local educational agencies within the State shall meet the
State's criteria for adequate yearly progress.
``(ii) Modification.--If the application of the 90 percent
requirement described in clause (i) would require a
fractional number of local educational agencies to meet the
criteria, the Secretary shall issue an order modifying the
requirement, to the minimum extent necessary, and shall
require a substantial number of the agencies to meet the
criteria.
``(E) Annual improvement for local educational agencies.--
``(i) 90 percent requirement.--Each State plan shall
specify that, for a local educational agency to make adequate
yearly progress under subparagraph (A)(ii), not less than 90
percent of the schools served by the local educational agency
shall meet the State's criteria for adequate yearly progress.
``(ii) Modification.--If the application of the 90 percent
requirement described in clause (i) would require a
fractional number of schools to meet the criteria, the
Secretary shall issue an order modifying the requirement, to
the minimum extent necessary, and shall require a substantial
number of the schools to meet the criteria.
``(F) Annual improvement for schools.--Each State plan
shall specify that, for an elementary school or a secondary
school to make adequate yearly progress under subparagraph
(A)(i), not less than 90 percent of each group of students
described in subparagraph (B)(iv) who are enrolled in such
school shall take the assessments described in paragraph (4)
and in section 612(a)(17)(A) of the Individuals with
Disabilities Education Act.
``(G) Public notice and comment.--
``(i) In general.--Each State shall submit information in
the State plan demonstrating that the State, in developing
such plan--

``(I) diligently sought public comment from a range of
institutions and individuals in the State with an interest in
improved student performance; and
``(II) made and will continue to make a substantial effort
to ensure that information regarding content standards,
performance

[[Page S1276]]

standards, assessments, and the State accountability system
is widely known and understood by the public, parents,
teachers, and school administrators throughout the State.

``(ii) Effort.--The effort described in clause (i)(II), at
a minimum, shall include annual publication of such
information and explanatory text to the public through such
means as the Internet, the media, and public agencies.
Languages other than English shall be used to communicate the
information and text to parents in appropriate cases.
``(3) State authority.--If a State educational agency
provides evidence that is satisfactory to the Secretary that
neither the State educational agency nor any other State
government official, agency, or entity has sufficient
authority under State law to adopt content and student
performance standards, and assessments aligned with such
standards, that will be applicable to all students enrolled
in the State's public schools, the State educational agency
may meet the requirements of this subsection by stating in
the State plan that the State is--
``(A) adopting content and student performance standards
and assessments that meet the requirements of this
subsection, on a statewide basis, and limiting the
applicability of such standards and assessments to students
served under this part; or
``(B) adopting and implementing policies that ensure that
each local educational agency within the State that receives
assistance under this part will adopt content and student
performance standards and assessments--
``(i) that are aligned with the standards described in
subparagraph (A); and
``(ii) that meet the criteria in this subsection and any
regulations regarding such standards and assessments that the
Secretary may publish and that are applicable to all students
served by each such local educational agency.
``(4) Assessments.--Each State plan shall demonstrate that
the State has implemented a set of high quality, yearly
student assessments that includes, at a minimum, assessments
in mathematics, science, and English language arts, that will
be used, starting not later than the 2002-2003 school year as
the primary means of determining the yearly performance of
each local educational agency and school served by the State
under this title in enabling all students to meet the State's
challenging content and student performance standards. Such
assessments shall--
``(A) be the same as the assessments used to measure the
performance of all students, if the State has assessments
that measure the performance of all students;
``(B) be aligned with the State's challenging content and
student performance standards, and provide coherent
information about the local educational agency's contribution
to the student attainment of such standards;
``(C) be used only for purposes for which such assessments
are valid and reliable, and be consistent with relevant,
nationally recognized professional and technical standards
for such assessments;
``(D) measure the performance of students against the
challenging State content and student performance standards,
and be administered not less than once during--
``(i) grades 3 through 5;
``(ii) grades 6 through 9; and
``(iii) grades 10 through 12;
``(E) include multiple, up-to-date measures of student
performance and the local educational agency's contribution
to student performance, including measures that assess higher
order thinking skills and understanding;
``(F) provide for--
``(i) the participation in such assessments of all
students;
``(ii) the reasonable adaptations and accommodations for
children with disabilities, as such term is defined in
section 602(3) of the Individuals with Disabilities Education
Act, that are necessary to measure the performance of such
students relative to State content and student performance
standards;
``(iii) in the case of a student with limited English
proficiency, the assessment of such student in the student's
native language if such a native language assessment is more
likely than an English language assessment to yield accurate
and reliable information on what that student knows and is
able to do; and
``(iv) notwithstanding clause (iii), the assessment (using
tests written in English) of English language arts of any
student who has attended school in the United States (not
including the Commonwealth of Puerto Rico) for 3 or more
consecutive school years, except that if the local
educational agency determines, on a case-by-case individual
basis, that assessments in another language and form would
likely yield more accurate and reliable information on what
such students know and can do, the local educational agency
may assess such students in the appropriate language other
than English for 1 additional consecutive year beyond the
third consecutive year;
``(G) include students who have attended schools served by
a local educational agency for a full academic year but have
not attended a single school for a full academic year, except
that the performance of students who have attended more than
1 school served by the local educational agency in any
academic year shall be used only in determining the progress
of the local educational agency;
``(H) provide individual student reports to be submitted to
parents, including reports containing assessment scores or
other information on the attainment of student performance
standards;
``(I) enable results to be disaggregated within each State,
local educational agency, and school by each major racial and
ethnic group, by gender, by English proficiency status, and
by classification as economically disadvantaged students as
compared to students who are not economically disadvantaged;
and
``(J) to the extent practicable, use rigorous criteria.
``(5) First grade literacy assessment.--In addition to
implementing the assessments described in paragraph (4), each
State receiving funds under this part shall describe in the
State plan what reasonable steps the State is taking to
assist and encourage local educational agencies--
``(A) to measure literacy skills of first graders in
schools receiving funds under this part by providing
assessments of first graders that are--
``(i) developmentally appropriate;
``(ii) aligned with State content and student performance
standards; and
``(iii) tied to scientifically based research; and
``(B) to assist and encourage local educational agencies
receiving funds under this part in identifying and taking
developmentally appropriate and effective interventions in
any school served under this part in which a substantial
number of first graders have not demonstrated grade-level
literacy proficiency by the end of the school year.
``(6) Language assessments.--Each State plan shall identify
the languages other than English and Spanish that are present
in the participating student populations in the State, and
indicate the languages for which yearly student assessments
are not available and are needed. The State may request
assistance from the Secretary in identifying assessment
measures in the needed languages. Upon request, the Secretary
shall assist with the identification of appropriate
assessment measures in the needed languages, but shall not
mandate a specific assessment or mode of instruction.
``(7) Development and implementation.--Each State plan
shall provide that the State shall develop and implement, at
a minimum, the assessments described in paragraph (4) in
mathematics and English language arts by the 2002-2003 school
year.
``(8) Requirement.--Each State plan shall describe--
``(A) how the State educational agency will assist each
local educational agency and school affected by the State
plan to develop the capacity to comply with each of the
requirements of sections 1114(b), 1115(c), and 1116 that are
applicable to such agency or school;
``(B) how the State educational agency will--
``(i) hold each local educational agency affected by the
State plan accountable for improved student performance,
including describing a procedure for--

``(I) identifying local educational agencies and schools
for improvement; and
``(II) assisting local educational agencies and schools
identified as described in subclause (I) to address
performance problems, including providing thorough
descriptions of--

``(aa) the amounts and types of professional development to
be provided to instructional staff; and
``(bb) the amount of any financial assistance to be
provided by the State under section 1003, and the amount of
any funds to be provided through other sources and the
activities to be provided with those funds; and
``(ii) implement corrective action if the assistance is not
effective;
``(C) how the State educational agency is providing
additional academic instruction, such as before- and after-
school programs and summer academic programs, to low-
performing students;
``(D) such other factors as the State considers to be
appropriate to provide students with an opportunity to attain
the knowledge and skills described in the State's challenging
content standards;
``(E) the specific steps that the State educational agency
will take or the specific strategies that the State
educational agency will use to ensure that--
``(i) all teachers in the State, in schoolwide programs and
targeted assistance programs, are fully qualified not later
than December 31, 2006; and
``(ii) economically disadvantaged students and minority
students are not taught at higher rates than other students
by inexperienced, uncertified or unlicensed, or out-of-field
teachers; and
``(F) the measures that the State educational agency will
use to evaluate and publicly report the State's progress in
improving the quality of instruction in the schools served by
the State educational agency and local educational agencies
receiving funding under this Act.
``(c) Other Provisions To Support Teaching and Learning.--
Each State plan shall contain assurances that--
``(1) the State educational agency will work with other
agencies, including educational service agencies, or local
consortia and institutions to provide technical assistance to
local educational agencies, elementary schools, and secondary
schools to carry out the State educational agency's
responsibilities under this part, including providing

[[Page S1277]]

technical assistance concerning providing professional
development under section 1119A and technical assistance
under section 1117;
``(2)(A) where educational service agencies exist, the
State educational agency will consider providing professional
development and technical assistance through such agencies;
and
``(B) where educational service agencies do not exist, the
State educational agency will consider providing professional
development and technical assistance through other
cooperative arrangements, such as through a consortium of
local educational agencies;
``(3) the State educational agency will use the
disaggregated results of the student assessments required
under subsection (b)(4), and other measures or indicators
available to the State, to review annually the progress of
each local educational agency and school served under this
part in the State to determine whether each such agency and
school is making the annual progress necessary to ensure that
all students will meet the State's proficient level of
performance on the State assessments described in subsection
(b)(4) within 10 years after the date of enactment of the
Public Education Reinvestment, Reinvention, and
Responsibility Act;
``(4) the State educational agency will provide the least
restrictive and burdensome regulations for local educational
agencies and individual elementary schools and secondary
schools participating in a program assisted under this part;
``(5) the State educational agency will regularly inform
the Secretary and the public in the State of any Federal laws
that hinder the ability of States to hold local educational
agencies and schools accountable for student academic
performance, and how the laws hinder that ability;
``(6) the State educational agency will encourage
elementary schools and secondary schools to consolidate funds
from other Federal, State, and local sources for schoolwide
reform in schoolwide programs under section 1114;
``(7) the State educational agency will modify or eliminate
State fiscal and accounting barriers so that elementary
schools and secondary schools can easily consolidate funds
from other Federal, State, and local sources for schoolwide
reform in schoolwide programs under section 1114;
``(8) the State educational agency has involved the
committee of practitioners established under section 1703(b)
in developing the State plan and will involve the committee
in monitoring the implementation of the State plan; and
``(9) the State educational agency will inform local
educational agencies of the local educational agencies'
authority to obtain waivers under title VIII and, if the
State is an Ed-Flex Partnership State, waivers under the
Education Flexibility Partnership Act of 1999.
``(d) Review.--
``(1) Peer review and secretarial approval.--The Secretary
shall--
``(A) establish a peer review process to assist in the
review of State plans;
``(B) only approve a State plan meeting each of the
requirements of this section;
``(C) if the Secretary determines that the State plan does
not meet each of the requirements of subsections (a), (b),
and (c), immediately notify the State of such determination
and the reasons for such determination;
``(D) not disapprove a State plan before--
``(i) notifying the State educational agency in writing of
the specific deficiencies of the State plan;
``(ii) offering the State an opportunity to revise the
State plan;
``(iii) providing technical assistance in order to assist
the State to meet the requirements of subsections (a), (b),
and (c); and
``(iv) providing a hearing;
``(E) have the authority to disapprove a State plan for not
meeting the requirements of this section, but shall not have
the authority to require a State, as a condition of approval
of the State plan, to include in, or delete from, such plan 1
or more specific elements of the challenging State content
standards or to use specific assessment instruments or items;
and
``(F) if the Secretary disapproves a State plan that is--
``(i) the first State plan submitted by a State after the
date of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act, require the State to
submit a revised State plan that meets the requirements of
this section to the Secretary for approval not later than 1
year after the date of disapproval; and
``(ii) the second or a subsequent State plan submitted by a
State after the date of enactment, require the State to
submit such a revised State plan to the Secretary for
approval not later than 30 days after the date of
disapproval.
``(2) Review.--The Secretary shall review information from
the State on the adequate yearly progress of schools and
local educational agencies within the State required under
subsection (b)(2) for the purpose of determining State and
local compliance with section 1116.
``(e) Duration of the Plan.--
``(1) In general.--Each State plan shall--
``(A) remain in effect for the duration of the State's
participation under this part; and
``(B) be periodically reviewed and revised by the State, as
necessary, to reflect changes in the State's strategies and
programs under this part.
``(2) Additional information.--If the State makes
significant changes in the State plan, such as the adoption
of new challenging State content standards and State student
performance standards, new assessments, or a new definition
of adequate yearly progress, the State shall submit
information on such significant changes to the Secretary.
``(f) Limitation on Conditions.--Nothing in this part shall
be construed to authorize an officer or employee of the
Federal Government to mandate, direct, or control a State's,
local educational agency's, or elementary school's or
secondary school's specific challenging content or student
performance standards, assessments, curricula, or program of
instruction, as a condition of eligibility to receive funds
under this part.
``(g) Penalties.--
``(1) In general.--If a State fails to meet the statutory
deadlines for demonstrating that the State has in place
challenging content standards and student performance
standards (including deadlines for standards required under
section 1111(b)(6), as in effect on the day before the date
of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act), assessments, and a
statewide State accountability system for holding schools and
local educational agencies accountable for making adequate
yearly progress (including adequate yearly progress with each
group of students specified in subsection (b)(2)(B)(iv)), for
the fiscal year after the failure, the State shall be
ineligible to receive a greater amount of administrative
funds under section 1703(c) than the amount the State
received for the previous year for the purposes described in
section 1703(c).
``(2) Additional funds.--Based on the extent to which the
standards, assessments, and system described in paragraph (1)
are not in place, the Secretary shall withhold from the
State, in addition to any amount withheld under paragraph
(1), additional administrative funds under section 1703(c).
The Secretary shall withhold such additional funds as the
Secretary determines to be appropriate, except that if the
State fails to meet the deadlines for a second or subsequent
fiscal year, the Secretary shall withhold, for the fiscal
year after the failure, not less than \1/5\ of the amount of
administrative funds the State received under section 1703(c)
during the first year in which the State failed to meet the
deadlines.
``(3) Waiver.--
``(A) In general.--Except as provided in subparagraph (B),
notwithstanding part D of title VIII, the Education
Flexibility Partnership Act of 1999, or any other provision
of law, the Secretary may not grant a waiver of the
requirements of this section, except that a State may request
a 1-time, 1-year waiver to meet the requirements of this
section.
``(B) Exception.--A waiver granted pursuant to subparagraph
(A) shall not apply to the requirements described under
subsection (h).
``(h) Special Rule on Science Standards and Assessments.--
Notwithstanding subsection (b) and part D of title IV, no
State shall be required to meet the requirements under this
title relating to science standards or assessments until the
beginning of the 2006-2007 school year.''.

SEC. 112. LOCAL EDUCATIONAL AGENCY PLANS.

(a) Subgrants.--Section 1112(a)(1) (20 U.S.C. 6312(a)(1))
is amended by striking ``the Goals 2000: Educate America
Act,'' and all that follows and inserting ``the Individuals
with Disabilities Education Act, the Carl D. Perkins
Vocational and Technical Education Act of 1998, the Head
Start Act, and other Acts, as appropriate.''.
(b) Plan Provisions.--Section 1112(b) (20 U.S.C. 6312(b))
is amended--
(1) in the matter preceding paragraph (1), by striking
``Each'' and inserting ``In order to help low-performing
students meet high standards, each'';
(2) in paragraph (1)--
(A) by striking ``part'' each place it appears and
inserting ``title''; and
(B) in subparagraph (B), by striking ``children'' and
inserting ``low-performing students'';
(3) in paragraph (4)--
(A) in subparagraph (A)--
(i) by striking ``elementary school programs,'' and
inserting ``programs, and''; and
(ii) by striking ``, and school-to-work transition
programs''; and
(B) in subparagraph (B), by striking ``under part C'' the
first place it appears and all that follows through
``dropping out'' and inserting ``under part C, neglected or
delinquent youth'';
(4) in paragraph (7), by striking ``eligible'';
(5) in paragraph (9), by striking the period and inserting
a semicolon; and
(6) by adding at the end the following new paragraphs:
``(10) a description of the actions the local educational
agency will take to assist the low-performing schools served
by the local educational agency, including schools identified
under section 1116 for school improvement;
``(11) a description of how the local educational agency
will promote the use of alternative instructional methods,
and extended learning time options, such as an extended
school year, before- and after-school programs, and summer
programs; and
``(12) a description of--
``(A) the steps the local educational agency will take to
ensure that all teachers in schoolwide programs and targeted
assistance programs assisted under this part are fully
qualified not later than December 31, 2006;

[[Page S1278]]

``(B) the strategies the local educational agency will use
to ensure that economically disadvantaged students and
minority students are not taught at higher rates than other
students by inexperienced, uncertified or unlicensed, or out-
of-field teachers; and
``(C) the measures the agency will use to evaluate and
publicly report progress in improving the quality of
instruction in schools served by the local educational agency
and receiving funding under this Act.''.
(c) Assurances.--Section 1112(c) (20 U.S.C. 6312(c)) is
amended to read as follows:
``(c) Assurances.--
``(1) In general.--Each local educational agency plan shall
provide assurances that the local educational agency will--
``(A) reserve not less than 10 percent of the funds the
agency receives under this part for high quality professional
development, as described in section 1119A, for professional
instructional staff;
``(B) provide eligible schools and parents with information
regarding schoolwide program authority and the ability of
such schools to consolidate funds from Federal, State, and
local sources;
``(C) provide technical assistance and support to schools
participating in schoolwide programs;
``(D) work in consultation with schools as the schools
develop school plans pursuant to section 1114(b)(2), and
assist schools in implementing such plans or undertaking
activities pursuant to section 1115(c), so that each school
can make adequate yearly progress toward meeting the
challenging State student performance standards;
``(E) use the disaggregated results of the student
assessments required under section 1111(b)(4), and other
measures or indicators available to the agency, to review
annually the progress of each school served by the agency and
receiving funds under this title to determine whether or not
all of the schools are making the annual progress necessary
to ensure that all students will meet the State's proficient
level of performance on the State assessments described in
section 1111(b)(4) within 10 years after the date of
enactment of the Public Education Reinvestment, Reinvention,
and Responsibility Act;
``(F) set, and hold schools served by the local educational
agency accountable for meeting, annual numerical goals for
improving the performance of all groups of students based on
the performance standards set by the State under section
1111(b)(1)(D)(ii);
``(G) fulfill the local educational agency's school
improvement responsibilities under section 1116, including
taking corrective actions under section 1116(c)(10);
``(H) provide the State educational agency with--
``(i) an annual, up-to-date, and accurate list of all
schools served by the local educational agency that are
identified for school improvement and corrective action;
``(ii) the reasons why each school described in clause (i)
was identified for school improvement or corrective action;
and
``(iii) specific plans for improving student performance in
each of the schools described in clause (i), including
specific numerical performance goals for each school, for the
2 school years after the school is identified for school
improvement, for each group of students specified in section
1111(b)(2)(B)(iv) enrolled in the school;
``(I) provide services to eligible students attending
private elementary schools and secondary schools in
accordance with section 1120, and provide timely and
meaningful consultation with private school officials
regarding such services;
``(J) take into account the experience gained from model
programs for the educationally disadvantaged and the findings
of relevant scientifically based research when developing
technical assistance plans for, and delivering technical
assistance to, schools served by the local educational agency
that are receiving funds under this part and are in school
improvement or corrective action status;
``(K) in the case of a local educational agency that
chooses to use funds under this part to provide early
childhood development services to economically disadvantaged
children below the age of compulsory school attendance,
ensure that such services meet the performance standards
established under subparagraphs (A) and (B) of section
641A(a)(1) of the Head Start Act;
``(L) comply with the requirements of section 1119
regarding the qualifications of teachers and
paraprofessionals;
``(M) inform eligible schools served by the local
educational agency of the agency's authority to obtain
waivers on such schools' behalf under title VIII and, if the
State is an Ed-Flex Partnership State, under the Education
Flexibility Partnership Act of 1999; and
``(N) coordinate activities and collaborate, to the extent
feasible and necessary as determined by the local educational
agency, with other agencies providing services to children,
youth, and their families.
``(2) Model programs; scientifically based research.--For
purposes of enabling local educational agencies to implement
paragraph (1)(J)--
``(A) the Secretary shall consult with the Secretary of
Health and Human Services on the implementation of such
paragraph, and shall establish procedures (taking into
consideration State and local laws and local teacher
contracts) to assist local educational agencies to comply
with such paragraph;
``(B) the Secretary shall disseminate to local educational
agencies the performance standards issued under subparagraphs
(A) and (B) of section 641A(a)(1) of the Head Start Act, on
the publication of such standards; and
``(C) local educational agencies affected by such paragraph
(1)(J) shall plan for the implementation of such paragraph
(taking into consideration State and local laws and local
teacher contracts), including pursuing the availability of
other Federal, State, and local funding to assist in
compliance with such paragraph.
``(3) Inapplicability.--The provisions of this subsection
shall not apply to preschool programs using an Even Start
model or to Even Start programs.''.
(d) Plan Development and Duration.--Section 1112(d) (20
U.S.C. 6312(d)) is amended to read as follows:
``(d) Plan Development and Duration.--
``(1) Consultation.--Each local educational agency plan
shall be developed in consultation with teachers, principals,
local school boards, administrators (including administrators
of programs described in other parts of this title), other
appropriate school personnel, and parents of students in
elementary schools and secondary schools served under this
part.
``(2) Duration.--Each plan described in paragraph (1) shall
remain in effect for the duration of the local educational
agency's participation under this part.
``(3) Review.--Each local educational agency shall
periodically review and, as necessary, revise the agency's
plan.''.
(e) State Approval.--Section 1112(e) (20 U.S.C. 6312(e)) is
amended to read as follows:
``(e) Peer Review and State Approval.--
``(1) In general.--Each local educational agency plan shall
be filed according to a schedule established by the State
educational agency.
``(2) Approval.--The State educational agency shall
establish a peer review process to assist in the review of
local educational agency plans. The State educational agency
shall approve a local educational agency plan only if the
State educational agency determines that the local
educational agency plan--
``(A) will enable elementary schools and secondary schools
served by the local educational agency and under this part to
help all groups of students specified in section
1111(b)(2)(B)(iv) to meet the State's proficient level of
performance on the State assessments described in section
1111(b)(4) within 10 years after the date of enactment of the
Public Education Reinvestment, Reinvention, and
Responsibility Act; and
``(B) meets each of the requirements of this section.
``(3) State review.--Each State educational agency shall at
least annually review each local educational agency plan
approved by the State educational agency under this
subsection, including comparing the objectives of the plan
against the results of the disaggregated assessments required
under section 1111(b)(4). The State educational agency shall
conduct the review to ensure that the progress of all
students in schools served by a local educational agency in
the State under this part is adequate to ensure that all
students in the State will meet the State's proficient level
of performance on the State assessments described in section
1111(b)(4) within 10 years after the date of enactment of the
Public Education Reinvestment, Reinvention, and
Responsibility Act.
``(4) Public review.--Each State educational agency will
make publicly available each such local educational agency
plan.''.
(f) Parental Notification for English Language
Instruction.--Section 1112 (20 U.S.C. 6312) is amended by
adding at the end the following:
``(g) Parental Notification for English Language
Instruction.--
``(1) Notification.--If a local educational agency uses
funds under this part to provide English language instruction
to limited English proficient students, the local educational
agency shall notify the parents of a student participating in
an English language instruction educational program under
this part of--
``(A) the reasons for the identification of the student as
being in need of English language instruction;
``(B) the student's level of English proficiency, how such
level was assessed, and the status of the student's academic
performance;
``(C) how the English language instruction educational
program will specifically help the student learn English and
meet age-appropriate standards for grade promotion and
graduation;
``(D) the specific exit requirements of the English
language instruction educational program;
``(E) the expected rate of graduation from the English
language instruction educational program into mainstream
classes; and
``(F) the expected rate of graduation from secondary school
of participants in the English language instruction
educational program, if funds under this part are used for
students in secondary schools.
``(2) Parental rights.--
``(A) In general.--The parents of a student participating
in an English language instruction educational program under
this part shall--
``(i) have the option of selecting among methods of
instruction, if more than 1 method is offered for the
program; and

[[Page S1279]]

``(ii) have the right to have their child immediately
removed from the program on their request.
``(B) Receipt of information.--The parents of a student
identified for participation in an English language
instruction educational program under this part shall
receive, in a manner and form understandable to the parents,
the information required by paragraph (1) and this paragraph.
At a minimum, the parents shall receive--
``(i) timely information about English language instruction
educational programs for limited English proficient students
assisted under this part; and
``(ii) if the parents of a participating student so desire,
notice of opportunities for regular meetings of parents of
limited English proficient students participating in English
language instruction educational programs under this part for
the purpose of formulating and responding to recommendations
from such parents.
``(3) Basis for admission or exclusion.--No student shall
be admitted to or excluded from any federally assisted
education program solely on the basis of a surname or
language minority status.''.

SEC. 113. SCHOOLWIDE PROGRAMS.

(a) Use of Funds for Schoolwide Programs.--Section 1114(a)
(20 U.S.C. 6314(a)) is amended--
(1) in paragraph (1), by striking ``school described in
subparagraph (A)'' and all that follows through ``such
families.'' the second place it appears and inserting
``school that serves an eligible school attendance area if--
``(A) not less than 40 percent of the children in the
school attendance area are from economically disadvantaged
families; or
``(B) not less than 40 percent of the children enrolled in
the school are from such families.''; and
(2) in paragraph (2)--
(A) in subparagraph (A), by striking ``subsections (c)(1)
and (e) of''; and
(B) in subparagraph (B), by striking ``subsections (c)(1)
and (e) of''.
(b) Components of a Schoolwide Program.--Section 1114(b)
(20 U.S.C. 6314(b)) is amended--
(1) in paragraph (1)--
(A) in subparagraph (A), by striking ``section 1111(b)(1)''
and inserting ``section 1111(b)'';
(B) in subparagraph (B)--
(i) in clause (i), by striking ``section 1111(b)(1)(D)''
and inserting ``1111(b)'';
(ii) in clause (iii)(II), by inserting ``and'' after the
semicolon;
(iii) in clause (iv)(II), by striking ``; and'' and
inserting a period; and
(iv) by striking clause (vii); and
(C) in subparagraph (G), by striking ``section 1112(b)(1)''
and inserting ``section 1112''; and
(2) in paragraph (2)--
(A) in subparagraph (A)--
(i) by striking ``Improving America's Schools Act of 1994''
and inserting ``Public Education Reinvestment, Reinvention,
and Responsibility Act'';
(ii) by striking ``subsections (c)(1) and (e) of''; and
(iii) in clause (iv), by striking ``section 1111(b)(3)''
and inserting ``section 1111(b)(4)'';
(B) in subparagraph (B), by striking ``paragraphs (1) and
(3) of section 1111(b)'' and inserting ``paragraphs (1) and
(4) of section 1111(b)''; and
(C) in subparagraph (C)(i)--
(i) in subclause (I), by striking ``subsections (c) and (e)
of''; and
(ii) in subclause (II), by striking ``Improving America's
Schools Act of 1994'' and inserting ``Public Education
Reinvestment, Reinvention, and Responsibility Act''.

SEC. 114. SCHOOL CHOICE.

Section 1115A (20 U.S.C. 6316) is amended to read as
follows:

``SEC. 1115A. SCHOOL CHOICE.

``(a) Choice Programs.--A local educational agency may use
funds under this part, in combination with State, local, and
private funds, to develop and implement public school choice
programs, for students eligible for assistance under this
part, that permit parents to select the public school that
their child will attend and are consistent with State and
local law, policy, and practice related to public school
choice and local pupil transfer.
``(b) Choice Plan.--A local educational agency that chooses
to implement a public school choice program under this
section shall first develop a plan that--
``(1) contains an assurance that all eligible students,
across grade levels, who are served under this part will have
equal access to the program;
``(2) contains an assurance that the program does not
include elementary schools or secondary schools that follow a
racially discriminatory policy in providing services to
students;
``(3) describes how elementary schools or secondary schools
will use resources under this part, and from other sources,
to implement the plan;
``(4) contains an assurance that the plan has been
developed with the involvement of parents and others in the
community to be served, and individuals who will carry out
the plan, including administrators, teachers, principals, and
other staff;
``(5) contains an assurance that parents of eligible
students served by the local educational agency will be given
prompt notice of the existence of the public school choice
program, and the program's availability to such parents, and
a clear explanation of how the program will operate;
``(6) contains an assurance that the public school choice
program--
``(A) will include charter schools (as defined in section
4210) and any other public elementary school or secondary
school served by the local educational agency; and
``(B) will not include as a school receiving transfers
under the program an elementary school or a secondary school
that the local educational agency determines--
``(i) is in school improvement or corrective action status;
``(ii) has been in school improvement or corrective action
status during the 2 academic years before the determination;
or
``(iii) is at risk of being identified for school
improvement or corrective action during the academic year
after the determination;
``(7) contains an assurance that transportation services or
the costs of transportation to and from a public school to
which a student transfers under the public school choice
program--
``(A) may be provided by the local educational agency with
funds under this part and funds from other sources; and
``(B) shall not be provided using more than 10 percent of
the funds made available under this part to the local
educational agency; and
``(8) contains an assurance that such local educational
agency will comply with the other requirements of this
part.''.

SEC. 115. ASSESSMENT AND LOCAL EDUCATIONAL AGENCY AND SCHOOL
IMPROVEMENT.

(a) Local Review.--Section 1116(a) (20 U.S.C. 6317(a)) is
amended--
(1) in paragraph (2), by striking ``1111(b)(2)(A)(i)'' and
inserting ``1111(b)(2)'';
(2) in paragraph (3)--
(A) by striking ``individual school performance profiles''
and inserting ``school report cards'';
(B) by striking ``1111(b)(3)(I)'' and inserting
``1111(b)(4)(I)''; and
(C) by striking ``and'' after the semicolon;
(3) in paragraph (4), by striking the period and inserting
``; and''; and
(4) by adding at the end the following:
``(5) review the effectiveness of the actions and
activities the schools are carrying out under this part with
respect to parental involvement.''.
(b) School Improvement.--Section 1116(c) (20 U.S.C.
6317(c)) is amended to read as follows:
``(c) School Improvement.--
``(1) In general.--A local educational agency shall
identify for school improvement any elementary school or
secondary school served under this part that--
``(A) for 2 consecutive years failed to make adequate
yearly progress as defined in the State's plan under section
1111(b)(2); or
``(B) was in school improvement status under this section
on the day before the date of enactment of the Public
Education Reinvestment, Reinvention, and Responsibility Act.
``(2) Transition.--The 2-year period described in paragraph
(1)(A) shall include any continuous period of time
immediately before the date of enactment of the Public
Education Reinvestment, Reinvention, and Responsibility Act
during which an elementary school or a secondary school did
not make adequate yearly progress as defined in the State's
plan, as such plan was in effect on the day before the date
of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act.
``(3) Targeted assistance schools.--To determine if an
elementary school or a secondary school that is conducting a
targeted assistance program under section 1115 should be
identified for school improvement under this subsection, a
local educational agency may choose to review the progress of
only the students in such school who are served, or are
eligible for services, under this part.
``(4) Opportunity to review and present evidence.--(A)
Before identifying an elementary school or a secondary school
for school improvement under paragraph (1), the local
educational agency shall provide the school with an
opportunity to review the school level data, including
assessment data, on which the proposed identification is
based.
``(B) If the principal of a school proposed for
identification for school improvement believes that the
proposed identification is in error for statistical or other
substantive reasons, the principal may provide supporting
evidence to the local educational agency, which shall
consider such evidence before making a final determination.
``(5) Time limits.--Not later than 30 days after a local
educational agency makes an initial determination concerning
identifying a school served by the agency and receiving
assistance under this part for school improvement, the local
educational agency shall make public a final determination on
the status of the school.
``(6) Notification to parents.--A local educational agency
shall, in an easily understandable format, and in the 3
languages, other than English, spoken by the greatest number
of individuals in the area served by the local educational
agency, provide in writing to parents of each student in an
elementary school or a secondary school identified for school
improvement--
``(A) an explanation of what the school improvement
identification means, and how the school identified for
school improvement compares in terms of academic performance
to other elementary schools or secondary

[[Page S1280]]

schools served by the local educational agency and the State
educational agency involved;
``(B) the reasons for such identification;
``(C) a description of the data on which such
identification was based;
``(D) an explanation of what the school identified for
school improvement is doing to address the problem of low
performance;
``(E) an explanation of what the local educational agency
or State educational agency is doing to help the school
address the performance problem, including an explanation of
the amounts and types of professional development being
provided to the instructional staff in such school, the
amount of any financial assistance being provided by the
State educational agency under section 1003, and the
activities that are being provided with such financial
assistance;
``(F) an explanation of how parents described in this
paragraph can become involved in addressing the academic
issues that caused the school to be identified for school
improvement; and
``(G) an explanation of the right of parents, pursuant to
paragraph (7), to transfer their child to a higher performing
public school, including a public charter school or magnet
school, that is not in school improvement status, and how
such transfer will be carried out.
``(7) Public school choice option.--(A)(i) In the case of a
school identified for school improvement on or before the
date of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act, a local educational
agency shall, not later than 18 months after such date of
enactment, provide all students enrolled in the school an
option to transfer (consistent with State and local law,
policy, and practices related to public school choice and
local pupil transfer) to any higher performing public school,
including a public charter or magnet school, that--
``(I) is not in school improvement or corrective action
status;
``(II) has not been in school improvement or corrective
action status at any time during the 2 academic years before
the identification; and
``(III) is not at risk of being identified for school
improvement or corrective action during the academic year
after the identification.
``(ii) In the case of a school identified for school
improvement after the date of enactment of the Public
Education Reinvestment, Reinvention, and Responsibility Act,
the local educational agency involved shall, not later than
12 months after the date on which the local educational
agency identifies the school for school improvement, provide
all students enrolled in the school with the transfer option
described in clause (i).
``(B) If all public schools served by the local educational
agency to which a student may transfer under clause (i) are
identified for school improvement or corrective action, or,
if public schools in the agency's jurisdiction that are not
in school improvement or corrective action status cannot
accommodate all of the students who are eligible to transfer
because of capacity constraints, or State or local law,
policy, and practices related to public school choice and
local pupil transfer, the local educational agency shall, to
the extent practicable, establish a cooperative agreement
with other local educational agencies that serve areas in
proximity to the area served by the local educational agency.
The cooperative agreement shall enable a student to transfer
(consistent with State and local law, policy, and practices
related to public school choice and local pupil transfer) to
a school served by such other local educational agencies that
meets the requirements described in subparagraph (A)(i).
``(C) A local educational agency that serves a school that
has been identified for corrective action shall provide
transportation services or pay for the costs of
transportation for students who transfer to a different
school pursuant to this paragraph. Not more than 10 percent
of the funds allocated to a local educational agency under
this part may be used to provide such transportation services
or pay for the costs of such transportation.
``(D) Once a school is no longer identified for school
improvement, the local educational agency shall continue to
provide the transfer option described in subparagraph (A)(i)
to students in such school for a period of not less than 2
years.
``(8) School plan.--(A) Each school identified under
paragraph (1) for school improvement shall, not later than 3
months after being so identified, develop or revise a school
plan, in consultation with parents, school staff, the local
educational agency serving the school, the local school
board, and other outside experts, for approval by such local
educational agency. The school plan shall--
``(i) incorporate scientifically based research strategies
that strengthen the core academic subjects in the school and
address the specific academic issues that caused the school
to be identified for school improvement;
``(ii) adopt policies and practices concerning the school's
core academic subjects that have the greatest likelihood of
ensuring that all groups of students specified in section
1111(b)(2)(B)(iv) and enrolled in the school will meet the
State's proficient level of performance on the State
assessment described in section 1111(b)(4) within 10 years
after the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act;
``(iii) provide an assurance that the school will reserve
not less than 10 percent of the funds made available to the
school under this part for each fiscal year that the school
is in school improvement status, for the purpose of providing
to the school's teachers and principal high quality
professional development that--
``(I) directly addresses the academic performance problem
that caused the school to be identified for school
improvement; and
``(II) meets the requirements for professional development
activities under section 1119A;
``(iv) specify how the funds described in clause (iii) will
be used to remove the school from school improvement status;
``(v) establish specific annual, numerical progress goals
for each group of students specified in section
1111(b)(2)(B)(iv) and enrolled in the school that will ensure
that all such groups of students will meet the State's
proficient level of performance on the State assessment
described in section 1111(b)(4) within 10 years after the
date of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act;
``(vi) identify how the school will provide written
notification about the identification to parents of each
student enrolled in such school, in a format and, to the
extent practicable, in a language such parents can
understand; and
``(vii) specify the responsibilities of the school, the
local educational agency, and the State educational agency
serving such school under the plan.
``(B) The local educational agency described in
subparagraph (A)(vii) may condition approval of a school plan
on inclusion of 1 or more of the corrective actions specified
in paragraph (10)(D).
``(C) A school shall implement the school plan (including a
revised plan) expeditiously, but not later than the beginning
of the school year following the school year in which the
school was identified for school improvement.
``(D) The local educational agency described in
subparagraph (A)(vii) shall establish a peer review process
to assist with review of a school plan prepared by a school
served by the local educational agency, promptly review the
school plan, work with the school as necessary, and approve
the school plan if the school plan meets the requirements of
this paragraph.
``(9) Technical assistance.--(A) For each school identified
for school improvement under paragraph (1), the local
educational agency serving the school shall provide technical
assistance as the school develops and implements the school
plan.
``(B) Such technical assistance--
``(i) shall include assistance in analyzing data from the
assessments required under section 1111(b)(4), and other
samples of student work, to identify and address
instructional problems and solutions;
``(ii) shall include assistance in identifying and
implementing instructional strategies and methods that are
tied to scientifically based research and that have proven
effective in addressing the specific instructional issues
that caused the school to be identified for school
improvement;
``(iii) shall include assistance in analyzing and revising
the school's budget so that the school resources are more
effectively allocated for the activities most likely to
increase student performance and to remove the school from
school improvement status; and
``(iv) may be provided--
``(I) by the local educational agency, through mechanisms
authorized under section 1117; or
``(II) with the local educational agency's approval, by the
State educational agency, an institution of higher education
(in full compliance with all the reporting provisions of
title II of the Higher Education Act of 1965), a private not-
for-profit organization or for-profit organization, an
educational service agency, the recipient of a Federal
contract or cooperative agreement as described under section
7104(a)(3), or another entity with experience in helping
schools improve performance.
``(C) Technical assistance provided under this section by a
local educational agency or an entity approved by such agency
shall be based on scientifically based research.
``(10) Corrective action.--(A) In this paragraph, the term
`corrective action' means action, consistent with State and
local law, that--
``(i) substantially and directly responds to--
``(I) the consistent academic failure of a school that
caused the local educational agency to take such action; and
``(II) any underlying staffing, curriculum, or other
problem in the school; and
``(ii) is designed to increase substantially the likelihood
that students enrolled in the school identified for
corrective action will perform at the State's proficient and
advanced levels of performance on the State assessment
described in section 1111(b)(4).
``(B) 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 subparagraphs (C) through (H).
``(C) After providing technical assistance under paragraph
(9) and subject to subparagraph (G), the local educational
agency--
``(i) may identify for corrective action and take
corrective action at any time with respect to a school that
is served by the local

[[Page S1281]]

educational agency and that has been identified under
paragraph (1);
``(ii) shall identify for corrective action and take
corrective action with respect to any school served by the
local educational agency that fails to make adequate yearly
progress, as defined by the State under section 1111(b)(2),
at the end of the second year after the school year in which
the school was identified under paragraph (1); and
``(iii) shall continue to provide technical assistance
while instituting any corrective action under clause (i) or
(ii).
``(D) In the case of a school described in subparagraph
(C)(ii), the local educational agency shall take corrective
action by--
``(i)(I) withholding funds from the school;
``(II) making alternative governance arrangements,
including reopening the school as a public charter school;
``(III) reconstituting the relevant school staff; or
``(IV) instituting and fully implementing a new curriculum,
including providing appropriate professional development for
all relevant staff, that is tied to scientifically based
research and offers substantial promise of improving
educational performance for low-performing students; and
``(ii)(I) authorizing students to transfer (consistent with
the requirements of paragraph (7)) to higher performing
public schools served by the local educational agency,
including public charter and magnet schools; and
``(II) providing to such students transportation services,
or paying for the cost of transportation, to such schools
(except that the funds used by the local educational agency
to provide the transportation services or pay for the cost of
transportation shall not exceed 10 percent of the amount
allocated to the local educational agency under this part.
``(E) A local educational agency may delay, for a period
not to exceed 1 year, implementation of corrective action
only if the school's failure to make adequate yearly progress
was justified due to exceptional or uncontrollable
circumstances, such as a natural disaster or a precipitous
and unforeseen decline in the financial resources of the
local educational agency or school.
``(F) The local educational agency shall publish and
disseminate information regarding any corrective action the
local educational agency takes under this paragraph at a
school--
``(i) to the public and to the parents of each student
enrolled in the school subject to corrective action;
``(ii) in a format and, to the extent practicable, in a
language that the parents can understand; and
``(iii) through such means as the Internet, the media, and
public agencies.
``(G)(i) Before identifying a elementary school or a
secondary school corrective action under this paragraph, the
local educational agency shall provide the school with an
opportunity to review the school level data, including
assessment data, on which the proposed identification is
based.
``(ii) If the principal of the school believes that the
proposed determination is in error for statistical or other
substantive reasons, the principal may provide supporting
evidence to the local educational agency, which shall
consider such evidence before making a final determination.
``(H) Not later than 30 days after a local educational
agency makes an initial determination concerning identifying
a school served by the agency and receiving assistance under
this part, the local educational agency shall make public a
final determination on the status of the school.
``(11) State educational agency responsibilities.--If a
State educational agency determines that a local educational
agency failed to carry out the agency's responsibilities
under this section, or determines that, after 1 year of
implementation of corrective action, such action has not
resulted in sufficient progress in increased student
performance, the State educational agency shall take such
action as the agency finds necessary, including designating a
course of corrective action described in paragraph (10)(D),
consistent with this section, to improve the affected schools
and to ensure that the local educational agency carries out
the local educational agency's responsibilities under this
section.
``(12) Special rules.--Schools that, for at least 2 of the
3 years following identification under paragraph (1), make
adequate yearly progress toward meeting the State's
proficient and advanced levels of performance on the State
assessment described in section 1111(b)(4) shall no longer be
identified for school improvement.''.
(c) State Review and Local Educational Agency
Improvement.--Section 1116(d) (20 U.S.C. 6317(d)) is amended
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
within the State receiving funds under this part to determine
whether schools served by such agencies and receiving
assistance under this part are making adequate yearly
progress, as defined under section 1111(b)(2), toward meeting
the State's student performance standards and to determine
whether each local educational agency is carrying out its
responsibilities under sections 1116 and 1117.
``(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 in improvement status under this section on the
day before the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act.
``(3) Transition.--The 2-year period described in paragraph
(2)(A) shall include any continuous period of time
immediately before the date of enactment of the Public
Education Reinvestment, Reinvention, and Responsibility 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 before the date of enactment of the
Public Education Reinvestment, Reinvention, and
Responsibility Act.
``(4) Targeted assistance schools.--To determine if a local
educational agency that serves elementary schools or
secondary schools that are conducting targeted assistance
programs under section 1115 should be identified for
improvement under this subsection, a State educational agency
may choose to review the progress of only the students in
such schools who are served, or who are eligible for
services, 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 provide
the local educational agency with an opportunity to review
the local educational agency data, including assessment data,
on which the proposed identification is based.
``(B) If the local educational agency believes that the
proposed identification is in error for statistical or other
substantive reasons, the local educational agency may provide
supporting evidence to the State educational agency, which
shall consider such evidence before making a final
determination.
``(6) Time limits.--Not later than 45 days after the State
educational agency makes an initial determination concerning
identifying a local educational agency within the State and
receiving assistance under this part for improvement, the
State educational agency shall make public a final
determination on the status of the local educational agency.
``(7) Notification to parents.--The State educational
agency shall promptly notify parents of each student enrolled
in a school served by a local educational agency identified
for improvement, in a format, and to the extent practicable,
in a language the parents can understand, of--
``(A) the reasons for such identification; and
``(B) how the parents can participate in upgrading the
quality of the local educational agency.
``(8) Local educational agency plan.--(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, in consultation with
parents, teachers and other school staff, the local school
board, and others, for approval by the State educational
agency. Such plan shall--
``(i) incorporate scientifically based research strategies
that strengthen the core academic subjects in schools served
by the local educational agency;
``(ii) identify specific annual numerical academic
performance objectives in at least the areas of mathematics
and English language arts that the local educational agency
will meet, with such objectives being calculated in a manner
so that their achievement will ensure that each group of
students enrolled in each school served by the local
educational agency will meet the State's proficient level of
performance on the State assessment described in section
1111(b)(4) within 10 years after the date of enactment of the
Public Education Reinvestment, Reinvention, and
Responsibility Act; and
``(iii) provide an assurance that the local educational
agency will--
``(I) reserve not less than 10 percent of the funds made
available to the local educational agency under this part for
each fiscal year that the agency is in improvement status for
the purpose of providing to teachers and principals at
schools served by the agency and receiving funds under this
part high quality professional development that--

``(aa) directly addresses the academic performance problem
that caused the local educational agency to be identified for
improvement; and
``(bb) meets the requirements for professional development
activities under section 1119A; and

``(II) specify how the funds described in subclause (I)
will be used to remove the local educational agency from
improvement status;
``(iv) identify how the local educational agency will
provide written notification about the identification to
parents described in paragraph (7) in a format and, to the
extent practicable, in a language, that such parents can
understand, pursuant to paragraph (7);
``(v) specify the responsibilities of the local educational
agency and the State educational agency under the plan; and
``(vi) include a review of the local educational agency
budget to ensure that resources are allocated for the
activities that are most likely to improve student
performance and to remove the agency from improvement status.
``(B) The local educational agency shall implement the
local educational agency plan

[[Page S1282]]

(including a revised plan) expeditiously, but not later than
the beginning of the school year following the school year in
which the agency was identified for improvement.
``(C) The State educational agency shall establish a peer
review process to assist with review of the local educational
agency plan, promptly review the plan, work with the local
educational agency as necessary, and approve the plan if the
plan meets the requirements of this paragraph.
``(D) If the local educational agency budget, in allocating
resources to activities, fails to allocate resources as
described in subparagraph (A)(vi), the State educational
agency may direct the local educational agency to reallocate
resources to more effective activities.
``(9) State educational agency responsibility.--For each
local educational agency identified under paragraph (2), the
State educational agency shall provide technical or other
assistance, if requested, as authorized under section 1117,
to better enable the local educational agency--
``(A) to develop and implement a local educational agency
plan (including a revised plan) that is approved by the State
educational agency consistent with the requirements of this
section; and
``(B) to work with schools served by the local educational
agency that are identified for school improvement.
``(10) Technical assistance.--The technical assistance
provided by the State educational agency--
``(A) shall include assistance in analyzing data from the
assessments required under section 1111(b)(4) and other
samples of student work, to identify and address
instructional problems and solutions;
``(B) shall include assistance in identifying and
implementing instructional strategies and methods that are
tied to scientifically based research and that have proven
effective in addressing the specific instructional issues
that caused the local educational agency to be identified for
improvement;
``(C) shall include assistance in analyzing and revising
the local educational agency's budget so that the agency's
resources are more effectively allocated for the activities
most likely to increase student performance and to remove the
agency from improvement status; and
``(D) may be provided by--
``(i) the State educational agency; or
``(ii) with the local educational agency's approval, by an
institution of higher education (in full compliance with all
the reporting provisions of title II of the Higher Education
Act of 1965), a private not-for-profit organization or for-
profit organization, an educational service agency, the
recipient of a Federal contract or cooperative agreement as
described under section 7104(a)(3), or another entity with
experience in helping schools improve performance.
``(11) Resources reallocation.--The State educational
agency may, as a condition of providing the local educational
agency with technical assistance and financial support in
developing and carrying out a local educational agency plan,
require that the local educational agency reallocate
resources from ineffective or inefficient activities to
activities that, through scientifically based research, have
been proven to have the greatest impact on increasing student
performance and closing the achievement gap between groups of
students.
``(12) Corrective action.--(A) In this paragraph, the term
`corrective action' means action, consistent with State law,
that--
``(i) substantially and directly responds to--
``(I) the consistent academic failure of schools served by
a local educational agency that caused the State educational
agency to take such action with respect to the local
educational agency; and
``(II) any underlying staffing, curriculum, or other
problem in the schools served by the local educational
agency; and
``(ii) is designed to increase substantially the likelihood
that students enrolled in the schools served by the local
educational agency identified for corrective action will
perform at the State's proficient and advanced levels of
performance on the State assessment described in section
1111(b)(4).
``(B) 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 subparagraphs (C) through (H).
``(C) After providing technical assistance, if requested,
under paragraphs (9) and (10), and subject to subparagraph
(E), the State educational agency--
``(i) shall identify for corrective action and take
corrective action with respect to any local educational
agency that fails to make adequate yearly progress, as
defined by the State under section 1111(b)(2), at the end of
the second year after the school year in which the local
educational agency was identified under paragraph (2); and
``(ii) shall continue to provide technical assistance while
instituting any corrective action under clause (i).
``(D) In the case of a local educational agency described
in subparagraph (C)(ii), the State educational agency shall
take corrective action by--
``(i)(I) withholding funds from the local educational
agency;
``(II) reconstituting the relevant local educational agency
personnel;
``(III) removing particular schools from the jurisdiction
of the local educational agency, and establishing alternative
arrangements for public governance and supervision of such
schools;
``(IV) appointing a receiver or trustee to administer the
affairs of the local educational agency in place of the local
educational agency's superintendent and school board; or
``(V) abolishing or restructuring the local educational
agency; and
``(ii)(I) authorizing students to transfer (consistent with
the requirements of section 1116(c)(7)) from schools served
by the local educational agency to higher performing public
schools, including public charter and magnet schools, served
by another local educational agency; and
``(II) providing to such students transportation services,
or paying for the cost of transportation, to such higher
performing schools (except that the funds used by the local
educational agency to provide the transportation services or
pay for the cost of transportation shall not exceed 10
percent of the amount allocated to the local educational
agency under this part.
``(E) The State educational agency may delay, for a period
not to exceed 1 year, implementation of corrective action
only if the local educational agency's failure to make
adequate yearly progress was justified due to exceptional or
uncontrollable circumstances, such as a natural disaster or a
precipitous and unforeseen decline in the financial resources
of the local educational agency or schools served by the
local educational agency.
``(F) The State educational agency shall publish and
disseminate information regarding any corrective action the
State educational agency takes under this paragraph--
``(i) to the public and to the parents described in
paragraph (7) and the public;
``(ii) in a format and, to the extent practicable, in a
language that the parents can understand; and
``(iii) through such means as the Internet, the media, and
public agencies.
``(G) Prior to determining whether to take a corrective
action with respect to a local educational agency under this
paragraph, the State educational agency shall provide the
local educational agency with notice and a opportunity for a
hearing, if State law provides for such notice and
opportunity.
``(H) Not later than 45 days after the State educational
agency makes an initial determination regarding taking a
corrective action concerning a local educational agency in
the State and receiving assistance under this part, the State
educational agency shall make public a final determination on
the status of the local educational agency.''.
(d) Definition.--Section 1116 (20 U.S.C. 6317) is amended
by adding at the end the following:
``(f) Definition.--In this section, the term `charter
school' has the meaning given the term in section 4210.''.

SEC. 116. STATE ASSISTANCE FOR SCHOOL SUPPORT AND
IMPROVEMENT.

Section 1117 (20 U.S.C. 6318) is amended to read as
follows:

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

``(a) System for Support.--Using funds described in
subsection (e), each State educational agency shall establish
a statewide system of intensive and sustained support and
improvement for local educational agencies, elementary
schools, and secondary schools receiving funds under this
part, in order to ensure that all groups of students
specified in section 1111(b)(2)(B)(iv) and attending such
schools meet the State's proficient level of performance on
the State assessments described in section 1111(b)(4) within
10 years after the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act.
``(b) Priorities.--In carrying out this section during an
academic year, a State educational agency shall--
``(1) first, provide support and technical assistance to
local educational agencies identified for corrective action
under section 1116, and assist elementary schools and
secondary schools, in accordance with section 1116(c)(11),
for which a local educational agency has failed to carry out
the agency's responsibilities under paragraphs (9) and (10)
of section 1116(c);
``(2) second, provide support and technical assistance to
local educational agencies and schools identified for
improvement under section 1116; and
``(3) third, provide support and technical assistance to
local educational agencies and schools participating under
this part that are at risk of being identified for
improvement during the subsequent academic year.
``(c) Approaches.--In order to achieve the objective
described in subsection (a), the State educational agency
shall ensure that the statewide system will provide support
and technical assistance through approaches such as--
``(1) using school support teams, composed of individuals
who are knowledgeable about scientifically based research,
about teaching and learning practices, and particularly about
strategies for improving educational results for low-
performing students; and
``(2) designating and using distinguished educators, who
are chosen from schools served under this part that have been
especially successful in improving academic performance.
``(d) Alternatives.--The State educational agency may--

[[Page S1283]]

``(1) devise additional approaches to providing the support
and technical assistance described in subsection (c), such as
providing assistance through institutions of higher
education, educational service agencies, or other local
consortia; and
``(2) seek approval from the Secretary to use funds under
section 1003(b) for such approaches as part of the State
plan.
``(e) Funds.--The State educational agency--
``(1) shall use funds reserved under section 1003(a), but
not used under section 1003(b), to carry out this section;
and
``(2) may use State administrative funds authorized under
section 1703(c) to carry out this section.''.

SEC. 117. PARENTAL INVOLVEMENT.

(a) Local Educational Agency Policy.--Section 1118(a) (20
U.S.C. 6319(a)) is amended--
(1) in paragraph (1), by striking ``programs, activities,
and procedures'' and inserting ``activities and procedures'';
(2) in paragraph (2), by striking subparagraphs (E) and (F)
and inserting the following:
``(E) conduct, with the involvement of parents, an annual
evaluation of the content of the parental involvement policy
developed under such section and the effectiveness of the
policy in improving the academic quality of the schools
served under this part;
``(F) involve parents in the activities of the schools
served under this part; and
``(G) promote consumer friendly environments within the
local educational agency and schools served under this
part.''; and
(3) in paragraph (3), by adding at the end the following
new subparagraph:
``(C) Not less than 90 percent of the funds reserved under
subparagraph (A) shall be distributed to schools served under
this part.''.
(b) Notice.--Section 1118(b)(1) (20 U.S.C. 6319(b)(1)) is
amended by inserting after the first sentence the following:
``Parents shall be notified of the policy in a format and, to
the extent practicable, in a language, that the parents can
understand.''.
(c) Parental Involvement.--Section 1118(c)(4) (20 U.S.C.
6319(c)(4)) is amended--
(1) in subparagraph (B), by striking ``school performance
profiles required under section 1116(a)(3)'' and inserting
``school reports described in section 4401'';
(2) by redesignating subparagraphs (D) and (E) as
subparagraphs (F) and (G), respectively;
(3) by inserting after subparagraph (C) the following:
``(D) notice of the school's identification for school
improvement under section 1116(c), if applicable, and a clear
explanation of what such identification means;
``(E) notice of corrective action taken against the school
under section 1116(c)(10) or the local educational agency
involved under section 1116(d)(12), if applicable, and a
clear explanation of what such action means;''; and
(4) in subparagraph (G) (as redesignated by paragraph (2)),
by striking ``subparagraph (D)'' and inserting ``subparagraph
(F)''.
(d) Building Capacity for Involvement.--Section 1118(e) (20
U.S.C 6319(e)) is amended--
(1) in paragraph (1), by striking ``National Educational
Goals,'';
(2) by redesignating paragraphs (14) and (15) as paragraphs
(16) and (17), respectively;
(3) by inserting after paragraph (13) the following:
``(14) may establish a parent advisory council to advise on
all matters related to parental involvement in programs
supported under this part;'';
(4) by redesignating paragraph (5) as paragraph (15) and
inserting such paragraph after paragraph (14) (as inserted by
paragraph (3));
(5) by inserting after paragraph (4) the following:
``(5) shall expand the use of electronic communication
among teachers, students, and parents, such as communication
through the use of websites and e-mail communication;'';
(6) in paragraph (7), by inserting ``, to the extent
practicable, in a language and format the parent can
understand'' before the semicolon; and
(7) in paragraph (15) (as redesignated by paragraph (4)),
by striking ``shall'' and inserting ``may''.
(e) Accessibility.--Section 1118(f) (20 U.S.C. 6319(f)) is
amended by striking ``, including'' and all that follows and
inserting ``and of parents of migratory children, including
providing information required under section 1111 and school
reports described in section 4401 in a language and format
such parents can understand.''.

SEC. 118. QUALIFICATIONS FOR TEACHERS AND PARAPROFESSIONALS.

Title I (20 U.S.C. 6301 et seq.) is amended--
(1) by redesignating section 1119 (20 U.S.C. 6320) as
section 1119A; and
(2) by inserting after section 1118 the following:

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

``(a) In General.--
``(1) Plan.--Each State educational agency receiving
assistance under this part shall develop and submit to the
Secretary a plan to ensure that all teachers teaching within
the State are fully qualified not later than December 31,
2006. Such plan shall include an assurance that the State
educational agency will require each local educational agency
or school receiving funds under this part publicly to report
on annual progress with respect to the local educational
agency's or school's performance in increasing the percentage
of classes in core academic subjects (as defined in section
2002) taught by fully qualified teachers.
``(2) Special rule.--Notwithstanding any other provision of
law, the provisions of this section governing teacher
qualifications shall not supersede State laws governing
public charter schools (as defined in section 4210).
``(b) New Paraprofessionals.--Each local educational agency
receiving assistance under this part shall ensure that each
paraprofessional hired after December 31, 2004, and working
in a program assisted under this part--
``(1) has completed at least the number of courses at an
institution of higher education in the area of elementary
education, or in the academic subject in which the
paraprofessional is working, for a minor in elementary
education or that subject at such institution;
``(2) has obtained an associate's (or higher) degree; or
``(3) has met a rigorous standard of quality, through
formal State certification (as described in subsection (h)),
that demonstrates, as appropriate--
``(A) knowledge of, and the ability to provide tutorial
assistance in, reading, writing, and mathematics; or
``(B) knowledge of, and the ability to provide tutorial
assistance in, reading readiness, writing readiness, and
mathematics readiness.
``(c) Existing Paraprofessionals.--Each local educational
agency receiving assistance under this part shall ensure
that, not later than 4 years after the date of enactment of
the Public Education Reinvestment, Reinvention, and
Responsibility Act, each paraprofessional working in a
program assisted under this part shall have satisfied the
requirements of subsection (b).
``(d) Exceptions for Translation and Parental Involvement
Activities.--Subsections (b) and (c) shall not apply to a
paraprofessional--
``(1) who is proficient in English and a language other
than English, and who provides services primarily to enhance
the participation of students in programs under this part by
acting as a translator; or
``(2) whose duties consist solely of conducting parental
involvement activities consistent with section 1118 or other
school readiness activities that are noninstructional.
``(e) General Requirement for All Paraprofessionals.--Each
local educational agency receiving assistance under this part
shall ensure that each paraprofessional working in a program
assisted under this part, regardless of the
paraprofessional's hiring date, has obtained a secondary
school diploma or its recognized equivalent.
``(f) Duties of Paraprofessionals.--
``(1) In general.--Each local educational agency receiving
assistance under this part shall ensure that a
paraprofessional working in a program assisted under this
part is not assigned a duty inconsistent with this
subsection.
``(2) Authorized responsibilities.--A paraprofessional
described in paragraph (1) may be assigned--
``(A) to provide 1-on-1 tutoring for eligible students
under this part, if the tutoring is scheduled at a time when
the student would not otherwise receive instruction from a
teacher;
``(B) to assist with classroom management, such as
organizing instructional and other materials;
``(C) to provide assistance in a computer laboratory;
``(D) to conduct parental involvement activities or school
readiness activities that are noninstructional;
``(E) to provide support in a library or media center;
``(F) to act as a translator; or
``(G) to provide assistance with the provision of
instructional services to students.
``(3) Limitations.--A paraprofessional described in
paragraph (1)--
``(A) shall not perform the duties of a certified or
licensed teacher or a substitute;
``(B) shall not perform any duty assigned under paragraph
(2) except under the direct supervision of a fully qualified
teacher or other appropriate professional; and
``(C) may not provide assistance with the provision of
instructional services to students in the area of reading,
writing, or mathematics unless the paraprofessional has
demonstrated, through State certification as described in
subsection (b)(3), the ability to effectively provide the
assistance.
``(g) Uses of Funds.--Notwithstanding subsection (h)(2), a
local educational agency receiving funds under this part may
use such funds to support ongoing training and professional
development to assist teachers and paraprofessionals in
satisfying the requirements of this section.
``(h) State Certification.--Each State educational agency
receiving assistance under this part shall--
``(1) ensure that the State educational agency has in place
State criteria for the certification of paraprofessionals by
December 31, 2003; and
``(2) ensure that paraprofessionals hired before December
31, 2004 who do not meet the requirements of subsection (b)
are in high-quality professional development activities that
are aimed at assisting paraprofessionals in meeting the
requirements of subsection (b) and that ensure that a
paraprofessional has the ability to carry out the duties
described in subsection (f).

[[Page S1284]]

``(i) Verification of Compliance.--
``(1) In general.--In verifying compliance with this
section, each local educational agency, at a minimum, shall
require that each principal of an elementary school or
secondary school operating a program under section 1114 or
1115 annually attest in writing as to whether the school is
in compliance with the requirements of this section.
``(2) Availability of information.--Copies of the annual
attestation described in paragraph (1)--
``(A) shall be maintained at each elementary school and
secondary school operating a program under section 1114 or
1115 and at the main office of the local educational agency;
and
``(B) shall be available to any member of the general
public on request.''.

SEC. 119. PROFESSIONAL DEVELOPMENT.

Section 1119A (as redesignated by section 118(1)) is
amended--
(1) by striking subsection (a) and inserting the following:
``(a) Purpose.--The purpose of this section is to assist
each local educational agency receiving assistance under this
part in increasing the academic achievement of eligible
children (as identified under section 1115(b)(1)(B))
(referred to in this section as `eligible children') through
improved teacher quality.'';
(2) in subsection (b)--
(A) by amending paragraph (1) to read as follows:
``(1) Required activities.--Each local educational agency
receiving assistance under this part shall provide
professional development activities under this section that
shall--
``(A) give teachers, principals, and administrators the
knowledge and skills to provide eligible children with the
opportunity to meet challenging State or local content
standards and student performance standards;
``(B) support the recruiting, hiring, and training of fully
qualified teachers;
``(C) advance teacher understanding of effective
instructional strategies, based on scientifically based
research, for improving eligible children achievement in, at
a minimum, English language arts, mathematics, and science;
``(D) be directly related to the curricula and academic
subjects that a teacher teaches;
``(E) be designed to enhance the ability of a teacher to
understand and use the State's standards for the academic
subject that the teacher teaches;
``(F) be tied to scientifically based research that
demonstrates the effectiveness of such professional
development activities in increasing the achievement of
eligible children or substantially increasing the subject
matter knowledge, teaching knowledge, and teaching skills of
teachers;
``(G) be of sufficient intensity and duration (not to
include such activities as 1-day or short-term workshops and
conferences) to have a positive and lasting impact on
teachers' performance in the classroom, except that this
subparagraph shall not apply to an activity if such activity
is 1 component described in a long-term comprehensive
professional development plan--
``(i) established by the teacher and the teacher's
supervisor; and
``(ii) based on an assessment of the needs of the teacher,
the teacher's students who are eligible children, and the
local educational agency involved;
``(H) be developed with extensive participation of
teachers, principals, parents, administrators, and local
school boards of schools to be served under this part;
``(I) to the extent appropriate, provide training for
teachers regarding using technology and applying technology
effectively in the classroom, to improve teaching and
learning concerning the curricula and academic subjects that
the teachers teach;
``(J) as a whole, be regularly evaluated for such
activities' impact on increased teacher effectiveness and
improved student achievement, with the findings of such
evaluations used to improve the quality of professional
development; and
``(K) include strategies for identifying and eliminating
gender and racial bias in instructional materials, methods,
and practices.''; and
(B) in paragraph (2)--
(i) in subparagraph (A), by inserting ``and data to provide
information and instruction for classroom practice'' before
the semicolon;
(ii) by striking subparagraphs (D) and (G);
(iii) by redesignating subparagraphs (E), (F), (H), and
(I), as subparagraphs (D), (E), (F) and (G), respectively;
(iv) in subparagraph (F) (as redesignated by clause (iii)),
by striking ``and'' after the semicolon;
(v) in subparagraph (G) (as redesignated by clause (iii)),
by striking the period and inserting a semicolon; and
(vi) by adding at the end (as redesignated by clause (iii))
the following new subparagraph:
``(H) instruction in the ways that teachers, principals,
and guidance counselors can work with students (and the
parents of the students) from groups, such as females and
minorities, that are underrepresented in careers in
mathematics, science, engineering, and technology, to
encourage and maintain the interest of such students in those
careers; and
``(I) programs that are designed to assist new teachers
during their first 3 years of teaching, such as mentoring
programs that--
``(i) provide mentoring to new teachers from veteran
teachers with expertise in the same academic subject as the
new teachers are teaching;
``(ii) provide mentors time for activities such as
coaching, observing, and assisting teachers who are being
mentored; and
``(iii) use standards or assessments that are consistent
with the State's student performance standards and the
requirements for professional development activities
described in section 2109 in order to guide the new
teachers.'';
(3) by striking subsections (f) through (i); and
(4) by adding after subsection (e) the following:
``(f) Consolidation of Funds.--Funds provided under this
part that are used for professional development purposes may
be consolidated with funds provided under title II and other
sources.''.

SEC. 120. FISCAL REQUIREMENTS.

Section 1120A(a) (20 U.S.C. 6322(a)) is amended by striking
``section 14501'' and inserting ``section 8501''.

SEC. 121. COORDINATION REQUIREMENTS.

Section 1120B (20 U.S.C. 6323) is amended--
(1) in subsection (a), by striking ``to the extent
feasible'' and all that follows through the period and
inserting ``in coordination with local Head Start agencies
and, if feasible, entities carrying out other early childhood
development programs.''; and
(2) in subsection (b)--
(A) in paragraph (3), by striking ``and'' after the
semicolon;
(B) in paragraph (4), by striking the period and inserting
``; and''; and
(C) by adding at the end, the following:
``(5) linking the educational services provided by such
local educational agency with the services provided by local
Head Start agencies.''.

SEC. 122. LIMITATIONS ON FUNDS.

Subpart 1 of part A of title I (20 U.S.C. 6311 et seq.) is
amended by inserting after section 1120B (20 U.S.C. 6323) the
following:

``SEC. 1120C. LIMITATIONS ON FUNDS.

``(a) In General.--Notwithstanding any other provision of
this Act, a local educational agency shall use funds received
under this part only to provide academic instruction and
services directly related to the instruction to students in
preschool through grade 12 to assist eligible children to
improve their academic achievement and to meet achievement
standards established by the State.
``(b) Permissible and Prohibited Activities.--In this
subpart, the term `academic instruction'--
``(1) includes--
``(A) the employment of teachers and other instructional
personnel, including providing teachers and instructional
personnel with employee benefits;
``(B) the extension of instruction described in this
subsection beyond the normal school day and year, including
during summer school;
``(C) the provision of instructional services to pre-
kindergarten children to prepare such children for the
transition to kindergarten;
``(D) the purchase of instructional resources, such as
books, materials, computers, other instructional equipment,
and wiring to support instructional equipment;
``(E) the development and administration of curricula,
educational materials, and assessments;
``(F) the implementation of--
``(i) instructional interventions in schools in need of
improvement; and
``(ii) corrective actions to improve student achievement;
and
``(G) the transportation of students to assist the students
in improving academic achievement, except that not more than
10 percent of the funds made available under this part to a
local educational agency shall be used to carry out this
subparagraph; and
``(2) does not include--
``(A) the purchase or provision of janitorial services or
the payment of utility costs;
``(B) the construction or operation of facilities;
``(C) the acquisition of real property;
``(D) the payment of costs for food and refreshments; or
``(E) the purchase or lease of vehicles.''.

SEC. 123. GRANTS FOR THE OUTLYING AREAS AND THE SECRETARY OF
THE INTERIOR.

Section 1121 (20 U.S.C. 6331) is amended to read as
follows:

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

``(a) Reservation of Funds.--From the amount appropriated
for payments to States for any fiscal year under section
1002(a), the Secretary shall reserve a total of 1 percent to
provide assistance to--
``(1) the outlying areas on the basis of their respective
need for such assistance according to such criteria as the
Secretary determines will best carry out the purpose of this
part; and
``(2) the Secretary of the Interior in the amount necessary
to make payments pursuant to subsection (c).
``(b) Assistance to the Outlying Areas.--
``(1) In general.--From amounts made available under
subsection (a) in each fiscal year, the Secretary shall make
grants to local educational agencies in the outlying areas
(other than the outlying areas assisted under paragraph (2)).

[[Page S1285]]

``(2) Competitive grants.--(A) For each fiscal year through
2001, the Secretary shall reserve $5,000,000 from the amounts
made available under subsection (a) to award grants on a
competitive basis, to local educational agencies in the
Federated States of Micronesia, the Republic of the Marshall
Islands, and the Republic of Palau. The Secretary shall award
such grants according to the recommendations of the Pacific
Region Educational Laboratory which shall conduct a
competition for such grants.
``(B) Except as provided in subparagraph (D), grant funds
awarded under this part only may be used for programs
described in this Act, including teacher training, curriculum
development, instructional materials, or general school
improvement and reform.
``(C) Grant funds awarded under this paragraph may only be
used to provide direct educational services.
``(D) The Secretary may provide 5 percent of the amount
made available for grants under this paragraph to pay the
administrative costs of the Pacific Region Educational
Laboratory regarding activities assisted under this
paragraph.
``(c) Allotment to the Secretary of the Interior.--
``(1) In general.--The amount allotted for payments to the
Secretary of the Interior under subsection (a)(2) for any
fiscal year shall be, as determined pursuant to criteria
established by the Secretary, the amount necessary to meet
the special educational needs of--
``(A) Indian children on reservations served by elementary
schools and secondary schools for Indian children operated or
supported by the Department of the Interior; and
``(B) out-of-State Indian children in elementary schools
and secondary schools in local educational agencies under
special contracts with the Department of the Interior.
``(2) Payments.--From the amount allotted for payments to
the Secretary of the Interior under subsection (a)(2), the
Secretary of the Interior shall make payments to local
educational agencies, upon such terms as the Secretary
determines will best carry out the purposes of this part,
with respect to out-of-State Indian children described in
paragraph (1). The amount of such payment may not exceed, for
each such child, the greater of--
``(A) 40 percent of the average per pupil expenditure in
the State in which the agency is located; or
``(B) 48 percent of such expenditure in the United
States.''.

SEC. 124. AMOUNTS FOR GRANTS.

Section 1122 (20 U.S.C. 6332) is amended to read as
follows:

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

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

SEC. 125. BASIC GRANTS TO LOCAL EDUCATIONAL AGENCIES.

(a) Findings.--Congress finds that--
(1) according to the Department of Education, 58 percent of
all elementary schools and secondary schools receive at least
some funds under title I of the Elementary and Secondary
Education Act of 1965 (referred to in this section as ``title
I funds'');
(2) of the elementary schools and secondary schools that
receive no title I funds at all, a disturbing number have
high concentrations of poor students;
(3) 1 out of every 5 elementary schools and secondary
schools with poverty rates between 50 percent and 75 percent
do not get any title I funds;
(4) a school district qualifies for funding through basic
grants made under such title I if at least 2 percent of the
students in the school district are from families with
incomes below the poverty line;
(5) 9 out of every 10 school districts receive some title I
funds; and
(6) Congress has never appropriated funding to provide
targeted grants under such title I.
(b) Sense of Congress.--It is the sense of Congress that--
(1) title I funds are distributed so broadly that many of
the Nation's elementary schools and secondary schools with
high poverty rates are not receiving on title I funds;
(2) the Federal Government is not living up to the original
intent of the Elementary and Secondary Education Act of 1965,
which was to focus Federal funding to ensure that poor
students have equal access to a quality education;
(3) it is the role of the Federal Government to provide
targeted funding for school districts in which the Nation's
poorest students live, while holding States and localities
accountable for raising the academic performance of all
students in the United States to a higher level; and
(4) the Federal Government must take a firm stand to better
focus Federal funds on the Nation's poorest school districts
through a new formula for the title I funds that will ensure
that the funds are targeted so that elementary schools and
secondary schools in high-poverty urban and rural areas get
the Federal resources for education that the schools need and
deserve.
(c) General Authority.--Section 1124 (20 U.S.C. 6333) is
amended to read as follows:

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

``(a) Amount of Grants.--
``(1) Grants for local educational agencies and puerto
rico.--Except as provided in paragraph (4) and in section
1126, the grant that a local educational agency is eligible
to receive under this section for a fiscal year is the amount
determined by multiplying--
``(A) the number of children counted under subsection (c);
and
``(B) 40 percent of the average per-pupil expenditure in
the State, except that the amount determined under this
subparagraph shall not be less than 32 percent, and not more
than 48 percent, of the average per-pupil expenditure in the
United States.
``(2) Calculation of grants.--(A) The Secretary shall
calculate grants under this section on the basis of the
number of children counted under subsection (c) for local
educational agencies, unless the Secretary and the Secretary
of Commerce determine that some or all of those data are
unreliable or that their use would be otherwise
inappropriate, in which case--
``(i) the 2 Secretaries shall publicly disclose the reasons
for their determination in detail; and
``(ii) paragraph (3) shall apply.
``(B)(i) For any fiscal year to which this paragraph
applies, the Secretary shall calculate grants under this
section for each local educational agency.
``(ii) The amount of a grant under this section for each
large local educational agency shall be the amount determined
under clause (i).
``(iii) For small local educational agencies, the State
educational agency may either--
``(I) distribute grants under this section in amounts
determined by the Secretary under clause (i); or
``(II) use an alternative method, developed in accordance
with clause (iv), approved by the Secretary to distribute the
portion of the State's total grants under this section that
is based on those small agencies.
``(iv) An alternative method under clause (iii)(II) shall
be based on population data

[[Page S1286]]

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

SEC. 126. CONCENTRATION GRANTS.

Section 1124A (20 U.S.C. 6334) is amended to read as
follows:

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

``(a) Eligibility for and Amount of Grants.--
``(1) In general.--(A) Except as otherwise provided in this
paragraph, each local educational agency, in a State other
than an outlying area, which is eligible for a grant under
section 1124 for any fiscal year is eligible for an
additional grant under this section for that fiscal year if
the number of children counted under section 1124(c) for the
agency exceeds either--
``(i) 6,500; or
``(ii) 15 percent of the total number of children aged 5
through 17 in the agency.
``(B) Notwithstanding section 1122, no State described in
subparagraph (A) shall receive less than the lesser of--
``(i) 0.25 percent of total grants; or
``(ii) the average of--
``(I) one-quarter of 1 percent of the sums available to
carry out this section for such fiscal year; and

[[Page S1287]]

``(II) the greater of--

``(aa) $340,000; or
``(bb) the number of children in such State counted for
purposes of this section in that fiscal year multiplied by
150 percent of the national average per pupil payment made
with funds available under this section for that year.

``(2) Special rule.--For each county or local educational
agency eligible to receive an additional grant under this
section for any fiscal year the Secretary shall determine the
product of--
``(A) the number of children counted under section 1124(c)
for that fiscal year; and
``(B) the amount in section 1124(a)(1)(B) for all States
except Puerto Rico, and the amount in section 1124(a)(4) for
Puerto Rico.
``(3) Amount.--The amount of the additional grant for which
an eligible local educational agency or county is eligible
under this section for any fiscal year shall be an amount
which bears the same ratio to the amount available to carry
out this section for that fiscal year as the product
determined under paragraph (2) for such local educational
agency for that fiscal year bears to the sum of such products
for all local educational agencies in the United States for
that fiscal year.
``(4) Local allocations.--(A) Grant amounts under this
section shall be determined in accordance with paragraphs (2)
and (3) of section 1124(a).
``(B) For any fiscal year for which the Secretary allocates
funds under this section on the basis of counties, a State
may reserve not more than 2 percent of its allocation under
this section for any fiscal year to make grants to local
educational agencies that meet the criteria of clause (i) or
(ii) of paragraph (1)(A) but that are in ineligible counties.
``(b) States Receiving Minimum Grants.--In States that
receive the minimum grant under subsection (a)(1)(B), the
State educational agency shall allocate such funds among the
local educational agencies in each State either--
``(1) in accordance with paragraphs (2) and (4) of
subsection (a); or
``(2) based on their respective concentrations and numbers
of children counted under section 1124(c), except that only
those local educational agencies with concentrations or
numbers of children counted under section 1124(c) that exceed
the statewide average percentage of such children or the
statewide average number of such children shall receive any
funds on the basis of this paragraph.''.

SEC. 127. TARGETED GRANTS.

Section 1125 (20 U.S.C 6335) is amended to read as follows:

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

``(a) Eligibility of Local Educational Agencies.--A local
educational agency in a State is eligible to receive a
targeted grant under this section for any fiscal year if the
number of children in the local educational agency counted
under section 1124(c), before application of the weighting
factor described in subsection (c), is at least 10, and if
the number of children counted for grants under section 1124
is at least 5 percent of the total population aged 5 to 17
years, inclusive, in the local educational agency. Funds made
available as a result of applying this subsection shall be
reallocated by the State educational agency to other eligible
local educational agencies in the State in proportion to the
distribution of other funds under this section.
``(b) Grants for Local Educational Agencies, the District
of Columbia, and Puerto Rico.--
``(1) In general.--The amount of the grant that a local
educational agency in a State or that the District of
Columbia is eligible to receive under this section for any
fiscal year shall be the product of--
``(A) the weighted child count determined under subsection
(c); and
``(B) the amount in section 1124(a)(1).
``(2) Puerto rico.--For each fiscal year, the amount of the
grant for which the Commonwealth of Puerto Rico is eligible
under this section shall be equal to the number of children
counted under subsection (c) for Puerto Rico, multiplied by
the amount determined in section 1124(a)(4).
``(c) Weighted Child Count.--
``(1) Weights for allocations to counties.--(A) For each
fiscal year for which the Secretary uses county population
data to calculate grants, the weighted child count used to
determine a county's allocation under this section is the
larger of the 2 amounts determined under clause (i) or (ii),
as follows:
``(i) This amount is determined by adding--
``(I) the number of children determined under section
1124(c) for that county constituting up to 12.20 percent,
inclusive, of the county's total population aged 5 to 17,
inclusive, multiplied by 1.0;
``(II) the number of such children constituting more than
12.20 percent, but not more than 17.70 percent, of such
population, multiplied by 1.75;
``(III) the number of such children constituting more than
17.70 percent, but not more than 22.80 percent, of such
population, multiplied by 2.5;
``(IV) the number of such children constituting more than
22.80 percent, but not more than 29.70 percent, of such
population, multiplied by 3.25; and
``(V) the number of such children constituting more than
29.70 percent of such population, multiplied by 4.0.
``(ii) This amount is determined by adding--
``(I) the number of children determined under section
1124(c) constituting up to 1,917, inclusive, of the county's
total population aged 5 to 17, inclusive, multiplied by 1.0;
``(II) the number of such children between 1,918 and 5,938,
inclusive, in such population, multiplied by 1.5;
``(III) the number of such children between 5,939 and
20,199, inclusive, in such population, multiplied by 2.0;
``(IV) the number of such children between 20,200 and
77,999, inclusive, in such population, multiplied by 2.5; and
``(V) the number of such children in excess of 77,999 in
such population, multiplied by 3.0.
``(B) Notwithstanding subparagraph (A), the weighting
factor for Puerto Rico under this paragraph shall not be
greater than the total number of children counted under
section 1124(c) multiplied by 1.72.
``(2) Weights for allocations to local educational
agencies.--(A) For each fiscal year for which the Secretary
uses local educational agency data, the weighted child count
used to determine a local educational agency's grant under
this section is the larger of the 2 amounts determined under
clauses (i) and (ii), as follows:
``(i) This amount is determined by adding--
``(I) the number of children determined under section
1124(c) for that local educational agency constituting up to
14.265 percent, inclusive, of the agency's total population
aged 5 to 17, inclusive, multiplied by 1.0;
``(II) the number of such children constituting more than
14.265 percent, but not more than 21.553 percent, of such
population, multiplied by 1.75;
``(III) the number of such children constituting more than
21.553 percent, but not more than 29.223 percent, of such
population, multiplied by 2.5;
``(IV) the number of such children constituting more than
29.223 percent, but not more than 36.538 percent, of such
population, multiplied by 3.25; and
``(V) the number of such children constituting more than
36.538 percent of such population, multiplied by 4.0.
``(ii) This amount is determined by adding--
``(I) the number of children determined under section
1124(c) constituting up to 575, inclusive, of the agency's
total population aged 5 to 17, inclusive, multiplied by 1.0;
``(II) the number of such children between 576 and 1,870,
inclusive, in such population, multiplied by 1.5;
``(III) the number of such children between 1,871 and
6,910, inclusive, in such population, multiplied by 2.0;
``(IV) the number of such children between 6,911 and
42,000, inclusive, in such population, multiplied by 2.5; and
``(V) the number of such children in excess of 42,000 in
such population, multiplied by 3.0.
``(B) Notwithstanding subparagraph (A), the weighting
factor for Puerto Rico under this paragraph shall not be
greater than the total number of children counted under
section 1124(c) multiplied by 1.72.
``(d) Calculation of Grant Amounts.--Grants under this
section shall be calculated in accordance with paragraphs (2)
and (3) of section 1124(a).
``(e) State Minimum.--Notwithstanding any other provision
of this section or section 1122, from the total amount
available for any fiscal year to carry out this section, each
State shall be allotted at least the lesser of--
``(1) 0.25 percent of total appropriations; or
``(2) the average of--
``(A) one-quarter of 1 percent of the total amount
available to carry out this section; and
``(B) 150 percent of the national average grant under this
section per child described in section 1124(c), without
application of a weighting factor, multiplied by the State's
total number of children described in section 1124(c),
without application of a weighting factor.''.

SEC. 128. EDUCATION FINANCE INCENTIVE PROGRAM.

Section 1125A (20 U.S.C. 6336) is amended to read as
follows:

``SEC. 1125A. EDUCATION FINANCE INCENTIVE PROGRAM.

``(a) Grants.--The Secretary is authorized to make grants
to States from the sums appropriated pursuant to subsection
(e) to carry out the purposes of this part.
``(b) Distribution Based Upon Fiscal Effort and Equity.--
``(1) In general.--Funds appropriated pursuant to
subsection (e) shall be allotted to each State based upon the
number of children aged 5 to 17, inclusive, of such State
multiplied by the product of--
``(A) such State's effort factor described in paragraph
(2); multiplied by
``(B) 1.30 minus such State's equity factor described in
paragraph (3), except that for each fiscal year no State
shall receive less than \1/4\ of 1 percent of the total
amount appropriated pursuant to subsection (e) for such
fiscal year.
``(2) Effort factor.--(A) Except as provided in
subparagraph (B), the effort factor for a State shall be
determined in accordance with the succeeding sentence, except
that such factor shall not be less than .95 nor greater than
1.05. The effort factor determined under this sentence shall
be a fraction

[[Page S1288]]

the numerator of which is the product of the 3-year average
per-pupil expenditure in the State multiplied by the 3-year
average per capita income in the United States and the
denominator of which is the product of the 3-year average per
capita income in such State multiplied by the 3-year average
per-pupil expenditure in the United States.
``(B) The effort factor for the Commonwealth of Puerto Rico
shall be equal to the lowest effort factor calculated under
subparagraph (A) for any State.
``(3) Equity factor.--(A)(i) Except as provided in
subparagraph (B), the Secretary shall determine the equity
factor under this section for each State in accordance with
clause (ii).
``(ii)(I) For each State, the Secretary shall compute a
weighted coefficient of variation for the per-pupil
expenditures of local educational agencies in accordance with
subclauses (II), (III), (IV), and (V).
``(II) In computing coefficients of variation, the
Secretary shall weigh the variation between per-pupil
expenditures in each local educational agency and the average
per-pupil expenditures in the State according to the number
of pupils in the local educational agency.
``(III) In determining the number of pupils under this
paragraph in each local educational agency and each State,
the Secretary shall multiply the number of children from
economically disadvantaged families by 1.4 under this
paragraph.
``(IV) In computing coefficients of variation, the
Secretary shall include only those local educational agencies
with an enrollment of more than 200 students.
``(V) The Secretary shall compute separate coefficients of
variation for elementary, secondary, and unified local
educational agencies and shall combine such coefficients into
a single weighted average coefficient for the State by
multiplying each coefficient by the total enrollments of the
local educational agencies in each group, adding such
products, and dividing such sum by the total enrollments of
the local educational agencies in the State.
``(B) The equity factor for a State that meets the
disparity standard described in section 222.63 of title 34,
Code of Federal Regulations (as such section was in effect on
the day preceding the date of enactment of the Public
Education Reinvestment, Reinvention, and Responsibility Act)
or a State with only 1 local educational agency shall be not
greater than 0.10.
``(C) The Secretary may revise each State's equity factor
as necessary based on the advice of independent education
finance scholars to reflect other need-based costs of local
educational agencies in addition to economically
disadvantaged student enrollment, such as differing
geographic costs, costs associated with students with
disabilities, children with limited English proficiency or
other meaningful educational needs, which deserve additional
support. In addition and also with the advice of independent
education finance scholars, the Secretary may revise each
State's equity factor to incorporate other valid and accepted
methods to achieve adequacy of educational opportunity that
may not be reflected in a coefficient of variation method.
``(c) Use of Funds.--All funds awarded to each State under
this section shall be allocated to local educational agencies
and schools on a basis consistent with the distribution of
other funds to such agencies and schools under sections 1124,
1124A, and 1125 to carry out activities under this part.
``(d) Maintenance of Effort.--
``(1) In general.--Except as provided in paragraph (2), a
State is entitled to receive its full allotment of funds
under this part for any fiscal year only if the Secretary
finds that either the combined fiscal effort per student or
the aggregate expenditures within the State with respect to
the provision of free public education for the fiscal year
preceding the fiscal year for which the determination is made
was not less than 90 percent of such combined fiscal effort
or aggregate expenditures for the second fiscal year
preceding the fiscal year for which the determination is
made.
``(2) Reduction of funds.--The Secretary shall reduce the
amount of the funds awarded to any State under this section
in any fiscal year in the exact proportion to which the State
fails to meet the requirements of paragraph (1) by falling
below 90 percent of both the fiscal effort per student and
aggregate expenditures (using the measure most favorable to
the State), and no such lesser amount shall be used for
computing the effort required under paragraph (1) for
subsequent years.
``(3) Waivers.--The Secretary may waive, for 1 fiscal year
only, the requirements of paragraphs (1) and (2) if the
Secretary determines that such a waiver would be equitable
due to exceptional or uncontrollable circumstances such as a
natural disaster or a precipitous and unforeseen decline in
the financial resources of the State.
``(e) Authorization of Appropriations.--For the purpose of
making grants under this section, there are authorized to be
appropriated $200,000,000 for fiscal year 2002 and such sums
as may be necessary for each of the 3 succeeding fiscal
years.''.

SEC. 129. SPECIAL ALLOCATION PROCEDURES.

Section 1126 (20 U.S.C. 6337) is amended to read as
follows:

``SEC. 1126. SPECIAL ALLOCATION PROCEDURES.

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

Subtitle B--Even Start Family Literacy Programs

SEC. 131. PROGRAM AUTHORIZED.

Section 1202(c) (20 U.S.C. 6362(c)) is amended--
(1) in paragraph (1), by striking ``subsection and for
which'' and all that follows through ``, whichever is less,
to award grants,'' and inserting ``subsection, from funds
reserved under section 7104(b), the Secretary shall award
grants,'';
(2) by striking paragraph (2)(C); and
(3) in paragraph (3)--
(A) by striking ``is defined'' and inserting ``was
defined''; and
(B) by inserting ``as such section was in effect on the day
preceding the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act'' after
``2252''.

SEC. 132. APPLICATIONS.

Section 1207(c)(1)(F) (20 U.S.C. 6367(c)(1)(F)) is amended
by striking ``14306'' and inserting ``8305''.

SEC. 133. RESEARCH.

Section 1211(c) (20 U.S.C. 6396b(c)) is amended to read as
follows:
``(c) Dissemination.--The Secretary shall disseminate, or
designate another entity to disseminate, the results of the
research described in subsection (a) to States and recipients
of subgrants under this part.''.

Subtitle C--Education of Migratory Children

SEC. 141. COMPREHENSIVE NEEDS ASSESSMENT AND SERVICE-DELIVERY
PLAN; AUTHORIZED ACTIVITIES.

Section 1306(a)(1) (20 U.S.C. 6369(a)(1)) is amended--
(1) in subparagraph (A), by striking ``, the Goals 2000''
and all that follows through the semicolon and inserting ``or
other Acts, as appropriate, consistent with section 8306;'';
(2) in subparagraph (B), by striking ``section 14302'' and
inserting ``section 8302''; and
(3) in subparagraph (F), by striking ``bilingual
education'' and all that follows and inserting ``language
instruction programs under title III; and''.

Subtitle D--Prevention and Intervention Programs for Children and Youth
who are Neglected, Delinquent, or at Risk of Dropping Out

SEC. 151. STATE PLAN AND STATE AGENCY APPLICATIONS.

Section 1414 (20 U.S.C. 6434) is amended--
(1) in subsection (a)(1), by striking ``, the Goals 2000''
and all that follows through the period and inserting ``or
other Acts, as appropriate, consistent with section 8305.'';
and
(2) in subsection (c)--
(A) in paragraph (6), by striking ``section 14701'' and
inserting ``section 8701''; and
(B) in paragraph (7), by striking ``section 14501'' and
inserting ``section 8501''.

SEC. 152. USE OF FUNDS.

Section 1415(a)(2)(D) (20 U.S.C. 6435(a)(2)(D)) is amended
by striking ``section 14701'' and inserting ``section 8701''.

Subtitle E--Federal Evaluations, Demonstrations, and Transition
Projects

SEC. 161. EVALUATIONS.

Section 1501 (20 U.S.C. 6491) is amended--
(1) in subsection (a)(4)--
(A) by striking ``January 1, 1996'' and inserting ``January
1, 2003''; and
(B) by striking ``January 1, 1999'' and inserting ``January
1, 2006'';
(2) in subsection (b)(1), by striking ``December 31, 1997''
and inserting ``December 31, 2004''; and
(3) in subsection (e)(2), by striking ``December 31, 1996''
and inserting ``December 31, 2003''.

SEC. 162. DEMONSTRATIONS OF INNOVATIVE PRACTICES.

Section 1502 (20 U.S.C. 6492) is amended to read as
follows:

[[Page S1289]]

``SEC. 1502. COMPREHENSIVE SCHOOL REFORM.

``(a) Findings and Purpose.--
``(1) Findings.--Congress finds the following:
``(A) A number of schools across the country have shown
impressive gains in student performance through the use of
comprehensive models for schoolwide change that incorporate
virtually all aspects of school operations.
``(B) No single comprehensive school reform model may be
suitable for every school. Schools should be encouraged to
examine successful, externally developed comprehensive school
reform approaches as the schools undertake comprehensive
school reform.
``(C) Comprehensive school reform is an important means by
which children are assisted in meeting challenging State
student performance standards.
``(2) Purpose.--The purpose of this section is to provide
financial incentives for schools to develop comprehensive
school reforms, based upon scientifically based research and
effective practices that include an emphasis on basic
academics and parental involvement so that all children can
meet challenging State content and performance standards.
``(b) Grants to States.--
``(1) In general.--The Secretary is authorized to provide
grants to State educational agencies from allotments under
paragraph (2) to provide subgrants to local educational
agencies to carry out the purpose described in subsection
(a)(2).
``(2) Allotment.--
``(A) Reservation.--Of the amount made available under
subsection (f) for a fiscal year, the Secretary may reserve--
``(i) not more than 1 percent for--

``(I) payments to the Bureau of Indian Affairs for
activities, approved by the Secretary, consistent with this
section; and
``(II) payments to outlying areas, to be allotted in
accordance with their respective needs for assistance under
this section as determined by the Secretary, for activities,
approved by the Secretary, consistent with this section; and

``(ii) not more than 1 percent to conduct national
evaluation activities described in subsection (d).
``(B) In general.--Of the amount made available under
subsection (f) for a fiscal year and remaining after the
reservation under subparagraph (A), the Secretary shall allot
to each State an amount that bears the same ratio to the
remainder 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
that year.
``(C) Reallotment.--If a State chooses not to apply for
funds under this section, or fails to submit an approvable
application under paragraph (3), the Secretary shall reallot
the funds that such State would have received under
subparagraph (B) to States having applications approved under
paragraph (3), in accordance with subparagraph (B).
``(3) State application.--
``(A) In general.--Each State educational agency that
desires to receive a grant under this section shall submit an
application to the Secretary at such time, in such manner and
containing such other information as the Secretary may
reasonably require.
``(B) Contents.--Each State application shall describe--
``(i) the process and selection criteria with which the
State educational agency, after using expert review, will
select local educational agencies to receive subgrants under
this section;
``(ii) how the agency will ensure that only comprehensive
school reforms that are based on scientifically based
research will receive funds under this section;
``(iii) how the agency will disseminate materials regarding
information on comprehensive school reforms that are based on
scientifically based research;
``(iv) how the agency will evaluate the implementation of
such reforms and measure the extent to which the reforms
resulted in increased student academic performance; and
``(v) how the agency will provide, upon request, technical
assistance to a local educational agency in evaluating,
developing, and implementing comprehensive school reform.
``(4) Reporting.--Each State educational agency that
receives a grant under this section shall provide to the
Secretary such information as the Secretary may require,
including the names of local educational agencies and schools
selected to receive grants under this section, the amount of
such grants, and a description of the comprehensive school
reform model selected and used for the schools.
``(5) Administrative costs.--A State educational agency
that receives a grant under this section may reserve not more
than 5 percent of the funds made available through the grant
for administrative, evaluation, and technical assistance
expenses.
``(c) Grants to Local Educational Agencies.--
``(1) Grants.--
``(A) In general.--Except as provided in subsection (b)(5),
a State educational agency that receives a grant under this
section shall use the grant funds to provide grants, on a
competitive basis, to local educational agencies receiving
funds under part A.
``(B) Grant requirements.--A grant to a local educational
agency shall be--
``(i) of sufficient size and scope to pay for 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;
``(ii) in an amount of not less than $50,000 for each
participating school; and
``(iii) made for an initial period of 1 year, and shall be
renewable for 2 additional 1-year periods if the
participating schools are making substantial progress in the
implementation of their reforms.
``(2) Local applications.--
``(A) In general.--To be eligible to receive a grant under
this section, a local educational agency shall submit an
application to the State educational agency at such time, in
such manner, and containing such information as the agency
may require.
``(B) Contents.--At a minimum, the local application
shall--
``(i) identify which schools that are served by the local
educational agency and eligible for funds under part A plan
to implement a comprehensive school reform program, and
identify the projected costs of such a program;
``(ii) describe the scientifically based comprehensive
school reforms that such schools will implement;
``(iii) describe how the agency will provide technical
assistance and support for the effective implementation of
the scientifically based school reforms selected by such
schools; and
``(iv) describe how the agency will evaluate the
implementation of such reforms and measure the results
achieved in improving student academic performance.
``(3) Components of the program.--A local educational
agency that receives a grant under this section shall provide
grant funds to schools that, individually, implement a
comprehensive school reform program that--
``(A) employs innovative strategies and proven methods for
student learning, teaching, and school management that are
based on scientifically based research and effective
practices and have been replicated successfully in schools
with diverse characteristics;
``(B) uses 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 that addresses needs identified
through a school needs assessment;
``(C) provides high quality and continuous teacher and
staff professional development;
``(D) includes measurable goals for student performance and
benchmarks for meeting such goals;
``(E) is supported by teachers, principals, administrators,
and other professional staff;
``(F) provides for the meaningful involvement of parents
and the local community in planning and implementing school
improvement activities;
``(G) uses high quality external technical support and
assistance from an entity, which may be an institution of
higher education, with experience and expertise in schoolwide
reform and improvement;
``(H) includes a plan for the evaluation of the
implementation of school reforms and the student results
achieved; and
``(I) identifies how other resources, including Federal,
State, local, and private resources, available to the school
will be used to coordinate services to support and sustain
the school reform effort.
``(4) Priority and consideration.--
``(A) Priority.--The State educational agency, in awarding
grants under paragraph (1), shall give priority to local
educational agencies that--
``(i) plan to use the grant funds in schools identified for
school improvement or corrective action under section
1116(c); and
``(ii) demonstrate a commitment to assist schools with
budget allocation, professional development, and other
strategies necessary to ensure the comprehensive school
reforms are properly implemented and are sustained in the
future.
``(B) Grant consideration.--In making grants under this
section, the State educational agency shall take into account
the need for equitable distribution of funds to different
geographic regions within the State, including urban and
rural areas, and to elementary schools and secondary schools.
``(5) Special rule.--A school that receives funds under
this section to develop a comprehensive school reform program
shall not be limited to using the approaches identified or
developed by the Department of Education, but may develop
comprehensive school reform programs for schoolwide change
that comply with paragraph (3).
``(d) Evaluation and Report.--
``(1) In general.--The Secretary shall develop and carry
out a plan for a national evaluation of the programs
developed pursuant to this section.
``(2) Evaluation.--The national evaluation shall evaluate
the implementation of the programs and the results achieved
by schools after 1 year and 3 years of implementing
comprehensive school reforms through the programs, and assess
the effectiveness of comprehensive school reforms in schools
with diverse characteristics.
``(3) Reports.--

[[Page S1290]]

``(A) Interim report.--After evaluating the first year of
implementation and results under paragraph (2), the Secretary
shall submit an interim report outlining first year
implementation activities to the Committees on Education and
the Workforce and Appropriations of the House of
Representatives and the Committees on Health, Education,
Labor, and Pensions and Appropriations of the Senate.
``(B) Final report.--After evaluating the third year of
implementation and results under paragraph (2), the Secretary
shall submit a final report outlining third year
implementation activities to the committees described in
subparagraph (A).
``(e) Supplement.--Funds made available under this section
shall be used to supplement and not supplant other Federal,
State, and local public funds expended for activities
described in this section.
``(f) Authorization of Appropriations.--Funds appropriated
for any fiscal year under section 1002(f) shall be used for
carrying out the activities under this section.
``(g) Definition.--The term `scientifically based
research'--
``(1) means the application of rigorous, systematic, and
objective procedures in the development of comprehensive
school reform models; and
``(2) shall include research that--
``(A) employs systematic, empirical methods that draw on
observation or experiment;
``(B) involves rigorous data analyses that are adequate to
test stated hypotheses and justify the general conclusions
drawn;
``(C) relies on measurements or observational methods that
provide valid data across evaluators and observers and across
multiple measurements and observations; and
``(D) has been accepted by a journal that uses peer review
or approved by a panel of independent experts through a
comparably rigorous, objective, and scientific review.''.

Subtitle F--Rural Education Development Initiative

SEC. 171. RURAL EDUCATION DEVELOPMENT INITIATIVE.

Title I (20 U.S.C. 6301 et seq.) is amended--
(1) by redesignating part F (20 U.S.C. 6511 et seq.) as
part G and redesignating accordingly the references to such
part F;
(2) by redesignating sections 1601 through 1604 (20 U.S.C.
6511, 6514) as sections 1701 through 1704, respectively, and
by redesignating accordingly the references to such sections
1601 through 1604; and
(3) by inserting after part E (20 U.S.C. 6491 et seq.) the
following:

``PART F--RURAL EDUCATION INITIATIVE

``SEC. 1601. SHORT TITLE.

``This part may be cited as the `Rural Education
Achievement Program'.

``SEC. 1602. PURPOSE.

``It is the purpose of this part to address the unique
needs of rural school districts that frequently--
``(1) lack the personnel and resources needed to compete
for Federal competitive grants; and
``(2) receive formula allocations in amounts too small to
be effective in meeting their intended purposes.

``SEC. 1603. AUTHORIZATION OF APPROPRIATIONS.

``(a) In General.--There are authorized to be appropriated
to carry out this part $300,000,000 for fiscal year 2002 and
such sums as may be necessary for each of the 4 succeeding
fiscal years, of which 50 percent shall be available to carry
out subpart 1 for each such fiscal year and 50 percent shall
be available to carry out subpart 2 for each such fiscal
year.
``(b) Special Rule.--Notwithstanding subsection (a), if the
amount of funds made available under subsection (a) to carry
out subpart 1 for any fiscal year exceeds the amount required
to carry out subpart 1 for the fiscal year, then such excess
shall be available to carry out subpart 2 for the fiscal
year.

``Subpart 1--Small, Rural School Achievement Program

``SEC. 1611. FORMULA GRANT PROGRAMS.

``(a) Alternative Uses.--
``(1) In general.--Notwithstanding any other provision of
law, an eligible local educational agency may use the
applicable funding, that the agency is eligible to receive
from the State educational agency for a fiscal year, to carry
out activities described in section 1114, 1115, 1116, 2207,
3107, or 6006.
``(2) Notification.--An eligible local educational agency
shall notify the State educational agency of the local
educational agency's intention to use the applicable funding
in accordance with paragraph (1) not later than a date that
is established by the State educational agency for the
notification.
``(b) Eligibility.--A local educational agency shall be
eligible to use the applicable funding in accordance with
subsection (a) if--
``(1) the total number of students in average daily
attendance at all of the schools served by the local
educational agency is less than 600; and
``(2) all of the schools served by the local educational
agency are designated with a School Locale Code of 7 or 8, as
determined by the Secretary of Education.
``(c) Applicable Funding.--In this section, the term
`applicable funding' means funds provided under each of
titles II, III, and VI.
``(d) Disbursal.--Each State educational agency that
receives applicable funding for a fiscal year shall disburse
the applicable funding to local educational agencies for
alternative uses under this section for the fiscal year at
the same time that the State educational agency disburses the
applicable funding to local educational agencies that do not
intend to use the applicable funding for such alternative
uses for the fiscal year.
``(e) Supplement not Supplant.--Funds made available under
this section shall be used to supplement and not supplant any
other Federal, State, or local education funds.
``(f) Special Rule.--References in Federal law to funds for
the provisions of law set forth in subsection (c) may be
considered to be references to funds for this section.
``(g) Cooperative Arrangements.--Nothing in this subpart
shall be construed to prohibit a local educational agency
that enters into cooperative arrangements with other local
educational agencies for the provision of special,
compensatory, or other education services pursuant to State
law or a written agreement from entering into similar
arrangements for the use or the coordination of the use of
the funds made available under this section.

``SEC. 1612. FORMULA GRANT PROGRAM AUTHORIZED.

``(a) In General.--The Secretary is authorized to award
grants to eligible local educational agencies to enable the
local educational agencies to carry out activities described
in section 1114, 1115, 1116, 2207, 3107, or 6006.
``(b) Eligibility.--A local educational agency shall be
eligible to receive a grant under this section if--
``(1) the total number of students in average daily
attendance at all of the schools served by the local
educational agency is less than 600; and
``(2) all of the schools served by the local educational
agency are designated with a School Locale Code of 7 or 8, as
determined by the Secretary of Education.
``(c) Amount.--
``(1) In general.--The Secretary shall award a grant to a
local educational agency under this section for a fiscal year
in an amount equal to the amount determined under paragraph
(2) for the fiscal year minus the total amount received by
the local educational agency for the preceding fiscal year
under the provisions of law described in section 1611(c).
``(2) Determination.--The amount referred to in paragraph
(1) is equal to $100 multiplied by the total number of
students in excess of 50 students that are in average daily
attendance at the schools served by the local educational
agency, plus $20,000, except that the amount may not exceed
$60,000.
``(3) Census determination.--
``(A) In general.--Each local educational agency desiring a
grant under this section shall conduct a census not later
than December 1 of each year to determine the number of
kindergarten through grade 12 students in average daily
attendance at the schools served by the local educational
agency.
``(B) Submission.--Each local educational agency shall
submit the number described in subparagraph (A) to the
Secretary not later than March 1 of each year.
``(4) Penalty.--If the Secretary determines that a local
educational agency has knowingly submitted false information
under paragraph (3) for the purpose of gaining additional
funds under this section, then the local educational agency
shall be fined an amount equal to twice the difference
between the amount the local educational agency received
under this section, and the correct amount the local
educational agency would have received under this section if
the agency had submitted accurate information under paragraph
(3).
``(d) Disbursal.--The Secretary shall disburse the funds
awarded to a local educational agency under this section for
a fiscal year not later than July 1 of that year.
``(e) Supplement not Supplant.--Funds made available under
this section shall be used to supplement and not supplant any
other Federal, State, or local education funds.
``(f) Construction.--Nothing in this subpart shall be
construed to prohibit a local educational agency that enters
into cooperative arrangements with other local educational
agencies for the provision of special, compensatory, or other
education services pursuant to State law or a written
agreement from entering into similar arrangements for the use
or the coordination of the use of the funds made available
under this section.

``SEC. 1613. APPLICATIONS.

``(a) In General.--Each eligible local educational agency
desiring to use funds for alternative uses under section 1611
or desiring a grant under section 1612 annually shall submit
an application to the Secretary at such time, in such manner,
and accompanied by such information as the Secretary may
require.
``(b) Contents.--Each application submitted under
subsection (a) shall--
``(1) describe the activities for which funds made
available under this subpart will be used to raise student
academic performance;
``(2) specify annual, measurable performance goals and
objectives, at a minimum, for the activities assisted under
this subpart with respect to--
``(A) increased student academic achievement;
``(B) decreased gaps in achievement between minority and
nonminority students,

[[Page S1291]]

and between economically disadvantaged and non-economically
disadvantaged students (unless the Secretary determines the
number of students in a category is insufficient to yield
statistically reliable information); and
``(C) other factors that the eligible local educational
agency may choose to measure; and
``(3) specify the extent to which such goals are aligned
with State content and student performance standards;
``(4) describe how the eligible local educational agency
will--
``(A) measure the annual impact of activities described in
paragraph (1) and the extent to which the activities will
increase student academic performance; and
``(B) hold elementary schools or secondary schools using or
receiving funds under this subpart accountable for meeting
the annual, measurable goals and objectives;
``(5) describe how the eligible local educational agency
will provide technical assistance for an elementary school or
secondary school that does not meet the annual, measurable
goals and objectives;
``(6) describe how the eligible local educational agency
will take action against an elementary school or secondary
school, if the school fails, over 2 consecutive years, to
meet the annual, measurable goals and objectives; and
``(7) in the case that the application describes
alternative uses for funds under title II or III, specify how
the eligible local educational agency shall use the funds to
meet the annual numerical performance objectives described in
section 2104 or 3109, respectively.

``SEC. 1614. ACCOUNTABILITY.

``The Secretary, at the end of the third year that an
eligible local educational agency uses funds in accordance
with section 1611 or receives grant funds under section 1612,
shall permit only those eligible local educational agencies
that meet their annual, measurable goals and objectives
described in section 1613(b)(2) and their performance
objectives described in section 2104 and 3109 for 2
consecutive years to continue to so use funds or receive
grant funds for the fourth or fifth fiscal years of
participation in the program under this subpart.

``SEC. 1615. RATABLE REDUCTIONS IN CASE OF INSUFFICIENT
APPROPRIATIONS.

``(a) In General.--If the amount appropriated for any
fiscal year and made available for grants under section 1612
is insufficient to pay the full amount for which all agencies
are eligible under this subpart, the Secretary shall ratably
reduce each such amount.
``(b) Additional Amounts.--If additional funds become
available for making payments under paragraph (1) for such
fiscal year, payments that were reduced under subsection (a)
shall be increased on the same basis as such payments were
reduced.

``SEC. 1616. REPORTS.

``(a) Reports From Eligible Local Educational Agencies.--
Each eligible local educational agency making alternative use
of funds under section 1611 or receiving a grant under
section 1612 shall provide an annual report to the Secretary.
The report shall describe--
``(1) how the agency used the funds made available under
this subpart;
``(2) the degree to which progress has been made toward
meeting the annual, measurable goals and objectives described
in the agency's application; and
``(3) how the agency coordinated funds received under this
subpart with other Federal, State, and local funds.
``(b) Report to Congress.--The Secretary shall prepare and
submit to Congress an annual report setting forth the
information provided to the Secretary pursuant to subsection
(a).

``Subpart 2--Low-Income and Rural School Program

``SEC. 1621. DEFINITIONS.

``In this subpart:
``(1) Poverty line.--The term `poverty line' means the
poverty line (as defined by the Office of Management and
Budget, and revised annually in accordance with section
673(2) of the Community Services Block Grant Act (42 U.S.C.
9902(2))) applicable to a family of the size involved.
``(2) Specially qualified agency.--The term `specially
qualified agency' means an eligible local educational agency,
located in a State that does not participate in a program
carried out under this subpart for a fiscal year, that
applies directly to the Secretary for a grant for such year
in accordance with section 1622(b).

``SEC. 1622. PROGRAM AUTHORIZED.

``(a) Grants to States.--
``(1) In general.--From the sum appropriated under section
1603 for a fiscal year and made available to carry out this
subpart, the Secretary shall award grants, from allotments
made under paragraph (2) , to State educational agencies that
have applications approved under section 1624 to enable the
State educational agencies to award grants to eligible local
educational agencies for activities described in section
1114, 1115, 1116, 2207, 3107, or 6006.
``(2) Allotment.--From the sum appropriated under section
1603 for a fiscal year and made available to carry out this
subpart, the Secretary shall allot to each State educational
agency an amount that bears the same ratio to the sum as the
number of students in average daily attendance at the schools
served by eligible local educational agencies in the State
for that fiscal year bears to the number of all such students
at the schools served by eligible local educational agencies
in all States for that fiscal year.
``(b) Direct Grants to Specially Qualified Agencies.--
``(1) Nonparticipating state.--If a State educational
agency elects not to participate in the program carried out
under this subpart or does not have an application approved
under section 1624, a specially qualified agency in such
State desiring a grant under this subpart may apply directly
to the Secretary under section 1624 to receive a grant under
this subpart.
``(2) Direct awards to specially qualified agencies.--The
Secretary may award, on a competitive basis, the amount the
State educational agency is eligible to receive under
subsection (a)(2) directly to specially qualified agencies in
the State.
``(c) Administrative Costs.--A State educational agency
that receives a grant under this subpart may not use more
than 2 percent of the amount of the grant funds for State
administrative costs.

``SEC. 1623. STATE DISTRIBUTION OF FUNDS.

``(a) In General.--A State educational agency that receives
a grant under this subpart shall use the funds made available
through the grant to award grants to eligible local
educational agencies to enable the local educational agencies
to carry out activities described in section 1114, 1115,
1116, 2207, 3107, or 6006.
``(b) Local Awards.--A local educational agency shall be
eligible to receive a grant under this subpart if--
``(1) 20 percent or more of the children age 5 through 17
that are served by the local educational agency are from
families with incomes below the poverty line; and
``(2) all of the schools served by the local educational
agency are located in a community with a Rural-Urban
Continuum Code of 6, 7, 8, or 9, as determined by the
Secretary of Agriculture.
``(c) Award Basis.--The State educational agency shall
award the grants to eligible local educational agencies--
``(1) according to a formula based on the number of
students in average daily attendance at schools served by the
eligible local educational agencies; or
``(2) on a competitive basis if distribution by formula is
impracticable as determined by the State educational agency.

``SEC. 1624. APPLICATIONS.

``(a) In General.--Each State educational agency desiring a
grant under section 1622(a) and each specially qualified
agency desiring a grant under section 1622(b) shall submit an
application to the Secretary at such time, in such manner,
and accompanied by such information as the Secretary may
require.
``(b) Contents.--Each application submitted under
subsection (a) shall--
``(1) specify annual, measurable performance goals and
objectives for the activities assisted under this subpart, at
a minimum, with respect to--
``(A) increased student academic achievement;
``(B) decreased gaps in achievement between minority and
non-minority students, and between economically disadvantaged
and non-economically disadvantaged students (unless the
Secretary determines the number of students in a category is
insufficient to yield statistically reliable information);
and
``(C) other factors that the State educational agency or
eligible local educational agency may choose to measure;
``(2) describe how the State educational agency or
specially qualified agency will hold local educational
agencies and elementary schools or secondary schools
receiving funds under this subpart accountable for meeting
the annual, measurable goals and objectives;
``(3) describe how the State educational agency or
specially qualified agency will provide technical assistance
for a local educational agency, an elementary school, or a
secondary school that does not meet the annual, measurable
goals and objectives; and
``(4) describe how the State educational agency or
specially qualified agency will take action against a local
educational agency, an elementary school, or a secondary
school, if the local educational agency or school fails, over
2 consecutive years, to meet the annual, measurable goals and
objectives.

``SEC. 1625. USES OF FUNDS.

``Grant funds awarded to eligible local educational
agencies under this subpart shall be used for--
``(1) educational technology activities;
``(2) high quality professional development for teachers
and principals;
``(3) technical assistance;
``(4) recruitment and retention of fully qualified
teachers, as defined in section 2002, and highly qualified
principals;
``(5) parental involvement activities; or
``(6) other programs or activities that--
``(A) seek to raise the academic achievement levels of all
elementary school and secondary school students; and
``(B) are based on State content and student performance
standards.

``SEC. 1626. ACCOUNTABILITY.

``The Secretary, at the end of the third year that a State
educational agency or specially qualified agency receives
grant funds under this subpart, shall permit only those State
educational agencies and specially qualified agencies that
meet their annual, measurable goals and objectives for 2
consecutive years to continue to receive grant

[[Page S1292]]

funds for the fourth or fifth fiscal years of the program
under this subpart.

``SEC. 1627. REPORTS AND STUDY.

``(a) State Reports.--Each State educational agency that
receives a grant under this subpart shall provide an annual
report to the Secretary. The report shall describe--
``(1) the method the State educational agency used to award
grants to eligible local educational agencies and to provide
assistance to elementary schools and secondary schools under
this subpart;
``(2) how eligible local educational agencies, elementary
schools, and secondary schools within the State used the
grant funds provided under this subpart; and
``(3) the degree to which progress has been made toward
meeting the annual, measurable goals and objectives described
in the State application.
``(b) Reports From Eligible Local Educational Agencies.--
Each eligible local educational agency receiving a grant
under this subpart shall provide an annual report to the
Secretary. Such report shall describe--
``(1) how the agency used the grant funds;
``(2) the degree to which progress has been made toward
meeting the annual, measurable goals and objectives described
in the agency's application; and
``(3) how the agency coordinated funds received under this
subpart with other Federal, State, and local funds.
``(c) Report to Congress.--The Secretary shall prepare and
submit to Congress an annual report setting forth the
information provided to the Secretary pursuant to subsections
(a) and (b).
``(d) Study.--The Comptroller General of the United States
shall conduct a study regarding the impact of assistance
provided under this subpart on student achievement, and shall
submit such study to Congress.

``SEC. 1628. SUPPLEMENT NOT SUPPLANT.

``Funds made available under this subpart shall be used to
supplement and not supplant any other Federal, State, or
local education funds.

``SEC. 1629. SPECIAL RULE.

``No local educational agency may concurrently participate
in activities carried out under subpart 1 and activities
carried out under this subpart.''.

Subtitle G--General Provisions

SEC. 181. STATE ADMINISTRATION.

Section 1703 (20 U.S.C. 6513) (as redesignated by section
171(2)) is amended by striking subsection (c).

SEC. 182. DEFINITIONS.

Part G of title I (20 U.S.C. 6511 et seq.) (as redesignated
by section 171(1)) is amended by adding at the end the
following:

``SEC. 1705. DEFINITIONS.

``In this title:
``(1) Fully qualified.--The term `fully qualified' has the
meaning given such term in section 2002.
``(2) Low-performing student.--The term `low-performing
student' means a student who performs below a State's basic
level of performance described in the State standards
described in section 1111(b)(1).
``(3) Scientifically based research.--Except as provided in
section 1502, the term `scientifically based research'--
``(A) means the application of rigorous, systematic, and
objective procedures; and
``(B) shall include research that--
``(i) employs systematic, empirical methods that draw on
observation or experiment;
``(ii) involves rigorous data analyses that are adequate to
test stated hypotheses and justify the general conclusions
drawn;
``(iii) relies on measurements or observational methods
that provide valid data across evaluators and observers and
across multiple measurements and observations; and
``(iv) has been accepted by a journal that uses peer review
or approved by a panel of independent experts through a
comparably rigorous, objective, and scientific review.''

TITLE II--TEACHER AND PRINCIPAL QUALITY, PROFESSIONAL DEVELOPMENT, AND
CLASS SIZE

SEC. 201. TEACHER AND PRINCIPAL QUALITY, PROFESSIONAL
DEVELOPMENT, AND CLASS SIZE.

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

``TITLE II--TEACHER AND PRINCIPAL QUALITY, PROFESSIONAL DEVELOPMENT,
AND CLASS SIZE

``SEC. 2001. PURPOSE.

``The purpose of this title is to provide grants to State
educational agencies and local educational agencies in order
to assist their efforts to increase student academic
achievement through such strategies as improving teacher and
principal quality, increasing professional development, and
decreasing class size.

``SEC. 2002. DEFINITIONS.

``In this title:
``(1) Charter school.--The term `charter school' has the
meaning given the term in section 4210.
``(2) Core academic subject.--The term `core academic
subject', used with respect to a State, means English
language arts, mathematics, science, and any other academic
subject that the State determines is a core academic subject.
``(3) Fully qualified.--The term `fully qualified' means--
``(A) in the case of an elementary school teacher (other
than a teacher teaching in a public charter school or a
middle school teacher), a teacher who, at a minimum--
``(i) has obtained State certification (which may include
certification obtained through alternative means), or a State
license, to teach in the State in which the teacher teaches;
``(ii) holds a bachelor's degree from an institution of
higher education; and
``(iii) demonstrates the subject matter knowledge, teaching
knowledge, and teaching skills required to teach effectively
reading, writing, mathematics, science, social studies, and
other elements of a liberal arts education;
``(B) in the case of a middle school or secondary school
teacher (other than a teacher teaching in a public charter
school), a teacher who, at a minimum--
``(i) has obtained State certification (which may include
certification obtained through alternative means), or a State
license, to teach in the State in which the teacher teaches;
``(ii) holds a bachelor's degree from an institution of
higher education; and
``(iii) demonstrates a high level of competence in all
academic subjects in which the teacher teaches through--

``(I) 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;
``(II) in the case of a teacher who is a mid-career
professional entering the teaching profession, achievement
of--

``(aa) a high level of performance in other professional
employment experience relevant to the core academic subjects
that the teacher teaches; and
``(bb) achievement of a level of performance described in
subclause (III); or

``(III) achievement of a high level of performance on
rigorous academic subject area tests administered by the
State in which the teacher teaches; and

``(C) in the case of a teacher teaching in a public charter
school--
``(i) meets the requirements of State law, if any, relating
to certification or licensing to teach in the State in a
charter school;
``(ii) meets the requirements of State law, if any,
regarding holding a degree from an institution of higher
education to teach in a charter school; and
``(iii)(I) in the case of an elementary school teacher
(other than a middle school teacher), demonstrates the
knowledge and skills described in subparagraph (A)(iii); or
``(II) in the case of a middle school or secondary school
teacher, demonstrates a high level of competence as described
in subparagraph (B)(iii).
``(4) Institution of higher education.--The term
`institution of higher education' means an institution of
higher education, as defined in section 101 of the Higher
Education Act of 1965, that--
``(A) has not been identified as low-performing under
section 208 of the Higher Education Act of 1965; and
``(B) is in full compliance with the public reporting
requirements described in section 207 of the Higher Education
Act of 1965.
``(5) Low-performing student.--The term `low-performing
student' means a student who, based on multiple measures,
performs at or below a State's basic level of performance for
the student's grade level, as described in the State student
performance standards described in section 1111(b)(1).
``(6) Outlying area.--The term `outlying area' means the
United States Virgin Islands, Guam, American Samoa, and the
Commonwealth of the Northern Mariana Islands.
``(7) 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) applicable to a family of the size involved, for the
most recent year for which satisfactory data are available.
``(8) School-age population.--The term `school-age
population' means the population aged 5 through 17, as
determined on the basis of the most recent satisfactory data.
``(9) Scientifically based research.--The term
`scientifically based research' has the meaning given the
term in section 1705.
``(10) State.--The term `State' means each of the several
States in the United States, the District of Columbia, and
the Commonwealth of Puerto Rico.
``(11) State educational agency.--The term `State
educational agency' means the entity or agency designated
under the laws of a State as responsible for teacher
certification or licensing in the State.

``PART A--TEACHER AND PRINCIPAL QUALITY AND PROFESSIONAL DEVELOPMENT

``SEC. 2101. PROGRAM AUTHORIZED.

``(a) Grants Authorized.--The Secretary shall award a
grant, from an allotment made under subsection (b), to each
State educational agency having a State plan approved under
section 2103, to enable the State educational agency to raise
the quality of, and provide professional development
opportunities for, public elementary school and secondary
school teachers, principals, and administrators.
``(b) Reservations and Allotments.--
``(1) Reservations.--From the amount appropriated under
section 2114 to carry out this part for each fiscal year, the
Secretary shall reserve--

[[Page S1293]]

``(A) \1/2\ of 1 percent of such amount for payments to the
Bureau of Indian Affairs for activities, approved by the
Secretary, consistent with this part;
``(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; and
``(C) such sums as may be necessary to continue to support
any multiyear partnership program award made under part A, C,
or D (as such part was in effect on the day before the date
of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act) until the termination of
the multiyear award.
``(2) State allotments.--From the amount appropriated under
section 2114 for a fiscal year and remaining after the
Secretary makes reservations under paragraph (1), the
Secretary shall allot to each State having a State plan
approved under section 2103 the sum of--
``(A) an amount that bears the same relationship to 50
percent of the remainder as the school-age population from
families with incomes below the poverty line in the State
bears to the school-age population from families with incomes
below the poverty line in all States; and
``(B) an amount that bears the same relationship to 50
percent of the remainder as the school-age population in the
State bears to the school-age population in all States.
``(c) State Minimum.--For any fiscal year, no State shall
be allotted under this section an amount that is less than
\1/2\ of 1 percent of the total amount allotted to all States
under subsection (b)(2).
``(d) Hold-Harmless Amounts.--For fiscal year 2002,
notwithstanding subsection (b)(2), the amount allotted to
each State under subsection (b)(2) shall be not less than 100
percent of the total amount the State was allotted under part
B (as such part was in effect on the day before the date of
enactment of the Public Education Reinvestment, Reinvention,
and Responsibility Act) for fiscal year 2001.
``(e) Ratable Reductions.--If the sums made available under
subsection (b)(2) for any fiscal year are insufficient to pay
the full amounts that all States are eligible to receive
under subsection (d) for such year, the Secretary shall
ratably reduce such amounts for such year.

``SEC. 2102. WITHIN-STATE ALLOCATION.

``(a) In General.--Each State educational agency for a
State receiving a grant under section 2101(a) shall--
``(1) set aside 15 percent of the grant funds to award
educator partnership grants under section 2113;
``(2) set aside not more than 5 percent of the grant funds
to carry out activities described in the State plan submitted
under section 2103; and
``(3) using the remaining 80 percent of the grant funds,
make subgrants by allocating to each local educational agency
in the State the sum of--
``(A) an amount that bears the same relationship to 60
percent of the remainder as the school-age population from
families with incomes below the poverty line in the area
served by the local educational agency bears to the school-
age population from families with incomes below the poverty
line in the area served by all local educational agencies in
the State; and
``(B) an amount that bears the same relationship to 40
percent of the remainder as the school-age population in the
area served by the local educational agency bears to the
school-age population in the area served by all local
educational agencies in the State.
``(b) Hold-Harmless Amounts.--
``(1) Fiscal year 2002.--For fiscal year 2002,
notwithstanding subsection (a), the amount allocated to each
local educational agency under this section shall be not less
than 100 percent of the total amount the local educational
agency was allocated under part B (as such part was in effect
on the day before the date of enactment of the Public
Education Reinvestment, Reinvention, and Responsibility Act)
for fiscal year 2001.
``(2) Fiscal year 2003.--For fiscal year 2003,
notwithstanding subsection (a), the amount allocated to each
local educational agency under this section shall be not less
than 85 percent of the amount allocated to the local
educational agency under this section for fiscal year 2002.
``(3) Fiscal years 2004-2006.--For each of fiscal years
2004 through 2006, notwithstanding subsection (a), the amount
allocated to each local educational agency under this section
shall be not less than 70 percent of the amount allocated to
the local educational agency under this section for the
previous fiscal year.
``(c) Ratable Reductions.--If the sums made available under
subsection (a)(3) for any fiscal year are insufficient to pay
the full amounts that all local educational agencies are
eligible to receive under subsection (b) for such year, the
State educational agency shall ratably reduce such amounts
for such year.

``SEC. 2103. STATE PLANS.

``(a) Plan Required.--
``(1) Comprehensive state plan.--The State educational
agency shall submit a State plan to the Secretary at such
time, in such manner, and containing such information as the
Secretary may require. If the State educational agency (as
defined in section 8101) is not the entity or agency
designated under the laws of the State as responsible for
teacher certification or licensing in the State, then the
plan shall be developed in consultation with the State
educational agency. The entity or agency shall provide annual
evidence of such consultation to the Secretary.
``(2) Consolidated plan.--A State plan submitted under
paragraph (1) may be submitted as part of a consolidated plan
under section 8302.
``(b) Contents.--Each plan submitted under subsection (a)
shall--
``(1) describe how the State educational agency is taking
reasonable steps to--
``(A) reform teacher certification, recertification, or
licensure requirements to ensure that--
``(i) teachers have the necessary subject matter knowledge,
teaching knowledge, and teaching skills in the academic
subjects that the teachers teach;
``(ii) such requirements are aligned with the challenging
State content standards;
``(iii) teachers have the knowledge and skills necessary to
help students meet the challenging State student performance
standards;
``(iv) such requirements take into account the need, as
determined by the State educational agency, for greater
access to, and participation in, the teaching profession by
individuals from historically underrepresented groups; and
``(v) teachers have the necessary technological skills to
integrate technology more effectively in the teaching of
content required by State and local standards in all academic
subjects that the teachers teach;
``(B) develop and implement rigorous testing procedures for
teachers, as described in subparagraphs (A)(iii) and
(B)(iii)(IV) of section 2002(3), to ensure that the teachers
have the subject matter knowledge, teaching knowledge, and
teaching skills necessary to teach effectively the content
required by State and local standards in the academic
subjects that the teachers teach;
``(C) establish, expand, or improve alternative routes to
State certification of teachers, especially in the areas of
mathematics and science, for highly qualified individuals
with a baccalaureate degree, including mid-career
professionals from other occupations, paraprofessionals,
former military personnel, and recent college or university
graduates who have records of academic distinction and who
demonstrate the potential to become highly effective
teachers;
``(D) reduce emergency teacher certification;
``(E) develop and implement effective programs, and provide
financial assistance, to assist local educational agencies,
elementary schools, and secondary schools in effectively
recruiting and retaining fully qualified teachers and
principals, particularly in schools that have the lowest
proportion of fully qualified teachers or the highest
proportion of low-performing students;
``(F) provide professional development programs that meet
the requirements described in section 2109;
``(G) provide programs that are designed to assist new
teachers during their first 3 years of teaching, such as
mentoring programs that--
``(i) provide mentoring to new teachers from veteran
teachers with expertise in the same academic subject as the
new teachers are teaching;
``(ii) provide mentors time for activities such as
coaching, observing, and assisting teachers who are being
mentored; and
``(iii) use standards or assessments that are consistent
with the State's student performance standards and the
requirements for professional development activities
described in section 2109 in order to guide the new teachers;
``(H) provide technical assistance to local educational
agencies in developing and implementing activities described
in section 2108; and
``(I) ensure that programs in core academic subjects,
particularly in mathematics and science, will take into
account the need for greater access to, and participation in,
such core academic subjects by students from historically
underrepresented groups, including females, minorities,
individuals with limited English proficiency, the
economically disadvantaged, and individuals with
disabilities, by incorporating pedagogical strategies and
techniques that meet such students' educational needs;
``(2) describe the activities for which assistance is
sought under the grant, and how such activities will improve
students' academic achievement and close academic achievement
gaps of economically disadvantaged, minority, and limited
English proficient students;
``(3) describe how the State educational agency will
establish annual numerical performance objectives under
section 2104 for improving the qualifications of teachers and
the professional development of teachers, principals, and
administrators;
``(4) contain an assurance that the State educational
agency consulted with local educational agencies, education-
related community groups, nonprofit organizations, parents,
teachers, school administrators, local school boards,
institutions of higher education in the State, and content
specialists in establishing the performance objectives
described in section 2104;
``(5) describe how the State educational agency will hold
local educational agencies, elementary schools, and secondary
schools

[[Page S1294]]

accountable for meeting the performance objectives described
in section 2104 and for reporting annually on the local
educational agencies' and schools' progress in meeting the
performance objectives;
``(6) describe how the State educational agency will ensure
that a local educational agency receiving a subgrant under
section 2102 will comply with the requirements of this part;
``(7) provide an assurance that the State educational
agency will require each local educational agency, elementary
school, or secondary school receiving funds under this part
to report publicly the local educational agency's or school's
annual progress with respect to the performance objectives
described in section 2104; and
``(8) describe how the State educational agency will
coordinate professional development activities provided under
the program carried out under this part with professional
development activities provided under other Federal, State,
and local programs, including programs authorized under
titles I and III and, where appropriate, the Individuals with
Disabilities Education Act and the Carl D. Perkins Vocational
and Technical Education Act of 1998.
``(c) Secretary Approval.--The Secretary, after using a
peer review process, shall approve a State plan if the plan
meets the requirements of this section.
``(d) Duration of the Plan.--
``(1) In general.--Each State plan shall--
``(A) remain in effect for the duration of the State
educational agency's participation under this part; and
``(B) be periodically reviewed and revised by the State
educational agency, as necessary, to reflect changes to the
agency's strategies and programs carried out under this part.
``(2) Additional information.--If a State educational
agency receiving a grant under this part makes significant
changes to the State plan, such as the adoption of new
performance objectives, the agency shall submit information
regarding the significant changes to the Secretary.

``SEC. 2104. STATE PERFORMANCE OBJECTIVES.

``(a) In General.--Each State educational agency receiving
a grant under this part shall establish annual numerical
performance objectives with respect to progress in improving
the qualifications of teachers and the professional
development of teachers, principals, and administrators. For
each annual numerical performance objective established, the
agency shall specify an incremental percentage increase for
the objective to be attained for each fiscal year (after the
first fiscal year) for which the agency receives a grant
under this part, relative to the preceding fiscal year.
``(b) Required Objectives.--At a minimum, the annual
numerical performance objectives described in subsection (a)
shall include an incremental increase in the percentage of--
``(1) classes in core academic subjects that are being
taught by fully qualified teachers;
``(2) new teachers and principals receiving professional
development support, including mentoring during the teachers'
and principals' first 3 years of employment as teachers and
principals, respectively;
``(3) teachers, principals, and administrators
participating in high quality professional development
programs that are consistent with section 2109; and
``(4) fully qualified teachers teaching in the State, to
ensure that all teachers teaching in such State are fully
qualified by December 31, 2006.
``(c) Requirement for Fully Qualified Teachers.--Each State
educational agency receiving a grant under this part shall
ensure that all public elementary school and secondary school
teachers in the State are fully qualified not later than
December 31, 2006.
``(d) Accountability.--
``(1) In general.--Each State educational agency receiving
a grant under this part shall be held accountable for--
``(A) meeting the State's annual numerical performance
objectives; and
``(B) meeting the reporting requirements described in
section 4401.
``(2) Sanctions.--Any State educational agency that fails
to meet the requirement described in paragraph (1)(A) shall
be subject to sanctions under section 7101.
``(e) Special Rule.--Notwithstanding any other provision of
law, the provisions of subsection (c) shall not supersede
State laws governing public charter schools.

``SEC. 2105. STATE OPTIONAL ACTIVITIES.

``(a) In General.--Each State educational agency receiving
a grant under section 2101(a) may use the grant funds
described in section 2102(a)(2)--
``(1) to develop and implement a system to measure the
effectiveness of specific professional development programs
and strategies;
``(2) to increase the portability of teacher pensions and
reciprocity of teaching certification or licensure among
States, except that no reciprocity agreement developed under
this section may lead to the weakening of any State teacher
certification or licensing requirement;
``(3) to develop or assist local educational agencies in
the development and utilization of proven, innovative
strategies to deliver intensive professional development
programs that are cost effective and easily accessible, such
as programs offered through the use of technology and
distance learning;
``(4) to provide assistance to local educational agencies
for the development and implementation of innovative
professional development programs that train teachers to use
technology to improve teaching and learning and that are
consistent with the requirements of section 2109;
``(5) to provide professional development to enable
teachers to ensure that female students, minority students,
limited English proficient students, students with
disabilities, and economically disadvantaged students have
the full opportunity to meet challenging State content and
performance standards in the core academic subjects;
``(6) to increase the number of persons who are women,
minorities, or individuals with disabilities, who teach in
the State, who are fully qualified, and who teach in core
academic subjects in which such persons are underrepresented;
``(7) to increase the number of highly qualified women,
minorities, and individuals from other underrepresented
groups who are involved in the administration of elementary
schools and secondary schools within the State; and
``(8) to create a statewide online leadership network for
principals to communicate with other principals in order to
share ideas and solve problems.
``(b) Coordination.--Each State that receives a grant under
this part and a grant under section 202 of the Higher
Education Act of 1965 shall coordinate the activities the
State carries out under such section 202 with the activities
the State educational agency carries out under this section.

``SEC. 2106. STATE ADMINISTRATIVE EXPENSES.

``Each State educational agency receiving a grant under
section 2101(a) may use not more than 5 percent of the amount
set aside in section 2102(a)(2) for a fiscal year for the
cost of--
``(1) planning and administering the activities described
in section 2103(b); and
``(2) administration relating to making subgrants to local
educational agencies under section 2102.

``SEC. 2107. LOCAL PLANS.

``(a) In General.--Each local educational agency desiring a
subgrant from the State educational agency under section
2102(a)(3) shall submit a local plan to the State educational
agency--
``(1) at such time, in such manner, and containing such
information as the State educational agency may require; and
``(2) that describes how the local educational agency will
coordinate the activities for which the agency seeks the
subgrant with other programs carried out under this Act, or
other Acts, as appropriate.
``(b) Local Plan Contents.--The local plan described in
subsection (a) shall, at a minimum--
``(1) describe how the local educational agency will use
the subgrant funds to meet the State performance objectives
for teacher qualifications and professional development
described in section 2104;
``(2) describe how the local educational agency will hold
elementary schools and secondary schools accountable for
meeting the requirements described in this part;
``(3) contain an assurance that the local educational
agency will target funds to the elementary schools and
secondary schools served by the local educational agency
that--
``(A) have the lowest proportion of fully qualified
teachers; and
``(B) are identified for school improvement and corrective
action under section 1116;
``(4) describe how the local educational agency will
coordinate professional development activities authorized
under section 2108(a) with professional development
activities provided through other Federal, State, and local
programs, including those authorized under titles I and III
and, where applicable, the Individuals with Disabilities
Education Act and the Carl D. Perkins Vocational and
Technical Education Act of 1998; and
``(5) describe how the local educational agency has
collaborated with teachers, principals, parents, and
administrators in the preparation of the local plan.

``SEC. 2108. LOCAL ACTIVITIES.

``(a) In General.--Each local educational agency receiving
a subgrant under section 2102(a)(3) shall use the subgrant
funds to--
``(1) support professional development activities, for--
``(A) teachers, in at least the areas of reading,
mathematics, and science; and
``(B) teachers, principals, and administrators in order to
provide such individuals with the knowledge and skills to
provide all students, including female students, minority
students, limited English proficient students, students with
disabilities, and economically disadvantaged students, with
the opportunity to meet challenging State content and student
performance standards;
``(2) provide professional development to teachers,
principals, and administrators to enhance the use of
technology within elementary schools and secondary schools in
order to deliver more effective curriculum instruction;
``(3) recruit and retain fully qualified teachers and
highly qualified principals, particularly for elementary
schools and secondary schools located in areas with high
percentages of low-performing students and students from
families with incomes below the poverty line;
``(4) recruit and retain fully qualified teachers and
highly qualified principals to

[[Page S1295]]

serve in the elementary schools and secondary schools with
the highest percentages of low-performing students, through
activities such as--
``(A) mentoring programs for newly hired teachers,
including programs provided by master teachers, and for newly
hired principals; and
``(B) programs that provide other incentives, including
financial incentives, to retain--
``(i) teachers who have a record of success in helping low-
performing students improve those students' academic success;
and
``(ii) principals who have a record of improving the
performance of all students, or significantly narrowing the
gaps between minority students and nonminority students, and
economically disadvantaged students and noneconomically
disadvantaged students, within the elementary schools or
secondary schools served by the principals;
``(5) provide professional development that incorporates
effective strategies, techniques, methods, and practices for
meeting the educational needs of diverse groups of students,
including female students, minority students, students with
disabilities, limited English proficient students, and
economically disadvantaged students; and
``(6) provide professional development for mental health
professionals, including school psychologists, school
counselors, and school social workers, that is focused on
enhancing the skills and knowledge of such individuals so
that the individuals may help students exhibiting distress
(through conduct such as substance abuse, disruptive
behavior, and suicidal behavior) meet the challenging State
student performance standards.
``(b) Optional Activities.--Each local educational agency
receiving a subgrant under section 2102(a)(3) may use the
subgrant funds--
``(1) to provide a signing bonus or other financial
incentive, such as differential pay, for--
``(A) a fully qualified teacher to teach in an academic
subject for which there exists a shortage of fully qualified
teachers within the elementary school or secondary school in
which the teacher teaches or within the elementary schools
and secondary schools served by the local educational agency;
``(B) a fully qualified teacher or a highly qualified
principal in a school in which there is--
``(i) a large percentage of students from economically
disadvantaged families; or
``(ii) a high percentage of low-performing students; or
``(C) a teacher who has met the National Education
Technology Standards, as developed by the Department of
Education and the International Society for Technology in
Education, or has obtained an information technology
certification that is directly related to the curriculum or
subject area that the teacher teaches;
``(2) to establish programs that--
``(A) recruit professionals into teaching from other fields
and provide such professionals with alternative routes to
teacher certification, especially in the areas of
mathematics, science, and English language arts; and
``(B) provide increased teaching and administration
opportunities for fully qualified females, minorities,
individuals with disabilities, and other individuals
underrepresented in the teaching or school administration
professions; and
``(3) to establish programs and activities that are
designed to improve the quality of the teacher and principal
force, such as innovative professional development programs
(which may be provided through partnerships, including
partnerships with institutions of higher education), and
including programs that--
``(A) train teachers and principals to utilize technology
to improve teaching and learning;
``(B) develop principals by helping schools identify school
leaders and invest in their professional development; and
``(C) are provided in a manner consistent with the
requirements of section 2019;
``(4) to provide collaboratively designed performance pay
systems for teachers and principals that encourage teachers
and principals to work together to raise student performance;
``(5) to establish professional development programs that
provide instruction in how to teach students with different
learning styles, particularly students with disabilities and
students with special learning needs (including students who
are gifted and talented);
``(6) to establish professional development programs that
provide instruction in how best to discipline students in the
classroom, and to identify early and appropriate
interventions to help students described in paragraph (5)
learn;
``(7) to provide professional development programs that
provide instruction in how to teach character education in a
manner that--
``(A) reflects the values of parents, teachers, and local
communities; and
``(B) incorporates elements of good character, including
honesty, citizenship, courage, justice, respect, personal
responsibility, and trustworthiness;
``(8) to provide scholarships or other incentives to assist
teachers in attaining national board certification;
``(9) to support activities designed to provide effective
professional development for teachers of limited English
proficient students;
``(10) to establish other activities designed--
``(A) to improve professional development for teachers,
principals, and administrators; and
``(B) to recruit and retain fully qualified teachers and
highly qualified principals;
``(11) to establish master teacher programs to increase
teacher salaries and employee benefits for teachers who enter
into contracts with the local educational agency to serve as
master teachers in the public schools, in accordance with the
requirements of subsection (c); and
``(12) to carry out professional development activities
that consist of--
``(A) instruction in the use of data and assessments to
provide information and instruction for classroom practice;
``(B) instruction in ways that teachers, principals, pupil
services personnel, and school administrators may work more
effectively with parents;
``(C) the formation of partnerships with institutions of
higher education to establish school-based teacher training
programs that provide prospective teachers and new teachers
with an opportunity to work under the guidance of experienced
teachers and college faculty;
``(D) the creation of career ladder programs for
paraprofessionals, who are assisting teachers under this
part, to obtain the education necessary for such
paraprofessionals to become certified and licensed teachers;
``(E) instruction in ways to teach special needs students;
``(F) joint professional development activities involving
teachers, principals, and administrators eligible to
participate in programs under this part, and personnel from
Head Start programs, Even Start programs, or State preschool
programs;
``(G) instruction in experiential-based teaching methods
such as service-learning or applied learning; and
``(H) mentoring programs focusing on changing teacher
behaviors and practices--
``(i) to help new teachers, including teachers who are
members of a minority group, develop and gain confidence in
their skills;
``(ii) to increase the likelihood that the new teachers
will continue in the teaching profession; and
``(iii) to improve the quality of their teaching.
``(c) Requirements for Master Teacher Programs.--
``(1) Definition.--In this subsection, the term `master
teacher' means a teacher who--
``(A) is certified or licensed under State law;
``(B) has been teaching for at least 5 years in a public or
private school or institution of higher education;
``(C) is selected to serve as a master teacher on the basis
of an application and recommendations by administrators and
other teachers;
``(D) at the time of submission of such application, is
teaching in a public school;
``(E) assists other teachers in improving instructional
strategies, improves the skills of other teachers, performs
mentoring, develops curricula, and provides other
professional development; and
``(F) enters into a contract with the local educational
agency involved to continue to teach and serve as a master
teacher for at least 5 years.
``(2) Requirements for master teacher contracts.--
``(A) In general.--A local educational agency that
establishes a master teacher program under subsection (b)(11)
shall negotiate the terms of contracts of master teachers
with the local labor organizations that represent teachers in
the school district served by that agency.
``(B) Breach.--A contract with a master teacher entered
into under this paragraph shall specify that a breach of the
contract shall be deemed to have occurred if the master
teacher voluntarily withdraws from the program, terminates
the contract, or is dismissed by the local educational agency
for nonperformance of duties, subject to the requirements of
any statutory or negotiated due process procedures that may
apply.
``(C) Repayment.--The contract shall require, in the event
of a breach of the contract described in subparagraph (B),
that the teacher repay the local educational agency all funds
provided to the teacher under the contract.
``(d) Requirements.--Professional development provided
under this section shall be provided in a manner consistent
with section 2109.

``SEC. 2109. PROFESSIONAL DEVELOPMENT FOR TEACHERS.

``(a) Limitation Relating to Curricula and Academic
Subjects.--In deciding how to use subgrant funds allocated
under section 2102(a)(3) to support a professional
development activities for teachers, a local educational
agency shall first use the funds to support activities that--
``(1) are directly related to the curricula and academic
subjects that the teachers teach; or
``(2) are designed to enhance the ability of the teachers
to understand and use the State's challenging content
standards for the academic subjects that the teachers teach;
or
``(3) provide instruction in methods of disciplining
students.
``(b) Professional Development Activity.--A professional
development activity carried out under this part shall--

[[Page S1296]]

``(1) be measured, in terms of progress described in
section 2104(a), using the specific performance objectives
established by the State educational agency in accordance
with section 2104;
``(2) be tied to challenging State or local content
standards and student performance standards;
``(3) be tied to scientifically based research
demonstrating the effectiveness of such activity in
increasing student achievement or substantially increasing
the subject matter knowledge, teaching knowledge, and
teaching skills of teachers;
``(4) be of sufficient intensity and duration (not to
include such activities as 1-day or short-term workshops and
conferences) to have a positive and lasting impact on
teachers' performance in the classroom, except that this
paragraph shall not apply to an activity that is 1 component
described in a long-term comprehensive professional
development plan--
``(A) established by a teacher and the teacher's
supervisor; and
``(B) based on an assessment of the needs of the teacher,
the teacher's students, and the local educational agency
involved;
``(5) be developed with extensive participation of
teachers, principals, parents, administrators, and local
school boards of elementary schools and secondary schools to
be served under this part, and institutions of higher
education in the State involved, and, with respect to any
professional development program described in paragraph (6)
or (7) of section 2108(b), shall, if applicable, be developed
with extensive coordination with, and participation of,
professionals with expertise in such type of professional
development;
``(6) to the extent appropriate, provide training for
teachers regarding using technology and applying technology
effectively in the classroom, to improve teaching and
learning concerning the curricula and academic subjects that
the teachers teach; and
``(7) be directly related to the academic subjects that the
teachers teach and the State content standards.
``(c) Accountability.--
``(1) In general.--A State educational agency shall notify
a local educational agency that the local educational agency
may be subject to the action described in paragraph (3) if,
after any fiscal year, the State educational agency
determines that the programs or activities funded by the
agency under this part fail to meet the requirements of
subsections (a) and (b).
``(2) Technical assistance.--A local educational agency
that has received notification pursuant to paragraph (1) may
request technical assistance from the State educational
agency and an opportunity for such local educational agency
to comply with the requirements of subsections (a) and (b).
``(3) State educational agency action.--If a State
educational agency determines that a local educational agency
failed to carry out the local educational agency's
responsibilities under subsections (a) and (b), the State
educational agency shall take such action as the agency
determines to be necessary, consistent with this section, to
provide, or direct the local educational agency to provide,
high-quality professional development for teachers,
principals, and administrators.

``SEC. 2110. PARENTS' RIGHT TO KNOW.

``Each local educational agency receiving a subgrant under
section 2102(a)(3) shall meet the reporting requirements with
respect to teacher qualifications described in section
4401(f).

``SEC. 2111. LOCAL ADMINISTRATIVE EXPENSES.

``Each local educational agency receiving a subgrant under
section 2102(a)(3) may use not more than 1.5 percent of the
subgrant funds for a fiscal year for the cost of
administering activities under this part.

``SEC. 2112. 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 report setting forth
information regarding--
``(1) the progress of States' in achieving compliance
concerning increasing the percentage of fully qualified
teacher, for fiscal years 2002 through 2004;
``(2) any obstacles to achieving that compliance; and
``(3) the approximate percentage of Federal, State, and
local resources being expended to carry out activities to
attract and retain fully qualified teachers, especially in
geographic areas and core academic subjects in which a
shortage of such teachers exists.

``SEC. 2113. EDUCATOR PARTNERSHIP GRANTS.

``(a) Subgrants.--
``(1) In general.--A State educational agency receiving a
grant under section 2101(a) shall award subgrants, on a
competitive basis, from amounts made available under section
2102(a)(1), to local educational agencies, elementary
schools, and secondary schools, that have formed educator
partnerships, for the design and implementation of programs
that will enhance professional development opportunities for
teachers, principals, and administrators, and will increase
the number of fully qualified teachers.
``(2) Allocations.--A State educational agency awarding
subgrants under this subsection shall allocate the subgrant
funds on a competitive basis and in a manner that results in
an equitable distribution of the subgrant funds by geographic
areas within the State.
``(b) Educator Partnerships.--An educator partnership
described in subsection (a) shall be a coalition established
by a cooperative arrangement between--
``(1) a public elementary school or secondary school
(including a charter school), or a local educational agency;
and
``(2) 1 or more of the following:
``(A) An institution of higher education.
``(B) An educational service agency.
``(C) A public or private not-for-profit education
organization.
``(D) A for-profit education organization.
``(E) An entity from outside the traditional education
arena, including a corporation or consulting firm.
``(c) Use of Funds.--An educator partnership receiving a
subgrant under this section shall use the subgrant funds for
1 or more activities consisting of--
``(1) developing and enhancing professional development
activities for teachers in core academic subjects to ensure
that the teachers have subject matter knowledge in the
academic subjects that the teachers teach;
``(2) developing and enhancing professional development
activities for mathematics and science teachers to ensure
that such teachers have the subject matter knowledge to teach
mathematics and science;
``(3) developing and providing assistance to local
educational agencies and elementary schools and secondary
schools for sustained, high-quality professional development
activities for teachers, principals, and administrators,
that--
``(A) ensure that teachers, principals, and administrators
are able to use State content standards, performance
standards, and assessments to improve instructional practices
and student achievement; and
``(B) may include intensive programs designed to prepare a
teacher who participates in such a program to provide
professional development instruction to other teachers within
the participating teacher's school;
``(4) increasing the number of fully qualified teachers
available to provide high-quality education to limited
English proficient students by--
``(A) working with institutions of higher education that
offer degree programs, to attract more people into such
programs, and to prepare better new teachers who are English
language teachers to provide effective language instruction
to limited English proficient students; and
``(B) supporting development and implementation of
professional development programs for language instruction
teachers to improve the language proficiency of limited
English proficient students;
``(5) developing and implementing professional development
activities for principals and administrators to enable the
principals and administrators to be effective school leaders
and to improve student achievement on challenging State
content and student performance standards, including
professional development relating to--
``(A) leadership skills;
``(B) recruitment, assignment, retention, and evaluation of
teachers and other staff;
``(C) effective instructional practices, including the use
of technology; and
``(D) parental and community involvement; and
``(6) providing activities that enhance professional
development opportunities for teachers, principals, and
administrators or will increase the number of fully qualified
teachers.
``(d) Application Required.--Each educator partnership
desiring a subgrant under this section shall submit an
application to the appropriate State educational agency at
such time, in such manner, and containing such information as
the State educational agency may reasonably require.
``(e) Administrative Expenses.--Each educator partnership
receiving a subgrant under this section may use not more than
5 percent of the subgrant funds for a fiscal year for the
cost of planning and administering programs under this
section.
``(f) Coordination.--Each educator partnership that
receives a subgrant under this section and a grant under
section 203 of the Higher Education Act of 1965 shall
coordinate the activities carried out under such section 203
with any related activities carried out under this section.

``SEC. 2114. AUTHORIZATION OF APPROPRIATIONS.

``There are authorized to be appropriated to carry out this
part $2,000,000,000 for fiscal year 2002 and such sums as may
be necessary for each of the 4 succeeding fiscal years.

``PART B--CLASS SIZE REDUCTION

``SEC. 2201. FINDINGS.

``Congress makes the following findings:
``(1) Rigorous research has shown that, in the early
elementary school grades, students attending small classes
make more rapid educational gains than students in larger
classes, and that those gains persist through at least the
eighth grade.
``(2) The benefits of smaller classes are greatest for
lower-achieving, minority, poor, and inner-city children, as
demonstrated by a study that found that urban fourth graders
in smaller-than-average classes were \3/4\ of a school year
ahead of their counterparts in larger-than-average classes.
``(3) Teachers in small classes can provide students with
more individualized attention, spend more time on instruction
and less time on other tasks, and cover more material
effectively, and are better able to work with

[[Page S1297]]

parents to further their children's education, than teachers
in large classes.
``(4) Smaller classes allow teachers to identify and work
with students who have learning disabilities sooner than is
possible with larger classes, potentially reducing those
students' needs for special education services in the later
grades.
``(5) The National Research Council report, `Preventing
Reading Difficulties in Young Children', recommends reducing
class sizes, accompanied by providing high-quality
professional development for teachers, as a strategy for
improving student achievement in reading.
``(6) Some research has shown that class size reduction
efforts are most effective in the early elementary school
grades.
``(7) Efforts to improve educational outcomes by reducing
class sizes in the early elementary school grades are likely
to be successful only if well-qualified teachers are hired to
fill additional classroom positions, and if teachers receive
intensive, ongoing professional development.
``(8) Several States and school districts have begun
serious efforts to reduce class sizes in the early elementary
school grades, but those efforts may be impeded by financial
limitations or difficulties in hiring highly qualified
teachers.
``(9) The Federal Government can assist in those efforts by
providing funding for class size reductions in grades 1
through 3, and by helping to ensure that both new and current
teachers who are moving into smaller classrooms are well
prepared.

``SEC. 2202. PURPOSES.

``The purposes of this part are--
``(1) to help States and local educational agencies to
reduce class sizes with fully qualified teachers;
``(2) to enable local educational agencies to carry out
effective approaches to reducing class sizes with fully
qualified teachers; and
``(3) to improve educational achievement for children in
regular classes and special needs children, and particularly
to improve that achievement by reducing class sizes in the
early elementary school grades.

``SEC. 2203. ALLOTMENTS TO STATES.

``(a) Reservations for the Outlying Areas and the Bureau of
Indian Affairs.--From the amount appropriated under section
2212 for any fiscal year, the Secretary shall reserve a total
of not more than 1 percent to make payments to--
``(1) 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; and
``(2) 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.
``(b) Allotments to States.--
``(1) In general.--
``(A) Fiscal year 2002.--From the amount appropriated under
section 2212 for fiscal year 2002 and remaining after the
Secretary makes reservations under subsection (a), the
Secretary shall make grants to State educational agencies by
allotting to each State having a State application approved
under section 2204(c) an amount that bears the same
relationship to the remainder as the greater of the amounts
that the State received for the preceding fiscal year under
sections 1122 and 2202(b) (as such sections were in effect on
the day before the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act) bears to
the total of the greater amounts that all States received
under such sections for fiscal year 2001.
``(B) Fiscal year 2003 and subsequent fiscal years.--From
the amount appropriated under section 2212 for fiscal year
2003 or a subsequent fiscal year and remaining after the
Secretary makes reservations under subsection (a), the
Secretary shall make grants to State educational agencies by
allotting to each State having a State application approved
under section 2204(c) an amount that bears the same
relationship to the remainder as the greater of the amounts
that the State received for the preceding fiscal year as
described in section 1122 and this section bears to the total
of the greater amounts that all States received under such
sections for the preceding fiscal year.
``(2) Reallotment.--If any State chooses not to participate
in the program carried out under this part, or fails to
submit an approvable application under this part, the
Secretary shall reallot the amount that such State would have
received under paragraph (1) to States having applications
approved under section 2204(c), in accordance with paragraph
(1).

``SEC. 2204. STATE APPLICATIONS.

``(a) Applications Required.--The State educational agency
for each State desiring 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 require.
``(b) Contents.--The application shall include--
``(1) a description of the State's goals for using funds
under this part to reduce average class sizes in regular
classrooms in grades 1 through 3, including a description of
class sizes in those classrooms, for each local educational
agency in the State (as of the date of submission of the
application);
``(2) a description of how the State educational agency
will allocate program funds made available through the grant
within the State;
``(3) a description of how the State educational agency
will use other funds, including other Federal funds, to
reduce class sizes and to improve teacher quality and reading
achievement within the State; and
``(4) an assurance that the State educational agency will
submit to the Secretary such reports and information as the
Secretary may reasonably require.
``(c) Approval of Applications.--The Secretary shall
approve a State application submitted under this section if
the application meets the requirements of this section and
holds reasonable promise of achieving the purposes of this
part.
``(d) Notification.--Not later than 30 days after the date
of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act, the Secretary shall
provide specific notification to each local educational
agency eligible to receive funds under this part regarding
the flexibility provided under section 2207(b)(2)(B) and the
ability to use such funds to carry out activities described
in section 2207(b)(1)(C).

``SEC. 2205. WITHIN-STATE ALLOCATIONS.

``(a) Allocations to Local Educational Agencies.--Each
State educational agency receiving a grant under this part
for a fiscal year--
``(1) may reserve not more than 1 percent of the grant
funds for the cost of administering this part; and
``(2) using the remaining funds, shall make subgrants by
allocating to each local educational agency in the State the
sum of--
``(A) an amount that bears the same relationship to 80
percent of the remainder as the school-age population from
families with incomes below the poverty line in the area
served by the local educational agency bears to the school-
age population from families with incomes below the poverty
line in the area served by all local educational agencies in
the State; and
``(B) an amount that bears the same relationship to 20
percent of the remainder as the enrollment of the school-age
population in public and private nonprofit elementary schools
and secondary schools in the area served by the local
educational agency bears to the enrollment of the school-age
population in public and private nonprofit elementary schools
and secondary schools in the area served by all local
educational agencies in the State.
``(b) Reallocation.--If any local educational agency
chooses not to participate in the program carried out under
this part, or fails to submit an approvable application under
this part, the State educational agency shall reallocate the
amount such local educational agency would have received
under subsection (a) to local educational agencies having
applications approved under section 2206(b), in accordance
with subsection (a).

``SEC. 2206. LOCAL APPLICATIONS.

``(a) In General.--Each local educational agency desiring a
subgrant under section 2205(a) shall submit an application to
the appropriate State educational agency at such time, in
such manner, and containing such information as the State
educational agency may require, including a description of
the local educational agency's program to reduce class sizes
by hiring additional fully qualified teachers.
``(b) Approval of Applications.--The State educational
agency shall approve a local agency application submitted
under this section if the application meets the requirements
of this section and holds reasonable promise of achieving the
purposes of this part.

``SEC. 2207. USES OF FUNDS.

``(a) Administrative Expenses.--Each local educational
agency receiving a subgrant under section 2205(a) may use not
more than 3 percent of the subgrant funds for a fiscal year
for the cost of administering this part.
``(b) Local Activities.--
``(1) In general.--Each local educational agency receiving
a subgrant under section 2205(a) may use the subgrant funds
for--
``(A) recruiting (including recruiting 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 students with disabilities and other students)
and fully qualified teachers of special-needs students;
``(B) testing new teachers for subject matter knowledge and
satisfaction of State certification or licensing requirements
consistent with title II of the Higher Education Act of 1965;
and
``(C) providing professional development (which may include
such activities as the activities described in section 2108,
opportunities for teachers to attend multiweek institutes,
such as institutes offered 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 students, in
order to meet the goal of ensuring that all teachers have the
necessary subject matter knowledge, teaching knowledge, and
teaching skills to teach effectively the academic subjects
that the teachers teach, consistent with title II of the
Higher Education Act of 1965.

[[Page S1298]]

``(2) Limitations.--
``(A) In general.--Except as provided in subparagraph (B),
a local educational agency may use not more than a total of
25 percent of the subgrant funds for activities described in
subparagraphs (B) and (C) of paragraph (1).
``(B) Exception.--
``(i) In general.--A local educational agency may use a
portion equal to more than 25 percent of the subgrant funds
for activities described in paragraph (1)(C) if 10 percent or
more of the teachers in elementary schools served by the
agency--

``(I) have not met applicable State and local certification
requirements (including certification through State or local
alternative routes); or
``(II) are teachers for whom the requirements have been
waived.

``(ii) Use of funds.--The local educational agency shall
use the portion referred to in clause (i)--

``(I) to help teachers who are not certified or licensed by
the State become certified or licensed, including
certification through State or local alternative routes; or
``(II) to help teachers affected by class size reduction
who lack sufficient subject matter knowledge to teach
effectively the academic subjects that the teachers teach, to
obtain that knowledge.

``(iii) Notification.--To be eligible to use the portion of
the funds described in clause (i) for objectives described in
this subparagraph, the local educational agency shall notify
the State educational agency of the percentage of the funds
that the local educational agency will use for those
objectives.
``(3) Additional uses.--
``(A) In general.--A local educational agency that has
already reduced class size in the early elementary school
grades to 18 or fewer students (or has already reduced class
size to a State or local class size reduction goal that was
in effect on the day before the date of enactment of the
Department of Education Appropriations Act, 2000, if that
State or local goal is 20 or fewer students) may use the
subgrant funds--
``(i) to make further class size reductions in kindergarten
or grade 1, 2, or 3;
``(ii) to reduce class size in other grades; or
``(iii) to carry out activities to improve teacher quality,
including professional development.
``(B) Professional development.--Even if a local
educational agency has already reduced class size in the
early elementary school grades to 18 or fewer students and
intends to use the subgrant funds to carry out activities to
improve teacher quality, including professional development
activities, the State educational agency shall make the
subgrant under section 2205 to the local educational agency.
``(c) Special Rule.--Notwithstanding subsection (b), if the
amount of the subgrant made to a local educational agency
under section 2205 is less than the starting salary for a new
fully qualified teacher teaching in a school served by that
agency, the agency may use the subgrant funds to--
``(1) help pay the salary of a full- or part-time teacher
hired to reduce class size, and may provide the funds in
combination with other Federal, State, or local funds; or
``(2) pay for activities described in subsection (b), which
may be related to teaching in smaller classes.

``SEC. 2208. PRIVATE SCHOOLS.

``If a local educational agency uses funds made available
under this part for professional development activities, the
local educational agency shall ensure the equitable
participation of private nonprofit elementary schools and
secondary schools in such activities. Section 8503(b)(1)
shall not apply to other activities carried out under this
part.

``SEC. 2209. TEACHER SALARIES AND BENEFITS.

``A local educational agency may use grant funds provided
under this part--
``(1) except as provided in paragraph (2), to increase the
salaries of, or provide benefits (other than participation in
professional development and enrichment programs) to,
teachers only if such teachers were hired under this part;
and
``(2) to pay the salaries of teachers hired with funds made
available under section 307 of the Department of Education
Appropriations Act, 1999 or under section 310 of the
Department of Education Appropriations Act, 2000, who not
later than the beginning of the 2002-2003 school year, are
fully qualified.

``SEC. 2210. STATE REPORT REQUIREMENTS.

``(a) Report on Activities.--A State educational agency
receiving funds under this part shall submit a report to the
Secretary providing information about the activities in the
State assisted under this part.
``(b) Report to Parents.--Each State educational agency or
local educational agency receiving funds under this part
shall publicly issue a report to parents of students who
attend schools assisted under this part describing--
``(1) the agency's progress in reducing class size;
``(2) the agency's progress in increasing the percentage of
classes in core academic areas that are taught by fully
qualified teachers; and
``(3) the impact, if any, that hiring additional fully
qualified teachers and reducing class size has had on
increasing student academic achievement in schools served by
the agency.
``(c) Professional Qualifications Report.--Upon the request
of a parent of a student attending a school receiving
assistance under this part, such school shall provide the
parent with information regarding the professional
qualifications of the student's teacher.

``SEC. 2211. SUPPLEMENT NOT SUPPLANT.

``Funds made available under this part shall be used to
supplement and not supplant State and local funds expended
for activities described in this part.

``SEC. 2212. AUTHORIZATION OF APPROPRIATIONS.

``There are authorized to be appropriated to carry out this
part $1,623,000,000 for fiscal year 2002, and such sums as
may be necessary for each of the 4 succeeding fiscal
years.''.

TITLE III--LANGUAGE MINORITY STUDENTS AND INDIAN, NATIVE HAWAIIAN, AND
ALASKA NATIVE EDUCATION

SEC. 301. LANGUAGE MINORITY STUDENTS.

Title III (20 U.S.C. 6801 et seq.) is amended--
(1) by amending the title heading for title III to read as
follows:

``TITLE III--LANGUAGE MINORITY STUDENTS AND INDIAN, NATIVE HAWAIIAN,
AND ALASKA NATIVE EDUCATION'';

(2) by repealing section 3101 (20 U.S.C. 6801) and part A
(20 U.S.C. 6811 et seq.); and
(3) by inserting after the title heading for title III (as
amended by paragraph (1)) the following:

``PART A--LANGUAGE MINORITY STUDENTS

``SEC. 3101. FINDINGS, POLICY, AND PURPOSE.

``(a) Findings.--Congress makes the following findings:
``(1)(A) Educating limited English proficient students is
an urgent goal for many local educational agencies, but that
goal is not being achieved.
``(B) Each year, 640,000 limited English proficient
students are not served by any sort of program targeted to
the students' unique needs.
``(C) In 1998, only 15 percent of local educational
agencies that applied for related funding through enhancement
grants and comprehensive school grants received such funding.
``(2)(A) The school dropout rate for Hispanic students, the
largest group of limited English proficient students, is
approximately 29 percent, and is approximately 44 percent for
Hispanics born outside of the United States.
``(B) A Department of Education report regarding school
dropout rates states that language difficulty `may be a
barrier to participation in United States schools'.
``(C) Reading ability is a key predictor of graduation and
academic success.
``(3) Through fiscal year 2001, bilingual education
capacity and demonstration grants--
``(A) have spread funding too broadly to make an impact on
language instruction educational programs implemented by
State educational agencies and local educational agencies;
and
``(B) have lacked concrete performance measures.
``(4)(A) Since 1979, the number of limited English
proficient children in schools in the United States has
doubled to more than 3,000,000, and demographic trends
indicate the population of limited English proficient
children will continue to increase.
``(B) Language-minority students in the United States speak
virtually all world languages plus many that are indigenous
to the United States.
``(C) The rich linguistic diversity language-minority
students bring to classrooms in the United States enhances
the learning environment for all students and should be
valued for the significant, positive impact such diversity
has on the entire school environment.
``(D) Parent and community participation in educational
language programs for limited English proficient students
contributes to program effectiveness.
``(E) The Federal Government has a special and continuing
obligation, as reflected in title VI of the Civil Rights Act
of 1964 and section 204(f) of the Equal Educational
Opportunities Act of 1974, to ensure that States and local
educational agencies take appropriate action to provide equal
educational opportunities to limited English proficient
children and youth, and other children and youth.
``(F) The Federal Government also has a special and
continuing obligation to assist States and local educational
agencies, as exemplified by programs authorized under this
title, to develop the capacity to provide programs of
instruction that offer equal educational opportunities to
limited English proficient children and youth, and other
children and youth.
``(5) Limited English proficient children and youth face a
number of challenges in receiving an education that will
enable the children and youth to participate fully in
society, including--
``(A) disproportionate attendance at high-poverty schools,
as demonstrated by the fact that, in 1994, 75 percent of
limited English proficient students attended schools in which
at least half of all students were eligible for free or
reduced-price meals;
``(B) the limited ability of parents of such children and
youth to participate fully in the education of their children
because of the parents' own limited English proficiency;
``(C) a shortage of teachers and other staff who are
professionally trained and qualified to serve such children
and youth; and

[[Page S1299]]

``(D) lack of appropriate performance and assessment
standards that distinguish between language ability and
academic achievement so that State educational agencies and
local educational agencies are equally as accountable for the
achievement of limited English proficient students in
academic content while the students are acquiring English
language skills as the agencies are for enabling the students
to acquire those skills.
``(b) Policy.--It is the policy of the United States that
in order to ensure equal educational opportunity for all
children and youth, and to promote educational excellence,
the Federal Government should--
``(1) assist State educational agencies, local educational
agencies, and community-based organizations to build their
capacity to establish, implement, and sustain programs of
instruction and English language development for children and
youth of limited English proficiency;
``(2) hold State educational agencies and local educational
agencies accountable for increases in English proficiency and
core content knowledge among limited English proficient
students; and
``(3) promote parental and community participation in
limited English proficiency programs.
``(c) Purposes.--The purposes of this part are--
``(1) to assist all limited English proficient students to
attain English proficiency;
``(2) to assist all limited English proficient students to
develop high levels of attainment in the core academic
subjects so that those students can meet the same challenging
State content standards and challenging State student
performance standards as all students are expected to meet,
as required by section 1111(b)(1);
``(3) to assist local educational agencies to develop and
enhance their capacity to provide high quality instruction in
teaching limited English proficient students to attain the
same high levels of academic achievement as other students;
and
``(4) to provide the assistance described in paragraphs
(1), (2), and (3) by--
``(A) streamlining language instruction educational
programs into a program carried out through a performance-
based grant for State and local educational agencies to help
limited English proficient students become proficient in
English;
``(B) increasing significantly the amount of Federal
assistance provided to local educational agencies serving
such students while requiring that State educational agencies
and local educational agencies--
``(i) demonstrate improvements in the English proficiency
of such students each fiscal year; and
``(ii) make adequate yearly progress with limited English
proficient students in the core academic subjects as
described in section 1111(b)(2); and
``(C) providing State educational agencies and local
educational agencies with the flexibility to implement
instructional programs, tied to scientifically based
research, that the agencies believe to be the most effective
for teaching English.

``SEC. 3102. DEFINITIONS.

``Except as otherwise provided, in this part:
``(1) Core academic subject.--The term `core academic
subject' has the meaning given the term in section 2002.
``(2) Limited english proficient student.--The term
`limited English proficient student' means an individual aged
5 through 17 enrolled in an elementary school or secondary
school--
``(A) who--
``(i) was not born in the United States or whose native
language is a language other than English;
``(ii)(I) is a Native American or Alaska Native, or a
native resident of the outlying areas; and
``(II) comes from an environment where a language other
than English has had a significant impact on such
individual's level of English language proficiency; or
``(iii) is migratory, whose native language is a language
other than English, and who comes from an environment where a
language other than English is dominant; and
``(B) who has sufficient difficulty speaking, reading,
writing, or understanding the English language, and whose
difficulties may deny such individual--
``(i) the ability to meet the State's proficient level of
performance on State assessments described in section
1111(b)(4) in core academic subjects; or
``(ii) the opportunity to participate fully in society.
``(3) Language instruction educational program.--The term
`language instruction educational program' means an
instructional course in which a limited English proficient
student is placed for the purpose of becoming proficient in
the English language.
``(4) Scientifically based research.--The term
`scientifically based research' has the meaning given the
term in section 1705.
``(5) Specially qualified agency.--The term `specially
qualified agency' means a local educational agency, in a
State that does not participate in a program under this part
for a fiscal year.
``(6) State.--The term `State' means each of the several
States of the United States, the District of Columbia, and
the Commonwealth of Puerto Rico.

``SEC. 3103. PROGRAM AUTHORIZED.

``(a) Grants Authorized.--The Secretary shall award grants,
from allotments under subsection (b), to each State having a
State plan approved under section 3105(c), to enable the
State to help limited English proficient students become
proficient in English.
``(b) Reservations and Allotments.--
``(1) Reservations.--From the amount appropriated under
section 3111 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; 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
section 3111 for any of the fiscal years 2002 through 2006
that remains after making reservations under paragraph (1),
the Secretary shall allot to each State having a State plan
approved under section 3105(c) an amount that bears the same
relationship to the remainder as the number of limited
English proficient students in the State bears to the number
of limited English proficient students in all States.
``(3) Data.--For the purpose of determining the number of
limited English proficient students in a State and in all
States for each fiscal year, the Secretary shall use data
that will yield the most accurate, up-to-date numbers of such
students, including--
``(A) data available from the Bureau of the Census; or
``(B) data submitted to the Secretary by the States to
determine the number of limited English proficient students
in a State and in all States.
``(4) Hold-harmless amounts.--For fiscal year 2002, and for
each of the 4 succeeding fiscal years, notwithstanding
paragraph (2), the total amount allotted to each State under
this subsection shall be not less than 85 percent of the
total amount the State was allotted under parts A and B of
title VII (as such title was in effect on the day before the
date of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act) for fiscal year 2001.
``(c) Direct Awards to Specially Qualified Agencies.--
``(1) Nonparticipating state.--If a State educational
agency for a fiscal year chooses not to participate in a
program under this part, or fails to submit an approvable
application under section 3105, a specially qualified agency
in such State desiring a grant under this part for the fiscal
year shall apply directly to the Secretary to receive a grant
under this subsection.
``(2) Direct awards.--The Secretary may award, on a
competitive basis, the amount the State educational agency is
eligible to receive under subsection (b)(2) directly to
specially qualified agencies in the State desiring a grant
under this part and having an application approved under
section 3105(c).
``(3) Administrative funds.--A specially qualified agency
that receives a direct grant under this subsection may use
not more than 1 percent of the grant funds for the
administrative costs of carrying out this part in the first
year the agency receives a grant under this subsection and
0.5 percent of the funds for such costs in the second and
each succeeding fiscal year for which the agency receives
such a grant.

``SEC. 3104. WITHIN-STATE ALLOCATIONS.

``(a) Grant Awards.--Each State educational agency
receiving a grant under this part shall use 95 percent of the
grant funds to award subgrants, from allocations under
subsection (b), to local educational agencies in the State to
carry out the activities described in section 3107.
``(b) Allocation Formula.--Each State educational agency
receiving a grant under this part shall award grants for a
fiscal year by allocating to each local educational agency in
the State having a plan approved under section 3106 in an
amount that bears the same relationship to the amount of
funds appropriated under section 3111 for the fiscal year as
the population of limited English proficient students in
schools served by the local educational agency bears to the
population of limited English proficient students in schools
served by all local educational agencies in the State.
``(c) Reservations.--
``(1) State activities.--Each State educational agency or
specially qualified agency receiving a grant under this part
may reserve not more than 5 percent of the grant funds to
carry out activities described in the State plan or specially
qualified agency plan submitted under section 3105.
``(2) Administrative expenses.--From the amount reserved
under paragraph (1), a State educational agency or specially
qualified agency may use not more than 2 percent for the
planning costs and administrative costs of carrying out the
activities described in the State plan or specially qualified
agency plan and providing grants to local educational
agencies.

``SEC. 3105. STATE AND SPECIALLY QUALIFIED AGENCY PLANS.

``(a) Plan Required.--Each State educational agency and
specially qualified agency desiring a grant under this part
shall submit a plan to the Secretary at such time, in

[[Page S1300]]

such manner, and containing such information as the Secretary
may require.
``(b) Contents.--Each State plan submitted under subsection
(a) shall--
``(1) describe how the State or specially qualified agency
will--
``(A)(i) establish standards and benchmarks for English
language development that are aligned with the State content
and student performance standards described in section
1111(b)(1);
``(ii) establish the standards and benchmarks for each of
the 4 recognized domains of speaking, listening, reading, and
writing; and
``(iii) for each domain, establish at least 3 benchmarks,
including benchmarks for performance that is not proficient,
partially proficient performance, and proficient performance;
``(B) develop high-quality, annual assessments to measure
English language proficiency, including proficiency in the 4
recognized domains of speaking, listening, reading, and
writing; and
``(C) develop annual performance objectives, based on the
English language development standards described in
subparagraph (A), to raise the level of English proficiency
of each limited English proficient student;
``(2) contain an assurance that the State educational
agency or specially qualified agency consulted with local
educational agencies, education-related community groups and
nonprofit organizations, parents, teachers, school
administrators, and English language instruction specialists,
in setting the performance objectives;
``(3) describe how--
``(A) in the case of a State educational agency, the State
educational agency will hold local educational agencies and
elementary schools and secondary schools accountable for--
``(i) meeting the performance objectives described in
section 3109 for English proficiency in each of the 4 domains
of speaking, listening, reading, and writing; and
``(ii) making adequate yearly progress with limited English
proficient students in the core academic subjects as
described in section 1111(b)(2); and
``(B) in the case of a specially qualified agency, the
agency will hold elementary schools and secondary schools
accountable for--
``(i) meeting the performance objectives described in
section 3109 for English proficiency in each of the 4 domains
of speaking, listening, reading, and writing; and
``(ii) making adequate yearly progress, including meeting
annual numerical goals for improving the performance of
limited English proficient students on performance standards
described in section 1111(b)(1)(D)(ii);
``(4) describe the activities for which assistance is
sought, and how the activities will increase the speed and
effectiveness with which students learn English;
``(5) in the case of a State educational agency, describe
how local educational agencies in the State will be given the
flexibility to teach English--
``(A) using a language instruction curriculum that is tied
to scientifically based research and has been demonstrated to
be effective; and
``(B) in the manner the local educational agencies
determine to be the most effective; and
``(6) describe how--
``(A) in the case of a State educational agency, the State
educational agency will--
``(i) provide technical assistance to local educational
agencies and elementary schools and secondary schools for the
purposes of identifying and implementing English language
instruction educational programs and curricula that are tied
to scientifically based research; and
``(ii) provide technical assistance to local educational
agencies and elementary schools and secondary schools for the
purposes of helping limited English proficient students meet
the same challenging State content standards and challenging
State student performance standards as all students are
expected to meet; and
``(B) in the case of a specially qualified agency, the
specially qualified agency will--
``(i) provide technical assistance to elementary schools
and secondary schools served by the specially qualified
agency for the purposes of identifying and implementing
programs and curricula described in subparagraph (A)(i); and
``(ii) provide technical assistance in elementary schools
and secondary schools served by the specially qualified
agency for the purposes described in subparagraph (A)(ii).
``(c) Approval.--The Secretary, after using a peer review
process, shall approve a State plan or a specially qualified
agency plan if the plan meets the requirements of this
section, and holds reasonable promise of achieving the
purposes described in section 3101(c).
``(d) Duration of the Plan.--
``(1) In general.--Each State plan or specially qualified
agency plan shall--
``(A) remain in effect for the duration of the State
educational agency's or specially qualified agency's
participation under this part; and
``(B) be periodically reviewed and revised by the State
educational agency or specially qualified agency, as
necessary, to reflect changes to the State's or specially
qualified agency's strategies and programs carried out under
this part.
``(2) Additional information.--If the State educational
agency or specially qualified agency makes significant
changes to the plan, such as the adoption of new performance
objectives or assessment measures, the State educational
agency or specially qualified agency shall submit information
regarding the significant changes to the Secretary.
``(e) Consolidated Plan.--A State plan submitted under
subsection (a) may be submitted as part of a consolidated
plan under section 8302.
``(f) Secretary Assistance.--Pursuant to section
7104(a)(3), the Secretary shall provide assistance, if
required, in the development of English language development
standards and English language proficiency assessments.

``SEC. 3106. LOCAL PLANS.

``(a) Plan Required.--Each local educational agency
desiring a grant from the State educational agency under
section 3104 shall submit a plan to the State educational
agency at such time, in such manner, and containing such
information as the State educational agency may require.
``(b) Contents.--Each local educational agency plan
submitted under subsection (a) shall--
``(1) describe how the local educational agency will use
the grant funds to meet the English proficiency performance
objectives described in section 3109;
``(2) describe how the local educational agency will hold
elementary schools and secondary schools accountable for
meeting the performance objectives;
``(3) contain an assurance that the local educational
agency consulted with elementary schools and secondary
schools, education-related community groups and nonprofit
organizations, institutions of higher education, parents,
language instruction teachers, school administrators, and
English language instruction specialists, in developing the
local educational agency plan;
``(4) describe how the local educational agency will use
the disaggregated results of the student assessments required
under section 1111(b)(4), and other measures or indicators
available to the agency, to review annually the progress of
each school served by the agency under this part and under
title I to determine whether the schools are making the
adequate yearly progress necessary to ensure that limited
English proficient students attending the schools will meet
the State's proficient level of performance on the State
assessment described in section 1111(b)(4) within 10 years
after the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act; and
``(5) describe how the local educational agency will hold
elementary schools and secondary schools accountable for
making adequate yearly progress with limited English
proficient students in the core academic subjects as
described in section 1111(b)(2).

``SEC. 3107. USES OF FUNDS.

``(a) Administrative Expenses.--Each local educational
agency receiving a grant under section 3104 may use not more
than 1 percent of the grant funds for a fiscal year for the
cost of administering this part.
``(b) Activities.--Each local educational agency receiving
grant funds under section 3104 shall use the grant funds that
are not used under subsection (a)--
``(1) to increase limited English proficient students'
proficiency in English by providing high-quality language
instruction educational programs, such as bilingual education
programs and transitional education or English immersion
education programs, that are--
``(A) tied to scientifically based research demonstrating
the effectiveness of the programs in increasing English
proficiency; and
``(B) approved by the State educational agency;
``(2) to provide high-quality professional development
activities for teachers of limited English proficient
students that are--
``(A) designed to enhance the ability of such teachers to
understand and use curricula, assessment measures, and
instructional strategies for limited English proficient
students;
``(B) tied to scientifically based research demonstrating
the effectiveness of such activities in increasing students'
English proficiency or substantially increasing the subject
matter knowledge, teaching knowledge, and teaching skills of
such teachers;
``(C) of sufficient intensity and duration (not to include
activities such as 1-day or short-term workshops and
conferences) to have a positive and lasting impact on the
teachers' performance in the classroom, except that this
subparagraph shall not apply to an activity that is 1
component described in a long-term, comprehensive
professional development plan established by a teacher and
the teacher's supervisor based upon an assessment of the
needs of the teacher, the supervisor, the students of the
teacher, and the local educational agency;
``(3) to identify, acquire, and upgrade curricula,
instructional materials, educational software, and assessment
procedures; and
``(4) to provide parent and community participation
programs to improve language instruction educational programs
for limited English proficient students.

``SEC. 3108. PROGRAM REQUIREMENTS.

``(a) Prohibition.--In carrying out this part, the
Secretary shall neither mandate nor preclude the use of a
particular curricular or pedagogical approach to educating
limited English proficient students.
``(b) Teacher English Fluency.--Each local educational
agency receiving grant

[[Page S1301]]

funds under section 3104 shall certify to the State
educational agency that all teachers in any language
instruction educational program for limited English
proficient students funded under this part are fluent in
English.

``SEC. 3109. PERFORMANCE OBJECTIVES.

``(a) In General.--Each State educational agency or
specially qualified agency receiving a grant under this part
shall develop annual numerical performance objectives with
respect to helping limited English proficient students become
proficient in English, including proficiency in the 4
recognized domains of speaking, listening, reading, and
writing. For each annual numerical performance objective
established, the agency shall specify an incremental
percentage increase for the objective to be attained for each
of the fiscal years (after the first fiscal year) for which
the agency receives a grant under this part, relative to the
preceding fiscal year, including increases in the number of
limited English proficient students demonstrating an increase
in performance on annual assessments in speaking, listening,
reading, and writing.
``(b) Accountability.--Each State educational agency or
specially qualified agency receiving a grant under this part
shall be held accountable for meeting the annual numerical
performance objectives under this part and the adequate
yearly progress levels for limited English proficient
students under clauses (iv) and (vii) of section
1111(b)(2)(B). Any State educational agency or specially
qualified agency that fails to meet the annual performance
objectives shall be subject to sanctions under section 7101.

``SEC. 3110. REGULATIONS AND NOTIFICATION.

``(a) Regulation Rule.--In developing regulations under
this part, the Secretary shall consult with State educational
agencies, local educational agencies, organizations
representing limited English proficient individuals, and
organizations representing teachers and other personnel
involved in the education of limited English proficient
students.
``(b) Parental Notification.--
``(1) In general.--Each local educational agency shall
notify parents of a student participating in a language
instruction educational program under this part 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- and grade-
appropriate academic attainment, promotion, and graduation;
``(B)(i) the programs that 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
``(ii) in the case of a student with a disability who
participates in the language instruction educational program,
how the program meets the objectives of the individualized
education program of the student; and
``(C)(i) the instructional goals of the language
instruction educational program in which the student
participates, and how the program will specifically help the
limited English proficient student learn English and meet
age-appropriate standards for grade promotion and graduation;
``(ii) the characteristics, benefits, and past academic
results of the language instruction educational program and
of instructional alternatives; and
``(iii) the reasons the student was identified as being in
need of a language instruction educational program.
``(2) Option to decline.--
``(A) In general.--Each parent described in paragraph (1)
shall also be informed that the parent has the option of
declining the enrollment of the student in a language
instruction educational program, and shall be given an
opportunity to decline such enrollment if the parent so
chooses.
``(B) Obligations.--A local educational agency shall not be
relieved of any of the agency's obligations under title VI of
the Civil Rights Act of 1964 if a parent chooses not to
enroll a student in a language instruction educational
program.
``(3) Receipt of information.--A parent described in
paragraph (1) shall receive the information required by this
subsection in a manner and form understandable to the parent
including, if necessary and to the extent feasible, receiving
the information in the native language of the parent. At a
minimum, the parent shall receive--
``(A) timely information about programs funded under this
part; and
``(B) if the parent desires, notice of opportunities for
regular meetings for the purpose of formulating and
responding to recommendations from parents of students
assisted under this part.
``(4) 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.
``(5) Limitations on conditions.--Nothing in this part
shall be construed to authorize an officer or employee of the
Federal Government to mandate, direct, or control a State's,
local educational agency's, elementary school's, or secondary
school's specific challenging English language development
standards or assessments, curricula, or program of
instruction, as a condition of eligibility to receive grant
funds under this part.

``SEC. 3111. AUTHORIZATION OF APPROPRIATIONS.

``There are authorized to be appropriated to carry out this
part $1,000,000,000 for fiscal year 2002, and such sums as
may be necessary for each of the 4 succeeding fiscal
years.''.

SEC. 302. EMERGENCY IMMIGRANT EDUCATION PROGRAM.

(a) Repeals, Transfers, and Redesignations.--Title III (20
U.S.C. 6801 et seq.) is further amended--
(1) by repealing part B (20 U.S.C. 6891 et seq.), part C
(20 U.S.C. 6921 et seq.), part D (20 U.S.C. 6951 et seq.),
part E (20 U.S.C. 6971 et seq.), and part F, as added by
section 1711 of division B of the Miscellaneous
Appropriations Act, 2001 (as enacted into law by section
1(a)(4) of Public Law 106-554);
(2) by transferring part C of title VII (20 U.S.C. 7541 et
seq.) to title III and inserting such part after part A (as
inserted by section 301(3));
(3) by redesignating part C of title VII (as transferred by
paragraph (2)) as part B, and redesignating the references to
such part C as the references to such part B; and
(4) by redesignating sections 7301 through 7309 (20 U.S.C.
7541, 7549) (as transferred by paragraph (2)) as sections
3201 through 3209, respectively, and redesignating
accordingly the references to such sections 7301 through
7309.
(b) Amendments.--Part B of title III (as so transferred and
redesignated) is amended--
(1) in section 3205(a)(2) (as redesignated by subsection
(a)(4)), by striking ``the Goals 2000: Educate America
Act,''; and
(2) in section 3209 (as redesignated by subsection (a)(4)),
by striking ``$100,000,000'' and all that follows through
``necessary for'' and inserting ``such sums as may be
necessary for fiscal year 2002 and''.

SEC. 303. INDIAN, NATIVE HAWAIIAN, AND ALASKA NATIVE
EDUCATION.

(a) Repeals, Transfers, and Redesignations.--Title III (20
U.S.C 6801 et seq.) is further amended--
(1) by transferring title IX (20 U.S.C. 7801 et seq.) to
title III and inserting such title after part B (as
redesignated by section 302(a)(3));
(2) by redesignating subparts 1 through 6 of part A of
title IX (as transferred by paragraph (1)) as chapters I
through VI, respectively, and redesignating accordingly the
references to such subparts as the references to such
chapters;
(3) by redesignating parts A through C of title IX (as
transferred by paragraph (1)) as subparts 1 through 3,
respectively, and redesignating accordingly the references to
such parts as the references to such subparts;
(4) by redesignating title IX (as transferred by paragraph
(1)) as part C, and redesignating accordingly the references
to such title as the references to such part;
(5) by redesignating sections 9101 and 9102 (20 U.S.C.
7801, 7802) (as transferred by paragraph (1)) as sections
3301 and 3302, respectively, and redesignating accordingly
the references to such sections 9101 and 9102;
(6) by redesignating sections 9111 through 9118 (20 U.S.C.
7811, 7818) (as transferred by paragraph (1)) as sections
3311 through 3318, respectively, and redesignating
accordingly the references to such sections 9111 through
9118;
(7) by redesignating sections 9121 through 9125 (20 U.S.C.
7831, 7835) (as transferred by paragraph (1)) as sections
3321 through 3325, and redesignating accordingly the
references to such sections 9121 through 9125;
(8) by redesignating sections 9131 and 9141 (20 U.S.C.
7851, 7861) (as transferred by paragraph (1)) as sections
3331 and 3341, respectively, and redesignating accordingly
the references to such sections 9131 and 9141;
(9) by redesignating sections 9151 through 9154 (20 U.S.C.
7871, 7874) (as transferred by paragraph (1)) as sections
3351 through 3354, respectively, and redesignating
accordingly the references to such sections 9151 through
9154;
(10) by redesignating sections 9161 and 9162 (20 U.S.C.
7881, 7882) (as transferred by paragraph (1)) as sections
3361 and 3362, respectively, and redesignating accordingly
the references to such sections 9161 and 9162;
(11) by redesignating sections 9201 through 9212 (20 U.S.C.
7901, 7912) (as transferred by paragraph (1)) as sections
3401 through 3412, respectively, and redesignating
accordingly the references to such sections 9201 through
9212; and
(12) by redesignating sections 9301 through 9308 (20 U.S.C.
7931, 7938) (as transferred by paragraph (1)) as sections
3501 through 3508, and redesignating accordingly the
references to such sections 9301 through 9308.
(b) Amendments.--Part C of title III (as so transferred and
redesignated) is amended--
(1) by amending section 3314(b)(2)(A) (as redesignated by
subsection (a)(6)) to read as follows:
``(2)(A) is consistent with, and promotes the goals in, the
State and local plans under sections 1111 and 1112;'';
(2) by amending section 3325(e) (as redesignated by
subsection (a)(7)) to read as follows:
``(e) Authorization of Appropriations.--There are
authorized to be appropriated such sums as may be necessary
to carry out this chapter for fiscal year 2002 and each of
the 4 succeeding years.'';
(3) in section 3361(4)(E) (as redesignated by subsection
(a)(10)), by striking ``the Act entitled the `Improving
America's Schools Act of 1994' '' and inserting ``the Public
Education Reinvestment, Reinvention, and Responsibility
Act'';
(4) by amending section 3362 (as redesignated by subsection
(a)(10)) to read as follows:

[[Page S1302]]

``SEC. 3362. AUTHORIZATION OF APPROPRIATIONS.

``For the purpose of carrying out chapters I through V of
this subpart, there are authorized to be appropriated to the
Department of Education such sums as may be necessary for
fiscal year 2002 and each of the 4 succeeding years.'';
(5) in section 3404 (as redesignated by subsection
(a)(11))--
(A) in subsection (i), by striking ``Improving America's
Schools Act of 1994'' and inserting ``Public Education
Reinvestment, Reinvention, and Responsibility Act''; and
(B) in subsection (j), by striking ``$500,000 for fiscal
year 1995, and such sums as may be necessary'' and inserting
``such sums as may be necessary for fiscal year 2002, and'';
(6) in section 3405(c) (as redesignated by subsection
(a)(11)), by striking ``$6,000,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and'';
(7) in section 3406(e) (as redesignated by subsection
(a)(11)), by striking ``$2,000,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and'';
(8) in section 3407(e) (as redesignated by subsection
(a)(11)), by striking ``$1,500,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and'';
(9) in section 3408(c) (as redesignated by subsection
(a)(11)), by striking ``$2,000,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and'';
(10) in section 3409(d) (as redesignated by subsection
(a)(11)), by striking ``$2,000,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and'';
(11) in section 3410(d) (as redesignated by subsection
(a)(11)), by striking ``$1,000,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and'';
(12) in section 3504(c) (as redesignated by subsection
(a)(12)), by striking ``$5,000,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and'';
(13) in section 3505(e) (as redesignated by subsection
(a)(12)), by striking ``$2,000,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and''; and
(14) in section 3506(d) (as redesignated by subsection
(a)(12)), by striking ``$1,000,000 for fiscal year 1995, and
such sums as may be necessary'' and inserting ``such sums as
may be necessary for fiscal year 2002, and''.

TITLE IV--PUBLIC SCHOOL CHOICE

SEC. 401. PUBLIC SCHOOL CHOICE.

(a) Magnet Schools Amendments.--Section 5113(a) (20 U.S.C.
7213(a)) is amended--
(1) by striking ``$120,000,000'' and inserting
``$130,000,000''; and
(2) by striking ``1995'' and inserting ``2002''.
(b) Charter School Amendments.--Section 10311 (20 U.S.C.
8067) is amended--
(1) by striking ``$100,000,000'' and inserting
``$200,000,000''; and
(2) by striking ``1999'' and inserting ``2002''.
(c) Repeals, Transfers, and Redesignations.--The Act (20
U.S.C. 6301 et seq.) is amended--
(1) by amending the heading for title IV (20 U.S.C. 7101 et
seq.) to read as follows:

``TITLE IV--PUBLIC SCHOOL CHOICE'';

(2) by amending section 4001 to read as follows:

``SEC. 4001. FINDINGS, POLICY, AND PURPOSE.

``(a) Findings.--Congress makes the following findings:
``(1)(A) Charter schools and magnet schools are an integral
part of the educational system in the United States.
``(B) Thirty-four States and the District of Columbia have
established charter schools.
``(C) Magnet schools have been established throughout the
United States.
``(D) A Department of Education evaluation of charter
schools shows that 59 percent of charter schools reported
that lack of start-up funds posed a difficult or very
difficult challenge for the school.
``(2) State educational agencies and local educational
agencies should hold all schools accountable for the improved
performance of all students, including students attending
charter schools and magnet schools, using State standards and
student assessment measures.
``(3) Transportation is an important and critical component
of school choice. Local educational agencies have a
responsibility to provide transportation costs to ensure that
all children receive equal access to high quality schools.
``(4) School report cards constitute the key informational
component used by parents for effective public school choice.
``(b) Policy.--It is the policy of the United States--
``(1) to support and stimulate improved public school
performance through increased public elementary school and
secondary school competition and increased Federal financial
assistance; and
``(2) to provide parents with more choices among public
school options.
``(c) Purposes.--The purposes of this title are as follows:
``(1) To consolidate Federal law regarding public school
choice programs into 1 title.
``(2) To increase Federal assistance for magnet schools and
charter schools.
``(3) To give parents more options and help parents make
better and more informed choices by--
``(A) providing continued support for and financial
assistance for magnet schools;
``(B) providing continued support for and expansion of
charter schools and charter school districts; and
``(C) providing financial assistance to States and local
educational agencies for the development of local educational
agency and school report cards.'';
(3) by repealing sections 4002 through 4004 (20 U.S.C.
7102, 7104), and part A (20 U.S.C. 7111 et seq.), of title
IV;
(4) by transferring part A of title V (20 U.S.C. 7201 et
seq.) to title IV, inserting such part A after section 4001,
and redesignating the references to part A of title V as the
references to part A of title IV;
(5) by redesignating sections 5101 through 5113 (20 U.S.C.
7201, 7213) (as transferred by paragraph (4)) as sections
4101 through 4113, respectively, and by redesignating
accordingly the references to such sections 5105 through
5113;
(6) by transferring part C of title X (20 U.S.C. 8061 et
seq.) to title IV and inserting such part C after part A of
title IV (as transferred by paragraph (4));
(7) by redesignating part C of title IV (as transferred by
paragraph (6)) as part B of title IV, and redesignating
accordingly the references to such part C;
(8) by redesignating sections 10301 through 10311 (20
U.S.C. 8061, 8067) (as transferred by paragraph (6)) as
sections 4201 through 4211, respectively, and by
redesignating accordingly the references to such sections
10301 through 10311; and
(9) by redesignating sections 10321 through 10331 (as added
by section 322 of the Department of Education Appropriations
Act, 2001 (as enacted into law by section 1(a)(1) of Public
Law 106-554) and transferred by paragraph (6)) as sections
4221 through 4231, respectively, and by redesignating
accordingly the references to such sections 10321 through
10331.

SEC. 402. DEVELOPMENT OF PUBLIC SCHOOL CHOICE PROGRAMS;
REPORT CARDS.

Title IV (20 U.S.C. 7101 et seq.) is further amended by
adding at the end the following:

``PART C--DEVELOPMENT OF PUBLIC SCHOOL CHOICE PROGRAMS

``SEC. 4301. DEFINITIONS.

``In this part:
``(1) High-poverty local educational agency.--The term
`high-poverty local educational agency' means a local
educational agency serving a school district in which the
percentage of children, ages 5 to 17, from families with
incomes below the poverty line is 20 percent or more.
``(2) 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, for the most recent year for which satisfactory
data are available.

``SEC. 4302. GRANTS AUTHORIZED.

``(a) In General.--From amounts made available to carry out
this part for a fiscal year under section 4306, and not
reserved under section 4305, the Secretary is authorized to
award grants, on a competitive basis, to State educational
agencies and local educational agencies to enable the local
educational agencies to develop local public school choice
programs.
``(b) Duration.--Grants awarded under this part may be
awarded for periods of not more than 3 years.

``SEC. 4303. USES OF FUNDS.

``(a) In General.--
``(1) Public school choice.--Funds made available under
this part may be used to develop, implement, evaluate,
demonstrate, and disseminate information on, innovative
approaches to promote public 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 public schools.
``(2) Innovative approaches.--Such approaches, which may be
carried out at the school, local educational agency, and
State levels, may include--
``(A) universal public school choice programs that serve to
make every school in a school district, group of school
districts, or a State, a school of choice;
``(B) interdistrict and intradistrict approaches to public
school choice, including approaches that increase equal
access to high quality educational programs and diversity in
schools;
``(C) public elementary school and secondary school
programs that--
``(i) involve partnerships that include institutions of
higher education; and
``(ii) are located on the campuses of the institutions;
``(D) programs that allow students in public secondary
schools to enroll in postsecondary courses and to receive
both secondary and postsecondary academic credit;
``(E) approaches in which State educational agencies or
local educational agencies form partnerships with public or
private employers, to create public schools at parents'
places of employment, referred to as worksite satellite
schools; and
``(F) approaches to school desegregation that provide
students and parents choice

[[Page S1303]]

through strategies other than magnet schools.
``(b) Transportation.--Funds made available under this part
may be used for providing transportation services or paying
for the cost of transportation for students, except that not
more than 10 percent of the funds received under this part
shall be used by a State educational agency or local
educational agency to provide such services or pay for such
cost.
``(c) Supplement, Not Supplant.--Funds made available under
this part shall be used to supplement and not supplant State
and local public funds expended for public school choice
programs.

``SEC. 4304. GRANT APPLICATION; PRIORITIES.

``(a) Application Required.--A State educational agency or
local educational agency desiring 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 require.
``(b) Application Contents.--The application shall
include--
``(1) a description of the program for which the agency
seeks the grant the goals for such program;
``(2) a description of how the program will be coordinated
with, and will complement and enhance, other related Federal
and non-Federal programs;
``(3) if the program involves partners, the name of each
partner and a description of the partner's responsibilities;
``(4) a description of the policies and procedures the
applicant will use to ensure--
``(A) accountability for results, including goals and
performance indicators; and
``(B) that the program is open and accessible to, and will
promote high academic standards for, all students;
``(5) information demonstrating that the applicant will
provide transportation services or the cost of transportation
to ensure that all students receive equal access to high
quality schools; and
``(6) such other information as the Secretary may require.
``(c) Priorities.--
``(1) Low-performing schools.--In making grants under this
part, the Secretary shall give priority to an agency
submitting an application for a program for a local
educational agency serving schools designated as low-
performing.
``(2) High-poverty agencies.--In making grants under this
part, the Secretary shall give priority to an agency
submitting an application for a program for a high-poverty
local educational agency.
``(3) Partnerships.--In making grants under this part, the
Secretary may give priority to an agency submitting an
application demonstrating that the applicant will carry out
the applicant's program in partnership with 1 or more public
or private agencies, organizations, or institutions, such as
institutions of higher education and public or private
employers.

``SEC. 4305. EVALUATION, TECHNICAL ASSISTANCE, AND
DISSEMINATION.

``(a) Reservation for Evaluation, Technical Assistance, and
Dissemination.--From the amount appropriated under section
4306 for any fiscal year, the Secretary may reserve not more
than 5 percent to carry out evaluations under subsection (b),
to provide technical assistance, and to disseminate
information.
``(b) Evaluations.--The Secretary may use funds reserved
under subsection (a) to carry out 1 or more evaluations of
programs assisted under this part, which shall, at a minimum,
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.

``SEC. 4306. AUTHORIZATION OF APPROPRIATIONS.

``There are authorized to be appropriated to carry out this
part $200,000,000 for fiscal year 2002 and such sums as may
be necessary for each of the 4 succeeding fiscal years.

``PART D--REPORT CARDS

``SEC. 4401. REPORT CARDS.

``(a) Grants Authorized.--The Secretary shall award grants,
from allotments made under subsection (b), to States, local
educational agencies, and public schools receiving assistance
under this Act to enable the States, agencies, and schools to
publish annually reports and report cards concerning the
agencies and schools.
``(b) Reservations and Allotments.--
``(1) Reservations.--From the amount appropriated under
subsection (k) 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 (k) for a fiscal year and remaining after the
Secretary makes reservations under paragraph (1), the
Secretary shall allot to each State receiving assistance
under this Act 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 under 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.--
``(1) Reports required.--
``(A) In general.--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 with
respect to all public elementary schools and secondary
schools within the State that receive funds under this Act.
``(B) State report cards on education.--In the case of a
State that publishes State report cards on education, the
State shall meet the requirements of subparagraph (A) by
including in such report cards the information described in
paragraphs (3) through (5) for all public schools and local
educational agencies in the State that receive funds under
this Act.
``(C) Report cards on all public schools.--In the case of a
State that publishes report cards on all public elementary
schools and secondary schools in the State, the State shall
meet the requirements of subparagraph (A) by including in the
report cards, at a minimum, the information described in
paragraphs (3) through (5) for all public schools and local
educational agencies in the State that receive funds under
this Act.
``(D) Publication through other means.--In the event that
the State does not publish a report card described in
subparagraph (B) or (C), the State shall, not later than the
beginning of the 2002-2003 school year, meet the requirements
of subparagraph (A) by publicly reporting the information
described in paragraphs (3) through (5) for all public
schools and local educational agencies in the State that
receive funds under this Act.
``(2) Implementation; requirements.--The State shall ensure
implementation at the State, local, and school levels of the
activities necessary to enable the State to make the reports
described in paragraph (1).
``(3) Required information.--Each State described in
paragraph (1)(A) shall, at a minimum, include in the annual
State report information on each local educational agency and
public school that receives funds under this Act, including
information regarding--
``(A)(i) student performance on statewide assessments for
the year for which the annual State report is made, and the
preceding year, in at least English language arts,
mathematics, and (in each State report for a school year
after the 2006-2007 school year) science, including--
``(I) a comparison of the proportions of students who
performed at the State's basic, proficient, and advanced
levels of performance in each academic subject, for each
grade level for which State assessments are required under
section 1111(b)(4) for the year for which the report is
prepared, with proportions in each of the same 3 levels in
each academic subject at the same grade levels in the
preceding school year; and
``(II) a statement of the percentage of students not tested
and a listing of categories of the reasons why such students
were not tested; and
``(ii) the most recent 3-year trend in the percentage of
students performing at the State's basic, proficient, and
advanced levels of performance, for each grade level for
which State assessments are required under section
1111(b)(4), in each academic subject, including at least--
``(I) English language arts;
``(II) mathematics; and
``(III) (in each State report for a school year after the
2007-2008 school year) science;
``(B) student retention rates in each grade, the number of
students completing advanced placement courses, and 4-year
graduation rates;
``(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; and
``(D) the professional qualifications of paraprofessionals
in the aggregate, the number of paraprofessionals in the
aggregate,

[[Page S1304]]

and the ratio of paraprofessionals to teachers in the
classroom.
``(4) Student data.--Student data in each report shall
contain disaggregated results for the following categories:
``(A) Racial and ethnic groups.
``(B) Gender groups.
``(C) Economically disadvantaged students, as compared to
students who are not economically disadvantaged.
``(D) Students with limited English proficiency, as
compared with students who are proficient in English.
``(5) Optional information.--A State may include in the
State annual report any other information the State
determines appropriate to reflect school quality and school
achievement, including by grade level information on--
``(A) average class size; and
``(B) school safety, such as the incidence of school
violence and drug and alcohol abuse, and the incidence of
student suspensions and expulsions.
``(6) Waiver.--The Secretary may grant a waiver to a State
seeking a waiver of the requirements of this subsection, if
the State demonstrates to the Secretary that--
``(A) the content of State reports meets the goals of this
part; and
``(B) the State is taking identifiable steps to meet the
requirements of this subsection.
``(f) Local Educational Agency and School Report Cards.--
``(1) Report card required.--
``(A) In general.--The State shall ensure that each local
educational agency, public elementary school, or public
secondary school in the State that receives funds under this
Act, collects appropriate data and publishes an annual report
card consistent with this subsection.
``(B) Required information.--Each local educational agency,
elementary school, and secondary school described in
subparagraph (A) shall, at a minimum, include in its annual
report card--
``(i) the information described in paragraphs (3) and (4)
of subsection (e) for each local educational agency and
school, as appropriate;
``(ii) 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 and corrective action,
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 that shows 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;

``(iii) in the case of an elementary school or a secondary
school--

``(I) information regarding whether the school has been
identified for school improvement or corrective action; and
``(II) information that shows 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

``(iv) other appropriate information, whether or not the
information is included in the annual State report.
``(2) Special rule.--A local educational agency that issues
report cards for all public elementary schools and secondary
schools served by the agency shall include, at a minimum, the
information described in paragraphs (3) through (5) of
subsection (e) for all public schools that receive funds
under this Act.
``(g) Dissemination and Accessibility of Reports and Report
Cards.--
``(1) Requirements.--Annual reports and 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 reports.--State annual reports 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 all 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 all 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) Parents Right-to-Know.--
``(1) Qualifications.--A local educational agency that
receives funds under part A of title I or part A of title II
shall provide, on request, in an understandable and uniform
format, to any parent of a student attending any school
served by the agency and receiving funds under part A of
title I or part A of title II, information regarding the
professional qualifications of the student's classroom
teachers. The information shall describe, at a minimum--
``(A) whether the teacher is fully qualified, as defined in
section 2002, for the grade levels and academic subjects in
which the teacher teaches;
``(B) whether the teacher is teaching under emergency or
other provisional status through which State certification or
licensing criteria are waived;
``(C) the major in which the teacher received a
baccalaureate degree, any graduate degree or certification
held by the teacher, and the field of discipline of each such
degree or certification; and
``(D) whether the student is provided services by
paraprofessionals, and the qualifications of any such
paraprofessional.
``(2) Additional information.--In addition to the
information described in paragraph (1), and the information
provided in reports and report cards under this part, a
school that receives funds under part A of title I or part A
of title II shall provide, to the extent practicable, to each
individual parent (including a guardian) of a student
attending the school--
``(A) information on the level of performance of the
student on each of the State assessments required under
section 1111(b)(4); and
``(B) if the student was assigned to or taught for 2 or
more consecutive weeks by a substitute teacher or by a
teacher who is not fully qualified, timely notice about the
teacher involved.
``(i) Coordination of State Plan Content.--A State shall
include in the State's plan under part A of title I or part A
of title II, an assurance that the State has in effect a
policy that meets the requirements of this section.
``(j) Privacy.--Information collected under this section
shall be collected and disseminated in a manner that protects
the privacy of individuals.
``(k) 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.
``(l) Definition.--In this section, the term `State' means
each of the several States of the United States, the District
of Columbia, and the Commonwealth of Puerto Rico.''.

TITLE V--IMPACT AID

SEC. 501. PAYMENTS RELATING TO FEDERAL ACQUISITION OF REAL
PROPERTY.

Section 8002 (20 U.S.C. 7702), as amended by section 1803
of the Floyd D. Spence National Defense Authorization Act for
Fiscal Year 2001 (Public Law 106-398), is amended--
(1) in subsection (h)(4), by striking subparagraph (B) and
inserting the following:
``(B) the Secretary shall make a payment to each local
educational agency that is eligible to receive a payment
under this section for the fiscal year involved in an amount
that bears the same relation to 75 percent of the remainder
as a percentage share determined for the local educational
agency (as determined by dividing the maximum amount that
such agency is eligible to receive under subsection (b) by
the total maximum amounts that all such local educational
agencies are eligible to receive under such subsection) bears
to the percentage share determined (in the same manner) for
all local educational agencies eligible to receive a payment
under this section for the fiscal year involved, except that
for purposes of calculating a local educational agency's
maximum payment, data from the most current fiscal year shall
be used.''; and
(2) by adding at the end the following:
``(n) Loss of Eligibility.--
``(1) In general.--Notwithstanding any other provision of
this section, the Secretary shall make the following minimum
payments for each fiscal year to each local educational
agency described in paragraph (2):
``(A) For the first fiscal year following the loss of
eligibility (as described in paragraph (2)), an amount equal
to 90 percent of the amount received in the final fiscal year
of eligibility.
``(B) For the second fiscal year following the loss of
eligibility (as described in paragraph (2)), an amount equal
to 75 percent of the amount received in the final fiscal year
of eligibility.
``(C) For the third fiscal year following the loss of
eligibility (as described in paragraph (2)), an amount equal
to 50 percent of the amount received in the final fiscal year
of eligibility.
``(2) Eligible local educational agencies.--A local
educational agency described in this paragraph is an agency
that--
``(A) was eligible for, and received, a payment under this
section for fiscal year 2002; and
``(B) beginning in fiscal year 2003 or a subsequent fiscal
year, is no longer eligible for payments under this section
as provided for in subsection (a)(1)(C) as a result of the
transfer of the Federal property involved to a non-Federal
entity.''.

SEC. 502. REPEAL OF SPECIAL RULE RELATING TO THE COMPUTATION
OF PAYMENTS FOR ELIGIBLE FEDERALLY CONNECTED
CHILDREN.

Section 8003(a) (20 U.S.C. 7703(a)) is amended by striking
paragraph (3).

SEC. 503. EXTENSION OF AUTHORIZATION OF APPROPRIATIONS.

Section 8014 (20 U.S.C. 7714), as amended by section 1817
of the Floyd D. Spence National

[[Page S1305]]

Defense Authorization Act for Fiscal Year 2001 (Public Law
106-398), is amended--
(1) in subsection (a), by striking ``three succeeding'' and
inserting ``six succeeding'';
(2) in subsection (b), by striking ``three succeeding'' and
inserting ``six succeeding'';
(3) in subsection (c), by striking ``three succeeding'' and
inserting ``six succeeding'';
(4) in subsection (e), by striking ``three succeeding'' and
inserting ``six succeeding'';
(5) in subsection (f), by striking ``three succeeding'' and
inserting ``six succeeding''; and
(6) in subsection (g), by striking ``three succeeding'' and
inserting ``six succeeding''.

SEC. 504. REPEALS, TRANSFERS, AND REDESIGNATIONS.

The Act (20 U.S.C. 6301 et seq.) is amended--
(1) by repealing title V (20 U.S.C. 7201 et seq.);
(2) by redesignating title VIII (20 U.S.C. 7701 et seq.) as
title V, and transferring the title to follow title IV (as
amended by section 402);
(3) by redesignating references to title VIII as references
to title V (as redesignated and transferred by paragraph
(2)); and
(4) by redesignating sections 8001 through 8005, and 8007
through 8014 (20 U.S.C. 7701, 7714) (as transferred by
paragraph (2)) as sections 5001 through 5001, and 5007
through 5014, respectively, and redesignating accordingly the
references to such sections 8001 through 8005 and 8007
through 8014.

TITLE VI--HIGH PERFORMANCE AND QUALITY EDUCATION INITIATIVES

SEC. 601. HIGH PERFORMANCE AND QUALITY EDUCATION INITIATIVES.

Title VI (20 U.S.C. 7301 et seq.) is amended to read as
follows:

``TITLE VI--HIGH PERFORMANCE AND QUALITY EDUCATION INITIATIVES

``SEC. 6001. FINDINGS, POLICY, AND PURPOSE.

``(a) Findings.--Congress makes the following findings:
``(1)(A) The educators most familiar with schools,
including school superintendents, principals, teachers, and
school support personnel, have critical roles in knowing what
students need and how best to meet the educational needs of
students.
``(B) Local educational agencies should therefore have
primary responsibility for deciding how to use funds.
``(2)(A) Since the Elementary and Secondary Education Act
of 1965 was first authorized in 1965, the Federal Government
has created numerous grant programs, each of which was
created to address 1 among the myriad challenges and problems
facing education.
``(B) Only a few of the Federal grant programs established
before the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act can be tied
to significant quantitative results.
``(C) Because Federal education dollars are distributed
through a patchwork of programs, with each program having a
set of requirements and restrictions, local educational
agencies and schools have found it difficult to leverage
funds for maximum impact.
``(D) In many cases, Federal education dollars distributed
through competitive grant programs are too diffused to
provide a true impact at the school level.
``(E) As a result of the Federal elementary and secondary
education policies in place before the date of enactment of
the Public Education Reinvestment, Reinvention, and
Responsibility Act, the focus of Federal, State, and local
educational agencies has been diverted from comprehensive
student achievement to administrative compliance.
``(3)(A) Every elementary school and secondary school
should provide a drug- and violence-free learning
environment.
``(B) The widespread illegal use of alcohol and drugs among
the Nation's secondary school students, and increasingly
among elementary school students, constitutes a grave threat
to students' physical and mental well-being, and
significantly impedes the learning process.
``(C) Drug and violence prevention programs are essential
components of a comprehensive strategy to promote school
safety, youth development, and positive school outcomes, and
reduce the demand for and illegal use of alcohol, tobacco,
and drugs throughout the Nation.
``(D) Schools, local organizations, parents, students, and
communities throughout the Nation have a special
responsibility to work together to combat the continuing
epidemic of violence and illegal drug use, and should measure
the success of programs established to address this epidemic
against clearly defined goals and objectives.
``(E) Drug and violence prevention programs are most
effective when implemented within a research-based, drug and
violence prevention framework of proven effectiveness.
``(F) Substance abuse and violence are intricately related,
and must be dealt with in a holistic manner.
``(4)(A) Technology can produce far greater opportunities
to enable all students to meet high learning standards,
promote efficiency and effectiveness in education, and help
to immediately and dramatically reform our Nation's
educational system.
``(B) Because most Federal and State educational technology
programs have focused on acquiring educational technologies,
rather than emphasizing the utilization of the technologies
in the classroom and the training and infrastructure required
efficiently to support the technologies, the full potential
of educational technology has rarely been realized.
``(C) The effective use of technology in education has been
inhibited by the inability of many State educational agencies
and local educational agencies to invest in and support
needed technologies, and to obtain sufficient resources to
seek expert technical assistance in developing high-quality
professional development activities for teachers and keeping
pace with rapid technological advances.
``(D) To remain competitive in the global economy, which is
increasingly reliant on a workforce that is comfortable with
technology and able to integrate rapid technological changes
into production processes, it is imperative that our Nation
maintain a work-ready labor force.
``(b) Policy.--It is the policy of the United States--
``(1) to facilitate significant innovation in elementary
school and secondary school education programs;
``(2) to enrich the learning environment of students;
``(3) to provide a safe learning environment for all
students;
``(4) to ensure that all students are technologically
literate; and
``(5) to assist State educational agencies and local
educational agencies in building the agencies' capacity to
establish, implement, and sustain innovative programs for
public elementary school and secondary school students.
``(c) Purposes.--The purposes of this title are as follows:
``(1) To provide supplementary assistance for school
improvement to elementary schools, secondary schools, and
local educational agencies--
``(A) that have been or are at risk of being identified for
improvement, as described in subsection (c) or (d) of section
1116, to carry out activities (as described in such schools'
or agencies' improvement plans developed under such section)
that are designed to remedy the circumstances that caused
such schools or agencies to be identified for improvement; or
``(B) to improve core content curricula and instructional
practices and materials in core academic subjects (as defined
in section 2002) to ensure that all students are performing
at a State's proficient level of performance described in the
State performance standards described in section 1111(b)(1)
within 10 years after the date of enactment of the Public
Education Reinvestment, Reinvention, and Responsibility Act.
``(2) To provide assistance to local educational agencies
and schools for innovative programs and activities that will
transform schools into places that provide 21st century
opportunities for students by--
``(A) creating challenging learning environments and
facilitating academic enrichment through innovative academic
programs; or
``(B) providing extra learning, time, and opportunities for
students.
``(3) To provide assistance to local educational agencies,
schools, and communities to strengthen existing programs or
develop and implement new programs, based on proven
researched-based strategies, that create safe learning
environments by--
``(A) preventing violence and other high-risk behavior from
occurring in and around schools; and
``(B) preventing the illegal use of alcohol, tobacco, and
drugs among students.
``(4) To create New Economy Technology Schools by providing
assistance to local educational agencies and schools for--
``(A) the acquisition, development, interconnection,
implementation, improvement, and maintenance of an effective
educational technology infrastructure;
``(B) the acquisition and maintenance of technology
equipment and the provision of training in the use of such
equipment for teachers, school library and media personnel,
and administrators;
``(C) the acquisition or development of technology-enhanced
curricula and instructional materials that are aligned with
challenging State content and student performance standards;
and
``(D) the acquisition or development, and implementation,
of high-quality professional development activities for
teachers concerning the use of technology and integration of
technology with challenging State content and student
performance standards.

``SEC. 6002. DEFINITIONS.

``In this title:
``(1) Authentic task.--The term `authentic task' means a
real world task as determined by the State involved that--
``(A) is challenging, meaningful, multidisciplinary, and
interactive;
``(B) involves reasoning, problem solving, and composition;
and
``(C) is not a task requiring a discrete component skill
that has no obvious connection with students' activities
outside of school.
``(2) 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) applicable to a family of the size involved, for the
most recent year for which satisfactory data are available.
``(3) School-age population.--The term `school-age
population', used with respect to a State, means the
population of children

[[Page S1306]]

that the State determines are school-age children, but at
least the population aged 5 through 17, as determined on the
basis of the most recent satisfactory data.
``(4) State.--The term `State' means each of the several
States, the District of Columbia, and the Commonwealth of
Puerto Rico.

``SEC. 6003. PROGRAMS AUTHORIZED.

``(a) Grants Authorized.--From the amount appropriated
under section 6009 for a fiscal year, the Secretary shall
award a grant, from an allotment made under subsection (b),
to each State educational agency having a State plan approved
under section 6005(a)(4) to enable the State educational
agency to award grants to local educational agencies in the
State.
``(b) Reservations and Allotments.--
``(1) Reservations.--From the amount appropriated under
section 6009 for a fiscal year, the Secretary shall reserve--
``(A) not more than \1/2\ of 1 percent of such amount for
payments to the Bureau of Indian Affairs for activities,
approved by the Secretary, consistent with this title;
``(B) not more than \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 title as
determined by the Secretary, for activities, approved by the
Secretary, consistent with this title; and
``(C) such sums as may be necessary to continue to support
any multiyear award made under title III, title IV, part B of
title V, or title X (as such titles and part were in effect
on the day before the date of enactment of the Public
Education Reinvestment, Reinvention, and Responsibility Act)
until the termination of the multiyear award.
``(2) State allotments.--
``(A) In general.--From the amount appropriated under
section 6009 for a fiscal year and remaining after the
Secretary makes reservations under paragraph (1), the
Secretary shall allot to each State having a State plan
approved under section 6005(a)(4) the sum of--
``(i) an amount that bears the same relationship to 50
percent of the remainder as the amount the State received
under part A of title I for the fiscal year bears to the
amount all States received under such part for the fiscal
year; and
``(ii) an amount that bears the same relationship to 50
percent of the remainder as the school-age population in the
State bears to the school-age population in all States.
``(B) Data.--For the purposes of determining the school-age
population in a State and in all States, the Secretary shall
use the most recent available data from the Bureau of the
Census.
``(c) State Minimum.--For any fiscal year, no State shall
be allotted under subsection (b)(2) an amount that is less
than 0.4 percent of the total amount allotted to all States
under subsection (b)(2).
``(d) Hold-Harmless Amounts.--For fiscal year 2002,
notwithstanding subsection (e), the amount allotted to each
State under subsection (b)(2) shall be not less than 100
percent of the total amount the State was allotted through
formula grants under sections 3132, 4011, and 6101 (as such
sections were in effect on the day before the date of
enactment of the Public Education Reinvestment, Reinvention,
and Responsibility Act) for fiscal year 2001.
``(e) Ratable Reductions.--If the sums made available under
subsection (b)(2) for any fiscal year are insufficient to pay
the full amounts that all State educational agencies are
eligible to receive under subsection (c) or (d) for such
year, the Secretary shall ratably reduce such amounts for
such year.

``SEC. 6004. WITHIN STATE ALLOCATION.

``(a) Reservations; Allocations.--Each State educational
agency for a State receiving a grant for a fiscal year under
section 6003(a) shall--
``(1) set aside not more than 1 percent of the grant funds
for the cost of administering the activities under this
title;
``(2) set aside not more than 4 percent of the grant funds
to--
``(A) provide for the establishment of, and continued
improvement on, high-quality, internationally competitive
content and student performance standards that all students
will be expected to meet;
``(B) provide for the establishment of, and continued
improvement on, high-quality, rigorous assessments that
include multiple measures and demonstrate comprehensive
knowledge;
``(C) encourage and enable all State educational agencies
and local educational agencies to develop, implement, and
strengthen comprehensive education improvement plans that
address student achievement, teacher quality, parent
involvement, and reliable measurement and evaluation methods;
and
``(D) encourage and enable all States to develop and
implement value-added assessments, including model value-
added assessments identified by the Secretary under section
7104(a)(6); and
``(3) using the remaining 95 percent of the grant funds,
make grants by allocating to each local educational agency in
the State having a local educational agency plan approved
under section 6005(b)(3) the sum of--
``(A) an amount that bears the same relationship to 60
percent of such remainder as the amount the local educational
agency received under part A of title I for the fiscal year
bears to the amount all local educational agencies in the
State received under such part for the fiscal year; and
``(B) an amount that bears the same relationship to 40
percent of such remainder as the school-age population in the
area served by the local educational agency bears to the
school-age population in the area served by all local
educational agencies in the State.
``(b) Matching Requirement.--
``(1) In general.--Each eligible local educational agency
receiving a grant under subsection (a) shall, with respect to
the costs to be incurred by the agency in carrying out the
programs for which the grant was awarded, make available
(directly or through donations from public or private
entities) non-Federal contributions, in cash or in kind, in
an amount equal to 25 percent of the Federal funds provided
under the grant.
``(2) Waiver.--A local educational agency may apply to the
State educational agency for, and the State educational
agency may grant, a waiver of the requirements of paragraph
(1) to a local educational agency that--
``(A) applies for such a waiver; and
``(B) demonstrates that extreme circumstances make the
agency unable to meet such requirements.

``SEC. 6005. PLANS.

``(a) State Plans.--
``(1) In general.--The State educational agency for each
State desiring a grant under this title shall submit a State
plan to the Secretary at such time, in such manner, and
containing such information as the Secretary may require.
``(2) Consolidated plan.--A State plan submitted under
paragraph (1) may be submitted as part of a consolidated plan
under section 8302.
``(3) Contents.--Each plan submitted under paragraph (1)
shall--
``(A) describe how the State educational agency will assist
each local educational agency and school served under this
title in the State to comply with the requirements described
in section 6006 that are applicable to the local educational
agency or school;
``(B) certify that the State has in place the standards and
assessments required under section 1111;
``(C) certify that the State educational agency has a
system, as required under section 1111, for--
``(i) holding each local educational agency and school in
the State accountable for adequate yearly progress (as
defined under section 1111(b)(2)(B));
``(ii) identifying local educational agencies and schools
for improvement and corrective action (as required in
subsections (c) and (d) of section 1116);
``(iii) assisting local educational agencies and schools
that are identified for improvement with the development of
improvement plans; and
``(iv) providing technical assistance, professional
development, and other capacity building as needed to remove
such agencies and schools from improvement status;
``(D) certify that the State educational agency shall use
the disaggregated results of student assessments required
under section 1111(b)(4), and other available measures or
indicators, to review annually the progress of each local
educational agency and school served under this title in the
State, to determine whether or not each such agency and
school is making adequate yearly progress as required under
section 1111(b)(2);
``(E) certify that the State educational agency will take
action against a local educational agency that is in
corrective action and receiving funds under this title as
described in section 6006(d)(1);
``(F) describe what, if any, State and other resources will
be provided to local educational agencies and schools served
under this title to carry out activities consistent with this
title; and
``(G) certify that the State educational agency has a
system to hold local educational agencies accountable for
meeting the annual performance objectives required under
subsection (b)(2)(C).
``(4) Approval.--The Secretary, after using a peer review
process, shall approve a State plan if the State plan meets
the requirements of this subsection.
``(5) Duration of the plan.--Each State plan shall remain
in effect for the duration of the State's participation under
this title.
``(6) Requirement.--The Secretary shall not approve a State
plan for a State unless the State has established the
standards and assessments required under section 1111.
``(b) Local Plans.--
``(1) In general.--Each local educational agency desiring a
grant under this title shall annually submit a local
educational agency plan to the State educational agency at
such time, in such manner, and containing such information as
the State educational agency may require.
``(2) Contents.--Each local educational agency shall--
``(A) describe the programs for which funds allocated under
section 6004(a)(3) will be used and the reasons for the
selection of such programs;
``(B) describe the methods the local educational agency
will use to measure the annual impact of programs described
under subparagraph (A) and the extent to which such programs
will increase student academic performance;
``(C) describe the annual, quantifiable, and measurable
performance goals and objectives that the local educational
agency will use for each program described under subparagraph
(A) and the extent to which such goals

[[Page S1307]]

and objectives are aligned with State content and student
performance standards;
``(D) describe how the local educational agency will hold
schools accountable for meeting the performance objectives
for each program described under subparagraph (C);
``(E) provide an assurance that the local educational
agency has met the local plan requirements described in
section 1112 for--
``(i) holding schools accountable for adequate yearly
progress as required under section 1111(b)(2), including
meeting annual numerical goals for improving the performance
of all groups of students based on the student performance
standards set by the State under section 1111(b)(1)(D)(ii);
``(ii) identifying schools for school improvement or
corrective action;
``(iii) fulfilling the local educational agency's school
improvement responsibilities described in section 1116,
including taking corrective action under section 1116(c)(10);
and
``(iv) providing technical assistance, professional
development, or other capacity building to schools served by
the agency;
``(F) certify that the local educational agency will take
action against a school that is in corrective action and
receiving funds under this title as described under section
6006(d)(2);
``(G) describe what State and local resources will be
contributed to carrying out programs described under
subparagraph (A);
``(H) provide 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 local
educational agency plan and select the programs to be
assisted under this title; and
``(I) provide assurances that the local educational agency
will continue such consultation on a regular basis and will
provide the State with annual evidence of such consultation.
``(3) Approval.--The State, after using a peer review
process, shall approve a local educational agency plan if the
plan meets the requirements of this subsection.
``(4) Duration of the plan.--Each local educational agency
plan shall remain in effect for the duration of the local
educational agency's participation under this title.
``(5) Public review.--Each State educational agency shall
make publicly available each local educational agency plan
approved under paragraph (3).

``SEC. 6006. LOCAL USES OF FUNDS AND ACCOUNTABILITY.

``(a) Administrative Expenses.--Each local educational
agency receiving a grant award under section 6004(a)(3) may
use not more than 1 percent of the grant funds for a fiscal
year for the cost of administering this title.
``(b) Required Activities.--Each local educational agency
receiving a grant award under section 6004(a)(3) shall use
the grant funds pursuant to this section to establish and
carry out programs that are designed to achieve, separately
or cumulatively, each of the goals described in the
categories specified in the following paragraphs:
``(1) School improvement.--Each local educational agency
shall use 30 percent of the grant funds--
``(A) in the case of a school that has been identified for
school improvement under section 1116(c), for activities or
strategies that are described in section 1116(c) that focus
on removing such school from school improvement status; or
``(B) for programs that seek to raise the academic
achievement levels of all elementary school and secondary
school students based on challenging State content and
student performance standards and, to the greatest extent
possible--
``(i) incorporate the best practices developed from
research-based methods and practices;
``(ii) are aligned with challenging State content and
performance standards and focused on reinforcing and boosting
the core academic skills and knowledge of students who are
struggling academically, as determined by State assessments
under section 1111(b)(4) and local evaluations;
``(iii) focus on accelerated learning rather than
remediation, so that students will master the high level of
skills and knowledge needed to meet the highest State
standards or to perform at high levels on all State
assessments;
``(iv) offer teachers, principals, and administrators
professional development and technical assistance that are
aligned with the other content of such programs; and
``(v) address local needs, as determined by the local
educational agency's evaluation of school and districtwide
data.
``(2) 21st century opportunities.--Each local educational
agency shall use 25 percent of the grant funds for--
``(A) programs that provide for extra learning, time, and
opportunities for students so that all students may achieve
high levels of learning and perform at the State's proficient
level of performance described in the State standards
described in section 1111(b)(1) within 10 years after the
date of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act;
``(B) programs to improve higher order thinking skills of
all students, especially disadvantaged students;
``(C) promising innovative education reform projects that
are consistent with challenging State content and student
performance standards; or
``(D) programs that focus on ensuring that disadvantaged
students enter elementary school with the basic skills needed
to meet the highest State content and student performance
standards.
``(3) Safe learning environments.--Each local educational
agency shall use 15 percent of the grant funds for programs
that help ensure that all elementary school and secondary
school students learn in a safe and supportive environment,
by--
``(A) reducing drugs, violence, and other high-risk
behavior in schools;
``(B) providing safe, extended-day opportunities for
students;
``(C) providing professional development activities for
teachers, principals, mental health professionals, and
guidance counselors concerning dealing with students
exhibiting distress (such as exhibiting distress through
substance abuse, disruptive behavior, and suicidal behavior);
``(D) recruiting or retaining high-quality mental health
professionals;
``(E) providing character education for students;
``(F) meeting other objectives that are established under
State standards regarding safety or that address local
community concerns; or
``(G) providing alternative educational opportunities for
violent and disruptive students.
``(4) New economy technology schools.--
``(A) In general.--Each local educational agency shall use
30 percent of the grant funds to establish technology
programs that will transform schools into New Economy
Technology Schools and, to the greatest extent possible,
will--
``(i) increase student performance related to an authentic
task;
``(ii) integrate the use of technology into activities that
are a core part of classroom curricula and are available to
all students;
``(iii) emphasize how to use technology to accomplish
authentic tasks;
``(iv) provide professional development and technical
assistance to teachers so that teachers may integrate
technology into daily teaching activities that are directly
aligned with State content and student performance standards;
``(v) enable the local educational agency annually to
increase the percentage of classrooms with access to
technology, particularly in schools in which not less than 50
percent of the school-age population comes from families with
incomes below the poverty line; and
``(vi) allow local educational agencies to provide
incentives or bonuses for teachers who have met the National
Education Technology Standards, as developed by the
Department of Education and the International Society for
Technology in Education, or have obtained an information
technology certification that is directly related to the
curricula or the academic subjects that the teachers teach.
``(B) Limitation.--Each local educational agency shall use
a portion equal to not more than 50 percent of the grant
funds described in subparagraph (A) to purchase, upgrade, or
retrofit computer hardware in schools. In distributing funds
from that portion, the agency shall give priority to schools
in which not less than 50 percent of the school-age
population comes from families with incomes below the poverty
line.
``(c) Transfer of Funds.--Notwithstanding subsection (b)--
``(1) a local educational agency that meets adequate yearly
progress requirements for student performance, as established
by the State educational agency under section 1111(b)(2)(B),
may allocate, at the local educational agency's discretion,
not more than 30 percent of the grant funds received under
section 6004(a)(3) among the 4 categories described in
paragraphs (1) through (4) of subsection (b);
``(2) a local educational agency that exceeds the adequate
yearly progress requirements described in paragraph (1) by a
significant amount, as determined by the State educational
agency, may allocate, at the local educational agency's
discretion, not more than 50 percent of the grant funds
received under section 6004(a)(3) among the 4 categories; and
``(3) a local educational agency that is identified for
improvement, as described in section 1116(d), may apply not
more than 25 percent of the grant funds in the categories
described in paragraphs (2), (3), and (4) of subsection (b)
to carry out school improvement activities described in
subsection (b)(1).
``(d) Limitations for Schools and Local Educational
Agencies in Corrective Action.--
``(1) Local educational agencies in corrective action.--If
a local educational agency is identified for corrective
action under section 1116(d), the State educational agency
shall--
``(A) notwithstanding any other provision of law, specify
how the local educational agency shall spend the grant funds
in order to focus the local educational agency on the
activities that will be the most effective in raising student
performance levels; and
``(B) implement corrective action in accordance with the
provisions for corrective action described in section
1116(d)(12).
``(2) Schools in corrective action.--If a school is
identified for corrective action under section 1116(c), the
local educational agency shall--

[[Page S1308]]

``(A) specify how the school shall spend grant funds
received under this section in order to focus the school on
the activities that will be the most effective in raising
student performance levels; and
``(B) implement corrective action in accordance with the
provisions for corrective action described in section
1116(c)(10).
``(3) Duration.--Limitations imposed under paragraphs (1)
and (2) on a school or local educational agency in corrective
action status shall remain in effect until such time as the
school or local educational agency has made sufficient
improvement, as determined by the State educational agency,
and is removed from corrective action status.

``SEC. 6007. STATE AND LOCAL RESPONSIBILITIES.

``(a) Data Review.--
``(1) State and local review.--A State educational agency
shall jointly review with a local educational agency
described in section 6006(d)(1) the local educational
agency's data gathered from student assessments and other
measures required under section 1111(b)(4), in order to
determine pursuant to section 6006(d)(1)(A) how the local
educational agency shall spend the grant funds in order to
substantially increase student performance levels.
``(2) School and local review.--A local educational agency
shall jointly review with a school described in section
6006(d)(2) the school's data gathered from student
assessments and other measures required under section
1111(b)(4), in order to determine pursuant to section
6006(d)(2) how the school shall spend grant funds in order to
substantially increase student performance levels.
``(b) Technical Assistance.--
``(1) State assistance.--
``(A) In general.--A State educational agency shall
provide, upon request by a local educational agency receiving
grant funds under this title, technical assistance to the
local educational agency and schools served by the local
educational agency, including assistance in analyzing student
performance and the impact of programs assisted under this
title, and identifying the best instructional strategies and
methods for carrying out such programs.
``(B) Provision.--State technical assistance may be
provided by--
``(i) the State educational agency; or
``(ii) with the local educational agency's approval, an
institution of higher education, a private not-for-profit or
for-profit organization, an educational service agency, the
recipient of a Federal contract or participant in a
cooperative agreement as described in section 7104(a)(3), a
nontraditional entity such as a corporation or consulting
firm, or any other entity with experience in the program area
for which the assistance is being sought.
``(2) Local assistance.--
``(A) In general.--A local educational agency shall
provide, upon request by an elementary school or secondary
school served by the agency and receiving grant funds under
this title, technical assistance to such school, including
assistance in analyzing student performance and the impact of
programs assisted under this title, and identifying the best
instructional strategies and methods for carrying out such
programs.
``(B) Provision.--Local technical assistance may be
provided by--
``(i) the State educational agency or local educational
agency; or
``(ii) with the school's approval, an institution of higher
education, a private not-for-profit or for-profit
organization, an educational service agency, the recipient of
a Federal contract or participant in a cooperative agreement
as described in section 7104(a)(3), a nontraditional entity
such as a corporation or consulting firm, or any other entity
with experience in the program area for which the assistance
is being sought.

``SEC. 6008. LOCAL REPORTS.

``Each local educational agency receiving funds under this
title to carry out programs shall annually publish and
disseminate to the public in a format and, to the extent
practicable, in a language that parents can understand, a
report on--
``(1) information describing the use of funds in the 4
categories described in section 6006(b);
``(2) the impact of such programs and an assessment of such
programs' effectiveness; and
``(3) the local educational agency's progress toward
attaining the goals and objectives described in the plan
described in section 6005(b), and the extent to which
programs assisted under this title have increased student
achievement.

``SEC. 6009. AUTHORIZATION OF APPROPRIATIONS.

``There are authorized to be appropriated to carry out this
title $3,500,000,000 for fiscal year 2002, and such sums as
may be necessary for each of the 4 succeeding fiscal
years.''.

TITLE VII--ACCOUNTABILITY

SEC. 701. ACCOUNTABILITY.

Title VII (20 U.S.C. 7401 et seq.) is amended to read as
follows:

``TITLE VII--ACCOUNTABILITY

``PART A--SANCTIONS AND REWARDS

``SEC. 7101. SANCTIONS.

``(a) Third Fiscal Year.--If a State receiving grant funds
under a covered provision has not met the performance
objectives established under the covered provision 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 receives for administrative expenses under
such provision.
``(b) Fourth Fiscal Year.--If the State fails to meet the
performance objectives established under the covered
provision by the end of the fourth fiscal year for which the
State receives such grant funds, the Secretary shall reduce
the total amount the State receives under title VI by 30
percent.
``(c) Duration.--If the Secretary determines, under
subsection (a) or (b), that a State failed to meet the
performance objectives established under a covered provision
for a third or fourth fiscal year, the Secretary shall reduce
grant funds in accordance with subsection (a) or (b) for the
State for each subsequent fiscal year until the State
demonstrates that the State met the performance objectives
for the fiscal year preceding the demonstration.
``(d) Technical Assistance.--The Secretary shall provide
technical assistance, if sought, to a State subjected to
sanctions under subsection (a) or (b).
``(e) Local Sanctions.--
``(1) In general.--Each State receiving assistance under
part A of title I, part A of title II, part A of title III,
or title VI shall develop a system to hold local educational
agencies accountable for meeting--
``(A) the performance objectives established under part A
of title II, part A of title III, and title VI; and
``(B) the adequate yearly progress requirements established
under part A of title I, and required under part A of title
III and title VI.
``(2) Sanctions.--A system developed under paragraph (1)
shall include a mechanism for sanctioning local educational
agencies for failure to meet such performance objectives and
adequate yearly progress levels.
``(f) Definitions.--In this section:
``(1) Covered provision.--The term `covered provision'
means part A of title I, part A of title II, part A of title
III, and title VI.
``(2) Performance objectives.--The term `performance
objectives' means, used with respect to--
``(A) part A of title I, the adequate yearly progress
levels established under subsections (b)(2)(A)(iii) and
(b)(2)(B) of section 1111;
``(B) part A of title II, the set of performance objectives
established under section 2104;
``(C) part A of title III, the set of performance
objectives established under section 3109; and
``(D) title VI, the set of performance objectives set by
each local educational agency under section 6005(b)(2)(C).

``SEC. 7102. REWARDING HIGH PERFORMANCE.

``(a) State Rewards.--
``(1) In general.--From amounts appropriated under
subsection (d), and from amounts made available as a result
of reductions under section 7101, the Secretary shall make
awards to States that--
``(A) for 3 consecutive years have--
``(i) exceeded the States' performance 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 and noneconomically disadvantaged students;
``(iv) raised all students enrolled in the States' public
elementary schools and secondary schools to the State's
proficient level of performance described in the State
standards described in section 1111(b)(4) earlier than 10
years after the date of enactment of the Public Education
Reinvention, Reinvestment, and Responsibility Act; or
``(v) significantly increased the percentage of classes in
core academic subjects being taught by fully qualified
teachers in schools receiving funds under part A of title I;
or
``(B) not later than December 31, 2004, ensure that all
teachers teaching in the States' 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 that is
not distributed under subsection (b) to establish
demonstration sites with respect to high-performing schools
(based on performance objectives or 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
that is not used pursuant to subparagraph (A) or (C) and is
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 on 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 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 by making awards to local educational agencies in the
State that--
``(A) for 3 consecutive years have--
``(i) exceeded the State-established local educational
agency performance objectives established for any title under
this Act;
``(ii) exceeded the adequate yearly progress levels
established under section 1111(b)(2);

[[Page S1309]]

``(iii) significantly narrowed the gaps between minority
and nonminority students, and between economically
disadvantaged and noneconomically disadvantaged students;
``(iv) raised all students enrolled in schools served by
the local educational agency to the State's proficient level
of performance described in the State standards described in
section 1111(b)(1) earlier than 10 years after the date of
enactment of the Public Education Reinvestment, Reinvention,
and Responsibility Act; or
``(v) significantly increased the percentage of classes in
core academic subjects being taught by fully qualified
teachers in schools receiving funds under part A of title I;
``(B) not later than December 31, 2004, ensure that all
teachers teaching in the elementary schools and secondary
schools served by the local educational agencies are fully
qualified; or
``(C) have attained consistently high achievement in
another area that the State determines is appropriate to
reward.
``(2) School awards.--A local educational agency shall use
funds made available under paragraph (1) for activities
described in subsection (c).
``(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 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 Awards.--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 for 1 or more activities--
``(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)(vii);
``(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 improve 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 districtwide programs
or policies to improve the level of student performance on
State assessments that are aligned with State content
standards; or
``(5) to reward schools for consistently high achievement
in another area that the local educational agency determines
is 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.--In this section:
``(1) Core academic subject.--The term `core academic
subject' has the meaning given the term in section 2002.
``(2) Low-performing student.--In this section, the term
`low-performing student' means a student who performs below a
State's basic level of performance described in the State
standards described in section 1111(b)(1).

``SEC. 7103. SUPPLEMENT NOT SUPPLANT.

``Funds appropriated pursuant to the authority of this
title shall be used to supplement and not supplant other
Federal, State, and local public funds expended to provide
activities described in section 7102.

``SEC. 7104. SECRETARY'S ACTIVITIES.

``(a) In General.--Notwithstanding any other provision of
this Act, from amounts appropriated under subsection (d) and
not reserved under subsection (b), the Secretary may--
``(1) support activities of the National Board for
Professional Teaching Standards;
``(2) study and disseminate information regarding model
programs assisted under this Act;
``(3) provide training and technical assistance to States,
local educational agencies, elementary schools and secondary
schools, Indian tribes, and other recipients of grant funds
under this Act that are carrying out activities assisted
under this Act, including entering into contracts or
cooperative agreements with public or private nonprofit
entities or consortia of such entities, in order to provide
comprehensive training and technical assistance related to
the administration and implementation of activities assisted
under this Act;
``(4) support activities that will promote systemic
education reform at the State and local levels;
``(5) award grants or contracts to public or private
nonprofit entities to enable the entities--
``(A) to develop and disseminate information on exemplary
educational practices relating to reading, writing,
mathematics, science, and other academic subjects, and
technology, and instructional materials and professional
development concerning the academic subjects, for States,
local educational agencies, and elementary schools and
secondary schools; and
``(B) to provide technical assistance concerning the
implementation of teaching methods and assessment tools for
use by elementary school and secondary school students,
teachers, and administrators;
``(6) disseminate information on models of value-added
assessments;
``(7) award a grant or contract to a public or private
nonprofit entity or consortium of such entities for the
development and dissemination of information on exemplary
programs and curricula for accelerated and advanced learning
for all students, including gifted and talented students;
``(8) award a grant or contract to Reading Is Fundamental,
Inc. and other public or private nonprofit entities to
support and promote programs that include the distribution of
inexpensive books to students and the provision of literacy
activities that motivate students to read; and
``(9) provide assistance to States--
``(A) by assisting in the development of English language
development standards and high-quality assessments, if
requested by a State participating in activities under part A
of title III; and
``(B) by developing native language tests for limited
English proficient students that a State may administer to
such students to assess student performance in at least
reading, science, and mathematics, consistent with section
1111.
``(b) Reservation.--From the amounts appropriated under
subsection (d), the Secretary shall reserve $10,000,000 for
the purposes of carrying out activities under section
1202(c).
``(c) Special Rule for Secretary Awards.--
``(1) In general.--Notwithstanding any other provision of
this Act, a recipient of funds under this Act for a program
that are provided through a direct grant made by the
Secretary, or a contract or cooperative agreement entered
into directly with the Secretary, shall include information
on the following in any application or plan required under
such program:
``(A) How funds provided under the program have been used
and will be used and how such use has increased and will
increase student academic achievement.
``(B) The goals and objectives that have been met and that
will be met through the program, including goals for
dissemination and use of any information or materials
produced.
``(C) How the recipient has tracked and reported annually,
and will track and report annually, to the Secretary
information on--
``(i) the successful dissemination of any information or
materials produced under the program;
``(ii) where the information or materials produced are
being used; and
``(iii) the impact of such use and, if applicable, the
extent to which such use increases student academic
achievement.
``(2) Requirement.--If no application or plan is required
under a program described in paragraph (1), the Secretary
shall require the recipient 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), assess the magnitude of the
dissemination, and 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 described in paragraph (1) if--
``(i) the goals and objectives described in paragraph
(1)(B) have not been met;
``(ii) the dissemination has not been of a magnitude to
ensure that national goals are being addressed; or
``(iii) the information or materials produced have not made
a significant impact on raising student achievement in places
where such information or materials are used.
``(d) Authorization of Appropriations.--There are
authorized to be appropriated to carry out this section
$150,000,000 for fiscal year 2002, and such sums as may be
necessary for each of the 4 succeeding fiscal years.

``PART B--AMERICA'S EDUCATION GOALS PANEL

``SEC. 7201. AMERICA'S EDUCATION GOALS PANEL.

``(a) Purpose.--The purpose of this section is to establish
a bipartisan mechanism for--
``(1) building a national consensus for education
improvement; and
``(2) reporting on progress toward achieving America's
Education Goals.
``(b) America's Education Goals Panel.--
``(1) Establishment.--There is established in the executive
branch an America's Education Goals Panel (referred to in
this part as the `Goals Panel') to advise the President, the
Secretary, and Congress.
``(2) Composition.--The Goals Panel shall be composed of 18
members (referred to individually in this section as a
`member'), including--
``(A) 2 members appointed by the President;

[[Page S1310]]

``(B) 8 members who are Governors, 3 of whom shall be from
the same political party as the President and 5 of whom shall
be from the opposite political party from the President,
appointed by the Chairperson and Vice Chairperson of the
National Governors' Association, with the Chairperson and
Vice Chairperson each appointing representatives of such
Chairperson's and Vice Chairperson's respective political
parties, in consultation with each other;
``(C) 4 Members of Congress, of whom--
``(i) 1 member shall be appointed by the Majority Leader of
the Senate from among the Members of the Senate;
``(ii) 1 member shall be appointed by the Minority Leader
of the Senate from among the Members of the Senate;
``(iii) 1 member shall be appointed by the Majority Leader
of the House of Representatives from among the Members of the
House of Representatives; and
``(iv) 1 member shall be appointed by the Minority Leader
of the House of Representatives from among the Members of the
House of Representatives; and
``(D) 4 members of State legislatures appointed by the
President of the National Conference of State Legislatures,
of whom 2 shall be from the same political party as the
President of the United States.
``(3) Special appointment rules.--
``(A) In general.--The members appointed pursuant to
paragraph (2)(B) shall be appointed as follows:
``(i) Same party.--If the Chairperson of the National
Governors' Association is from the same political party as
the President, the Chairperson shall appoint 3 individuals
and the Vice Chairperson of such association shall appoint 5
individuals.
``(ii) Opposite party.--If the Chairperson of the National
Governors' Association is from the opposite political party
from the President, the Chairperson shall appoint 5
individuals and the Vice Chairperson of such association
shall appoint 3 individuals.
``(B) Special rule.--If the National Governors' Association
has appointed a panel that meets the requirements of
paragraph (2) and subparagraph (A) (except for the
requirements of paragraph (2)(D)), prior to the date of
enactment of the Public Education Reinvestment, Reinvention,
and Responsibility Act, the members serving on such panel
shall be deemed to be in compliance with the provisions of
such paragraph (2) and subparagraph (A) and shall not be
required to be reappointed pursuant to such paragraph (2) and
subparagraph (A).
``(C) Representation.--To the extent feasible, the
membership of the Goals Panel shall be geographically
representative and reflect the racial, ethnic, and gender
diversity of the United States.
``(4) Terms.--The terms of service of members shall be as
follows:
``(A) Presidential appointees.--Members appointed under
paragraph (2)(A) shall serve at the pleasure of the
President.
``(B) Governors.--Members appointed under paragraph (2)(B)
(or (3)(B)) shall serve for 2-year terms, except that the
initial appointments under such paragraph shall be made to
ensure staggered terms.
``(C) Congressional appointees and state legislators.--
Members appointed under subparagraphs (C) and (D) of
paragraph (2) shall serve for 2-year terms.
``(5) Date of appointment.--The initial members shall be
appointed not later than 60 days after the date of enactment
of the Public Education Reinvestment, Reinvention, and
Responsibility Act.
``(6) Initiation.--The Goals Panel may begin to carry out
the Goals Panel's duties under this section when 10 members
of the Goals Panel have been appointed.
``(7) Vacancies.--A vacancy on the Goals Panel shall not
affect the powers of the Goals Panel, but shall be filled in
the same manner as the original appointment.
``(8) Travel.--The members shall not receive compensation
for the performance of services for the Goals Panel, but each
member may be allowed travel expenses, including per diem in
lieu of subsistence, as authorized by section 5703 of title
5, United States Code, for each day the member is engaged in
the performance of duties for the Goals Panel away from the
home or regular place of business of the member.
Notwithstanding section 1342 of title 31, United States Code,
the President may accept the voluntary and uncompensated
services of members.
``(9) Chairperson.--
``(A) In general.--The members shall select a Chairperson
from among the members.
``(B) Term and political affiliation.--The Chairperson of
the Goals Panel shall serve a 1-year term. No 2 consecutive
Chairpersons shall be from the same political party.
``(10) Conflict of interest.--A member of the Goals Panel
who is an elected official of a State that has developed
content or student performance standards may not participate
in Goals Panel consideration of such standards.
``(11) Ex officio member.--If the President has not
appointed the Secretary as 1 of the 2 members the President
appoints pursuant to paragraph (2)(A), the Secretary shall
serve as a nonvoting ex officio member of the Goals Panel.
``(c) Duties.--
``(1) In general.--The Goals Panel shall--
``(A) report to the President, the Secretary, and Congress
regarding the progress the Nation and the States are making
toward achieving America's Education Goals, including issuing
an annual report;
``(B) report on, and widely disseminate through multiple
strategies information pertaining to, promising or effective
actions being taken at the Federal, State, and local levels,
and in the public and private sectors, to achieve America's
Education Goals;
``(C) report on, and widely disseminate information on
promising or effective practices pertaining to, the
achievement of each of the 8 America's Education Goals; and
``(D) help build a bipartisan consensus for the reforms
necessary to achieve America's Education Goals.
``(2) Report.--
``(A) In general.--The Goals Panel shall annually prepare
and submit to the President, the Secretary, the appropriate
committees of Congress, and the Governor of each State a
report that shall--
``(i) assess the progress of the United States toward
achieving America's Education Goals; and
``(ii) identify actions that should be taken by Federal,
State, and local governments.
``(B) Form; data.--The reports shall be presented in a
form, and include data, that is understandable to parents and
the general public.
``(3) Early childhood assessment.--The Goals Panel shall
carry out the activities described in section 207 of the
Goals 2000: Educate America Act, as in effect on the day
before the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act.
``(d) Powers.--The Goals Panel shall have the powers
described in section 204 of the Goals 2000: Educate America
Act, as in effect on the day before the date of enactment of
the Public Education Reinvestment, Reinvention, and
Responsibility Act.
``(e) Administration.--The Goals Panel shall comply with
the administrative requirements described in section 205 of
the Goals 2000: Educate America Act, as in effect on the day
before the date of enactment of the Public Education
Reinvestment, Reinvention, and Responsibility Act.
``(f) Personnel.--The Goals Panel shall have the authority
relating to a director, employees, experts and consultants,
and detailees described in section 206 of the Goals 2000:
Educate America Act, as in effect on the day before the date
of enactment of the Public Education Reinvestment,
Reinvention, and Responsibility Act.
``(g) Definition.--In this section, the term `America's
Education Goals' means the National Education Goals
established under section 102 of the Goals 2000: Educate
America Act, as in effect on the day before the date of
enactment of the Public Education Reinvestment, Reinvention,
and Responsibility Act.''.

TITLE VIII--GENERAL PROVISIONS AND REPEALS

SEC. 801. REPEALS, TRANSFERS, AND REDESIGNATIONS REGARDING
TITLE XIV.

(a) In General.--The Act (20 U.S.C. 6301 et seq.) is
amended--
(1) by inserting after title VII the following:

``TITLE VIII--GENERAL PROVISIONS'';

(2) by repealing sections 14514 and 14603 (20 U.S.C. 8904,
8923);
(3)(A) by transferring title XIV (20 U.S.C. 8801 et seq.)
to title VIII and inserting such title after the title
heading for title VIII; and
(B) by striking the title heading for title XIV;
(4)(A) by redesignating part H of title VIII (as
redesignated by paragraph (3)) as part I of title VIII; and
(B) by redesignating the references to such part H of title
VIII as references to part I of title VIII;
(5) by inserting after part G of title VIII the following:

``PART H--SUPPLEMENT, NOT SUPPLANT

``SEC. 8801. SUPPLEMENT, NOT SUPPLANT.

``Funds appropriated pursuant to the authority of this Act
shall be used to supplement and not supplant State and local
public funds expended to provide activities described in this
Act.'';
(6) by redesignating the references to title XIV as
references to title VIII;
(7)(A) by redesignating sections 14101 through 14103 (20
U.S.C. 8801, 8803) (as transferred by paragraph (3)) as
sections 8101 through 8103, respectively; and
(B) by redesignating the references to such sections 14101
through 14103 as references to sections 8101 through 8103,
respectively;
(8)(A) by redesignating sections 14201 through 14206 (20
U.S.C. 8821, 8826) (as transferred by paragraph (3)) as
sections 8201 through 8206, respectively; and
(B) by redesignating the references to such sections 14201
through 14206 as references to sections 8201 through 8206,
respectively;
(9)(A) by redesignating sections 14301 through 14307 (20
U.S.C. 8851, 8857) (as transferred by paragraph (3)) as
sections 8301 through 8307, respectively; and
(B) by redesignating the references to such sections 14301
through 14307 as references to sections 8301 through 8307,
respectively;
(10)(A) by redesignating section 14401 (20 U.S.C. 8881) (as
transferred by paragraph (3)) as section 8401; and
(B) by redesignating the references to such section 14401
as references to section 8401;
(11)(A) by redesignating sections 14501 through 14513 (20
U.S.C. 8891, 8903) (as transferred by paragraph (3)) as
sections 8501 through 8513, respectively; and

[[Page S1311]]

(B) by redesignating the references to such sections 14501
through 14513 as references to sections 8501 through 8513,
respectively;
(12)(A) by redesignating sections 14601 and 14602 (20
U.S.C. 8921, 8922) (as transferred by paragraph (3)) as
sections 8601 and 8602, respectively; and
(B) by redesignating the references to such sections 14601
and 14602 as references to sections 8601 and 8602,
respectively;
(13)(A) by redesignating section 14701 (20 U.S.C. 8941) (as
transferred by paragraph (3)) as section 8701; and
(B) by redesignating the references to such section 14701
as references to section 8701; and
(14)(A) by redesignating sections 14801 and 14802 (20
U.S.C. 8961, 8962) (as transferred by paragraph (3)) as
sections 8901 and 8902, respectively; and
(B) by redesignating the references to such sections 14801
and 14802 as references to sections 8901 and 8902,
respectively.
(b) Amendments.--Title VIII (as so transferred and
redesignated) is amended--
(1) in section 8101(10) (as redesignated by subsection
(a)(7))--
(A) by striking subparagraphs (C) through (F); and
(B) by adding after subparagraph (B) the following:
``(C) part A of title II;
``(D) part A of title III; and
``(E) title IV.'';
(2) in section 8102 (as redesignated by subsection (a)(7)),
by striking ``VIII'' and inserting ``V'';
(3) in section 8201 (as redesignated by subsection
(a)(8))--
(A) in subsection (a)(2), by striking ``, and
administrative funds under section 308(c) of the Goals 2000:
Educate America Act''; and
(B) by striking subsection (f);
(4) in section 8203(b) (as redesignated by subsection
(a)(8)), by striking ``Improving America's Schools Act of
1994'' and inserting ``Public Education Reinvestment,
Reinvention, and Responsibility Act'';
(5) in section 8204 (as redesignated by subsection
(a)(8))--
(A) by striking subsection (b); and
(B) in subsection (a)--
(i) in paragraph (2)--

(I) in the matter preceding subparagraph (A), by striking
``1995'' and inserting ``2002''; and
(II) in subparagraph (B), by inserting ``professional
development,'' after ``curriculum development,''; and

(ii) in paragraph (4)--

(I) by striking ``and section 410(b) of the Improving
America's Schools Act of 1994'';
(II) by striking ``paragraph (2)'' and inserting
``subsection (a)(2)'';
(III) by striking the following:

``(4) Results.--'' and inserting the following:
``(b) Results.--'';

(IV) by striking the following:

``(A) develop'' and inserting the following:
``(1) develop''; and

(V) by striking the following:

``(B) within'' and inserting the following:
``(2) within'';
(6) in section 8205(a)(1) (as redesignated by subsection
(a)(8)), by striking ``part A of title IX'' and inserting
``subpart 1 of part C of title III'';
(7) in section 8206 (as redesignated by subsection
(a)(8))--
(A) by striking ``(a) Unneeded Program Funds.--''; and
(B) by striking subsection (b);
(8) in section 8302(a)(2) (as redesignated by subsection
(a)(9))--
(A) by striking subparagraph (C); and
(B) by redesignating subparagraphs (D) and (E) as
subparagraphs (C) and (D), respectively;
(9) in section 8304(b) (as redesignated by subsection
(a)(9)), by striking ``Improving America's Schools Act of
1994'' and inserting ``Public Education Reinvestment,
Reinvention, and Responsibility Act'';
(10) in section 8401 (as redesignated by subsection
(a)(10))--
(A) in subsection (a), by striking ``Except as provided in
subsection (c),'' and inserting ``Except as provided in
subsection (c), and notwithstanding any other provision
regarding waivers in this Act,''; and
(B) in subsection (c)(8), by striking ``part C of title X''
and inserting ``part B of title IV'';
(11) in section 8502 (as redesignated by subsection
(a)(11)), by striking ``VIII'' and inserting ``V'';
(12) in section 8503(b)(1) (as redesignated by subsection
(a)(11))--
(A) by striking subparagraphs (B) through (E); and
(B) by adding at the end the following:
``(B) part A of title II, relating to professional
development;
``(C) title III; and
``(D) title VI.'';
(13) in section 8506(d) (as redesignated by subsection
(a)(11)), by striking ``Improving America's Schools Act of
1994'' and inserting ``Public Education Reinvestment,
Reinvention, and Responsibility Act'';
(14) in section 8513 (as redesignated by subsection
(a)(11)), by striking ``Improving America's Schools Act of
1994'' each place it appears and inserting ``Public Education
Reinvestment, Reinvention, and Responsibility Act'';
(15) in section 8601 (as redesignated by subsection
(a)(12))--
(A) in subsection (b)(3)--
(i) in subparagraph (A), by striking ``Improving America's
Schools Act of 1994'' and inserting ``Public Education
Reinvestment, Reinvention, and Responsibility Act''; and
(ii) in subparagraph (B), by striking ``Improving America's
Schools Act'' and inserting ``Public Education Reinvestment,
Reinvention, and Responsibility Act''; and
(B) in subsection (f), by striking ``Improving America's
Schools Act of 1994'' and inserting ``Public Education
Reinvestment, Reinvention, and Responsibility Act''; and
(16) in section 8701(b) (as redesignated by subsection
(a)(13))--
(A) in paragraph (1)--
(i) in subparagraph (B)--

(I) in clause (i), by striking ``Improving America's
Schools Act of 1994'' and inserting ``Public Education
Reinvestment, Reinvention, and Responsibility Act'';
(II) in clause (ii), by striking ``such as initiatives
under the Goals 2000: Educate America Act, and'' and
inserting ``under''; and
(III) in clause (ii), by striking ``such Acts'' and
inserting ``such Act''; and

(ii) in subparagraph (C)(ii), by striking ``the School-to-
Work Opportunities Act of 1994, and the Goals 2000: Educate
America Act,'' and inserting ``and the School-to-Work
Opportunities Act of 1994''; and
(B) in paragraph (3), by striking ``1998'' and inserting
``2005''.

SEC. 802. OTHER REPEALS.

Titles X, XI, XII, and XIII (20 U.S.C. 8001 et seq., 8401
et seq., 8501 et seq., 8601 et seq.) and the Goals 2000:
Educate America Act (20 U.S.C. 5801 et seq.) are repealed.

Mr. BAYH Mr. President, I am pleased to join with my colleagues
Senators Lieberman, Landrieu, Kohl, Lincoln, Breaux, Graham, Feinstein,
Carper, Kerry, and Nelson in offering the Public Education
Reinvestment, Reinvention, and Responsibility Act. It is my hope that
our proposal will allow Congress to break the gridlock of the recent
past and pursue a two-track strategy in this Congress, working together
for the benefit of the American people when we agree, while continuing
to disagree on other matters over which consensus cannot be formed.
We introduce our version of the Elementary and Secondary Education
Act today in recognition of the fact that for too many millions of
American children the promise of a quality public education is a hollow
dream. We stand here today in recognition of the fact that the
solutions of the 1960s are inadequate to meet the challenges of the
21st Century and the years beyond. We stand here today to say the
status quo is not good enough; that we must do better. Congress has an
historic opportunity and responsibility to enact the most sweeping
education reform since the 1960s to ensure that no child is left
behind. The consequences of any of our children not receiving a quality
education are far greater than ever before. For the first time in our
nation's history, the growing gap between the educational ``haves'' and
``have nots'' threatens to create a permanent underclass. If we do not
address these shortcomings, the knowledge and information gap will lock
many of our citizens out of the marketplace and prevent them from
accessing opportunity in the New Economy.
Our proposal breaks with the sterile orthodoxy of the past, in which
too often the left said just spending more money was the answer to the
problems facing our schools, and the right said the public schools
could not be fixed and, therefore, should be abandoned. Instead, we
propose a consensus, a synthesis of ideas reflecting the best of both
the right and the left to improve the quality of public education
across our country. We propose a substantial increase in our nation's
investment in education, because we recognize that we can't expect our
schools, particularly our poorer schools, to get the job done if we
don't give them the tools to get the job done. We propose an increase
of $35 billion over five years in Federal education spending. But we do
more than just throw money at the problem, because we know that
taxpayers, parents, and most of all our children, have a right to
expect more from us. Instead, we focus on accountability. In return for
increased investment, we insist upon results. We focus on outcomes, not
inputs. No longer will we define success only in terms of how much
money is spent, but instead of how much our children learn. Can they
read and write, add and subtract, know basic science? No longer will we
define accountability in terms of ordering local school districts to
spend dollars in particular ways, but instead in terms of whether our
children are getting the skills they need to make a successful life for
themselves. This is a significant rethinking from the ideas

[[Page S1312]]

that have prevailed here in Washington for several decades.
Our proposal also provides a substantial amount of flexibility. We
don't agree with the block grants our colleagues on the far right
advocate for which would allow money to be diverted from public
education or to allow dollars to be diverted from focusing on our
poorest students. But we do allow for local principals and
superintendents to have a much greater say in determining how best to
spend those dollars, because we believe that those at the local level
who labor in the classrooms and the schools every day, can make those
decisions far better than those of us who now work on the banks of the
Potomac.
Finally, our proposal harnesses market forces and embeds them in the
public education system to encourage innovation, improvement, and
increased accountability without abandoning the public schools and
those children who would not do well in a market-based system by going
down the path of vouchers. Instead, we support the expansion of public
school choice, magnet schools, and charter schools. We believe in the
enduring American principle of a quality public education for all of
our nation's children--not just the lucky few under a market based
system.
It was Thomas Jefferson who said that a society that expects to be
both ignorant and free is expecting something that never has been and
never shall be. So we put forward this proposal because we know that
the cause of improving public education is critically important to our
economy, critically important to the kind of society that we will be,
and essential to the vibrancy of our democracy itself.
Mr. KOHL. Mr. President, I am proud to again be an original cosponsor
of The Public Education Reinvestment, Reinvention, and Responsibility
Act of 2000--better known as ``Three R's.'' I have been pleased to work
with the education community in Wisconsin, as well as Senators
Lieberman, Bayh, and our other cosponsors, on this important piece of
legislation.
Perhaps this year, the three ``R's'' should stand for: ``right,
right, and right.'' It is the right time to keep promises we all made
during the election to make bipartisan education reform our first order
of business. It is the right policy to give schools more flexibility
but ask for more accountability. And it is the right thing to do to
make our students a number one federal priority.
We have come a long way since we started this effort more than a year
ago. Unfortunately, in the 106th Congress, we were unable to rise above
the usual partisan sniping and have a serious education debate. But
last year's fighting has given way to this year's opportunity to do
what's right by our children. If we learned anything from the last
election, it is that the American people want real education reform--
and they want to see results.
None of us would deny that we have made great strides in recent years
toward a better public education system. Nearly all States now have
academic standards in place. More students are taking more challenging
courses. Test scores have risen slightly. Dropout rates have decreased.
In Wisconsin, educators have worked hard to help students achieve.
Students are showing continued improvement on State tests in nearly
every subject, particularly in science and math and across all groups,
including African Americans, the disabled, and the economically
disadvantaged.
But despite our best efforts, our public schools still face huge
challenges. Too many students do not have the skills they need to
compete in the 21st century economy. And the achievement gap between
poor and more affluent students remains alarmingly wide.
Mr. President, in the past some have called for reducing or
eliminating the Federal role in education. I think that would be a
mistake. As a nation, it is in all of our best interests to make sure
our children receive the best education possible. It is vital to their
future success, and to the success of our country.
But addressing problems in education is going to take more than
cosmetic reform. We risk our children's future by defending the tired
programs of the past. We need to let go of the partisan bickering and
focus on what the American people are focused on: Results.
Results are what the 3 R's bill is about. We make raising student
achievement for all students--and eliminating the achievement gap
between low-income and more affluent students--our top priorities. To
accomplish this, our bill centers around three principles.
First, we believe that we must make a strong investment in education,
and we need to target those funds to the neediest schools and students.
Since Federal funds make up only 7 percent of all money spent on
education, it is essential that we target those funds where they are
needed the most.
Second, we believe that States and local school districts are in the
best position to know what their educational needs are. The 3 R's give
educators more flexibility to decide how they will use Federal dollars
to meet those needs.
Finally--and I believe this is the key component of our approach--we
believe that in exchange for this increased flexibility, there must be
increased accountability.
For too long, we have seen a steady stream of Federal dollars flow to
States and school districts--regardless of how well they educated their
students. This has to stop. We need to reward schools that do a good
job. We need to provide help to schools that are struggling to do a
better job. But we need to stop subsidizing failure. Our highest
priority must be educating children--not protecting broken systems.
I am pleased that there is an emerging consensus around these core
principles of 3 R's. Already, President Bush has expressed interest in
pursuing many of these same ideas that our group laid out over a year
ago, and I look forward to joining with both parties to get this done.
The Three R's bill is a strong starting point for this debate. This
bill--by using the concepts of increased funding, targeting,
flexibility--and most importantly, accountability--demonstrates how we
can work with our State and local partners to make sure every child
receives the highest quality education--and a chance to live a
successful, productive life. I look forward to working with both sides
of the aisle as Congress debates education reform in the coming months.
Mr. GRAHAM. Mr. President, I am pleased to join my colleagues,
Senator Lieberman, Senator Bayh, and others of the Senate New Democrats
today in introducing the Three R's bill: the Public Education
Reinvestment, Reinvention and Responsibility Act of 2001.
This legislation is important for several reasons:
It re-establishes the education of our children, all our children, as
a national priority.
It is a sterling example of ``finding the center.'' We take the best
of many ideas, and forge what we hope will be common ground.
It is ``unfinished business'' from last year. The 106th Congress had
the responsibility to reauthorize the Elementary and Secondary
Authorization Act. We debated for a while, gridlock set in, and all
progress ended for the year. By coming forward early in the 107th
Congress with a centrist proposal--we hope for a different outcome in
2001.
The concepts in the Three R's are simple, but resonant with teachers,
parents and administrators:
More money is needed. State and local governments have the primary
responsibility toward funding K-12 education, but the federal
government can do more. We offer $35 billion more over the next five
years.
Accountability assures that we are getting the most effective use of
federal dollars in education. There is strong accountability here.
Struggling schools are offered extra help, but then they must show
results in student progress. Schools that exceed goals are rewarded.
Flexibility is essential so that each local school district is able
to meet specific local needs and challenges. The three R's ensures that
federal priorities in education receive a focus, but allow state and
local decision makers to implement what they most need.
In the first week of February last year, I hosted a roundtable
discussion of parents, teachers and administrators in Tampa, Florida.
All of them asked for the same thing: more resources more flexibility,
and a focus on results--not procedure. simply put, that's what we try
to do here.

[[Page S1313]]

My discussion in Tampa also highlighted the urgent need for the
federal government's commitment to education.
The latest National Assessment of Educational Progress, NAEP, scores
show:
Only 17 percent of 8th graders in Florida score at or above the
proficient level in mathematics.
Only 3 percent of African American 8th graders score at or above
proficient standards in math.
Only 23 percent of 4th graders are at or above proficient standards
in reading.
18 percent of the classes in Florida are taught by instructors who
lack a college major in the subject matter that they teach.
The ``achievement gap'' is real. White students in Florida on average
score 1001 points on the SAT. African American students, on average,
score 856 points. Hispanic students score a 957.
We need to do more to give all Florida's students, and all of our
nation's students, the best education possible.
The introduction of this legislation is the first step toward finding
the common ground and making the changes that are needed. I look
forward to working with each of my colleagues as we focus on this in
the 107th Congress.
Mr. KERRY. Mr. President, today I join several of my colleagues to
introduce an innovative education reform proposal, the Public Education
Reinvestment, Reinvention, and Responsibility Act, or Three R's for
short. Three R's aims to help states and districts raise the academic
achievement of all children by increasing the federal government's
investment in public education, by highly-targeting those resources
toward to most economically disadvantaged children, by increasing the
flexibility with which states and districts use federal dollars, and by
holding schools accountable for results.
I believe that it is past time to break the partisan gridlock in
Washington over education reform and to come together around programs,
policies, and initiatives that members of both parties can agree are
critical to improving education for our neediest children. I am very
pleased that President Bush agrees with my colleagues and I on the
fundamental principles underlying this legislation--that meaningful
education reform requires more resources, more flexibility, and more
accountability. I look forward to working with President Bush and my
Republican colleagues to reach a bipartisan consensus on education
reform. I believe that the Three R's legislation provides a great
framework for finding the common ground necessary to reach a consensus.
Bipartisanship means compromise, not capitulation--and education
reform is an issue for compromise. We've been pushing for three years
for real education reform for our kids--we've been willing to put aside
hot button issues--and now I hope that President Bush will join us by
putting aside his voucher proposals and working toward meaningful
public education reform that both parties can agree on. Both
Republicans and Democrats can agree that the federal government should
focus on helping states improve academic results for our children
instead of developing more rules, on encouraging states and schools to
enact bold reforms instead of passively tolerating failure. It is time
to step back from mico-managing public education from Washington, and
time instead to give states and school districts the flexibility they
need to improve public education. And we must hold those schools and
states accountable for results.
Members of both parties know that we must increase our investment in
public education so that schools can meet high standards, that we must
maintain our commitment to the most economically disadvantaged
students, that to be successful schools must have capable leaders and
fully certified teachers, and that schools must be held accountable for
providing children with a quality education.
I have worked on education reform in a bipartisan way in the past. In
the last Congress Senator Gordon Smith and I introduced education
reform legislation and were supported by many of our colleagues. Our
proposal represented an education reform agenda that members of both
parties could support and contained initiatives that many agreed were
fundamental to improving public education. The Three R's legislation--a
focus on increased investment, increased flexibility, and increased
accountability--is also an education reform agenda on which many can
agree and I want to reach out in the next few weeks and ask those
Republicans, like Gordon Smith, Susan Collins, and Olympia Snowe, to
join in this effort to reform education in a bipartisan fashion.
Mr. CARPER. Mr. President, I am very pleased to rise today in support
of the Public Education Reinvestment, Reinvention, and Responsibility
Act. I want to congratulate my good friends, the Senator from
Connecticut and the Senator from Indiana, for their strong leadership
on this issue. When they first introduced this legislation back last
year, the prospects for bipartisan education reform looked far
different than they do today. Members on the two sides of the aisle
were sharply divided over the future of the federal role in education.
As a result, the Congress failed last year to reauthorize the
Elementary and Secondary Education Act for the first time in its 35-
year history.
Last year, it took courage and foresight for the supporters of this
legislation to step into the partisan breach in the way that they did.
This bill received all of 13 votes when it was first brought to the
floor. Today, we ought to all be grateful for the leadership of those
13 senators, because this year the Public Education Reinvestment,
Reinvention, and Responsibility Act represents the best hope and the
best blueprint for finally achieving meaningful, bipartisan reform of
the federal role in education.
For the last eight years, I had the great privilege of serving my
little State as governor. During that time, I worked together with
legislators from both sides of the aisle, with educators and others, to
set rigorous standards, to provide local schools with the resources and
flexibility they needed, and in return to demand accountability for
results. We in Delaware have not been alone in this endeavor. We have
been part of a nationwide movement for change--a movement of parents
and teachers, of employers, legislators and governors, who believe that
our public schools can be improved and that every child can learn.
As a former chairman of the National Governors' Association, I can
attest that the Federal Government is frequently a lagging indicator
when it comes to responsiveness to change. It is clearly states and
local communities that are leading the movement for change in public
education today. The bill we introduce today does not seek to make the
Federal Government the leader in education reform by micromanaging the
operation of local schools. Nor does this legislation seek to
perpetuate the status quo in which the Federal Government passively
funds and facilitates failure. Rather, this legislation seeks for the
first time to make the Federal Government a partner and catalyst in the
movement for reform that we see all across this country at the State
and local level. This legislation refocuses Federal policy on doing a
few things, but doing them well. It redirects Federal policy toward the
purpose of achieving results rather than promulgating yet more rules
and regulations.
I believe we have a tremendous opportunity this year to achieve
bipartisan consensus to reform and reauthorize the Elementary and
Secondary Education Act, and in so doing to redeem the original intent
of that landmark legislation. I want to express my appreciation to our
new President for his interest in renewing educational opportunity in
America and leaving no child behind. There is much in the legislation
we introduce today that squares with the plan that the President sent
to Congress last week. We on this side of the aisle agree with the
President that we need to invest more federal dollars in our schools,
particularly in schools that serve the neediest students. We also agree
that the dollars we provide, we should provide more flexibly. And we
agree that if we are going to provide more money, and if we are going
to provide that money more flexibly, we should demand results. That's
the formula: invest in reform; insist on results.
I believe we also agree with our new President that parents should be
empowered to make choices to send their children to a variety of
different schools. We agree that parents are the

[[Page S1314]]

first enforcers of accountability in public education. Where we
disagree is in how we provide that choice. The President believes that
the best way to empower parents and to provide them with choices is to
give children and their parents vouchers of $1,500. With all due
respect, that is an empty promise. In my State, you just can't get your
child into most private or parochial schools for $1,500 per year. That
is simply an empty promise.
I believe there is a better way. I believe we've found a better way
in my little State of Delaware. Four years ago, we introduced statewide
public school choice. We also passed our first charter schools law. I
knew that this was going to work when I heard the following
conversation between a school administrator and some of his colleagues.
He said, ``If we don't provide parents and families what they want and
need, they'll send their kids somewhere else.'' I thought to myself,
``Right! He's got it.''
We have 200 public schools in my small State, and students in all of
these schools take our test measuring what they know and can do in
reading, writing, and math. We also measure our schools by the
incidence of poverty, from highest to lowest. The school with the
highest incidence of poverty in my state is the East Side Charter
School in Wilmington, Delaware. The incidence of poverty there is 83
percent. Its students are almost all minority. It is right in the
center of the projects in Wilmington. In the first year after East Side
Charter School opened its doors, very few of its students met our state
standards in math. Last spring, every third grader there who took our
math test met or exceeded our standards, which is something that
happened at no other school in the state. It's a remarkable story. And
it's been possible because East Side Charter School is a remarkable
school. Kids can come early and stay late. They have a longer school
year. They wear school uniforms. Parents have to sign a contract of
mutual responsibility. Teachers are given greater authority to innovate
and initiate.
We need to ensure that parents and students are getting what they
want and need, and if they're not getting what they want and need that
they have the choice--and most importantly that they have they have the
ability--to go somewhere else. A $1,500 voucher doesn't give parents
that ability, at least not in my State. Public school choice and
charter schools do.
We agree on many things. Where we disagree, as on vouchers, I believe
we can find common ground. I believe that we can come together, for
example, to provide a ``safety valve'' to children in failing schools,
in the way of broader public school choice and greater access to
charter schools. I am therefore hopeful about the prospects for
bipartisan agreement and for meaningful reform. To that end, I urge my
colleagues to support the Public Education Reinvestment, Reinvention,
and Responsibility Act.
______

By Mr. HATCH (for himself, Mr. Leahy, Mr. Biden, Mr. DeWine, and
Mr. Thurmond):
S. 304. A bill to reduce illegal drug use and trafficking and to help
provide appropriate drug education, prevention, and treatment programs;
to the Committee on the Judiciary.
Mr. HATCH. Mr. President, today we are taking an important step in
our effort to rid our nation of drug abuse. There has lately developed
a bipartisan consensus that realizes that supply reduction needs to be
complemented with demand reduction in our fight to combat drugs. Yes,
we must continue our vigilant defense of our borders and our streets
against those who make their living by manufacturing and selling these
harmful substances. And yes, we must sustain our vigorous law
enforcement offensive against these merchants of misery. But the time
has come to increase the resources we devote to prevent people from
using drugs in the first place and to breaking the cycle of addiction
for those whose lives are devastated and consumed by these substances.
Only through such a balanced approach can we remove the scourge of
drugs from our society.
Last session, to stem the maddening increase in methamphetamine
manufacturing and trafficking in America, Congress passed and the
President signed into law the Methamphetamine Anti-Proliferation Act, a
bill which I had authored. It was a balanced bill that provided law
enforcement with several needed tools to help turn back the tide of
methamphetamine proliferation, and it also contained several
significant prevention and treatment provisions. In particular, one of
the treatment provisions offered an innovative approach to how drug
addicted patients can seek and obtain treatment. As science and
medicine continue to make significant strides in developing drugs that
promise to make treatment more effective, we must pave the way to
ensure that these drugs can be administered in an effective manner,
Indeed, this provision did exactly that, by creating a decentralized
system of treating heroin addicts with a new generation of anti-
addiction medications.
Mr. President, the Drug Education, Prevention and Treatment Act of
2001, which we introduce today, also embodies this balanced approach.
While the bill furthers our law enforcement efforts by increasing
penalties for those who involve minors in drug crimes and those who use
our public lands for drug manufacturing, the bulk of the legislation
advances our prevention and treatment efforts. Before detailing some of
these measures, I want to thank my partner on the Judiciary Committee,
Senator Leahy, as well as my colleagues Senators Biden, DeWine, and
Thurmond for cosponsoring this bill. The effort and expertise they have
contributed to this bill have helped make it worthy of the support of
every member of this body.

I am extremely pleased that this bipartisan bill has a friend in the
new White House. President Bush has indicated on several occasions, and
in the plan he unveiled last fall, that he also believes in a
comprehensive drug control strategy. He, too, has stressed treatment as
an important component in combating juvenile drug abuse. I look forward
to working with the President, as well as with Attorney General
Ashcroft, as we combat drug abuse in this country in a bipartisan
fashion.
This legislation recognizes that we must do more to prevent and treat
substance abuse. Such efforts, it is safe to say, will prove well worth
it. According to a report recently released by the National Center on
Addiction and Substance Abuse at Columbia University in 1998, States
spent $81.3 billion--fully 13.1 percent of total state spending--on
substance abuse and addiction. Only $3 billion of this, however, was
spent on prevention and treatment. The remaining $78 billion was spent,
in the words of the study's authors, ``to shovel up the wreckage of
substance abuse and addiction.'' Remarkably, these staggering numbers
do not even include the amount of federal matching funds that states
spend, for example, on Medicaid and welfare, or the spending of local
governments--which bear most of the law enforcement burden, or private
sector costs such as employee health care, lost productivity, and
facility security. The report urges us, as policymakers, to reexamine
our priorities and shift our attention to drug prevention and
treatment.
This bill does just that, and, I hasten to add, it does so without
undermining in any way our commitment to supply reduction. Indeed, this
bill, it can be said, ultimately will help to cut supply by reducing
the demand for drugs among those who are the most consistent and
addicted users.
Whilte this legislation will prove enormously helpful, it is no
substitute for what is our most effective tool for preventing drug
abuse: good parenting. Demand reduction starts with educating all of
America's children about the harmful, destructive nature of drugs, and
that education must start at home. According to the 1999 PRIDE survey,
students whose parents never or seldom talk to them about drugs are
36.5 percent more likely to use drugs; in contrast, students whose
parents talk to them often, or a lot, about drugs are 33.5 percent less
likely to use drugs.
Parents need to talk seriously to their children about the risks of
drug use before they fall prey to peer pressure or drug dealers who
want nothing more than to create new addicts. Parents need to stop
deluding themselves into believing that moving to the suburbs, away
from the temptations and evils of the inner cities, will prevent

[[Page S1315]]

drug dealers from reaching their children. They need to stop thinking
that it is always the other family's kid who is using drugs.
Parents, grandparents, priests, pastors, rabbis, teachers, and
everyone else involved in a child's life need to take an active role in
educating our children about the dangers of drugs. Drug abuse knows no
boundaries. It doesn't discriminate on the basis of gender, race, age,
or class. It is truly an equal opportunity destroyer. Unless children
are prepared with the knowledge and truth of how drugs will ruin their
health and future, they are vulnerable to the lies of those who are
peddling drugs.
Sadly, studies reveal that many children will never have
conversations with their parents about drug use. Some children have
parents that are addicted to drugs, some have parents who are
imprisoned, and some have parents who just don't understand how vital
it is for them to talk to their children about drug use. This fact
alone represents one important reason why communities and organizations
need to be involved in educating both parent and children about the
dangers of drug abuse.

We need effective education and prevention programs in our schools
and communities. Even for children blessed with dedicated, concerned
parents, these school- and community-based programs are vitally
important. Indeed, according to the 1999 PRIDE survey, students who
never or seldom join in community activities are 52.6 percent more
likely to use drugs. Additionally, students who report never taking
part in gangs are 90.8 percent less likely to use drugs. It is clear
that the more children hear the truth about what drug abuse and
addiction can do to them, the more likely they will turn their backs on
drug use and lead productive lives.
To this end, this bill contains significant funding for drug abuse
education and prevention programs in our schools and communities. It
authorizes grants for school and community-based drug education and
prevention programs that have been proven to be effective and research-
based. The bill also authorizes funding for the National Institutes of
Health to continue its research toward identifying even more effective
prevention and treatment programs. Learning how to treat drug addiction
effectively is an inextricable component in America's battle to conquer
drug abuse.
An additional provision authorizes grants to eligible community-based
organizations, including youth-serving organizations, faith-based
organizations, and other community groups, to provide after-school or
out-of-school programs that include a strong character education
component. Another important provision authorizes funding for
community-based organizations that provide counseling and mentoring
services to children who have a parent or guardian that is
incarcerated. We want all who can help to be in a position to help, and
these drug education and prevention programs seek to get everyone in
all communities involved.
Mr. President, while I am confident these innovative drug education
and prevention programs will help reduce the number of children who
decide to use drugs, we also need to ensure that those who are addicted
receive treatment. This bill authorizes, therefore, sizeable grants to
States to provide residential treatment facilities specifically
designed to treat drug-addicted juveniles. It is crucial that drug-
addicted children receive treatment while they are young before they
ruin their lives and grow up to become hard core addicts, which often
leads to criminal behavior.
It does without saying that it is important to ensure that violent
and repeat offenders are imprisoned and punished for their crimes.
However, I believe that there is merit to giving nonviolent offenders,
whose crimes are tied directly to their addictions, a chance to enter
drug treatment in stead of prison. This bill contains several
provisions that will assist States in providing nonviolent, drug-
addicted offenders with the opportunity to participate in drug
treatment programs in lieu of incarceration.
For example, one provision authorizes the Attorney General to make
grants to State and local prosecutors for the purpose of developing,
implementing, or expanding drug treatment alternatives to prison
programs for nonviolent offenders. These programs are administered by
prosecutors who determine which offenders are eligible to participate.
All eligible offenders who participate are sentenced to, or placed
with, a long-term, drug-free residential substance abuse treatment
provider. If, however, the offender does not successfully complete
treatment, he or she is required to serve a sentence of imprisonment
with respect to the underlying crime.
This program has been administered effectively by certain district
attorneys in New York over the last decade. Last session, I worked hard
with Senators Thurmond and Schumer, to get these very programs
authorized so that other State and local prosecutors could benefit from
this drug alternative to prison program. I look forward to the
continuing support of Senators Thurmond and Schumer to ensure that this
provision is enacted into law this session.

This bill also reauthorizes the drug court program and authorizes
juvenile substance abuse courts, both of which provide continuing
judicial supervision over nonviolent offenders with substance abuse
problems while allowing them to enter treatment programs as an
alternative to prison.
A high percentage of offenders who otherwise don't qualify for
participation in alternatives to prison programs, but nonetheless have
serious drug addictions, far too often are released from incarceration
without ever receiving treatment. To address this issue, this bill
authorizes funding to provide drug treatment services to inmates. This
funding will go a long way in ensuring safer neighborhoods and a more
productive society once drug addicted offenders are released from
incarceration.
To further ensure safer neighborhoods, the bill also promotes the
successful reintegration of inmates into society by authorizing
demonstration projects in the federal and state court systems that
incorporate new strategies and programs for alleviating the public
safety risk posed by released prisoners. These projects, which
establish court-based programs for monitoring the return of offenders
into communities, include drug treatment, as well as vocation and basic
educational training. Each program uses court sanctions and incentives
to encourage positive behavior.
Finally, the bill contains a provision that requires the government
to consider, on the same basis as other non-governmental organizations,
faith-based organizations to provide the assistance under all programs
authorized by this bill, as long as the program is implemented in a
manner consistent with the first amendment. I am aware of some concerns
Senators Leahy and Biden may have with this provision relating to the
participation of faith-based organizations, and I am committed to
working with them in an effort to address their concerns as the
legislation moves through the process.
Mr. President, this bill bespeaks a compassionate concern for those
who suffer from drug addiction. By passing this bill, we will be
telling these people that we have not given up hope for them,
especially for our children, that we will offer the means to help them
help themselves, and that we will not leave them behind to be preyed
upon by those who would make a profit on their misery. Above all, this
legislation demonstrates our unwavering commitment to rid our nation of
drug abuse. To those who traffic drugs, let there be no mistake about
our resolve: we will put you in jail when we catch you, but we will
also fight you for the soul of every person you would prey upon. And,
in time, we will change them from helpless targets for your poison to
productive, responsible members of our society. I invite my colleagues
to join us in this effort.
I ask unanimous consent that a section-by-section summary of the bill
be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Drug Abuse Education, Prevention, and Treatment Act of 2001--Summary

Title I: Offenses Involving Juveniles

Sec. 101. Increased Penalties for Using Minors To Traffic
Drugs Across the Border
This section directs the Sentencing Commission to review
and amend, if appropriate,

[[Page S1316]]

the Sentencing Guidelines with respect to offenses relating
to the use of a minor to traffic controlled substances across
the border and to consider whether the base offense level for
such offenses should be increased to level 20.
Sec. 102. Increased Penalties for Drug Offenses Committed in
the Presence of Minors
This section directs the Sentencing Commission to review
and amend, if appropriate, the Sentencing Guidelines with
respect to offenses relating to drug offenses committed in
the line of sight or in the residence of a minor under the
age 16. The Sentencing Commission shall consider creating an
enhancement of 2 offense levels or 1 additional year
(whichever is greater) and 4 offense levels or 2 additional
years (whichever is greater) for subsequent offenses.
Sec. 103. Increased Penalties for Using Minors To Distribute
Drugs
This section directs the Sentencing Commission to review
and amend, if appropriate, the Sentencing Guidelines to
provide an appropriate sentencing enhancement for any offense
involving the use of minors to distribute drugs.
Sec. 104. Increased Penalties for Distributing Drugs To
Minors
21 U.S.C. 859 prohibits the distribution of controlled
substances to a person under 21 years old. This section
directs the Sentencing Commission to review and amend, if
appropriate, the Sentencing Guidelines to provide an
appropriate sentencing enhancement for offenses involving the
use of minors to distribute drugs.
Sec. 105. Increased Penalties for Distributing Drugs Near
Schools
21 U.S.C. 860 prohibits the distribution or manufacture of
controlled substances near schools and other places
frequented by minors. This section directs the Sentencing
Commission to review and amend, if appropriate the Sentencing
Guidelines to create a sentencing enhancement for such
violations.
Sec. 106. Increased Penalties for Using Federal Property to
Manufacture Controlled Substances
This section amends the Controlled Substances Act by
doubling the maximum punishment authorized by law for anyone
who cultivates or manufactures a controlled substances on any
property in whole or in part owned by or leased to the US or
any department or agency thereof. This section directs the
Sentencing Commission to review and amend, if appropriate,
the Sentencing Guidelines to provide an appropriate
sentencing enhancement for any offense under 21 U.S.C.
841(b)(5) that occurs on Federal property.
Sec. 107. Clarification of Length of Supervised Release Terms
in Controlled Substance Cases
This section clarifies an apparent conflict in the code
regarding the length of supervised release in controlled
substance cases.
Sec. 108. Supervised Release Period after Conviction for
Continuing Criminal Enterprise
Any sentence imposed for violating the continuing criminal
enterprise statute shall include a term of supervised release
of not less than 10 years, and if there was a prior
conviction, of not less than 15 years in addition to the term
of imprisonment.

Title II: Drug-Free Prisons and Jails

Sec. 201. Drug-Free Prisons and Jails Incentive Grants
This section authorizes grants to eligible States and
Indian tribes to encourage the establishment and maintenance
of drug-free prisons and jails. Eligible drug-free programs
shall include: (1) a zero-tolerance policy for drug use or
presence in State facilities, including routine sweeps and
inspections, random and frequent drug tests, and improved
screening for drugs; (2) enforcement of penalties, including
prosecution for the introduction, possession, or use of drugs
in any prison or jail; (3) implementation of residential drug
treatment programs; and (4) drug testing of all inmates upon
intake and release from incarceration, as appropriate.
Programs may include a system of incentives for prisoners to
participate in counter-drug programs such as treatment and to
be housed in wings with greater privileges, but incentives
may not include the early release of any prisoner convicted
of a crime of violence. Authorizes $50 million a year for
three years.
Sec. 202. Jail-Based Substance Abuse Treatment Programs
This section authorizes $100 million in additional funding
for residential substance abuse treatment programs,
outpatient treatment programs, and aftercare treatment
services in State and local prisons and jails.
Sec. 203. Mandatory Revocation of Probation and Supervised
Release for Failing Drug Tests
This section amends 18 U.S.C. 3565(b) and 3583(g) to
provide for mandatory revocation of probation or supervised
release if a defendant tests positive for illegal controlled
substances more than three times over the span of one year.
Sec. 204. Increased Penalties for Providing an Inmate with a
Controlled Substance
This section directs the Sentencing Commission to review
and amend, if appropriate, the Sentencing Guidelines with
respect to any offense relating to providing a Federal
prisoner a Schedule I or II controlled substance and to
consider increasing the base offense level for such
violations to not less than level 26. The Sentencing
Commission shall also consider increasing the base offense
level for such offenses by not less than 2 offense levels if
the defendant is a law enforcement or correctional officer or
employee, or an employee of the DOJ, at the time of the
offense.

title III: treatment, education, and prevention

Sec. 301. Prosecution Drug Treatment Alternative to Prison
This section authorizes the Attorney General to make grants
to State and local prosecutors for the purpose of developing,
implementing, or expanding drug treatment alternatives to
prison programs for non-violent offenders. These programs are
administered by prosecutors who determine which offenders are
eligible to participate. All eligible offenders who
participate are sentenced to or placed with a long term, drug
free residential substance abuse treatment provider. If the
offender does not successfully complete treatment, he is
required to serve a sentence of imprisonment with respect to
the underlying crime. Authorizes $30 million a year for three
years.
Sec. 302. Juvenile Substance Abuse Courts
This section authorizes the Attorney General to make grants
to States and local governments to establish programs that
continue judicial supervision over non-violent juvenile
offenders with substance abuse problems with integrate
administration of other sanctions and services, which
include: (1) mandatory testing for controlled substances; (2)
substance abuse treatment for participants; (3) probation,
diversion, or other supervised release involving the
possibility of prosecution, confinement, or incarceration
based on noncompliance with program requirements; and (4)
aftercare services, such as relapse prevention. Authorizes
$50 million to be appropriated each year for FY 2002-2004.
Sec. 303. Expansion of Drug Abuse Education and Prevention
Efforts
This section allows the Administrator of the Substance
Abuse and Mental Health Services Administration (SAMSHA) to
make grants to public and nonprofit private entities to carry
out school-based programs concerning the dangers of abuse of
and addiction to illicit drugs and to carry out community-
based abuse and addiction prevention programs that are
effective and research-based. The Administrator shall give
priority in making grants to rural and urban areas that are
experiencing a high rate or rapid increase in abuse, and the
amounts awarded may be used to carry out various programs,
including school-based and community-based programs that
focus on populations that are most at-risk for abuse of or
addiction to illicit drugs. Authorizes $100 million to be
appropriated for FY 2002 and such sums as necessary for each
succeeding FY.
Sec. 304. Funding for Treatment in Rural States and
Economically Depressed Communities
This section authorizes $50 million for grants to States to
provide treatment facilities in the neediest Rural States and
economically depressed communities that have high rates of
drug addiction but lack resources to provide adequate
treatment.
Sec. 305. Funding for Residential Treatment Centers for Women
with Children
This section authorizes $10 million for grants to States to
provide residential treatment facilities for methamphetamine,
heroin, and other drug addicted women who have minor
children. These facilities offer specialized treatment for
addicted mothers and allow their children to reside with them
in the facility or nearby while treatment is ongoing.
Sec. 306. Drug Treatment for Juveniles
This section authorizes $100 million a year for grants to
States to provide residential treatment facilities designed
to treat drug addicted juveniles.
Sec. 307. Coordinated Juvenile Services Grants
This section allows existing Juvenile Justice and
Delinquency and Prevention funds to be used to make grants to
encourage Federal, State, and local agencies (including
schools) and private childrens service providers to
coordinate the delivery of mental health and/or substance
abuse services to children at risk. Such grants leverage
limited Federal, State, and community-based adolescent
services to help fill the large unmet need for adolescent
mental health and substance abuse treatment.
Sec. 308. Expansion of Research
This section authorizes funding for the National Institutes
of Health to enter into cooperative agreements to conduct
research on drug abuse treatment and prevention and to
establish up to 12 new National Drug Abuse Treatment Clinical
Trials Network (CTN) centers to develop and test an array
of behavioral and pharmacological treatments and to
determine the conditions under which novel treatments are
successfully adopted by local treatment clinics.
Authorizes $76.4 million to be appropriated in 2002 and
such sums as are necessary for FY 2003-2005.
Sec. 309. Comprehensive Study By National Academy of Sciences
This section directs the Attorney General to enter into
contracts to (1) evaluate the effectiveness of federally
funded programs for preventing youth substance abuse; (2)
identify federal programs and programs that receive federal
funds that contribute to reductions in youth substance abuse;
and (3) identify programs that have not achieved their

[[Page S1317]]

intended results and to make recommendations on programs that
have proven successful and those that should have their
funding terminated or reduced because of lack of
effectiveness.
Sec. 310. Report on Drug-Testing Technologies
This section directs the National Institute on Standards
and Technology to conduct a study of drug-testing
technologies to identify and assess the efficacy, accuracy,
and usefulness of such technologies.
Sec. 311. Use of National Institutes of Health Substance
Abuse Research
This section ensures that the research on alcohol and drug
abuse conducted by NIDA is disseminated to treatment
practitioners to aid them in the treatment of addicts.

Title IV: School Safety and Character Education

Subtitle A--School Safety

Sec. 401. Alternative Education Demonstration Project Grants
This section authorizes funding for the Attorney General,
in consultation with the Secretary of Education, to make
grants to State educational agencies or local educational
agencies to establish not less than 10 demonstration projects
that enable the agencies to develop models and carry out
alternative education for at-risk youths. This section
authorizes $15 million a year for FY 2002 through 2004.
Sec. 402. Transfer of School Disciplinary Records
This section requires a State that receives federal funds
to have a procedure to facilitate the transfer of
disciplinary records by local educational agencies to any
private or public elementary school or secondary school.

Subtitle B--Character Education

Sec. 411. National Character Achievement Award
This section establishes a National Character Achievement
Award for students who distinguish themselves as models of
good character.
Sec. 421-424. Preventing Juvenile Delinquency through
Character Education
This section authorizes $100 million for the Secretary of
HHS, in consultation with the Attorney General, to award
grants to eligible community-based organizations, including
youth serving organizations, businesses, and other community
groups, to provide after school or out of school programs to
youth that include a strong character education component.
Eligible organizations must have a demonstrated capacity to
provide after school or out of school programs to youth.
Character education is defined as an organized educational
program that works to reinforce core elements of character,
including caring, civic virtue and citizenship, justice and
fairness, respect, responsibility, and trustworthiness.
Sec. 431-434. Counseling, Training, and Mentoring Children of
Prisoners
This section authorizes $25 million for the Attorney
General to award grants to community-based organizations
providing counseling, training, and mentoring services to
America's most at-risk children and youth in low-income and
high-crime communities who have a parent or legal guardian
that is incarcerated in a Federal, State, or local
correctional facility. Such services will include counseling,
including drug prevention counseling; academic tutoring,
including online computer academic programs that focus on the
development and reinforcement of basic skills; technology
training; job skills and vocational training; and confidence
building mentoring services.

TITLE V: REESTABLISHMENT OF DRUG COURTS

Sec. 501. Reauthorization of Drug Courts
This section reauthorizes the drug court programs that
provide continuing judicial supervision over non-violent
offenders with substance abuse problems and allow non-violent
offenders to enter treatment programs as an alternative to
prison. Authorizes $50 million to be appropriated in 2002 and
such sums as necessary for 2003-2004.

TITLE VI: PROGRAM FOR SUCCESSFUL REEENTRY OF CRIMINAL OFFENDERS INTO
LOCAL COMMUNITIES

Sec. 601-618. Federal Reentry Demonstration Projects
This section authorizes demonstration projects in Federal
judicial districts, the District of Columbia, States, and in
the Federal Bureau of Prisons using new strategies and
emerging technologies that alleviate the public safety risk
posed by released prisoners by promoting their successful
reintegration into the community. This section also
establishes court-based programs to monitor the return of
offenders into communities, which include drug treatment and
aftercare, mental and medical health treatment, vocational
and basic educational training. Each program uses court
sanctions and incentives to promote positive behavior and
graduated levels of supervision within the community
corrections facility to promote community safety.

TITLE VII: ASSISTANCE BY RELIGIOUS ORGANIZATIONS

Sec. 701. Assistance by Religious Organizations
This section provides that the government shall consider,
on the same basis as other non-governmental organizations,
faith-based organizations to provide the assistance under all
programs authorized by this bill, as long as the program is
implemented in a manner consistent with the First Amendment.

Mr. LEAHY. Mr. President, today I join with Senator Hatch and
Senators Biden, DeWine, and Thurmond to introduce the Drug Abuse
Education, Prevention, and Treatment Act of 2001. This bill provides a
comprehensive approach to drug treatment, prevention, and enforcement.
It is my hope that the innovative programs established by this
legislation will assist all of our States in their efforts to address
the drug problems that most affect our communities.
No community is immune from the ravages of drug abuse. My own State
of Vermont has one of the lowest crime rates in the nation, yet we are
experiencing serious troubles because of the abuse of heroin and other
drugs. Recent estimates indicate that heroin use in Vermont has doubled
in just the past three years, and the number of people seeking drug
treatment has risen even more rapidly. The average age of a first-time
heroin user dropped from 27 to 17 during the 1990s, signaling a sharp
rise in teenage drug abuse. The consequences of this rise have made
themselves all too clear over the past months.
On January 3, Christal Jones, a 16-year-old girl from Burlington, was
murdered in New York City. According to news reports, she was recruited
in Burlington to move to New York and become part of a prostitution
ring, and she was motivated by a desire to get money to buy heroin.
When she died, drugs were found in her body, although they were not the
cause of her death. And Christal Jones' tragedy apparently is not
unique as many as a dozen Vermont girls may have been involved in this
New York ring. And since her death, others have come forward to say
that teenage girls in Burlington are prostituting themselves to get
money to buy heroin.
These disturbing reports followed by only a few months a heinous
drug-related triple murder in Rutland, Vermont. In that case, 20-year-
olds Robert Lee and Donald Fell reportedly spent the night drinking and
taking crack cocaine, and then allegedly killed Fell's mother and her
friend. Looking to get out of Vermont, they then allegedly carjacked a
woman arriving for work at a local supermarket and drove to New York,
where they are accused of beating her to death. Such a case surely
deserves a strong law enforcement response, and last Thursday the
accused were indicted by a federal grand jury for carjacking resulting
in death and kidnapping, among other charges.
Such violence is rarely visited upon my State. When it is, a swift
law enforcement response is necessary, and we must do what we can to
support the efforts of law enforcement to safeguard our communities.
But we kid ourselves if we think that law enforcement alone, with ever-
increasing penalties, is the answer to the drug problem. Though
effective enforcement of our drug laws, particularly to deter
involvement of our young people, is a critical component, this is
simply insufficient to meet the severe social effects of drug abuse. We
need to provide a comprehensive approach to the drug problems of my
State and our nation. In Vermont, as the Rutland Daily Herald recently
editorialized, on January 26, 2001, ``agencies that treat addictions''
need ``a boost in resources and manpower.'' Those who work to prevent
drug abuse from occurring in the first place need our strong support.
I have tried to boost Vermont's anti-drug efforts by working to
provide funding for drug prevention, law enforcement, and drug
treatment projects. For example, I secured funding for the Vermont
Coalition of Teen Centers in last year's Commerce-Justice-State
Appropriations bill. These teen centers give adolescent Vermonters
recreational alternatives to drug use. I was also able to help provide
significant funding for the Vermont Multi-Jurisdictional Drug Task
Force, facilitating the ability of law enforcement officials to work
together to tackle Vermont's drug problems. In addition, at my request
Congress approved substantial funding for Vermont to plan and establish
a long-term residential treatment facility for adolescents.
I believe that the bill I introduce today with Senator Hatch will
build

[[Page S1318]]

upon those important efforts by providing a substantial boost for
treatment, law enforcement, and prevention, both in Vermont and across
the nation. It contains numerous grant programs to aid States and local
communities in their efforts to prevent and treat drug abuse. Of
particular interest to the residents of my State, it establishes drug
treatment grants for rural States and authorizes money for residential
treatment centers for mothers addicted to heroin, methamphetamines, or
other drugs.
This legislation also will help States and communities reduce drug
use in prisons through testing and treatment, an effort I proposed in
the Drug Free Prisons Act I introduced in the last Congress. It will
provide funding for programs designed to reduce recidivism through
funding drug treatment and other services for former prisoners after
release. In addition, this bill will reauthorize drug courts another
step I proposed in the Drug Free Prisons Act and create juvenile drug
courts.
Finally, the bill directs the Sentencing Commission to review and
amend penalties for a number of drug crimes involving children. For
example, in addressing circumstances such as those surrounding the
death of Christal Jones, the bill instructs the Sentencing Commission
to amend its guidelines to provide for any necessary sentencing
enhancement for criminals who distribute drugs to minors in order to
lure a minor into or keep a minor engaged in prostitution or other
criminal activity.
In short, there are programs in this legislation to benefit all
Americans whose lives are disrupted by drug abuse in their families and
communities. I strongly recommend this bipartisan bill to my
colleagues, and hope that we can move quickly to make it law.
As I mentioned earlier, I have worked to provide necessary funding
for treatment, prevention, and enforcement efforts in Vermont. Last
year, I secured $150,000 for the Vermont Coalition of Teen Centers,
$400,000 for the Vermont Drug Task Force, $100,000 for an adolescent
treatment facility, two grants worth $500,000 for a balanced and
restorative justice project, $1.7 million in Byrne law enforcement
grants, two grants worth $560,000 to reduce underage drinking, about
$725,000 for Drug Free Communities Support Programs throughout Vermont,
and $274,535 for Residential Substance Abuse Treatment, RSAT, programs
in the Vermont Corrections Department. In 1999, I worked to procure
$270,611 for RSAT programs for Vermont prisons and jails, $75,000 for
the Vermont Coalition of Teen Centers and an additional $74,976 for the
Essex Teen Center, two grants worth $660,000 to combat underage
drinking, and about $172,000 for Drug Free Community Support programs
throughout Vermont. And in 1998, I helped secure $249,864 for balanced
and restorative justice programs, $274,938 for RSAT programs, $1.9
million in Byrne law enforcement grants, $360,000 to combat drunk
driving, and $424,494 in a Safe Kids/Safe Streets grant.

This legislation will provide additional ways that Vermont and other
States can benefit from federal assistance to prevent drug abuse and
drug-related crime. I would like to describe in more detail some of its
most important aspects.
This bill authorizes a wide variety of treatment and prevention
programs. Treatment and prevention efforts are often overshadowed by
law enforcement needs. Indeed, a recent study by the Center on
Addiction and Substance Abuse, CASA, showed that of every dollar States
spent on substance abuse and addiction, only four cents went to
prevention and treatment. The States and the Federal government have
undeniably important law enforcement obligations, but we must do more
to balance those obligations with farsighted efforts to prevent drug
crimes from happening in the first place.
As I have said, heroin is an increasing problem in Vermont. In other
States, methamphetamines or other drugs present a growing challenge.
This legislation will help States address their most pressing drug
problems, and places a particular emphasis on States that may not have
been able to address their treatment and prevention needs in the past.
Indeed, among many other provisions, the bill offers funding for rural
States like Vermont to establish or enhance treatment centers. It
instructs the Director of the Center for Substance Abuse Treatment to
make grants to public and nonprofit private entities that provide
treatment and are approved by State experts. This will allow the
Vermont agencies looking to provide heroin treatment or to prevent
heroin abuse in the first place to acquire Federal funding to help in
their efforts.
The Drug Abuse Prevention and Treatment Act also authorizes funding
for residential treatment centers that treat mothers who are addicted
to heroin, methamphetamines, or other drugs. This will help mothers and
the children who depend on them to rebuild their lives it will keep
families together. And I hope it will help avoid further stories like
one that appeared in last Sunday's edition of the Burlington Free
Press, in which a young mother told a reporter how heroin ``made it
easier for [her] to take care of [her] kids.''
The bill also calls for funding drug treatment programs for
juveniles. As the tragic story of Christal Jones and the disturbing
reports about other girls in her position have shown, juveniles can see
their lives quickly deteriorate under the influence of drugs. This is
why I have worked to provide Vermont with funding to establish a long-
term residential treatment facility for adolescents. I hope to continue
that effort through this bill, in the hope that we may be able to
prevent future tragedies.
Our efforts here must include reducing the lure of drugs, and
educating our kids and making sure they have recreational alternatives
are two key components. In light of that, this bill authorizes grants
to carry out school- and community-based prevention and education
programs, with priority given to rural and urban areas experiencing
drug problems. It provides additional funding for after-school
programs. Finally, it authorizes funding for States to establish
demonstration projects of alternative education for at-risk youths.
These steps should improve the quality and availability of drug
education and prevention efforts throughout the United States.
In addition to providing additional funds for treatment and
prevention, the bill directs the United States Sentencing Commission to
review existing criminal penalties and provide any necessary increases
for drug crimes involving juveniles. In particular, the Sentencing
Commission must review the current penalties for distributing drugs to
minors, using minors to distribute drugs, trafficking near a school,
and using Federal property to grow or manufacture controlled
substances. I would like to highlight one provision in particular in my
comments today.
This bill calls for the Sentencing Commission to amend its guidelines
to provide for a specific sentencing enhancement for anyone who
distributes drugs to minors in order to lure a minor into or keep a
minor engaged in prostitution or other criminal activity. Let me
explain why this provision matters. If the law enforcement officials
investigating the death of Christal Jones find that the person or
people who brought her to New York and prostituted her were giving or
selling her heroin to entice her, the punishment should be more severe.
This provision will give prosecutors an additional tool to fight such
odious conduct.
I would also like to commend the approach taken in the criminal
provisions in this legislation. Instead of imposing mandatory minimums,
we have invested discretion in the Sentencing Commission to determine
appropriate penalties. A 1997 study by the RAND Corporation of
mandatory minimum drug sentences found that ``mandatory minimums are
not justifiable on the basis of cost-effectiveness at reducing cocaine
consumption, cocaine expenditures, or drug-related crime.'' Despite
this study and mounting evidence of prison overcrowding, legislators
continue to propose additional mandatory minimums. In light of the
persistence of that idea, this legislation calls for a new study of the
issue, including whether mandatory minimums have a disproportionate
impact on any racial or ethnic groups and whether they are an
appropriate vehicle to punish nonviolent offenders.
Last year I introduced the Drug Free Prisons Act, which authorized
grants to States to facilitate treatment and testing programs in
prisons and jails.

[[Page S1319]]

This bill provides resources to achieve the same goal. It is critical
that our prisons be drug-free, both because lawbreaking within our
correctional system is a national embarrassment, and because prisoners
who are released while still addicted to drugs are far more likely to
commit future crimes than prisoners who are released sober. This bill
will provide needed help to address drug abuse in prisons throughout
the country. It authorizes $50 million for drug-free prisons and jails
bonus grants, allows States to use Residential Substance Abuse
Treatment, RSAT, grants to provide services for inmates or former
inmates, and reauthorizes funding for substance abuse treatment in
Federal prisons.

As Joseph Califano, Jr., the president of CASA and former secretary
of Health, Education, and Welfare, told the National Press Club last
month: ``The next great opportunity to reduce crime is to provide
treatment and training to drug and alcohol abusing prisoners who will
return to a life of criminal activity unless they leave prison
substance free and, upon release, enter treatment and continuing
aftercare.'' This legislation will accomplish both of those goals.
A prior CASA study found that drug and alcohol abuse was implicated
in the crimes and incarceration of 80 percent of those currently
serving time in America's prisons. This finding shows that we have a
prison population that has a history of substance abuse, and will seek
out opportunities to continue using drugs while imprisoned. Of course,
if prisoners are using drugs in prison, this will create serious
behavioral and other problems that corrections officers will have to
address, at no small risk to them.
The problem does not end there. The same CASA study shows that
inmates who are illegal drug and/or alcohol abusers are the most likely
to be repeat offenders. In fact, the study concluded that 61 percent of
state prison inmates who have two prior convictions are regular drug
users. The strong link between drug use and recidivism cannot be
ignored. Prison should provide an opportunity for us to break this
cycle and therefore reduce crime. We can do this through a concerted
effort to test prisoners for drug use and penalize those who test
positive and provide adequate drug treatment so that prisoners can lead
productive, non-criminal lives upon their release.
This approach to reducing drug use and addiction in prisons has the
support of Jim Walton, Vermont's Commissioner of Public Safety, and
John Perry, the Director of Planning for the Vermont Department of
Corrections, who work with these issues every day. I have always valued
their counsel, as they have first-hand knowledge of the real law
enforcement needs in my state. They both feel strongly that the bill
will give law enforcement the tools it needs to test and treat offender
populations, both in jail and in the community. I hope and expect that
this bill will have the same effect across the country.
In addition to providing funding for drug treatment and testing in
prisons, this legislation also adopts a proposal made by Senator Biden
in both this Congress and the last that would provide funding for
Federal and State programs designed to ease the transition of criminal
offenders back into society after their release. It establishes court-
based programs to monitor the return of offenders into communities.
These programs include drug treatment and aftercare, mental and medical
health treatment, vocational and educational training, life skills
instructions, and assistance in obtaining suitable affordable housing.
Each program uses court sanctions and incentives to promote positive
behavior and graduated levels of supervision within the community
corrections facility to promote community safety. I commend Senator
Biden for his leadership on this program.
The bill also re-establishes the drug courts program and re-
authorizes funding for it, as I proposed in last year's Drug Free
Prisons Act. The majority repealed the authorization of the drug courts
program in the Omnibus Consolidated Rescissions and Appropriations Act
of 1996, in an apparent attempt to discredit Democratic programs. In my
view, effective programs dealing with drug abuse should not be used as
political footballs. That is why the Congress has continued to fund
drug courts in every year's appropriations acts. This has been the
right decision, and we should undo the repeal.
Drug courts provide the opportunity to deal systematically with
nonviolent drug offenders at a substantial savings to taxpayers.
Instead of jailing these nonviolent offenders, the courts can order
alternative punishments that are mixed with mandatory testing and drug
treatment and human services such as education or vocational training.
Meanwhile, imprisonment is held out as a stick to ensure good behavior.
To qualify for federal assistance, a drug court program must mandate
periodic drug testing during any supervised release or probation
periods, provide drug abuse treatment for each participant, and hold
out the possibility of prosecution, confinement, or incarceration for
noncompliance or failure to show satisfactory process. Violent
offenders are defined quite broadly, so we can be confident that we are
not funding programs that put dangerous people back on the streets.
In addition to reauthorizing drug courts for adults, this legislation
authorizes the Attorney General to provide grants to State and local
governments to establish juvenile drug courts, extending the drug court
model that has shown significant promise in dealing with adult
offenders to juveniles. Juvenile drug courts should provide a way to
reach out to younger offenders before they turn to a life of crime,
helping to save both lives and significant government resources.
Finally, I would like to comment on the inclusion of charitable
choice language in this legislation to allow religious groups to
compete for grants on the same basis as other groups. Although the
language in this bill mirrors language that was passed in the
Children's Health Act last year as well as in previous legislation, I
have serious reservations about it. I know that many of my colleagues
share those reservations.
Charitable choice is going to be a significant issue during this
Congress. I would have preferred that we have hearings about charitable
choice before including it in this bill, and I made my feelings known
to Senator Hatch. I asked him to introduce the bill without the
language and consider adding it later if specific language could be
crafted for which there was bipartisan support. But Senator Hatch was
committed to including this language in the bill as introduced. Let me
be clear: its inclusion here does not represent my endorsement. As this
legislation is considered by the Committee and the Senate, we need to
give considerable thought to the approach taken here. I intend to work
with Senator Hatch and the other sponsors of the bill to ensure that
the important protections and prohibitions of the First Amendment are
fully respected. At the very least, we need to ensure that those who
receive federal drug treatment and prevention funds are trained
professionals, and that the government funds are not used in any way,
directly or indirectly, to support or promote discrimination.
At the same time, I believe that this bill, taken as a whole, will do
a great deal of good. While charitable choice language is in this bill
today, I have made no commitment to having this charitable choice
language in the bill when Congress passes it. My commitment is to help
improve drug treatment, prevention, and education throughout the United
States.
I ask unanimous consent to print in the Record two newspaper
articles.
There being no objection, the material was ordered to be printed in
the Record, as follows:

[From the Rutland Daily Herald (VT), Jan. 26, 2001]

Now Is the Time

It is time for Vermont lawmakers to take the initiative in
pushing for a comprehensive anti-drug program that will
respond constructively to the increased use of dangerous
drugs in Vermont.
Major drug busts in the Rutland area, as well as a rise in
crimes related to drug addiction, have pointed to the heroin
problem in the region. City leaders have taken needed steps
to bolster efforts by city police to address the problem, and
Mayor John Cassarino has offered a tax proposal that would
provide necessary funding in the future.
Statewide, the use of heroin has probably doubled in the
past three years. The number of Vermonters seeking treatment
rose from 164 to 344 in that time. That number doesn't

[[Page S1320]]

take into account the users who don't seek treatment.
The Vermont State Police have made a compelling case for
boosting manpower, which has eroded substantially in the past
eight years. And Gov. Howard Dean has made the fight against
heroin one of his priorities.
But so far Dean has not come up with resources for a long-
term attack on the problem. The Legislature ought to use this
moment to take Dean's initiative further.
Dean is well known for his punitive attitude toward drugs
and for his lack of faith in the efficacy of treatment for
drug users. But aggressive treatment, combined with
aggressive law enforcement, has not been tried. And at this
late date in the war on drugs, we ought to realize that law
enforcement alone has not done the job.
Law enforcement agencies at the local and state levels can
use a boost in resources and manpower. But so can agencies
that treat addictions. Effective treatment is labor-intensive
and could be made available to people both inside and outside
of the state's corrections system.
Mental health workers know that drug addiction is not an
easy affliction to cure. Addicts sometimes want no part of
treatment. But the state could establish institutions that
would respond more effectively to people who need help. Drug
courts could establish a regimen of treatment that would
expose people in state custody to the kind of help they may
never have seen before.
Dean has promised to move quickly to set up clinics for
drug treatment, following passage last year of legislation
allowing for methadone treatment. But as Dean has often said,
methadone alone will not solve the problem. Methadone needs
to be part of a larger program of treatment.
As of last week, only two hospitals in Vermont had
expressed firm interest in establishing methadone clinics.
Rutland Regional Medical Center is waiting to determine what
resources will be available and what kind of program the
regulations will establish. Health care facilities such as
RRMC need to be given the support and the resources to do the
job.
Vermont is a small enough state that it could pioneer
methods for treating drug problems that go beyond the obvious
first step of locking people up. It would be in the state's
interest to do so both to prevent the kind of crime and
dereliction that is a drain on any community and to rescue
Vermonters who succumb to the deathly appeal of drugs.
A package that included both law enforcement and treatment
measures might draw bipartisan support. Vermonters are not
helpless before the scourge of drug addiction if they have
the will to act.
____

[From the Burlington Free Press (VT), Feb. 7, 2001]

Vt. Teen's Death Ruled Homicide

(By Sam Hemingway)

Christal Jean Jones, the 16-year-old Burlington girl found
dead in a Bronx apartment Jan. 3, was the victim of a
homicide, according to New York City's top medical officer.
``The cause of death was asphyxiation, and the manner of
death is homicide,'' Ellen Borakove; spokeswoman for the New
York City Medical Examiner's Office, confirmed Tuesday.
The medical examiner relied on police investigation and
toxicology tests to reach his conclusion. Borakove said Jones
was smothered.
Drugs were found in Jones' body, but Borakove declined to
say what the drug was or how it had been administered.
``Whatever substance was found was not a contributing
factor in her death,'' Borakove said.
Jones' mother, Kathleen Wright, received the news during an
emotional 11:30 a.m. phone call Tuesday from Borakove's
office.
``It's just what I expected,'' a weeping Wright said after
hanging up the phone. ``She was injected with drugs and then
she was killed.''
Local and federal authorities say Jones was part of a
prostitution ring operating out of an apartment in the Hunts
Point section of the Bronx last fall and this winter.
Authorities also say drugs, particularly heroin, were
involved.
As many as a dozen Vermont girls, many in the custody of
the state Social & Rehabilitation Services department at the
time, have been involved, say some of the teens who have
traveled to New York, their parents and authorities.
Gov. Howard Dean has ordered an investigation into SRS's
handling of the girls' cases.
Jose Rodriguez, a part-time Vermont resident with a
criminal record here, is being held on $100,000 bail in a New
York City prison because New York officials suspect he might
be involved in Jones' death. However, Rodriguez has been in
jail since Dec. 11, when he was arrested on two charges of
promoting prostitution and one charge of statutory rape
involving another Vermont teen-ager.
At prosecutors' request his initial bail of $10,000 was
increased to $100,000.
``Our sympathy goes out the (Jones) family,'' Eric Sachs,
Rodriguez's court-appointed attorney, said Tuesday. ``We
don't wish that on anybody, especially a young girl.''
He said Rodriguez has cooperated fully with authorities and
knows nothing about Christal Jones' death.
``He's in jail. Obviously, we know he didn't do it,'' Sachs
said.
When he was told Tuesday that the medical examiner had
ruled Jones' death a homicide, Sachs called the District
Attorney's Office.
He was assured, he said, ``there is no Christal Jones case,
and there is no accusation that my client is involved.''
``Nobody has ever seen him'' in the Zerega Avenue apartment
in which Jones was killed, Sachs said. ``It's not his
apartment. He has no connection to this apartment. Where
these girls live, or don't--he doesn't know.''
However, in the police affidavit outlining the prostitution
and rape charges against Rodriguez, New York Police Office
Sean Iannucci said the victim said the crimes were committed
at the apartment where Jones' body was found.
If convicted, Sachs said, Rodriguez faces a maximum jail
term of four years for the rape charge and 15 years for each
of two prostitution charges.
Investigators who have interviewed witnesses and some of
those involved say Rodriguez was intimately linked to the
girls and a prostitution ring.
``I will kill you if you try to leave; I know people in
Vermont and New York,'' Rodriguez was said to have told two
of the Vermont girls before his arrest. Police also said he
beat one of the girls after learning she had tried to call a
family member for help.
Since Jones' death, many of those involved have gone into
hiding. Some parents of the girls known to frequent New York
won't talk. When approached, they crack the door only to say
they don't know where their daughters are. Their fear is
palpable.
In the Old North End and the King Street area of
Burlington, Jones' death--and life-- are well known. Local
residents are painfully aware of the extent of heroin use and
the hold the drug has over their neighbors. They say there is
no easy resolution to the problem they have watched reach
epidemic propositions in the past five years.
``We've got the demand,'' said Mike Larow, who owns Larow's
Market on North Street. ``Everyone seems to be afraid to
admit that it's here.''
A federal grand jury in Burlington is reviewing evidence in
the case.
Vermont state officials and local police knew of the
prostitution ring in the fall, according to a variety of
sources. Dean said state officials went to New York and
brought back two girls who had been at the apartment where
Jones eventually died.
``The only comment is how sad it is that this child has
died and how unnecessary,'' SRS Commissioner William Young
said Tuesday. ``I think everyone from our local office and
throughout the organization takes this kind of news hard.
``We certainly hope whoever is responsible for her death is
brought to justice.''
Young said the case pointed out how vulnerable young women
are, especially when they abuse drugs. Young said this was
the first case that anyone in his agency was aware of in
which there was an organized effort to take girls from
Vermont to another location to work as prostitutes.

Mr. BIDEN. Mr. President, substance abuse is one of our Nation's most
pervasive problems. Addiction is a disease that does not discriminate
based on age, gender, socio-economic status, race or creed. And while
we tend to stereotype drug abuse as an urban problem, the steadily
growing number of heroin and methamphetamine addicts in rural villages
and suburban towns shows that is simply not the case.
We have nearly 15 million drug users in this country, four million of
whom are hard-core addicts. We all know someone--a family member,
neighbor, colleague or friend--who has become addicted to drugs or
alcohol. And we are all affected by the undeniable correlation between
substance abuse and crime--an overwhelming 80 percent of the two
million men and women behind bars today have a history of drug and
alcohol abuse or addiction or were arrested for a drug-related crime.
All of this comes at a hefty price. Drug abuse and addiction cost
this Nation $110 billion in law enforcement and other criminal justice
expenses, medical bills, lost earnings and other costs each year.
Illegal drugs are responsible for thousands of deaths each year and for
the spread of a number of communicable diseases, including AIDS and
Hepatitis C. And a study by The National Center on Addiction and
Substance Abuse at Columbia University, CASA, shows that seven out of
ten cases of child abuse and neglect are caused or exacerbated by
substance abuse and addiction.
Another CASA study released last week revealed that for each dollar
that States spend on substance-abuse related programs, 96 cents goes to
dealing with the consequences of substance abuse and only four cents to
preventing and treating it. Investing more in prevention and treatment
is cost-effective because it will decrease much of the street crime,
child abuse, domestic violence, and other social ills that can result
from substance abuse.

[[Page S1321]]

The bill I am introducing today with Senators Hatch, Leahy, DeWine
and Thurmond authorizes more than $900 million a year for prevention
and treatment programs to reduce the criminal justice, health care, and
human costs associated with substance abuse.
We know that if someone gets through age 21 without smoking, abusing
alcohol, or using drugs, they are unlikely ever to have a substance
abuse problem. That is why prevention programs for kids are vital. This
bill provides $200 million a year in grants to drug prevention programs
like those run by the Boys and Girls Clubs and by law enforcement
through the DARE program to get the message out to kids that drugs can
ruin their lives.
While there is good news that overall drug use has stabilized among
students, there is also bad news--use of Ecstasy by high school seniors
has increased more than 66 percent. Prevention programs funded by this
Act will get the message out to kids that drugs like Ecstasy are
incredibly dangerous--even if their friends or a cover story in the New
York Times Magazine might make it seem like it is ``no big deal.''
Studies show that Ecstasy can damage regions of the brain responsible
for thought and memory. If that isn't a big deal, I don't know what is.
This bill also authorizes additional funding for drug treatment,
which is desperately needed. Every year since 1989, I have published my
own drug report, each of which has advocated a three-prong approach to
address the drug problem--prevention, treatment and enforcement. I have
always urged more money for treatment because it always gets the short
end of the stick.
Drug addiction is a chronic relapsing disease. And as with other
chronic relapsing diseases--such as diabetes, hypertension and asthma--
there is no cure, although a number of treatments can effectively
control the disease. According to an article published in the Journal
of the American Medical Association in October, the rate of adherence
to the treatment program and the relapse rate are similar for drug
addiction and other chronic diseases--meaning that treatment for
addiction works just as well as treatment for other chronic relapsing
diseases.
Unfortunately, only two million of the estimated five million people
who need drug treatment are receiving it. The Drug Abuse Education,
Prevention and Treatment Act takes steps to close this ``treatment
gap'' by targeting drug treatment to rural and economically depressed
areas, funding adolescent treatment and residential treatment centers
for women with children, and increasing funding for the National
Institute on Drug Abuse--whose brilliant scientists conduct 85 percent
of the world's research on drug abuse--to conduct clinical trials on
new treatments for addiction.

The bill also reauthorizes two key programs created in the 1994 Biden
Crime Law that fund prison-based drug treatment in the state and
federal systems.
Providing treatment to criminal offenders is not ``soft''; it is
smart crime prevention policy as the Key and Crest programs in my home
state of Delaware have shown. If we do not treat addicted offenders
before they are released, they will return to our streets with the same
addiction problem that got them in trouble in the first place, and they
are likely to re-offend. This is not my opinion; it is fact. More than
80 percent of inmates with five or more prior convictions have been
habitual drug users, compared to approximately 40 percent of first-time
offenders. Re-authorizing prison-based treatment programs is a good
investment and an important crime prevention initiative.
This legislation would also re-authorize the drug court program, a
program I have championed and introduced legislation to reauthorize.
The Federal Government has funded drug courts since 1994 as a cost-
effective, innovative way to deal with non-violent offenders who need
drug treatment. Rather than just churning people through the revolving
door of the criminal justice system, drug courts help these folks get
their acts together so they won't be back. When they graduate from drug
court programs they are clean and sober and more prepared to
participate in society. In order to graduate, they are required to
finish high school or obtain a GED, hold down a job, and keep up with
financial obligations, including drug-court fees and child-support
payments.
Drug courts have been proven effective at keeping offenders with
little previous treatment history in treatment, providing closer
supervision than other community programs to which the offenders could
be assigned, reducing crime and being cost-effective.
According to the Department of Justice, drug courts save at least
$5,000 per offender each year in prison costs alone. That says nothing
of the savings associated with future crime prevention and freeing
scarce prison beds for violent criminals. But most important, more than
500 drug-free babies have been born to female drug court participants,
a sizable victory for society and the budget alike.
This Act also includes my ``Offender Reentry and Community Safety Act
of 2001,'' which creates demonstration programs to oversee the
reintegration of high-risk, high-need offenders into society upon
release. These individuals have served their prison sentences, but they
pose the greatest risk of re-offending because they lack the education,
job skills, stable family or living arrangements, and the substance
abuse treatment and other mental and medical health services they need
to successfully re-integrate into society.
According to the Department of Justice, 1.25 million offenders are
now living in prisons and another 600,000 offenders are incarcerated in
local jails. A record number of those inmates--nearly 590,000--will
return to communities this year. Historically, two-thirds of returning
prisoners have been re-arrested for new crimes within three years.
The safety threat posed by this number of prisoner returns has been
exacerbated by the fact that states and communities can't possibly
properly supervise all their returning offenders. In fact, parole
systems have been abolished in thirteen States, and policy shifts
toward more determinate sentencing have reduced the courts' authority
to impose supervisory conditions on offenders returning to their
communities.
The demonstration reentry programs created by this bill would help
supervise these people when they are released from jail and make sure
they get the mental health, substance abuse and other services they
need so that they won't go back to a life of crime and can be
productive members of our society.
I believe that the Drug Abuse Education, Prevention and Treatment Act
is a good piece of legislation. Strong treatment and prevention
programs are a vital part of a comprehensive drug strategy.
Forestalling drug abuse and treating it when it occurs is sensible
policy in terms of saving money, preventing crime and sparing lives. I
urge my colleagues to support this legislation.
______

By Mr. SMITH of New Hampshire:
S. 305. A bill to amend title 10, United States Code, to remove the
reduction in the amount of Survivor Benefit Plan annuities at age 62;
to the Committee on Armed Services.
Mr. SMITH of New Hampshire. Mr. President, I am delighted today to
rise to discuss President Bush's commitment to strengthening America's
national security. I know this is a matter that is very close to the
heart of my colleague in the Chair, the Senator from Oklahoma.
President Bush often said during the campaign to the military that
``help is on the way.'' It is nice to know that help has arrived.
The President is spending this week traveling to military
installations to see and hear, for the first time since assuming
office, the needs of the military.
I can tell you, having just come back a few weeks ago from visiting
the troops, marines and sailors aboard the U.S.S. Nassau in the
Mediterranean, that they appreciate it when anybody from the Government
comes to visit them where they are on location. Clearly, for the
President of the United States to go directly to a military facility
and look the troops in the eye and tell them that help is coming says a
lot about the President. And believe me, it will do a lot for the
morale of the military in this country. He is going to be traveling to
additional military installations this week to see and hear just what
the needs are as

[[Page S1322]]

those needs are addressed by the men and women who serve.
He is committed to address these urgent needs, and specifically pay
raises, housing, benefits, and the like. I fully support him in that
effort. I believe for the last 8 years our military has suffered.
I might just say it is nice to hear a President talking about
strengthening the military. The needs of our military in the last 8
years have not been funded, and our military has been overextended for
too many peacekeeping missions for which it was neither trained nor
equipped.
In addition to that, oftentimes these missions were conducted without
being budgeted, which forced the dollars to come out of the hides of
the men and women who serve in terms of readiness and other accounts.
As the Senator in the Chair understands full well, our military
readiness is at an all-time low. Planes are not flying for lack of
spare parts and numerous accidents. Two Army helicopters crashed
yesterday. Ships aren't sailing for lack of fuel. Soldiers aren't
training for lack of ammunition.
I remember looking a young marine in the eye aboard the U.S.S. Nassau
a couple of weeks ago and asking him if he needed anything other than a
little more money. He said: Yes, I would like to have that, but I also
would appreciate it, Senator, if you could give me some ammunition for
this weapon that I need to fire. We don't have even dummy rounds to
practice for this particular weapon. He showed me the weapon. I was
shocked by that, frankly.
But, again, let me reassure our military that help is on the way. In
fact, I think it has arrived.
Like the chairman of the Armed Services Committee, my friend Senator
Warner, I support this effort by the administration to complete a top-
to-bottom assessment of the military. I think it is important when we
do that assessment to do it on the basis of what the needs are and
understand that we are doing it for that reason--to assess the needs--
and not to come to some foregone conclusion and then prove it with your
top-to-bottom assessment. We need to be sure we are buying the right
weapons for the right threats.
The United States has a strong economy and a great open society.
Unfortunately, it is the only remaining superpower in the world. That
also makes us a target for those who oppose our values of life and our
liberties. The world is not a friendly place. We see violence and
unrest every night on the news.
I do not know if people realize it, but when you go and talk to the
men and women out there, their lives are on the line every day. I stood
on the bridge of the U.S.S. Nassau in Malta and watched a small Maltese
Navy gunboat circling around that ship 24 hours a day to keep guard so
that no terrorists could get to that ship. Oftentimes, as we found with
the U.S.S. Cole, we didn't have that kind of security from the host
country.
So weapons of mass destruction--nuclear, chemical, and biological--
continue to proliferate around the world into the hands of dictators
and demagogues who might, in desperation, choose to oppose us and,
worst of all, fall into the hands of terrorists.
We face new threats, such as cyberattacks on our command and control
networks and our vulnerable civil infrastructure. Our military needs to
think through these new defense challenges and architect the right
force for our Nation for the new century. I will give the
administration the time it needs to work through these issues as they
present a new budget.
As a member of the Emerging Threats Subcommittee and Strategic Forces
Subcommittee of the Senate Armed Services Committee, I fully appreciate
the challenges that President Bush and Secretary Rumsfeld face as they
try to rebuild our military and simultaneously set us on the right
course for this new century.
It is not going to be an easy job. There are a lot of needs. We have
a lot of ground to make up and a lot of new things to do. In the
meantime, like Chairman Warner, I expect a new administration will be
requesting a supplemental. But that is not my decision to make. I am
hopeful that will be the case.
There is no better way to understand the needs of our military than
to get out of Washington and visit them. As I said, I salute the
President for doing that. I went on the U.S.S. Nassau, and one of the
sailors walked up to me and said: Senator, is there any reason why a
member of the United States Navy like me who is an E2 cannot get sea
pay? I am serving aboard ship, and everybody from E4 and above gets sea
pay, and those of us at E1, E2, and E3 don't.
We are going to take care of that. That matter has already been
brought to the attention of the chairman of the Armed Services
Committee in the Senate as well as the relevant committees in the House
of Representatives.
But it felt good to be back at sea. It felt good to be on board ship.
It reminded me of my service aboard the U.S.S. Navasota during the
Vietnam war. It didn't feel good enough to reenlist, but it was a great
time. There were 13 members of the U.S. Navy and Marines on board from
New Hampshire. We listened, had lunch, and we talked. They deserve our
support. They deserve compensation commensurate with the rest of
America.

From E1 to E3--the lowest pay grades in the Navy serving aboard that
ship swabbing the decks and doing all the hard work--don't get sea pay,
and those E4s and above do. That is wrong. We are going to take care of
that.
All of our sailors face the same threat. They deal with the same
personal issues while they are away from home and family. They have
children to raise. They have things to do that they miss--all kinds of
family things they miss while they are away while we ask them to do it.
They shouldn't be on food stamps and should have a reasonable salary.
They ought to be compensated fairly. We are going to take care of the
sea pay with legislation this year so that those E1 and E3 sailors will
be compensated.
I appreciate the military's current desire to hold out the prospect
of sea pay as a reenlistment bonus. However, these sailors are paying
the same price at sea as the senior sailors. To say you can serve your
first elected tour of duty and not get it, but if you re-up, we will
give to it to you, is simply wrong. We will find another incentive to
get them to re-up. I think, frankly, for them to re-up, we should tell
them we are going to appreciate you and we are going to pay you sea pay
because you are away from your home and family.
In addition to some of the readiness problems and personnel issues we
are dealing with now in the military, I think one of the biggest
challenges Secretary Rumsfeld is going to face is space and how we
utilize space. Of course, Secretary Rumsfeld understands that as well
as anybody. He chaired the space commission, so-called, that was
created in our Armed Services defense bill. I was proud to be the
author of that language. One of the plain reasons is the U.S. economy
is so strong that we should use our satellite capabilities to fuel our
new information-based science. Satellites support Americans every day.
I don't think we realize how important they are. They support our
weather, help hunters and boaters navigate; they provide pagers and
telephones to communicate with travelers anywhere on the surface of the
Earth.
But we cannot stop there, however. We must also keep our promises to
those who have already given a lifetime of service to this country.
Just as our soldiers, sailors, and airmen were there for us,
protecting us--we must be there for our veterans and military retirees.
Therefore, I am introducing legislation today to eliminate the
military survivor's benefit penalty.
Mr. President, this legislation will repeal the existing reduction in
the Survivor Benefit Plan spouses currently suffer when they reach the
age of 62.
Today, after years of paying heavy premiums for this optional
benefit, survivors of military retirees receive 55 percent of their
spouses service pay prior to age 62. However, once these spouses reach
age 62, their benefits are drastically reduced to only 35 percent. The
overwhelming majority of these beneficiaries are women. This reduction
in benefits will have a devastating effect on their quality of life.
In addition to eliminating this reduction in benefits which retired
military spouses incur when they turn 62,

[[Page S1323]]

spouses whose loved one passed away after their 62nd birthday will also
receive full 55 percent.
Passage of this important legislation will bring the military
Survivor Benefits Plan more in line with other Federal and civil
servants employee health plans.
After a lifetime of sacrifice, we owe it to our military retirees to
provide them with peace of mind that their spouse will be taken care of
after their death.
Mr. President, I ask my colleagues to support our retirees and pass
this legislation immediately.

One of the many important defense challenges President Bush and
Secretary Rumsfeld face is protecting America's lead in space
activities. One of the main reasons the U.S. economy is so strong is
our use of satellite capabilities to fuel our new information-based
society.
Satellites support Americans every day. For example, they support our
weather forecasts, help hunters and boaters navigate, provide pagers
and phones that can communicate with travelers anywhere on the surface
of the earth, and allow farmers to check on the health of their fields.
Our soldiers, sailors, and airmen also rely on space assets.
Accordingly, the utilization of space will also be at the forefront of
our national security agenda during this century, and I will work to
ensure that America expands its leadership in this military arena.
To help the nation better posture for that future challenge, I
authored the provision in the FY2000 Defense Authorization Act that
created a commission 2 years ago called the ``Commission to Assess
National Security Space Management and Organization,'' more commonly
known today as the Space Commission.
Coincidentally, the chairman chosen last year to lead that commission
became our new Secretary of Defense--Donald Rumsfeld.
Last month, they finished their work, and I commend Secretary
Rumsfeld, the commissioners, and the staff for their outstanding work,
and for thoroughly pulling together a great deal of research and data.
The Commission's findings confirm my long-held view of the growing
importance of space to the nation and my belief that space management
and organization reforms are urgently needed as America's commercial,
civil, and military reliance on space assets expands.
The Commission's recommendations lay the foundations for what I have
often maintained--military space activities should evolve to the
eventual creation of a separate Space Force.
The United States has shown the world the value of space in providing
information superiority on the modern battlefield.

As we move into the new century, we need to: Defend our current
space-based information superiority; be able to deny our adversaries
that same capability (thorough programs I have long supported like KE-
SAT and Clementine); and leverage the uniqueness of space to be able to
rapidly project military force around the world (thorough programs I
have long supported like Space Plane).
We need a strong advocate for space to fight for and justify these
new space programs needed for the 21st century in competition with many
other pressing military investment requirements.
Near-term management and organization reforms recommended by the
Commission will begin to put in place the leadership and advocacy for
space programs that have long been lacking.
Another of the many defense challenges President Bush and Secretary
Rumsfeld face is protecting America from missile attack.
I salute the administration's commitment to deploying a robust
missile defense for this nation. Many Americans don't realize that the
United States does not have a defense against a missile attack today.
Meanwhile, for years, Russia has deployed various missile defenses
around Moscow and other sites which has been ignored by ABM Treaty
proponents. These missiles could carry weapons of mass destruction--a
nuclear, chemical, or biological warhead that could wreak havoc on a
U.S. city. We have a constitutional responsibility to defend America.
Homeland defense from missile attack is essential.
With such a threat hanging over our leader's head, it is impossible
to contemplate engaging globally in the best interest of the United
States--no President would risk a U.S. city to come to the aid of an
ally.
Worst yet, countries like China and North Korea continue to
proliferate missile technology to rogue nations.
I am pleased that the President and his Cabinet have been so pro-
active in explaining this important issue to our allies.
A U.S. missile defense system, both theater and national is not
intended as a threat to any nation. It is intended to defend America,
and we have a duty to deploy such a defense.
While I salute the military's efforts to develop a near-term missile-
defense capability, I want to work with the administration to ensure we
have a robust, multilayered architecture that includes the current
land-based concept with sea-, air-, and space-based systems to
eliminate this threat to U.S. cities and our deployed forces.
Today, President Bush visited the only NATO facility on U.S. soil at
the Joint Forces Command at Norfolk, VA. President Bush watched an
allied U.S.-NATO coordinated response to a simulated missile attack.
I understand the President commented ``Pretty exciting technology,
and it's only going to get better.`` I agree that this technology is
only going to get better. America needs to make a commitment to protect
it's citizens from threats that come on a missile, including biological
and chemical weapons.
I look forward to working with the new administration, President Bush
and Secretary Rumsfeld, to rebuild our military and set the nation on
the right course for the new century.
Let me assure the military, help has arrived.
Finally, continuing on the area of missile defense, this is a very
important challenge faced by President Bush and Secretary Rumsfeld in
protecting the United States. Over the last several years, I have been
involved in so many debates on the floor, so many discussions. I know
the Senator from Oklahoma has as well. We are trying to save a national
missile defense program only to have it put off with some wordsmithing
or delay. I salute President Bush's commitment to deploying a robust
missile defense for this Nation. It is immoral not to do it.
I also salute, because it was his birthday a few days ago, President
Reagan on his 90th birthday for being the visionary he was on this
issue. It was Ronald Reagan who really convinced Gorbachev that we
could have built that thing 20 years ago when, in fact, we couldn't.
Because he convinced Gorbachev that we could and that it might be a
threat to him, the Soviet Union essentially folded as the threat that
it was to the world in the cold war for so long. Ronald Reagan knew
this could be done. He was laughed at, still is to some extent on that
issue. But 10, 15, 20 years from now, when we have this thing up and
going and it is protecting our troops in the field, protecting our
allies and protecting our own homeland, Ronald Reagan will get the
credit he deserves so richly for coming up with that visionary promise
of a missile defense system.
Russia has deployed various missile defenses around Moscow and other
sites which have been ignored by the ABM Treaty proponents. These
missiles could carry weapons of mass destruction, nuclear, chemical,
and biological, that could wreak havoc on a U.S. city, and we have
basically ignored it. We have a constitutional responsibility to defend
America.
I can remember seeing little tapes of so-called focus groups where
they would ask 15 or 20 people in a room what would happen if another
nation, such as China or Iran or Iraq, fired a missile at the United
States of America. All of them answered: We would shoot it down. All of
them were wrong. We do not have the capability to shoot down such a
missile, but we need that capability. We need the capability to shoot
it down over the aggressor's homeland, not over ourselves. So that is
where this missile defense system is so important.
I hear the criticisms: It won't work; it is too expensive; we don't
need it.
The bottom line is, if we can defend America from any missile attack,
whether it be accidental or deliberate

[[Page S1324]]

or whatever, we need to do it. That is our obligation. We have a
constitutional responsibility to defend America. Homeland defense from
missile attack is the moral thing to do. With such a threat hanging
over our leader's head, it is impossible to contemplate engaging
globally in the best interests of the United States. No President
should risk a U.S. city to come to the aid of an ally.
And worst yet, China, North Korea, and other nations continue to
proliferate missile technology. There is some really shocking
documentation, both public as well as classified, that will tell us
that this is a serious matter. I am pleased the President and Secretary
of Defense and his Cabinet have been so proactive in explaining this
important issue to our allies. I understand that Secretary Rumsfeld
went to Europe, was very forceful to our allies, saying: You are free
nations. You have the right to your views, but our view is we need to
protect ourselves and to defend this system and build this system, and
we are going to do it.
In closing, I will just say I look forward to working with President
Bush, working with my colleagues on the Armed Services Committee to
improve our readiness, to improve pay for our military and benefits, to
cut all of the excessive operations throughout the world that are not
really related to defense and get our military morale back. It is going
to be exciting, and I look forward to being a part of it.
I ask unanimous consent to print the text of the legislation in the
Record.
There being no objection, the bill was ordered printed in the Record,
as follows:

S. 305

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Military Retirees Survivor
Benefits Protection Act of 2001''.

SEC. 2. REPEAL OF REDUCTION IN SBP ANNUITIES AT AGE 62.

(a) Computation of Annuity for a Spouse, Former Spouse, or
Child.--Subsection (a) of section 1451 of title 10, United
States Code, is amended--
(1) in paragraph (1), by striking ``shall be determined as
follows:'' and all that follows and inserting the following:
``shall be the amount equal to 55 percent of the base
amount.''; and
(2) in paragraph (2), by striking ``shall be determined as
follows:'' and all that follows and inserting the following:
``shall be the amount equal to a percentage of the base
amount that is less than 55 percent and is determined under
subsection (f).''.
(b) Annuities for Survivors of Certain Persons Dying During
a Period of Special Eligibility for SBP.--Subsection (c)(1)
of such section is amended by striking ``shall be determined
as follows:'' and all that follows and inserting the
following: ``shall be the amount equal to 55 percent of the
retired pay to which the member or former member would have
been entitled if the member or former member had been
entitled to that pay based upon his years of active service
when he died.''.
(c) Repeal of Requirement for Reduction.--Such section is
further amended by striking subsection (d).
(d) Repeal of Unnecessary Supplemental SBP.--(1) Subchapter
III of chapter 73 of title 10, United States Code, is
repealed.
(2) The table of contents at the beginning of such chapter
is amended by striking the item relating to subchapter III.

SEC. 3. EFFECTIVE DATE.

This Act and the amendments made by section 2 shall take
effect on October 1, 2001, and shall apply with respect to
months beginning on or after that date.

Mr. KYL. Mr. President, I thank the Senator from New Hampshire for
his comments about the need for deployment of a national missile
defense. I spoke to that subject this morning, when I talked about
Secretary of Defense Donald Rumsfeld's remarks in Munich that were very
well received by our allies. They had some concerns about the
deployment of a national missile defense by the United States. But
after his comments to them, they were very much reassured. While there
still isn't the degree of support that we need and that we would like
to have among our allies, I believe the consultations now occurring,
and those that will occur in the future, primarily led by the Secretary
of Defense, will bring our allies to the same conclusions that we have
reached; namely, that we need to get on with it and that they can
participate in this kind of assistance to the extent they want to as
well. I appreciate the comments of the Senator from New Hampshire. I
spoke to that issue this morning.
______

By Mrs. FEINSTEIN:
S. 307. A bill to provide grants to State educational agencies and
local educational agencies for the provision of classroom-related
technology training for elementary and secondary school teachers; to
the Committee on Health, Education, Labor, and Pensions.
Mrs. FEINSTEIN. Mr. President, today Representative Lois Capps and I
are introducing legislation to help teachers use technology in their
teaching, the Teacher Technology Training Act of 2001.
This bill has three major provisions:
It authorizes $100 million for state education departments to award
grants to local public school districts on the basis of need to train
teachers in how to use technology in the classroom.
It specifies that grants may be used to strengthen instruction and
learning, provide professional development, and pay the costs of
teacher training in using technology in the classroom.
It requires the Secretary of Education to evaluate the technology
training programs for teachers developed by school districts within
three years.
This bill is needed because teachers say they need to learn how to
use computers and other technology in their teaching. A 1999 Education
Week poll found that 27 percent of teachers have had no training in
computers, 31 percent have had one to five hours, and 17 percent have
had six to ten hours. This means that 75 percent of teachers have had
less than ten hours of training in how to use computers. In a 1999
survey conducted by the U.S. Department of Education, only 23 percent
of teachers said they felt ``well prepared'' to integrate educational
technology into instruction. ``Most teachers want to learn, but they
say it takes time and they need help,'' says Linda Roberts, Director of
Educational Technology, U.S. Department of Education.
In many schools, the students know more about how to use computers
than the teachers do. In one Kentucky school profiled by Inside
Technology Training magazine, the students run the school's computer
systems. The article quoted the school district's technology
coordinator as saying that the students had ``long surpassed'' what the
teachers could do and reported that one student had recently trained
twenty teachers on software for Web page construction (``Fast Times at
Kentucky High,'' Inside Technology training, June 1998).
In addition to helping teachers teach, technology proficiency is
becoming crucial to survival. Most good jobs require experience using
computers. Former U.S. Commerce Secretary William M. Daley has said,
``Opportunities are now dependent upon a person's ability to use
computers and engage in using the Internet,'' CQ Weekly, ``Digital
Haves and Have Nots,'' April 17, 1999.
The economy of California is a case in point as it shifts away from
manufacturing and toward higher-skill service and technology
industries. Employers are placing a high premium on the computer skills
necessary for these positions. Students are better prepared when their
teachers are well trained. We cannot educate students for the
increasingly technological workplace without trained teachers.
We have made great efforts to make technology available to students
in their classrooms. Eighty percent of California's schools have
Internet access.
But computers are of little value if people do not know how to use
them and in school, they can become diversions or entertainment,
instead of learning tools without trained teachers.
If we expect teachers to be effective, we must give them up-to-date
skills, knowledge, and tools. This includes training.
By introducing this bill, I am not suggesting that technology is a
cure-all for the problems in our schools. Technology is one of many
teaching and learning tools. It can bring some efficiencies to
learning, for example, providing a new way to do math and spelling
drills, making learning to write easier, providing easier access to
information that without a computer is time-consuming and cumbersome to
obtain.

[[Page S1325]]

We expect a great deal from our teachers and students. We must give
them the resources they need. This bill is one step.
______

By Mrs. FEINSTEIN:
S. 308. A bill to award grants for school construction; to the
Committee on Health, Education, Labor, and Pensions.
Mrs. FEINSTEIN. Mr. President, today, I am introducing the Excellence
in Education Act of 2001.
The purpose of this bill is to 1. reduce the size of schools; 2.
reduce the size of classes; and 3. bring accountability to the use of
these funds. The bill would create a matching grant program to build
new schools to meet the following size requirements:
For kindergarten through 5th grade, not more than 500 students, for
grades 6 through 8, not more than 750 students and for grades 9 through
12, not more than 1,500 students.
For kindergarten through grade 6, not more than 20 students per
teacher and for grades 7 through 12, not more than 28 students per
teacher.
The bill authorizes $1 billion each year for the next five years for
the
U.S. Department of Education to award grants to local school districts.
School districts would have to match federal funds with an equal
amount. In addition to making the above reductions, school districts
would be required to terminate social promotion, provide remedial
education, and require that students be subject to state achievement
standards in the core academic curriculum.
This bill will provide a new funding source for school districts or
states to match to build new schools and reduce both school size and
class size. There is no good estimate of how many schools would be
needed to reduce schools and classes to the levels specified in the
bill, but we all know that there are too many large schools and large
classes in public education today.
The U.S. Department of Education estimates that we need to build
6,000 new schools just to meet enrollment growth projections. This
estimate does not take into account the need to cut class and school
sizes. Consequently, the need for the funds my bill would authorize is
huge.
Why do we need this bill?
First, many of our schools are just too big, especially in urban
areas. The ``shopping mall'' high school is all too common. Some
schools have as many as 4,000 students. In fact, half of American high
school students go to schools that have 1,500 students or more.
Equally serious is the fact that our classes are too big. Even though
we have begun to reduce class sizes in the lower grades in California,
it still has some of the largest class sizes in the United States.
Studies show that student achievement improves when school and class
sizes are reduced. The Oakland, California, school district plans to
open 10 new small schools in the next few years. The Oakland tribune
explained it like this on October 18, 2000: ``Small schools are viewed
as antidotes to huge, factory-like campuses commonplace in America's
inner cities. Research has shown that small schools create intimate
learning atmospheres for students and teachers.''
The U.S. Department of Education cites studies that list these
benefits of small schools: students have a greater sense of belonging;
fewer discipline problems occur; crime, violence and gang activity go
down; alcohol and tobacco abuse decline; dropout rates fall and
graduation rates rise; and student attendance increases.
The American Education Research Association says that the ideal high
school size is between 600 and 900 students. Studies show that small
schools have higher academic achievement, fewer discipline problems,
lower dropout rates, higher levels of student participation, higher
graduation rates (The School Administrator, October 1997). The nation's
school administrators are calling for smaller, more personalized
schools.
A Tennessee study called Project STAR placed 6,500 kindergartners in
330 classes of different sizes. The students stayed in small classes
for four years and then returned to larger ones in the fourth grade.
The test scores and behavior of students in the smaller classes were
better than those of children in the larger classes. A similar 1997
study by Rand found that smaller classes benefit students from low-
income families the most.
Teachers say that students in smaller classes pay better attention,
ask more questions, and have fewer discipline problems. Smaller schools
and smaller classes make a difference, it is clear.
California has some of the largest schools in the country; Los
Angeles has some of the largest classes and schools in the world! Here
are some examples in the Los Angeles area: Hawaiian Elementary, 1,365
students; South Gate Middle School, 4,442 students; Belmont High
School, 4,874 students.
California also has some large classes, even though we have made
great progress in reducing teacher-to-pupil ratios in the lower grades.
Still today, many middle and high school English and math classes are
very large, up to as many as 39 students.
The American public supports increased federal funding for school
construction. The Rebuild American Coalition last year found that 82
percent of Americans favor federal spending for school construction, up
from 74 percent in a 1998 National Education Association poll.
Every parent knows the importance of a small class in which the
teacher can give individualized attention to a student. Every parent
knows the importance of the sense of a community that can come with
attending a small school. And every parent knows that big schools and
big classes can be a stressful learning environment.
I hope my colleagues will join me today in passing this important
education reform. I ask unanimous consent that the text of the bill and
a summary be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

S. 308

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Excellence in Education Act
of 2001''.

SEC. 2. DEFINITIONS.

In this Act:
(1) Core curriculum.--The term ``core curriculum'' means
curriculum in subjects such as reading and writing, language
arts, mathematics, social sciences (including history), and
science.
(2) Elementary school; local educational agency; secondary
school; secretary.--The terms ``elementary school'', ``local
educational agency'', ``secondary school'', and ``Secretary''
have the meanings given the terms in section 14101 of the
Elementary and Secondary Education Act of 1965 (20 U.S.C.
8801).
(3) Practice of social promotion.--The term ``practice of
social promotion'' means a formal or informal practice of
promoting a student from the grade for which the
determination is made to the next grade when the student
fails to meet State achievement standards in the core
academic curriculum, unless the practice is consistent with
the student's individualized education program under section
614(d) of the Individuals with Disabilities Education Act (20
U.S.C. 1414(d)).
(4) Construction.--
(A) In general.--Subject to subparagraph (B), the term
``construction'' means--
(i) preparation of drawings and specifications for school
facilities;
(ii) building new school facilities, or acquiring,
remodeling, demolishing, renovating, improving, or repairing
facilities to establish new school facilities; and
(iii) inspection and supervision of the construction of new
school facilities.
(B) Rule.--An activity described in subparagraph (A) shall
be considered to be construction only if the labor standards
described in section 439 of the General Education Provisions
Act (20 U.S.C. 1232b) are applied with respect to such
activity.
(5) School facility.--The term ``school facility'' means a
public structure suitable for use as a classroom, laboratory,
library, media center, or related facility the primary
purpose of which is the instruction of public elementary
school or secondary school students. The term does not
include an athletic stadium or any other structure or
facility intended primarily for athletic exhibitions,
contests, or games for which admission is charged to the
general public.

SEC. 3. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to carry out this
Act $1,000,000,000 for each of the fiscal years 2002 through
2006.

SEC. 4. PROGRAM AUTHORIZED.

The Secretary is authorized to award grants to local
educational agencies to enable the local educational agencies
to carry out the construction of new public elementary school
and secondary school facilities.

SEC. 5. CONDITIONS FOR RECEIVING FUNDS.

In order to receive funds under this Act a local
educational agency shall meet the following requirements:

[[Page S1326]]

(1) Reduce class and school sizes for public schools served
by the local educational agency as follows:
(A) Limit class size to an average student-to-teacher ratio
of 20 to 1, in classes serving kindergarten through grade 6
students, in the schools served by the agency.
(B) Limit class size to an average student-to-teacher ratio
of 28 to 1, in classes serving grade 7 through grade 12
students, in the schools served by the agency.
(C) Limit the size of public elementary schools and
secondary schools served by the agency to--
(i) not more than 500 students in the case of a school
serving kindergarten through grade 5 students;
(ii) not more than 750 students in the case of a school
serving grade 6 through grade 8 students; and
(iii) not more than 1,500 students in the case of a school
serving grade 9 through grade 12 students.
(2) Terminate the practice of social promotion in the
public schools served by the agency.
(3) Require that students be subject to State achievement
standards in the core curriculum at key transition points, to
be determined by the State, for all kindergarten through
grade 12 students.
(4) Use tests and other indicators, such as grades and
teacher evaluations, to assess student performance in meeting
the State achievement standards, which tests shall be valid
for the purpose of such assessment.
(5) Provide remedial education for students who fail to
meet the State achievement standards, including tutoring,
mentoring, summer programs, before-school programs, and
after-school programs.
(6) Provide matching funds, with respect to the cost to be
incurred in carrying out the activities for which the grant
is awarded, from non-Federal sources in an amount equal to
the Federal funds provided under the grant.

SEC. 6. APPLICATIONS.

(a) In General.--Each local educational agency desiring to
receive a grant under this Act shall submit an application to
the Secretary at such time and in such manner as the
Secretary may require.
(b) Contents.--Each application shall contain--
(1) an assurance that the grant funds will be used in
accordance with this Act;
(2) a brief description of the construction to be
conducted;
(3) a cost estimate of the activities to be conducted; and
(4) a description of available non-Federal matching funds.

Summary of the School Construction Grant Bill, the Excellence in
Education Act of 2001

Funds authorized, purpose: Authorizes $5 billion over 5
years ($1 billion each year) for the U.S. Department of
Education to award grants to local education agencies to
construct new school facilities from fiscal year 2002 to
2006.
Eligibility. Local education agencies as defined in 14101
of the Elementary and Secondary Education Act of 1965 (public
schools).
Use of funds: Local education agencies are authorized to
use funds to construct new school facilities.
Conditions for receiving funds: As a condition of receiving
funds, local education agencies are required to--
Reduce school and class sizes as follows:
Limit class size to: In the elementary grades to an average
student-teacher ratio of 20 to one; in grades 7 through 12 to
an average student-teacher ratio of 28 to one.
Limit school size to: Elementary schools (K-5): no more
than 500 students; Middle schools (6-8): no more than 750
students; High schools (9-12): no more than 1,500 students.
Terminate the practice of social promotion.
Require that students be subject to state academic
achievement standards, to be determined by the states, for
all K-12 students in the core curriculum, defined as subjects
such as reading and writing, language arts, mathematics,
social sciences (including history); and science.
Test student achievement in meeting achievement standards
periodically for advancement to the next grade, in at least
three grades (such as the 4th, 8th and 12th grades),
distributed evenly over the course of a student's education.
Provide remedial education for students who fail to meet
academic achievement standards, including tutoring,
mentoring, summer, before-school and after-school programs.
Provide matching funds from non-Federal sources in an
amount equal to the Federal funds provided under the grant.
______

By Mrs. FEINSTEIN:
S. 309. A bill to amend the Elementary and Secondary Education Act of
1965 to specify the purposes for which funds provided under subpart 1
of part A of title I may be used; to the Committee on Health,
Education, Labor, and Pensions.
Mrs. FEINSTEIN. Mr. President, today I am introducing a bill designed
to better direct and refocus ESEA Title I funds on academic
instruction. The goal of this bill, titled ``The Title I Integrity
Act,'' is to target Title I funds on learning and to get ``more for our
money'' from the largest Federal elementary-secondary education
program.
Title I provides assistance to virtually every school district in the
country for services to children attending schools with high
concentrations of low-income students, from preschool through high
school. It has been the ``anchor'' of Federal assistance to schools,
since its origin in 1965. For Fiscal Year 2000, funding for Part A
basic grants to school districts is almost $8 billion.
This bill would specify in law how Title I funds can and cannot be
used by schools. It seeks to direct Title I funds to uses that improve
academic achievement and help students meet state achievement
standards.
The bill says that ``a local educational agency shall use funds . . .
only to provide academic instruction and services directly related to
the instruction of students in preschool through grade 12 to assist
eligible children to improve their academic achievement and to meet
achievement standards established by the State.''
Permitted uses include these: Interventions and corrective actions to
improve student achievement; extending academic instruction beyond the
normal school day and year, including summer school; the employment of
teachers and other instructional personnel (including employee
benefits); instructional services to pre-kindergarten children for the
transition to kindergarten; the purchase of instructional resource such
as books, materials, computers, and other instructional equipment and
wiring to support instructional equipment; development and
administration of curriculum, educational materials and assessments;
and transportation of students to assist them in improving academic
achievement.
Uses explicitly not permitted are these: The purchase or lease of
privately-owned facilities; the purchase or provision of facilities
maintenance, janitorial, gardening, or landscaping services or the
payment of utility costs; the construction of facilities; acquisition
of real property; food and refreshments; travel to and attendance at
conferences or meetings; and the purchase or lease of vehicles.
Current law on Title I is much too vague. It says, ``A State or local
educational agency shall use funds received under this part only to
supplement the amount of funds that would, in the absence of such
Federal funds, be made available from non-Federal sources for the
education of pupils participating in programs assisted under this part,
and not to supplant such funds.''
The U.S. Department of Education has given states a guidance document
that explains how Title I funds can currently be used. Permitted uses
are for the following: instructional practices; counseling, mentoring;
developing curricula; salaries; employee benefits; renting privately-
owned facilities; janitorial services; utilities; mobile vans; training
and professional development; equipment; interest on lease purchase
agreements; travel and conferences; food and refreshments; insurance
for vehicles; parent involvement activities.
Under this guidance document, only two uses are specifically
prohibited: (1) construction or acquisition of real property; and (2)
payment to parents to attend a meeting or training session or to
reimburse a parent for salary lost due to attendance at ``parental
involvement'' meeting.
My reason for introducing this bill is this: Our students are not
learning; our schools are failing our children. We must use our limited
federal dollars for the fundamental purpose of education: to help
students learn.
Just this week I learned that a January 2001 study by Education
Weekly, titled ``Quality Counts 2001: A Better Balance,'' brought more
bad news about California's students. Here's what the report found:
In fourth grade reading, 20 percent of students are proficient and 52
percent are below the basic standard.
In eighth grade reading, 22 percent of students are proficient and 36
percent are below the basic standard.
Comparing California to other states, in how well fourth grade
students read, California ranks 36 out of 39 states. In eight grade
reading, California ranks 32 out of 36 states.

[[Page S1327]]

Nationally, the news is similarly distressing:
U.S. eighth graders are out-performed by their counterparts in math
and science from Japan, Korea, Hong Kong and Singapore, Australia and
Canada (Third International Math and Science Study, December 5, 2000).
The 1999 study showed virtually no improvement for U.S. students over
1995.
American twelfth graders performed in mathematics better than
students in only two countries, Cyprus and South Africa.
In writing, 75 percent of U.S. school children cannot compose a well-
organized, coherent essay, concluded the National Assessment for
Education Progress (NAEP) in September 1999.
While it is difficult to really ascertain exactly ow Title I funds
are always being used, we do know of a few examples of uses that raise
questions in my mind:
In Alabama, schools ``dipped into Title I to pay the electric bill
and for janitorial services.'' Citizens' Commission on Civil Rights.
While most of Title I's $8 billion appear to be spent on instruction,
the Los Angeles Times, in a March 12, 2000 editorial, said, ``About
half that amount is wasted on unskilled though well-meaning teacher
aides, who are often more baby-sitter than instructor.''
Title I has been used ``to pay for everything from playground
supervisors and field trips to more time for nurses and counselors.''
San Diego Tribune, March 16, 2000.
California school officials have told my staff that Title I has been
used for pay for clerical assistants in school administrative offices,
payroll staff, truant officers, schoolyard duty personnel, school bus
loading assistants, ``curriculum coordinators,'' ``compliance,''
attending conferences, and home visits.
It is time to put an end to the notion that Title I can be everything
to everyone, that it can fund all the services that schools need.
Federal funding is only seven percent of total funding for elementary
and secondary education and Title I is even a smaller percentage of
total support for public schools. We must get the most that we can
educationally for our limited dollars.
It is time to better direct Title I funds to the true goal of
education: to help students learn. This bill is one step toward that
goal.
I ask unanimous consent that the text of the bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 309

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Title I Integrity Act of
2001''.

SEC. 2. LIMITATIONS ON FUNDS.

Subpart 1 of part A of title I (20 U.S.C. 6311 et seq.) is
amended by inserting after section 1120B (20 U.S.C. 6323) the
following:

``SEC. 1120C. LIMITATIONS ON FUNDS.

``(a) In General.--Notwithstanding any other provision of
this Act, a local educational agency shall use funds received
under this subpart only to provide academic instruction and
services directly related to the instruction of students in
preschool through grade 12 to assist eligible children to
improve their academic achievement and to meet achievement
standards established by the State.
``(b) Permissible and Prohibited Activities.--In this
section, the term `academic instruction'--
``(1) includes--
``(A) the implementation of instructional interventions and
corrective actions to improve student achievement;
``(B) the extension of academic instruction beyond the
normal school day and year, including during summer school;
``(C) the employment of teachers and other instructional
personnel, including providing teachers and instructional
personnel with employee benefits;
``(D) the provision of instructional services to pre-
kindergarten children to prepare such children for the
transition to kindergarten;
``(E) the purchase of instructional resources, such as
books, materials, computers, other instructional equipment,
and wiring to support instructional equipment;
``(F) the development and administration of curricula,
educational materials, and assessments; and
``(G) the transportation of students to assist the students
in improving academic achievement; and
``(2) does not include--
``(A) the purchase or lease of privately owned facilities;
``(B) the purchase or provision of facilities maintenance,
gardening, landscaping, or janitorial services, or the
payment of utility costs;
``(C) the construction of facilities;
``(D) the acquisition of real property;
``(E) the payment of costs for food and refreshments;
``(F) the payment of travel and attendance costs at
conferences or other meetings; or
``(G) the purchase or lease of vehicles.''.
______

By Mr. KENNEDY (for himself and Mr. Kerry):
S. 310. A bill to designate the United States courthouse located at 1
Courthouse Way in Boston, Massachusetts, as the ``John Joseph Moakley
United States Courthouse''; to the Committee on Environment and Public
Works.
Mr. KENNEDY. Mr. President, it is a privilege to join my colleague,
Senator Kerry, in introducing this legislation to name the U.S.
courthouse in the city of Boston after a wonderful friend and an
outstanding leader, Congressman, Joseph Moakley, who announced
yesterday that he will not be candidate for re-election next year
because of a serious illness that has just been diagnosed.
Congressman Moakley has served Massachusetts and the nation with
great honor throughout his long and brilliant career in public service.
Like the rest of my colleagues, I'm deeply saddened by Joe's
announcement yesterday.
As dean of our delegation, Joe's leadership in Congress is invaluable
and indispensable for the people of Massachusetts--and the whole nation
too. He's a true giant in Congress, and I'm proud to serve with him.
Joe's has been at the forefront of many great battles of national and
international importance. No one is more effective in Congress on the
front lines or behind the scenes. He has touched the hearts of all our
people, and he's made a remarkable difference in their lives and hopes.
He's a voice for the voiceless, and for all those who need our help the
most. He champions the cause of hard-working families and the middle
class--and all of us are proud to be there with him, on the front-lines
in all these battles.
When I look back over the many years that Joe Moakley has served in
Congress, I think of the important progress we've achieved--the battles
we've waged and won--for decent and affordable health care--for good
education, so that more children can have a better start in life and a
chance to go to colelge--for better jobs, greater opportunities, fairer
wages, and safer working conditions--for a cleaner environment--for
equal rights for women and an end to discrimination in the workplace--
for civil rights at home and human rights in other lands. And above
all, in countless nations around the world, Joe Moakley is renowned for
his extraordinary achievement in protecting and defending the
fundamental human rights of all the people of El Salvador.
He has fought long and hard and well for funds to rebuild the Central
Artery--to build the South Boston Piers Transitway--to clean up Boston
Harbor--to modernize the Port of Boston--and to preserve Massachusetts'
many historic sites--the old State House, the Old South Meeting House,
the USS Constitution, Dorchester Heights, and Boston's historic
marketplace, Faneuil Hall. Joe Moakley's efforts to protect and
preserve these many sites guarantee that they'll be an important part
of our state's history and heritage for many years to come.
And that's only the tip of the iceberg. Few, if any, Members of
Congress have done so much for so many for so long.
When the chips are down, Joe Moakley is always there when we need him
most. If President Kennedy were here today, we all know what he'd day--
he'd call Joe Moakley a true profile in courage.
Thoughout his career, Joe Moakley has worked brilliantly, effectively
and tirelessly to promote the highest ideals of public service. He is
an outstanding statesman, leader, and legislator. I commend him for his
leadership, and I look forward to the early enactment of this
legislation as a tribute to a man who has served the city of Boston,
Congress, and the country so well.
______

By Mr. DOMENICI (for himself, Mr. Dodd, Mr, Cochran, Mr. Cleland,
Mr. Frist, Mr. Kennedy, and Mr. Harkin):
S. 311. A bill to amend the Elementary and Secondary Education Act of
1965 to provide for partnerships in character education: to the
Committee on

[[Page S1328]]

Health, Education, Labor, and Pensions.
Mr. DOMENICI. Mr. President, this is an issue on which I have been
working for 7 years; that is, character education in our schools, both
public and private. The bill I sent to the desk has seven cosponsors
from both parties. I ask other Senators who are interested in helping
at the grassroots level in public schools and private schools, who want
to bring Character Counts to their character education in their
schools, that they might consider this bill. I would like to speak a
little bit about character in our Nation and in our schools.
I rise today with my friend, Senator Dodd, who is my principal
cosponsor, although we now have Senators Frist, Kennedy, Harkin,
Cleland, and Cochran. This bill is called the Strong Character for
Strong Schools Act. It is not a very big program, and it does not
interfere very much at all with the schools, but it does provide for
money to be granted to public school systems, partnerships between
State agencies and others, bringing character, or character kind of
programs, into the schools.
Last month, I listened with great pleasure to President Bush's
inaugural address. He basically ticked off the tenets of good character
that underscore American life. The President's speech was clearly a
message about character and the importance of character in American
daily lives. In his speech, the President touched on many elements of
good character. I found it especially telling when the President
emphasized the necessity of teaching every child these principles and
the duty of every citizen to uphold these very same principles.
I am going to quote a number of people. Let me quote Theodore
Roosevelt, one of our great Presidents. He said:

Character, in the long run, is the decisive factor in the
life of an individual and of our Nation.

What I have been principally involved in, in our State of New Mexico,
is called Character Counts. Six pillars of character are promoted in
the schools. Almost all of them use the same six pillars:
Trustworthiness, respect, responsibility, fairness, caring, and
citizenship.
I would submit that character truly does transcend time as well as
religious, cultural, political, and socio-economic barriers.
I believe President Bush's renewed focus on character sends a
wonderful message to Americans, and will help those of us involved in
character education reinvigorate our efforts to get communities and
schools involved.
I say that because it was not too long ago, during the last
Elementary and Secondary Education Act, ESEA, re-authorization, that
Senators Nunn, Dodd and I included a provision in the bill to fund
pilot projects to increase character education.
Since then, the Department of Education has made $25 million in
``seed money'' grants available to 28 States to develop character
education programs. Currently, there are 36 States that have either
received Federal funding, or have enacted their own laws mandating or
encouraging character education.
In New Mexico, over 230,000 kids and nearly 90 percent of our schools
participate in some form of character education.
Most of New Mexico utilizes a wonderful character curriculum called
``Character Counts,'' which was established by Michael Josephson, a
renowned ethicist from the Josephson Institute in California.
Character Counts emphasizes six pillars of good character:
trustworthiness, respect, responsibility, fairness, caring, and
citizenship. The point is that teachers like this approach. These six
pillars are not based on any particular religion or philosophy. They
merely represent the kind of values that everybody can agree are
important for our children.
I first learned of Character Counts after reading about it in a
nationally syndicated newspaper column. I subsequently, found out that
one school in my State had decided to try the program, and that it
seemed to be working.
Character Counts started in New Mexico in 1993 at the Bel Air
Elementary School in Albuquerque. Bel Air had disciplinary problems,
and teachers and the principal were looking for ways to address those
problems. One of Bel Air's counselors, Mary Jane Aguilar, along with
Don Whatley, a teacher, suggested that the school try a new approach,
called Character Counts.
They took the six pillars, with training from the Josephson
Institute, and began integrating them into the daily lives of their
students. Within 6 months of integrating Character Counts into the
daily curriculum at Bel Air, the teachers noticed that disciplinary
episodes were fewer and that the students began to treat each other
better.
After hearing of the success at Bel Air, I invited the mayor of
Albuquerque in 1994 to join me in forming the Character Counts
Leadership Council, to bring together community leaders, schools,
teachers, parents, and students for the purpose of expanding Character
Counts in Albuquerque and throughout the State. And after our initial
efforts, I worked to establish Character Counts partnerships in other
parts of the State, and the program spread quickly throughout New
Mexico.
Since then, I have helped bring Character Counts to over 70 schools
and communities in New Mexico. Places like Farmington, Santa Fe,
Roswell, Portales, Carlsbad, Silver City, Hobbs and Las Cruces. And in
even smaller communities like Espanola, Mountainair, Dexter, Hagerman,
Lake Arthur, Artesia, Capitan, Carrizozo, Lovington, Eunice, Jal,
Tatum, Alamogordo, Socorro, Deming, and Gallup.
As I travel around New Mexico, in virtually every town I have noticed
school billboards with things like: ``The word for the month of May is
`citizenship.' Character Counts!'' It is everywhere in the schools in
New Mexico and I am proud to be a part of the program.
Additionally, many of our communities now have adopted Character
Counts in afterschool programs like the YMCA, Boys and Girls Clubs, and
4-H. So when kids leave the classroom for after-school activities, they
are still being taught how to make decisions based on the six pillars.
I think what we are starting to see in New Mexico is the beginning of
the Character Counts Generation--young people entering high school, who
are bringing with them the lessons they have learned through Character
Counts.
Mr. President, I could go on for quite some time talking about
Character Counts in New Mexico. The bottom line is that I believe it is
working in New Mexico and other parts of the country.
Consequently, I think we need to encourage more character education
by providing a little more seed money for these worthwhile programs.
So today, Senator Dodd and I are here to introduce a bill to
accomplish just that.
The Strong Character for Strong Schools Act seeks to encourage the
creation of character education programs at the State and local level
by providing grants to eligible entities.
Grant recipients would use the funding to design and implement
character education programs incorporating the following elements:
caring, civic virtue and citizenship, justice and fairness, respect,
responsibility, trustworthiness, and any other elements developed by
the program.
``Eligible entities'' would include partnerships of, one, a State
Educational Agency, SEA, and one or more school districts, two, an SEA,
one or more school districts, and one or more nonprofit organizations,
three, one or more school districts, or, four, a school district and a
nonprofit organization. Nonprofit organizations could be institutions
of higher education.
The program would be authorized at $50 million for fiscal year 2002
and such sums as may be necessary for each of the four succeeding
fiscal years.
I also want to emphasize that our bill does not dictate to States
which character education program to implement. Rather, the bill merely
provides states general guidelines and allows them to adopt whatever
principles or pillars they choose after consultation with their
communities.
Hopefully, our renewed effort will bring together even more
communities to ensure that character education is a part of every
child's life. And with the successful passage of the legislation we

[[Page S1329]]

are introducing today, our new Secretary of Education, Rodney Paige,
will be in a position to help make these programs a reality.
Thank you and I hope that my colleagues will support this effort.
Mr. President, I ask unanimous consent that a copy of the bill be
printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 311

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Strong Character for Strong
Schools Act''.

SEC. 2. PARTNERSHIPS IN CHARACTER EDUCATION PROGRAM.

Section 10103 of the Elementary and Secondary Education Act
of 1965 (20 U.S.C. 8003) is amended to read as follows:

``SEC. 10103. PARTNERSHIPS IN CHARACTER EDUCATION PROGRAM.

``(a) Program Authorized.--
``(1) In general.--The Secretary is authorized to award
grants to eligible entities for the design and implementation
of character education programs that incorporate the elements
of character described in subsection (d), as well as other
character elements identified by the eligible entities.
``(2) Eligible entity.--The term `eligible entity' means--
``(A) a State educational agency in partnership with 1 or
more local educational agencies;
``(B) a State educational agency in partnership with--
``(i) one or more local educational agencies; and
``(ii) one or more nonprofit organizations or entities,
including institutions of higher education;
``(C) a local educational agency or consortium of local
educational agencies; or
``(D) a local educational agency in partnership with
another nonprofit organization or entity, including
institutions of higher education.
``(3) Duration.--Each grant under this section shall be
awarded for a period not to exceed 3 years, of which the
eligible entity shall not use more than 1 year for planning
and program design.
``(4) Amount of grants for state educational agencies.--
Subject to the availability of appropriations, the amount of
grant made by the Secretary to a State educational agency in
a partnership described in subparagraph (A) or (B) of
paragraph (2), that submits an application under subsection
(b) and that meets such requirements as the Secretary may
establish under this section, shall not be less than
$500,000.
``(b) Applications.--
``(1) Requirement.--Each eligible entity desiring a grant
under this section shall submit an application to the
Secretary at such time and in such manner as the Secretary
may require.
``(2) Contents of application.--Each application submitted
under this section shall include--
``(A) a description of any partnerships or collaborative
efforts among the organizations and entities of the eligible
entity;
``(B) a description of the goals and objectives of the
program proposed by the eligible entity;
``(C) a description of activities that will be pursued and
how those activities will contribute to meeting the goals and
objectives described in subparagraph (B), including--
``(i) how parents, students (including students with
physical and mental disabilities), and other members of the
community, including members of private and nonprofit
organizations, will be involved in the design and
implementation of the program and how the eligible entity
will work with the larger community to increase the reach and
promise of the program;
``(ii) curriculum and instructional practices that will be
used or developed;
``(iii) methods of teacher training and parent education
that will be used or developed; and
``(iv) how the program will be linked to other efforts in
the schools to improve student performance;
``(D) in the case of an eligible entity that is a State
educational agency--
``(i) a description of how the State educational agency
will provide technical and professional assistance to its
local educational agency partners in the development and
implementation of character education programs; and
``(ii) a description of how the State educational agency
will assist other interested local educational agencies that
are not members of the original partnership in designing and
establishing character education programs;
``(E) a description of how the eligible entity will
evaluate the success of its program--
``(i) based on the goals and objectives described in
subparagraph (B); and
``(ii) in cooperation with the national evaluation
conducted pursuant to subsection (c)(2)(B)(iii);
``(F) an assurance that the eligible entity annually will
provide to the Secretary such information as may be required
to determine the effectiveness of the program; and
``(G) any other information that the Secretary may require.
``(c) Evaluation and Program Development.--
``(1) Evaluation and reporting.--
``(A) State and local reporting and evaluation.--Each
eligible entity receiving a grant under this section shall
submit to the Secretary a comprehensive evaluation of the
program assisted under this section, including the impact on
students (including students with physical and mental
disabilities), teachers, administrators, parents, and
others--
``(i) by the second year of the program; and
``(ii) not later than 1 year after completion of the grant
period.
``(B) Contracts for evaluation.--Each eligible entity
receiving a grant under this section may contract with
outside sources, including institutions of higher education,
and private and nonprofit organizations, for purposes of
evaluating its program and measuring the success of the
program toward fostering in students the elements of
character described in subsection (d).
``(2) National research, dissemination, and evaluation.--
``(A) In general.--The Secretary is authorized to make
grants to, or enter into contracts or cooperative agreements
with, State or local educational agencies, institutions of
higher education, tribal organizations, or other public or
private agencies or organizations to carry out research,
development, dissemination, technical assistance, and
evaluation activities that support or inform State and local
character education programs. The Secretary shall reserve not
more than 5 percent of the funds made available under this
section to carry out this paragraph.
``(B) Uses.--Funds made available under subparagraph (A)
may be used--
``(i) to conduct research and development activities that
focus on matters such as--

``(I) the effectiveness of instructional models for all
students, including students with physical and mental
disabilities;
``(II) materials and curricula that can be used by programs
in character education;
``(III) models of professional development in character
education; and
``(IV) the development of measures of effectiveness for
character education programs which may include the factors
described in paragraph (3);

``(ii) to provide technical assistance to State and local
programs, particularly on matters of program evaluation;
``(iii) to conduct a national evaluation of State and local
programs receiving funding under this section; and
``(iv) to compile and disseminate, through various
approaches (such as a national clearinghouse)--

``(I) information on model character education programs;
``(II) character education materials and curricula;
``(III) research findings in the area of character
education and character development; and
``(IV) any other information that will be useful to
character education program participants, educators, parents,
administrators, and others nationwide.

``(C) Priority.--In carrying out national activities under
this paragraph related to development, dissemination, and
technical assistance, the Secretary shall seek to enter into
partnerships with national, nonprofit character education
organizations with expertise and successful experience in
implementing local character education programs that have had
an effective impact on schools, students (including students
with disabilities), and teachers.
``(3) Factors.--Factors which may be considered in
evaluating the success of programs funded under this section
may include--
``(A) discipline issues;
``(B) student performance;
``(C) participation in extracurricular activities;
``(D) parental and community involvement;
``(E) faculty and administration involvement;
``(F) student and staff morale; and
``(G) overall improvements in school climate for all
students, including students with physical and mental
disabilities.
``(d) Elements of Character.--
``(1) In general.--Each eligible entity desiring funding
under this section shall develop character education programs
that incorporate the following elements of character:
``(A) Caring.
``(B) Civic virtue and citizenship.
``(C) Justice and fairness.
``(D) Respect.
``(E) Responsibility.
``(F) Trustworthiness.
``(G) Any other elements deemed appropriate by the members
of the eligible entity.
``(2) Additional elements of character.--An eligible entity
participating under this section may, after consultation with
schools and communities served by the eligible entity, define
additional elements of character that the eligible entity
determines to be important to the schools and communities
served by the eligible entity.
``(e) Use of Funds by State Educational Agency
Recipients.--Of the total funds received in any fiscal year
under this section by an eligible entity that is a State
educational agency--
``(1) not more than 10 percent of such funds may be used
for administrative purposes; and
``(2) the remainder of such funds may be used for--

[[Page S1330]]

``(A) collaborative initiatives with and between local
educational agencies and schools;
``(B) the preparation or purchase of materials, and teacher
training;
``(C) grants to local educational agencies, schools, or
institutions of higher education; and
``(D) technical assistance and evaluation.
``(f) Selection of Grantees.--
``(1) Criteria.--The Secretary shall select, through peer
review, eligible entities to receive grants under this
section on the basis of the quality of the applications
submitted under subsection (b), taking into consideration
such factors as--
``(A) the quality of the activities proposed to be
conducted;
``(B) the extent to which the program fosters in students
the elements of character described in subsection (d) and the
potential for improved student performance;
``(C) the extent and ongoing nature of parental, student,
and community involvement;
``(D) the quality of the plan for measuring and assessing
success; and
``(E) the likelihood that the goals of the program will be
realistically achieved.
``(2) Diversity of projects.--The Secretary shall approve
applications under this section in a manner that ensures, to
the extent practicable, that programs assisted under this
section--
``(A) serve different areas of the Nation, including urban,
suburban, and rural areas; and
``(B) serve schools that serve minorities, Native
Americans, students of limited-English proficiency,
disadvantaged students, and students with disabilities.
``(g) Participation by Private School Children and
Teachers.--Grantees under this section shall provide, to the
extent feasible and appropriate, for the participation of
students and teachers in private elementary and secondary
schools in programs and activities under this section.
``(h) Authorization of Appropriations.--There are
authorized to be appropriated to carry out this section,
$50,000,000 for fiscal year 2002 and such sums as may be
necessary for each of the 4 succeeding fiscal years.''.

The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Mr. President, before the Senator from New Mexico leaves
the floor, I ask permission to join as a cosponsor of this most
important legislation. It appears to be bipartisan. We have the two
leading Democrats on the Education Committee plus Republicans. It
should be a bill that we can pass.
Mr. DOMENICI. I am grateful that the distinguished minority whip
would join. We will be working together on this bill. I thank the
Senator.
Mr. DODD. Mr. President, I rise to join my friend and colleague from
New Mexico, Senator Domenici, in introducing the Strong Character for
Strong Schools Act. Senator Domenici and I have worked together for
many years on this important issue. We established the Partnerships in
Character Education Pilot Project in 1994 and have worked regularly
since then to commemorate National Character Counts Week. So, I am
pleased that today we are introducing the Strong Character for Strong
Schools Act to help expand States' and schools' ability to make
character education a central part of every child's education.
Our schools may be built with the bricks of English, math and
science, but character education certainly is the mortar. This
initiative ensures that our children's character, as well as their
minds, receives care and nurturing in our schools. Character education
means teaching students about such qualities as caring, citizenship,
fairness, respect, responsibility, trustworthiness, and other qualities
that their community values.
Character education provides students a context within which to
learn. If we view education simply as the imparting of knowledge to our
children, then we will not only miss an opportunity, but will
jeopardize our future. Character education isn't a separate subject,
but part of a seamless garment of learning. For example, at Waterford
High School, in Connecticut, as part of the character education
program, math students designed a ramp for kids who use wheelchairs.
The students learned about math, but also about caring.
Theodore Roosevelt said that ``[t]o educate a person's mind and not
his character is to educate a menace.'' That may be, but I prefer Dr.
Martin Luther King's exhortation that we judge each other not by the
color of our skin, but by the content of our character.
A recent survey of high school students by the Character Counts
Coalition found that during the preceding year, 71 percent cheated on
an exam; 92 percent lied to their parents and 78 percent lied to a
teacher; about 35 percent had stolen from a store; and 16 percent were
drunk in school. This doesn't mean that these are bad kids, but it does
mean that we need more character education.
We know that these programs work. Schools across the country that
have adopted strong character education programs report better student
performance, fewer discipline problems, and increased student
involvement with the community. Children want direction--they want to
be taught right from wrong. The American public wants character
education in our schools, too. Studies show that about 90 percent of
Americans support schools teaching character education.
Virtually all national education organizations are involved in
promoting character education. Last June, the Connecticut Department of
Education, on behalf of many State organizations, issued a Call to
Action letter, outlining a program to improve the school climate in all
Connecticut schools. And, the Connecticut Education Association has
developed its own character education program that teaches kids about
not bullying and other behaviors that can disrupt schools and make it
difficult for children to learn.
As all education policy should be, character education is bi-
partisan. When Senator Domenici and I introduced a resolution last
Congress establishing National Character Counts Week, we had 57 co-
sponsors, with broad support in both parties. And President Bush, in
his education plan, calls for increased funding for character
education.
Our children may be one-quarter of our population, but they
definitely are 100 percent of our future. That's why this measure is so
important--it provides a helping hand to our schools and communities to
ensure that children's futures are bright and filled with opportunities
and success. So, I am confident that not only are we doing the right
thing here, but that we will see this bill become law along with other
education reforms, this Congress.
Mr. CLELAND. Mr. President, when I was a boy growing up in Lithonia,
GA, I was privileged to have accomplished and dedicated teachers who
provided me with a strong foundation in the three R's. Thanks to their
capable and committed efforts, I received an excellent education in
reading, writing, and arithmetic. And thanks to their good example and
their ability to teach through inspiration, I was also well versed in
the fourth R, which I call ``respect.''
What my teachers demonstrated so effectively almost five decades ago
is that character education is essential to any well-rounded system of
education. We can work together to help ensure that all children in
America will start school ready to learn. We can pool our efforts--
parents, teachers, community leaders, and elected officials--to enable
our students to be first in the world in scientific and academic
achievement. But I believe the greatest gift and most effective tool we
can give to our children is to instill in them, from the beginning, the
values and beliefs which help mold their character. Character is the
essential building block in each youngster's journey to become a
responsible, moral adult. It is the gift my teachers gave me when they
offered me a first-rate education which addressed not only matters of
the head, but of the heart as well.
Thanks, in part, to the efforts of my distinguished colleagues,
Senators Domenici and Dodd, character education has spread into
thousands of classrooms throughout this nation. In 1994, Senator
Domenici with the support of Senators Dodd and Mikulski offered a
successful amendment to the Improving America's Schools Act which
established, for the first time ever, a grant program in the Department
of Education to enable State education agencies, in partnership with
local education agencies, to develop character education programs. My
State of Georgia was one of the first to receive funding under the
Partnerships in Character Education Pilot Projects. Since its inception
in 1995, this program has awarded more than $25 million to 37 States
throughout the country. I am proud to join my colleagues today in
introducing legislation to expand this worthy program which encourages
schools and communities to develop and sustain character education
programs of excellence.

[[Page S1331]]

It has been said that the character of a nation is only as strong as
the character of its individual citizens. In illustration of this
truth, I like to tell a true story which happened decades ago during
the war in Korea. At that time, one of our generals was captured by the
Communists. He was taken to an isolated prison camp and told that he
had but a few minutes to write a letter to his family. The implication
was that he was to be executed shortly. The general's letter was brief
and to the point: ``Tell Bill,'' he wrote, ``the word is integrity.''
The word is indeed integrity. This following Monday, Presidents' Day,
I will host a Summit on Character at the State Capitol in Georgia,
which will be attended by State leaders from across the political and
social spectrum. The purpose of the Summit is to rekindle the American
spirit that motivated the Founders in constituting our nation and to
inspire Georgians to develop the highest standards of character in
themselves and in the youth of our State. Benjamin Franklin once said
that ``The noblest question in the world is, What good may I do in
it?'' The Character Summit in Georgia has this in common with the
legislation we are introducing today: They both seek to encourage moral
character and civic virtue in our children--America's most precious
resource and the future of this great Nation.
______

By Mr. GRASSLEY (for himself, Mr. Baucus, Mr. Roberts, Mr.
Conrad, Mr. Brownback, Mrs. Lincoln, Mr. Burns, Mr. Craig, Mr.
Lugar, Mr. Enzi, Mr. Nelson of Nebraska, and Mr. Stevens):
S. 312. A bill to amend the Internal Revenue Code of 1986 to provide
tax relief for farmers and fishermen, and for other purposes; to the
Committee on Finance.
______

By Mr. GRASSLEY (for himself, Mr. Baucus, Mr. Roberts, Mrs.
Hutchison, Mr. Burns, Mr. Breaux, Mr. Hatch, Mr. Craig, Mr.
Allard, Mr. Lugar, Mr. Gramm, Mr. Hagel, Mr. Bunning, Mr.
DeWine, Mr. Bond, Mr. Fitzgerald, Mr. Conrad, Mr. Murkowski,
Mr. Stevens, Mr. Kyl, Mr. Brownback, and Mr. Sessions).
S. 313. A bill to amend the Internal Revenue Code of 1986 to provide
for Farm, Fishing, and Ranch Risk Management Accounts, and for other
purposes; to the Committee on Finance.
______

By Mr. GRASSLEY:
S. 314. A bill to amend the Internal Revenue Code of 1986 to provide
declaratory judgement relief for section 521 cooperatives; to the
Committee on Finance.
Mr. GRASSLEY. Mr. President, I would like to discuss legislation I'm
offering today on behalf of myself and Senators Baucus, Brownback,
Burns, Lugar, Roberts, Craig, Enzi, and Nelson from Nebraska this
afternoon. It will assist millions of farmers across the nation. I've
named the bill the Tax Empowerment and Relief for Farmers and Fishermen
Act, or what I will refer to as TERFF.
I'm a farmer, like my father was before me. I understand farming and
how policy decisions from Washington impact hardworking farmers, like
my son Robin. Before I ran for elected office and after I leave, God
willing, I'll still be farming. There is little that I feel more
strongly about than providing the agriculture community potential to
survive and thrive. As far as I'm concerned, agriculture is my ``terf''
and as long as I'm in this town, I'll do all I can to serve my friends
and neighbors in the agriculture community.
This legislation has already been adopted by the Senate multiple
times. In the midst of a serious downturn in the agriculture economy,
it seems to me we ought to be doing everything we can to help farmers,
and this would provide significant assistance.
For example, my agriculture tax package will include:
The Farm, Fish, and Ranch Risk Management Accounts--these farmer
saving accounts would allow farmers to contribute up to 20 percent of
their income in an account, and deduct it in the same year. Farm
accounts would be a very important risk management tool that will help
farmers put away money when there's actual income, so that, in the bad
times, there will be a safety net. This measure has strong bipartisan
support and was actually sent to President Clinton, who vetoed it.
Farmers who participate in the Conservation Reserve Program CRP, are
unnecessarily struggling during tax season because of a recent case
pushed by the IRS. The latest 6th Circuit court's ruling treats CRP
payments as farm income subject to the additional self employment tax
rate of 15 percent.
Senator Brownback has taken the lead on fixing this problem. This
unfair tax not only ignores the intent of Congress in creating the CRP,
it discourages farmers from using environmentally pro-active measures.
At a time when farmers are struggling to regain their footing
economically and do the right thing environmentally--it's important
that Congress support them by upholding it promise on CRP.
Senator Lugar has led the effort to expand the current program where
companies can donate to food banks, so that farmers and restaurants can
also donate surplus food directly to needy food banks. This will be a
win for the farmers and a big win for people who depend on food bank
assistance.
This was also part of the vetoed tax bill. When we passed income
averaging for farmers a few years ago, we neglected to take into
account the problem of running into the alternative minimum tax, which
many farmers are facing now. My bill will fix this growing problem.
My bill expands opportunities for beginning farmers who are in need
of low interest rate loans for capital purchases of farmland and
equipment.
Current law permits state authorities to issue tax exempt bonds and
to lend the proceeds from the sale of the bonds to beginning farmers
and ranchers to finance the cost of acquiring land, buildings and
equipment used in a farm or ranch operation.
Unfortunately, aggie bonds are subjected to a volume cap and must
compete with big industrial projects for bond allocation. Aggie bonds
share few similarities to industrial revenue bonds and should not be
subjected to the volume cap established for industrial revenue bonds.
Insufficient allocation of funding due to the volume cap limits the
effectiveness of this program. We can't stand by and allow the next
generation of farmers to lose an opportunity to participate in farming
because of competition with industry for reduced interest loan rates.
Recently the IRS determined that some cooperatives should be exposed
to a regular corporate tax due to the fact that they are using organic
value-added practices rather than manufactured value-added practices.
This is unfair, and needs to be fixed.
And of course my package wouldn't be complete without a provision
leveling the playing field for ethanol producers.
The Small Ethanol Producer Credit will allow small cooperative
producers of ethanol to be able to receive the same tax benefits as
large companies. This provision provides cooperatives the ability to
elect to pass through small ethanol producer credits to its patrons.
The ``TERFF'' package will do more to reform taxes for the American
farmer than any other measure in recent memory. I'll be urging my
colleagues to strongly support this measure. It's a bill that should
have the unanimous support it enjoyed last congress on the Senate
floor. As sure as I'm chairman of the Finance Committee, I will push to
have this package passed into law during the 107th Congress. Mr.
President, I ask unanimous consent that the text of these three bills
be printed in the Record.
There being no objection, the bills were ordered to be printed in the
Record, as follows:

S. 312

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

SECTION 1. SHORT TITLE; ETC.

(a) Short Title.--This Act may be cited as the ``Tax
Empowerment and Relief for Farmers and Fishermen (TERFF)
Act''.
(b) Amendment of 1986 Code.--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 Internal
Revenue Code of 1986.
(c) Table of Contents.--

Sec. 1. Short title; etc.

[[Page S1332]]

Sec. 2. Farm, fishing, and ranch risk management accounts.
Sec. 3. Written agreement relating to exclusion of certain farm rental
income from net earnings from self-employment.
Sec. 4. Treatment of conservation reserve program payments as rentals
from real estate.
Sec. 5. Exemption of agricultural bonds from State volume cap.
Sec. 6. Modifications to section 512(b)(13).
Sec. 7. Charitable deduction for contributions of food inventory.
Sec. 8. Income averaging for farmers and fishermen not to increase
alternative minimum tax liability.
Sec. 9. Cooperative marketing includes value-added processing through
animals.
Sec. 10. Declaratory judgment relief for section 521 cooperatives.
Sec. 11. Small ethanol producer credit.
Sec. 12. Payment of dividends on stock of cooperatives without reducing
patronage dividends.

SEC. 2. FARM, FISHING, AND RANCH RISK MANAGEMENT ACCOUNTS.

(a) In General.--Subpart C of part II of subchapter E of
chapter 1 (relating to taxable year for which deductions
taken) is amended by inserting after section 468B the
following new section:

``SEC. 468C. FARM, FISHING, AND RANCH RISK MANAGEMENT
ACCOUNTS.

``(a) Deduction Allowed.--In the case of an individual
engaged in an eligible farming business or commercial
fishing, there shall be allowed as a deduction for any
taxable year the amount paid in cash by the taxpayer during
the taxable year to a Farm, Fishing, and Ranch Risk
Management Account (hereinafter referred to as the `FFARRM
Account').
``(b) Limitation.--
``(1) Contributions.--The amount which a taxpayer may pay
into the FFARRM Account for any taxable year shall not exceed
20 percent of so much of the taxable income of the taxpayer
(determined without regard to this section) which is
attributable (determined in the manner applicable under
section 1301) to any eligible farming business or commercial
fishing.
``(2) Distributions.--Distributions from a FFARRM Account
may not be used to purchase, lease, or finance any new
fishing vessel, add capacity to any fishery, or otherwise
contribute to the overcapitalization of any fishery. The
Secretary of Commerce shall implement regulations to enforce
this paragraph.
``(c) Eligible Businesses.--For purposes of this section--
``(1) Eligible farming business.--The term `eligible
farming business' means any farming business (as defined in
section 263A(e)(4)) which is not a passive activity (within
the meaning of section 469(c)) of the taxpayer.
``(2) Commercial Fishing.--The term `commercial fishing'
has the meaning given such term by section (3) of the
Magnuson-Stevens Fishery Conservation and Management Act (16
U.S.C. 1802) but only if such fishing is not a passive
activity (within the meaning of section 469(c)) of the
taxpayer.
``(d) FFARRM Account.--For purposes of this section--
``(1) In general.--The term `FFARRM Account' means a trust
created or organized in the United States for the exclusive
benefit of the taxpayer, but only if the written governing
instrument creating the trust meets the following
requirements:
``(A) No contribution will be accepted for any taxable year
in excess of the amount allowed as a deduction under
subsection (a) for such year.
``(B) The trustee is a bank (as defined in section 408(n))
or another person who demonstrates to the satisfaction of the
Secretary that the manner in which such person will
administer the trust will be consistent with the requirements
of this section.
``(C) The assets of the trust consist entirely of cash or
of obligations which have adequate stated interest (as
defined in section 1274(c)(2)) and which pay such interest
not less often than annually.
``(D) All income of the trust is distributed currently to
the grantor.
``(E) The assets of the trust will not be commingled with
other property except in a common trust fund or common
investment fund.
``(2) Account taxed as grantor trust.--The grantor of a
FFARRM Account shall be treated for purposes of this title as
the owner of such Account and shall be subject to tax thereon
in accordance with subpart E of part I of subchapter J of
this chapter (relating to grantors and others treated as
substantial owners).
``(e) Inclusion of Amounts Distributed.--
``(1) In general.--Except as provided in paragraph (2),
there shall be includible in the gross income of the taxpayer
for any taxable year--
``(A) any amount distributed from a FFARRM Account of the
taxpayer during such taxable year, and
``(B) any deemed distribution under--
``(i) subsection (f )(1) (relating to deposits not
distributed within 5 years),
``(ii) subsection (f )(2) (relating to cessation in
eligible farming business), and
``(iii) subparagraph (B) or (C) of subsection (f )(3)
(relating to prohibited transactions and pledging account as
security).
``(2) Exceptions.--Paragraph (1)(A) shall not apply to--
``(A) any distribution to the extent attributable to income
of the Account, and
``(B) the distribution of any contribution paid during a
taxable year to a FFARRM Account to the extent that such
contribution exceeds the limitation applicable under
subsection (b) if requirements similar to the requirements of
section 408(d)(4) are met.

For purposes of subparagraph (A), distributions shall be
treated as first attributable to income and then to other
amounts.
``(f ) Special Rules.--
``(1) Tax on deposits in account which are not distributed
within 5 years.--
``(A) In general.--If, at the close of any taxable year,
there is a nonqualified balance in any FFARRM Account--
``(i) there shall be deemed distributed from such Account
during such taxable year an amount equal to such balance, and
``(ii) the taxpayer's tax imposed by this chapter for such
taxable year shall be increased by 10 percent of such deemed
distribution.

The preceding sentence shall not apply if an amount equal to
such nonqualified balance is distributed from such Account to
the taxpayer before the due date (including extensions) for
filing the return of tax imposed by this chapter for such
year (or, if earlier, the date the taxpayer files such return
for such year).
``(B) Nonqualified balance.--For purposes of subparagraph
(A), the term `nonqualified balance' means any balance in the
Account on the last day of the taxable year which is
attributable to amounts deposited in such Account before the
4th preceding taxable year.
``(C) Ordering rule.--For purposes of this paragraph,
distributions from a FFARRM Account (other than distributions
of current income) shall be treated as made from deposits in
the order in which such deposits were made, beginning with
the earliest deposits.
``(2) Cessation in eligible business.--At the close of the
first disqualification period after a period for which the
taxpayer was engaged in an eligible farming business or
commercial fishing, there shall be deemed distributed from
the FFARRM Account of the taxpayer an amount equal to the
balance in such Account (if any) at the close of such
disqualification period. For purposes of the preceding
sentence, the term `disqualification period' means any period
of 2 consecutive taxable years for which the taxpayer is not
engaged in an eligible farming business or commercial
fishing.
``(3) Certain rules to apply.--Rules similar to the
following rules shall apply for purposes of this section:
``(A) Section 220(f )(8) (relating to treatment on death).
``(B) Section 408(e)(2) (relating to loss of exemption of
account where individual engages in prohibited transaction).
``(C) Section 408(e)(4) (relating to effect of pledging
account as security).
``(D) Section 408(g) (relating to community property laws).
``(E) Section 408(h) (relating to custodial accounts).
``(4) Time when payments deemed made.--For purposes of this
section, a taxpayer shall be deemed to have made a payment to
a FFARRM Account on the last day of a taxable year if such
payment is made on account of such taxable year and is made
on or before the due date (without regard to extensions) for
filing the return of tax for such taxable year.
``(5) Individual.--For purposes of this section, the term
`individual' shall not include an estate or trust.
``(6) Deduction not allowed for self-employment tax.--The
deduction allowable by reason of subsection (a) shall not be
taken into account in determining an individual's net
earnings from self-employment (within the meaning of section
1402(a)) for purposes of chapter 2.
``(g) Reports.--The trustee of a FFARRM Account shall make
such reports regarding such Account to the Secretary and to
the person for whose benefit the Account is maintained with
respect to contributions, distributions, and such other
matters as the Secretary may require under regulations. The
reports required by this subsection shall be filed at such
time and in such manner and furnished to such persons at such
time and in such manner as may be required by such
regulations.''.
(b) Tax on Excess Contributions.--
(1) Subsection (a) of section 4973 (relating to tax on
excess contributions to certain tax-favored accounts and
annuities) is amended by striking ``or'' at the end of
paragraph (3), by redesignating paragraph (4) as paragraph
(5), and by inserting after paragraph (3) the following new
paragraph:
``(4) a FFARRM Account (within the meaning of section
468C(d)), or''.
(2) Section 4973 is amended by adding at the end the
following new subsection:
``(g) Excess Contributions to FFARRM Accounts.--For
purposes of this section, in the case of a FFARRM Account
(within the meaning of section 468C(d)), the term `excess
contributions' means the amount by which the amount
contributed for the taxable year to the Account exceeds the
amount which may be contributed to the Account under section
468C(b) for such taxable year. For purposes of this
subsection, any contribution which is distributed out of the
FFARRM Account in a distribution to which section
468C(e)(2)(B) applies shall be treated as an amount not
contributed.''.
(3) The section heading for section 4973 is amended to read
as follows:

[[Page S1333]]

``SEC. 4973. EXCESS CONTRIBUTIONS TO CERTAIN ACCOUNTS,
ANNUITIES, ETC.''.

(4) The table of sections for chapter 43 is amended by
striking the item relating to section 4973 and inserting the
following new item:

``Sec. 4973. Excess contributions to certain accounts, annuities,
etc.''.

(c) Tax on Prohibited Transactions.--
(1) Subsection (c) of section 4975 (relating to tax on
prohibited transactions) is amended by adding at the end the
following new paragraph:
``(6) Special rule for ffarrm accounts.--A person for whose
benefit a FFARRM Account (within the meaning of section
468C(d)) is established shall be exempt from the tax imposed
by this section with respect to any transaction concerning
such account (which would otherwise be taxable under this
section) if, with respect to such transaction, the account
ceases to be a FFARRM Account by reason of the application of
section 468C(f )(3)(A) to such account.''.
(2) Paragraph (1) of section 4975(e) is amended by
redesignating subparagraphs (E) and (F) as subparagraphs (F)
and (G), respectively, and by inserting after subparagraph
(D) the following new subparagraph:
``(E) a FFARRM Account described in section 468C(d),''.
(d) Failure To Provide Reports on FFARRM Accounts.--
Paragraph (2) of section 6693(a) (relating to failure to
provide reports on certain tax-favored accounts or annuities)
is amended by redesignating subparagraphs (C) and (D) as
subparagraphs (D) and (E), respectively, and by inserting
after subparagraph (B) the following new subparagraph:
``(C) section 468C(g) (relating to FFARRM Accounts),''.
(e) Clerical Amendment.--The table of sections for subpart
C of part II of subchapter E of chapter 1 is amended by
inserting after the item relating to section 468B the
following new item:

``Sec. 468C. Farm, Fishing and Ranch Risk Management Accounts.''.

(f ) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2001.

SEC. 3. WRITTEN AGREEMENT RELATING TO EXCLUSION OF CERTAIN
FARM RENTAL INCOME FROM NET EARNINGS FROM SELF-
EMPLOYMENT.

(a) Internal Revenue Code.--Section 1402(a)(1)(A) (relating
to net earnings from self-employment) is amended by striking
``an arrangement'' and inserting ``a lease agreement''.
(b) Social Security Act.--Section 211(a)(1)(A) of the
Social Security Act is amended by striking ``an arrangement''
and inserting ``a lease agreement''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2001.

SEC. 4. TREATMENT OF CONSERVATION RESERVE PROGRAM PAYMENTS AS
RENTALS FROM REAL ESTATE.

(a) In General.--Section 1402(a)(1) (defining net earnings
from self-employment) is amended by inserting ``and including
payments under section 1233(2) of the Food Security Act of
1985 (16 U.S.C. 3833(2))'' after ``crop shares''.
(b) Effective Date.--The amendment made by this section
shall apply to payments made after December 31, 2001.

SEC. 5. EXEMPTION OF AGRICULTURAL BONDS FROM STATE VOLUME
CAP.

(a) In General.--Section 146(g) (relating to exception for
certain bonds) is amended by striking ``and'' at the end of
paragraph (3), by striking the period at the end of paragraph
(4) and inserting ``, and'', and by inserting after paragraph
(4) the following new paragraph:
``(5) any qualified small issue bond described in section
144(a)(12)(B)(ii).''.
(b) Effective Date.--The amendments made by this section
shall apply to bonds issued after December 31, 2001.

SEC. 6. MODIFICATIONS TO SECTION 512(B)(13).

(a) In General.--Paragraph (13) of section 512(b) is
amended by redesignating subparagraph (E) as subparagraph (F)
and by inserting after subparagraph (D) the following new
paragraph:
``(E) Paragraph to apply only to excess payments.--
``(i) In general.--Subparagraph (A) shall apply only to the
portion of a specified payment received by the controlling
organization that exceeds the amount which would have been
paid if such payment met the requirements prescribed under
section 482.
``(ii) Addition to tax for valuation misstatements.--The
tax imposed by this chapter on the controlling organization
shall be increased by an amount equal to 20 percent of such
excess.''.
(b) Effective Date.--
(1) In general.--The amendment made by this section shall
apply to payments received or accrued after December 31,
2000.
(2) Payments subject to binding contract transition rule.--
If the amendments made by section 1041 of the Taxpayer Relief
Act of 1997 did not apply to any amount received or accrued
in the first 2 taxable years beginning on or after the date
of the enactment of this Act under any contract described in
subsection (b)(2) of such section, such amendments also shall
not apply to amounts received or accrued under such contract
before January 1, 2001.

SEC. 7. CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF FOOD
INVENTORY.

(a) In General.--Subsection (e) of section 170 (relating to
certain contributions of ordinary income and capital gain
property) is amended by adding at the end the following new
paragraph:
``(7) Special rule for contributions of food inventory.--
For purposes of this section--
``(A) Contributions by non-corporate taxpayers.--In the
case of a charitable contribution of food by a taxpayer,
paragraph (3)(A) shall be applied without regard to whether
or not the contribution is made by a corporation.
``(B) Limit on reduction.--In the case of a charitable
contribution of food which is a qualified contribution
(within the meaning of paragraph (3)(A), as modified by
subparagraph (A) of this paragraph)--
``(i) paragraph (3)(B) shall not apply, and
``(ii) the reduction under paragraph (1)(A) for such
contribution shall be no greater than the amount (if any) by
which the amount of such contribution exceeds twice the basis
of such food.
``(C) Determination of basis.--For purposes of this
paragraph, if a taxpayer uses the cash method of accounting,
the basis of any qualified contribution of such taxpayer
shall be deemed to be 50 percent of the fair market value of
such contribution.
``(D) Determination of fair market value.--In the case of a
charitable contribution of food which is a qualified
contribution (within the meaning of paragraph (3), as
modified by subparagraphs (A) and (B) of this paragraph) and
which, solely by reason of internal standards of the
taxpayer, lack of market, or similar circumstances, or which
is produced by the taxpayer exclusively for the purposes of
transferring the food to an organization described in
paragraph (3)(A), cannot or will not be sold, the fair market
value of such contribution shall be determined--
``(i) without regard to such internal standards, such lack
of market, such circumstances, or such exclusive purpose, and
``(ii) if applicable, by taking into account the price at
which the same or similar food items are sold by the taxpayer
at the time of the contribution (or, if not so sold at such
time, in the recent past).
``(E) Termination.--This paragraph shall not apply to any
contribution made during any taxable year beginning after
December 31, 2004.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2001.

SEC. 8. INCOME AVERAGING FOR FARMERS AND FISHERMEN NOT TO
INCREASE ALTERNATIVE MINIMUM TAX LIABILITY.

(a) In General.--Section 55(c) (defining regular tax) is
amended by redesignating paragraph (2) as paragraph (3) and
by inserting after paragraph (1) the following new paragraph:
``(2) Coordination with income averaging for farmers and
fishermen.--Solely for purposes of this section, section 1301
(relating to averaging of farm and fishing income) shall not
apply in computing the regular tax.''.
(b) Allowing Income Averaging for Fishermen.--
(1) In general.--Section 1301(a) is amended by striking
``farming business'' and inserting ``farming business or
fishing business''.
(2) Definition of elected farm income.--
(A) In general.--Clause (i) of section 1301(b)(1)(A) is
amended by inserting ``or fishing business'' before the
semicolon.
(B) Conforming amendment.--Subparagraph (B) of section
1301(b)(1) is amended by inserting ``or fishing business''
after ``farming business'' both places it occurs.
(3) Definition of fishing business.--Section 1301(b) is
amended by adding at the end the following new paragraph:
``(4) Fishing business.--The term `fishing business' means
the conduct of commercial fishing as defined in section 3 of
the Magnuson-Stevens Fishery Conservation and Management Act
(16 U.S.C. 1802).''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2001.

SEC. 9. COOPERATIVE MARKETING INCLUDES VALUE-ADDED PROCESSING
THROUGH ANIMALS.

(a) In General.--Section 1388 (relating to definitions and
special rules) is amended by adding at the end the following
new subsection:
``(k) Cooperative Marketing Includes Value-Added Processing
Through Animals.--For purposes of section 521 and this
subchapter, the term `marketing the products of members or
other producers' includes feeding the products of members or
other producers to cattle, hogs, fish, chickens, or other
animals and selling the resulting animals or animal
products.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.

SEC. 10. DECLARATORY JUDGMENT RELIEF FOR SECTION 521
COOPERATIVES.

(a) In General.--Section 7428(a)(1) (relating to
declaratory judgments of tax exempt organizations) is amended
by striking ``or'' at the end of subparagraph (B) and by
adding at the end the following new subparagraph:
``(D) with respect to the initial qualification or
continuing qualification of a cooperative as described in
section 521(b) which is exempt from tax under section 521(a),
or''.
(b) Effective Date.--The amendments made by this section
shall apply with respect

[[Page S1334]]

to pleadings filed after the date of the enactment of this
Act but only with respect to determinations (or requests for
determinations) made after January 1, 2001.

SEC. 11. SMALL ETHANOL PRODUCER CREDIT.

(a) Allocation of Alcohol Fuels Credit to Patrons of a
Cooperative.--Section 40(g) (relating to alcohol used as
fuel) is amended by adding at the end the following new
paragraph:
``(6) Allocation of small ethanol producer credit to
patrons of cooperative.--
``(A) Election to allocate.--
``(i) In general.--In the case of a cooperative
organization described in section 1381(a), any portion of the
credit determined under subsection (a)(3) for the taxable
year may, at the election of the organization, be apportioned
pro rata among patrons of the organization on the basis of
the quantity or value of business done with or for such
patrons for the taxable year.
``(ii) Form and effect of election.--An election under
clause (i) for any taxable year shall be made on a timely
filed return for such year. Such election, once made, shall
be irrevocable for such taxable year.
``(B) Treatment of organizations and patrons.--The amount
of the credit apportioned to patrons under subparagraph (A)--
``(i) shall not be included in the amount determined under
subsection (a) with respect to the organization for the
taxable year,
``(ii) shall be included in the amount determined under
subsection (a) for the taxable year of each patron for which
the patronage dividends for the taxable year described in
subparagraph (A) are included in gross income, and
``(iii) shall be included in gross income of such patrons
for the taxable year in the manner and to the extent provided
in section 87.
``(C) Special rules for decrease in credits for taxable
year.--If the amount of the credit of a cooperative
organization determined under subsection (a)(3) for a taxable
year is less than the amount of such credit shown on the
return of the cooperative organization for such year, an
amount equal to the excess of--
``(i) such reduction, over
``(ii) the amount not apportioned to such patrons under
subparagraph (A) for the taxable year,

shall be treated as an increase in tax imposed by this
chapter on the organization. Such increase shall not be
treated as tax imposed by this chapter for purposes of
determining the amount of any credit under this subpart or
subpart A, B, E, or G.''.
(b) Improvements to Small Ethanol Producer Credit.--
(1) Definition of small ethanol producer.--Section 40(g)
(relating to definitions and special rules for eligible small
ethanol producer credit) is amended by striking
``30,000,000'' each place it appears and inserting
``60,000,000''.
(2) Small ethanol producer credit not a passive activity
credit.--Clause (i) of section 469(d)(2)(A) is amended by
striking ``subpart D'' and inserting ``subpart D, other than
section 40(a)(3),''.
(3) Allowing credit against minimum tax.--
(A) In general.--Subsection (c) of section 38 (relating to
limitation based on amount of tax) is amended by
redesignating paragraph (3) as paragraph (4) and by inserting
after paragraph (2) the following new paragraph:
``(3) Special rules for small ethanol producer credit.--
``(A) In general.--In the case of the small ethanol
producer credit--
``(i) this section and section 39 shall be applied
separately with respect to the credit, and
``(ii) in applying paragraph (1) to the credit--

``(I) subparagraphs (A) and (B) thereof shall not apply,
and
``(II) the limitation under paragraph (1) (as modified by
subclause (I)) shall be reduced by the credit allowed under
subsection (a) for the taxable year (other than the small
ethanol producer credit).

``(B) Small ethanol producer credit.--For purposes of this
subsection, the term `small ethanol producer credit' means
the credit allowable under subsection (a) by reason of
section 40(a)(3).''.
(B) Conforming amendment.--Subclause (II) of section
38(c)(2)(A)(ii) is amended by striking ``(other'' and all
that follows through ``credit)'' and inserting ``(other than
the empowerment zone employment credit or the small ethanol
producer credit)''.
(4) Small ethanol producer credit not added back to income
under section 87.--Section 87 (relating to income inclusion
of alcohol fuel credit) is amended to read as follows:

``SEC. 87. ALCOHOL FUEL CREDIT.

``Gross income includes an amount equal to the sum of--
``(1) the amount of the alcohol mixture credit determined
with respect to the taxpayer for the taxable year under
section 40(a)(1), and
``(2) the alcohol credit determined with respect to the
taxpayer for the taxable year under section 40(a)(2).''.
(c) Conforming Amendment.--Section 1388 (relating to
definitions and special rules for cooperative organizations),
as amended by section 9, is amended by adding at the end the
following new subsection:
``(l) Cross Reference.--For provisions relating to the
apportionment of the alcohol fuels credit between cooperative
organizations and their patrons, see section 40(g)(6).''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.

SEC. 12. PAYMENT OF DIVIDENDS ON STOCK OF COOPERATIVES
WITHOUT REDUCING PATRONAGE DIVIDENDS.

(a) In General.--Subsection (a) of section 1388 (relating
to patronage dividend defined) is amended by adding at the
end the following new sentence: ``For purposes of paragraph
(3), net earnings shall not be reduced by amounts paid during
the year as dividends on capital stock or other proprietary
capital interests of the organization to the extent that the
articles of incorporation or bylaws of such organization or
other contract with patrons provide that such dividends are
in addition to amounts otherwise payable to patrons which are
derived from business done with or for patrons during the
taxable year.''.
(b) Effective Date.--The amendment made by this section
shall apply to distributions in taxable years beginning after
the date of the enactment of this Act.
____

S. 313

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

SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

(a) Short Title.--This Act may be cited as the ``Farm,
Fishing, and Ranch Risk Management Act''.
(b) Amendment of 1986 Code.--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 Internal
Revenue Code of 1986.

SEC. 2. FARM, FISHING, AND RANCH RISK MANAGEMENT ACCOUNTS.

(a) In General.--Subpart C of part II of subchapter E of
chapter 1 (relating to taxable year for which deductions
taken) is amended by inserting after section 468B the
following new section:

``SEC. 468C. FARM, FISHING, AND RANCH RISK MANAGEMENT
ACCOUNTS.

``(a) Deduction Allowed.--In the case of an individual
engaged in an eligible farming business or commercial
fishing, there shall be allowed as a deduction for any
taxable year the amount paid in cash by the taxpayer during
the taxable year to a Farm, Fishing, and Ranch Risk
Management Account (hereinafter referred to as the `FFARRM
Account').
``(b) Limitation.--
``(1) Contributions.--The amount which a taxpayer may pay
into the FFARRM Account for any taxable year shall not exceed
20 percent of so much of the taxable income of the taxpayer
(determined without regard to this section) which is
attributable (determined in the manner applicable under
section 1301) to any eligible farming business or commercial
fishing.
``(2) Distributions.--Distributions from a FFARRM Account
may not be used to purchase, lease, or finance any new
fishing vessel, add capacity to any fishery, or otherwise
contribute to the overcapitalization of any fishery. The
Secretary of Commerce shall implement regulations to enforce
this paragraph.
``(c) Eligible Businesses.--For purposes of this section--
``(1) Eligible farming business.--The term `eligible
farming business' means any farming business (as defined in
section 263A(e)(4)) which is not a passive activity (within
the meaning of section 469(c)) of the taxpayer.
``(2) Commercial fishing.--The term `commercial fishing'
has the meaning given such term by section (3) of the
Magnuson-Stevens Fishery Conservation and Management Act (16
U.S.C. 1802) but only if such fishing is not a passive
activity (within the meaning of section 469(c)) of the
taxpayer.
``(d) FFARRM Account.--For purposes of this section--
``(1) In general.--The term `FFARRM Account' means a trust
created or organized in the United States for the exclusive
benefit of the taxpayer, but only if the written governing
instrument creating the trust meets the following
requirements:
``(A) No contribution will be accepted for any taxable year
in excess of the amount allowed as a deduction under
subsection (a) for such year.
``(B) The trustee is a bank (as defined in section 408(n))
or another person who demonstrates to the satisfaction of the
Secretary that the manner in which such person will
administer the trust will be consistent with the requirements
of this section.
``(C) The assets of the trust consist entirely of cash or
of obligations which have adequate stated interest (as
defined in section 1274(c)(2)) and which pay such interest
not less often than annually.
``(D) All income of the trust is distributed currently to
the grantor.
``(E) The assets of the trust will not be commingled with
other property except in a common trust fund or common
investment fund.
``(2) Account taxed as grantor trust.--The grantor of a
FFARRM Account shall be treated for purposes of this title as
the owner of such Account and shall be subject to tax thereon
in accordance with subpart E of part I of subchapter J
of this chapter (relating to grantors and others treated
as substantial owners).
``(e) Inclusion of Amounts Distributed.--

[[Page S1335]]

``(1) In general.--Except as provided in paragraph (2),
there shall be includible in the gross income of the taxpayer
for any taxable year--
``(A) any amount distributed from a FFARRM Account of the
taxpayer during such taxable year, and
``(B) any deemed distribution under--
``(i) subsection (f )(1) (relating to deposits not
distributed within 5 years),
``(ii) subsection (f )(2) (relating to cessation in
eligible farming business), and
``(iii) subparagraph (B) or (C) of subsection (f )(3)
(relating to prohibited transactions and pledging account as
security).
``(2) Exceptions.--Paragraph (1)(A) shall not apply to--
``(A) any distribution to the extent attributable to income
of the Account, and
``(B) the distribution of any contribution paid during a
taxable year to a FFARRM Account to the extent that such
contribution exceeds the limitation applicable under
subsection (b) if requirements similar to the requirements of
section 408(d)(4) are met.

The preceding sentence shall not apply if an amount equal to
such nonqualified balance is distributed from such Account to
the taxpayer before the due date (including extensions) for
filing the return of tax imposed by this chapter for such
year (or, if earlier, the date the taxpayer files such return
for such year).
``(B) Nonqualified balance.--For purposes of subparagraph
(A), the term `nonqualified balance' means any balance in the
Account on the last day of the taxable year which is
attributable to amounts deposited in such Account before the
4th preceding taxable year.
``(C) Ordering rule.--For purposes of this paragraph,
distributions from a FFARRM Account (other than distributions
of current income) shall be treated as made from deposits in
the order in which such deposits were made, beginning with
the earliest deposits.
``(2) Cessation in eligible business.--At the close of the
first disqualification period after a period for which the
taxpayer was engaged in an eligible farming business or
commercial fishing, there shall be deemed distributed from
the FFARRM Account of the taxpayer an amount equal to the
balance in such Account (if any) at the close of such
disqualification period. For purposes of the preceding
sentence, the term `disqualification period' means any period
of 2 consecutive taxable years for which the taxpayer is not
engaged in an eligible farming business or commercial
fishing.
``(3) Certain rules to apply.--Rules similar to the
following rules shall apply for purposes of this section:
``(A) Section 220(f )(8) (relating to treatment on death).
``(B) Section 408(e)(2) (relating to loss of exemption of
account where individual engages in prohibited transaction).
``(C) Section 408(e)(4) (relating to effect of pledging
account as security).
``(D) Section 408(g) (relating to community property laws).
``(E) Section 408(h) (relating to custodial accounts).
``(4) Time when payments deemed made.--For purposes of this
section, a taxpayer shall be deemed to have made a payment to
a FFARRM Account on the last day of a taxable year if such
payment is made on account of such taxable year and is made
on or before the due date (without regard to extensions) for
filing the return of tax for such taxable year.
``(5) Individual.--For purposes of this section, the term
`individual' shall not include an estate or trust.
``(6) Deduction not allowed for self-employment tax.--The
deduction allowable by reason of subsection (a) shall not be
taken into account in determining an individual's net
earnings from self-employment (within the meaning of section
1402(a)) for purposes of chapter 2.
``(g) Reports.--The trustee of a FFARRM Account shall make
such reports regarding such Account to the Secretary and to
the person for whose benefit the Account is maintained with
respect to contributions, distributions, and such other
matters as the Secretary may require under regulations. The
reports required by this subsection shall be filed at such
time and in such manner and furnished to such persons at such
time and in such manner as may be required by such
regulations.''
(b) Tax on Excess Contributions.--
(1) Subsection (a) of section 4973 (relating to tax on
excess contributions to certain tax-favored accounts and
annuities) is amended by striking ``or'' at the end of
paragraph (3), by redesignating paragraph (4) as paragraph
(5), and by inserting after paragraph (3) the following new
paragraph:
``(4) a FFARRM Account (within the meaning of section
468C(d)), or''.
(2) Section 4973 is amended by adding at the end the
following new subsection:
``(g) Excess Contributions to FFARRM Accounts.--For
purposes of this section, in the case of a FFARRM Account
(within the meaning of section 468C(d)), the term `excess
contributions' means the amount by which the amount
contributed for the taxable year to the Account exceeds the
amount which may be contributed to the Account under section
468C(b) for such taxable year. For purposes of this
subsection, any contribution which is distributed out of the
FFARRM Account in a distribution to which section
468C(e)(2)(B) applies shall be treated as an amount not
contributed.''
(3) The section heading for section 4973 is amended to read
as follows:

``SEC. 4973. EXCESS CONTRIBUTIONS TO CERTAIN ACCOUNTS,
ANNUITIES, ETC.''

(4) The table of sections for chapter 43 is amended by
striking the item relating to section 4973 and inserting the
following new item:

``Sec. 4973. Excess contributions to certain accounts, annuities,
etc.''

(c) Tax on Prohibited Transactions.--
(1) Subsection (c) of section 4975 (relating to tax on
prohibited transactions) is amended by adding at the end the
following new paragraph:
``(6) Special rule for ffarrm accounts.--A person for whose
benefit a FFARRM Account (within the meaning of section
468C(d)) is established shall be exempt from the tax imposed
by this section with respect to any transaction concerning
such account (which would otherwise be taxable under this
section) if, with respect to such transaction, the account
ceases to be a FFARRM Account by reason of the application of
section 468C(f )(3)(A) to such account.''
(2) Paragraph (1) of section 4975(e) is amended by
redesignating subparagraphs (E) and (F) as subparagraphs (F)
and (G), respectively, and by inserting after subparagraph
(D) the following new subparagraph:
``(E) a FFARRM Account described in section 468C(d),''.
(d) Failure To Provide Reports on FFARRM Accounts.--
Paragraph (2) of section 6693(a) (relating to failure to
provide reports on certain tax-favored accounts or annuities)
is amended by redesignating subparagraphs (C) and (D) as
subparagraphs (D) and (E), respectively, and by inserting
after subparagraph (B) the following new subparagraph:
``(C) section 468C(g) (relating to FFARRM Accounts),''.
(e) Clerical Amendment.--The table of sections for subpart
C of part II of subchapter E of chapter 1 is amended by
inserting after the item relating to section 468B the
following new item:

``Sec. 468C. Farm, Fishing and Ranch Risk Management Accounts.''

(f ) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2001.
____

S. 314

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

SECTION 1. DECLARATORY JUDGMENT RELIEF FOR SECTION 521
COOPERATIVES.

(a) In General.--Section 7428(a)(1) of the Internal Revenue
Code of 1986 (relating to declaratory judgments of tax exempt
organizations) is amended by striking ``or'' at the end of
subparagraph (B) and by adding at the end the following new
subparagraph:
``(D) with respect to the initial qualification or
continuing qualification of a cooperative as described in
section 521(b) which is exempt from tax under section 521(a),
or''.
(b) Effective Date.--The amendments made by this section
shall apply with respect to pleadings filed after the date of
the enactment of this Act but only with respect to
determinations (or requests for determinations) made after
January 1, 2001.

Mr. BURNS. Mr. President, I rise today to join Senator Grassley and
others to introduce the TERFF Act, Tax Empowerment and Relief for
Farmers and Fisherman.
This bill includes several provisions providing tax relief that will
help our nation's farmers.
First, this bill will create FFARRM, Farm, Fish and Ranch Risk
Management, Accounts that will provide farmers, ranchers and fishermen
with additional money management tools. Agricultural producers will be
allowed to contribute up to 20 percent of their annual income into
these accounts. The tax on this income will be deferred for up to five
years or until the depositor withdraws the money.
The bill will amend the tax code to ensure that farm cash rents are
not subject to an additional 15 percent self-employment tax.
Additionally, the bill will ensure CRP, Conservation Reserve Program,
payments are not subject to the same self-employment tax. I have also
co-sponsored a similar CRP bill with Senator Brownback from Kansas.
The bill will also enable States to expand opportunities for
beginning farmers who are in need of low interest

[[Page S1336]]

loans for capital purchases of farmland and equipment.
The bill provides that interest, rent and royalty payment made by a
subsidiary to a non-profit are not subject to a unrelated business
income taxes. The bill provides a tax deduction to farmers and ranchers
who donate food to hunger relief organizations.
The bill will correct a problem experienced by farmers who use income
averaging by ensuring that farmers are not disqualified from using
income averaging due to the alternative minimum tax, AMT, calculation.
The bill would reapply taxes on cooperatives using animal value-added
practices in the same way as cooperatives using manufactured value-
added practices. Furthermore, it would allow cooperative producers of
ethanol to receive the same tax benefits as large corporations. The
bill will also allow farmer cooperatives to use preferred stock to
raise equity capital.
This bill will help our nation's farmers and ranchers. The
agriculture sector of our nation's economy needs the relief.
Mr. ENZI. Mr. President, I rise to introduce legislation to address a
concern of farmers in my State of Wyoming and throughout the United
States. This legislation, which I am introducing with the distinguished
chairman of the Finance Committee, Senator Grassley, as well as the
senior Senator from North Dakota, Mr. Conrad, is designed to clarify a
provision in the Internal Revenue Code and its accompanying regulations
which has been broadly interpreted to impose self-employment (SE) taxes
on rental income from real estate even though such income was generally
designed to be exempt from SE taxes.
Under Section 1402(a)(1) of the Internal Revenue Code, rental income
from real estate was only intended to be subject to the SE taxes when,
one, the income is from an arrangement between an owner and lessee
that, two, requires the lessee to produce agricultural or horticultural
commodities on the land; and, three, there shall be material
participation by the owner or tenant with respect to any such
agricultural or horticultural commodities. The problem all goes back to
ambiguity of the term ``arrangement'' in this section. This section has
been interpreted to by the IRS to apply not only to the specific lease
agreement itself, but also to other extraneous production or management
arrangements between the owner and his lessee. Accordingly, the IRS has
hit many small self-employed farmers with a tax penalty that they never
expected and which was never envisioned when Congress wrote the section
of the Internal Revenue Code in question.
The legislation I am introducing today clarifies this section by
replacing the term ``arrangement'' with ``agreement,'' indicating that
the lease agreement itself must specify the requisite responsibilities
of the owner in order to be subject to the SE tax. As in so much of
what we do here, a small change in words can have a dramatic impact on
people's lives. By clarifying what I believe was intended by Congress
all along, we will save numerous farmers the heartache and expense of
litigating with the IRS over whether rental income from their real
estate is subject to SE tax. This small change in the tax code will
provide considerable tax relief to farmers in my home State of Wyoming
and throughout the United States. I thank Chairman Grassley for his
support of this important legislation and I urge my colleagues to enact
this important relief for America's family farmers.
______

By Mr. BROWNBACK (for himself, Mr. Dorgan, Mr. Daschle, Mr.
Lugar, Mr. Levin, Mr. Roberts, Mr. Burns, Mr. Jeffords, Mr.
Baucus, Mr. DeWine, Mr. Harkin, Mr. Craig, Mr. Johnson, Mr.
Leahy, Mr. Bingaman, and Mr. Bond):
S. 315. A bill to amend the Internal Revenue Code of 1986 to treat
payments under the Conservation Reserve program as rentals from real
estate; to the Committee on Finance.
Mr. BROWNBACK. Mr. President, I am speaking on a bill that I put in
today, along with several cosponsors, regarding the Conservation
Reserve Program Tax Fairness Act.
To be a farmer today, you really need to be an optimist--about the
weather, about farm prices, about our rapidly changing economy. But one
thing farmers should not have to worry about is being additionally
taxed for participating in a conservation program.
I rise today to introduce the Conservation Reserve Program Tax
Fairness Act of 2001. This bill would simply correct the tax treatment
of one of our nation's most valuable conservation programs so that
there is not a disincentive for farmers to be good stewards of the
land.
I am joined in this effort by Senator Dorgan who has taken an active
role on this issue last year and serves as the lead cosponsor of the
bill this year. This bill is also co-sponsored by Senators Daschle,
Lugar, Levin, Roberts, Burns, Jeffords, Baucus, DeWine, Harkin, Craig,
Johnson, and Leahy.
As you can see, Mr. President, this bill has the bipartisan support
of many in the Senate because it is just common sense. In a time when
the farm economy continues to suffer and conservation efforts are more
important than ever, we should be doing everything we can to make
conservation efforts more appealing, not less. And if there is one
truth that is pretty evident here, it is that if you want less of
something, than tax it. Well, Mr. President, I think we can all agree
that we want more conservation, not less, and therefore, we need to
correct this tax interpretation.
The Conservation Reserve Program, or CRP, has been a great success
for this Nation. The program provides financial incentives for
improving and preserving environmentally sensitive land, taking it out
of production and enhancing its environmental benefit. The CRP program
increases water quality, wildlife habitat and prevents soil erosion--
all factors which have become even more important in light of recent
concerns about nonpoint source pollution in our nation's waterways.
Specifically, this measure clarifies once and for all that CRP
conservation payments from the Government are not subject to self-
employment social security taxes--a rate of up to 15 percent of the
payment amount. Currently, there is confusion over how CRP payments
should be taxed owing to a recent court case in the 6th Circuit Court
of Appeals. This case overturned a 1998 Tax Court ruling that CRP
payments are not subject to Social Security taxes because they are a
rental payment the Government makes in exchange for farmers taking
environmentally sensitive land out of production. Since other rental
payments are exempt from this additional tax, CRP payments were
considered exempt as well.
As a result of this confusion, there is now a discrepancy between
active farmers who take part in CRP, which are now subject to the tax
because it is considered income, and landowners who do not farm but
take part in CRP and are exempt from the tax. Clearly, this is not what
Congress intended when it set up this program.
Furthermore, the new court ruling has inspired the IRS to
aggressively seek back taxes on CRP payments, as far back as the 1996
tax year. That could amount to tens of thousands of dollars for farmers
who are already struggling through economic hard times.
In my State of Kansas alone, $102.7 million in CRP payments were
issued in 1999. Are we really going to tell farmers that this money--
promised them for conservation purposes--will now be additionally taxed
all the way back to 1996? This would amount to a disincentive for
farmers to participate in environmental and conservation programs
because they cannot trust that there won't be some hidden penalty down
the road. Is that the message this body really wants to send?
This tax makes no sense. Since CRP land is not used for agricultural
production, it should not be considered farm income--but rather rental/
real estate income as the Tax Court originally ruled. CRP payments are
different from traditional setaside programs because the program
requires strict adherence to environmental standards. The farmer is
contracting with the Government for an environmental benefit. Why on
Earth would we choose to tax him for it?
We must also consider the state of the farm economy today.
Agriculture

[[Page S1337]]

is one of the few industries in this country which has not been blessed
with a prolonged booming economy. This is the worst possible time to
burden farmers with additional taxes.
This bill received enthusiastic support in the last Congress. In
fact, this measure was approved unanimously in the Senate last year as
part of a larger tax bill, but, unfortunately, was not able to make its
way into law. In addition to strong Senate support, this bill has the
backing of numerous farm groups including: the National Corn Growers,
National Wheat Growers, American Soybean and Cattlemen's Beef
Associations--along with the National Farmer's Union and the American
Farm Bureau.
My colleagues, one of the privileges we have as Members of the Senate
is to be able to correct legislative wrongs that hurt our constituents.
This may be a minor thing in the larger scheme of the tax debate, but
it is of vital importance to our Nation's farmers. I urge you all to
join me in this effort.
If I may summarize, this Conservation Reserve Program Tax Fairness
Act of 2001 is to remove taxation on CRP and put it back to where it
was when the program was first put forward. That program pays farmers
to idle land to be able to build it up, conserve it, to be able to
build wildlife up on these tracts of land. It has been very successful.
What has taken place or occurred is that the IRS has taken farmers to
court and said they should be taxed for self-employment income for CRP
payments, which was never the intent of Congress when it passed that.
That was not to take place. Yet the lower court in that one circuit
ruled that that is, indeed, correct and that they should be taxed a
self-employment tax on that income.
Today Senators Dorgan, Roberts, and myself held a press conference
introducing this bill to clarify this issue and to remove the self-
employment tax on CRP payments. I think this is a key provision. I hope
we are able to move forward on it.
Senator Grassley, chairman of the Finance Committee, is supporting us
in this effort, and he put it in an overall farm tax relief package. At
this time, when we have so much difficulty in the farming economy, it
is important to clarify that we are not going to tax people in a
situation that they should not be taxed in and where it was never
intended for them to be taxed.
This bill previously passed the Senate last year. It has strong
bipartisan support. The list of original cosponsors is as follows:
Senators Daschle, Lugar, Levin, Roberts, Burns, Jeffords, Baucus,
DeWine, Harkin, Craig, Johnson, Leahy, and Bingaman. I hope more will
join us as well. I hope this not only clears the Senate this year, but
gets through to the President.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 315

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Conservation Reserve Program
Tax Fairness Act of 2001''.

SEC. 2. TREATMENT OF CONSERVATION RESERVE PROGRAM PAYMENTS AS
RENTALS FROM REAL ESTATE.

(a) In General.--Section 1402(a)(1) of the Internal Revenue
Code of 1986 (defining net earnings from self-employment) is
amended by inserting ``and including payments under section
1233(2) of the Food Security Act of 1985 (16 U.S.C.
3833(2))'' after ``crop shares''.
(b) Effective Date.--The amendment made by this section
shall apply to payments made before, on, or after the date of
the enactment of this Act.

Mr. DORGAN. Mr. President, I am pleased to join Senator Brownback and
a number of our colleagues today in introducing the Conservation
Reserve Program Tax Fairness Act of 2001. This much-needed legislation
would clarify that Conservation Reserve Program payments received by
farmers are treated for tax purposes as rental payments from real
estate not subject to self-employment taxes.
For over a decade, many farmers have agreed to take out of farm
production environmentally-sensitive lands and place them in the
Conservation Reserve Program (CRP) for an extended period. In return,
these farmers receive an annual rental payment from the Commodity
Credit Corporation of the U.S. Department of Agriculture.
Over the past several years, the IRS has waged an aggressive campaign
to try to re-characterize CRP rental payments as net earnings from
self-employment and subject to self-employment taxes. I believe that
the IRS's position here is dead-wrong.
North Dakota has about 3.3 million acres with $109 million in rental
payments in the CRP program. The IRS's position means that farmers in
North Dakota could be mailed a tax bill from the IRS for more than $16
million in added federal taxes this year alone. A typical North Dakota
farmer with 160 acres in CRP would have a CRP payment of $5,280 and
would owe nearly $800 in self-employment taxes because of the IRS's
ill-advised position. To make matters worse, if the IRS pursues back
taxes on returns filed by farmers in past years, the amount of taxes
owed by individual farmers could amount to thousands of dollars.
I believe that it is absolutely ludicrous for the IRS to load up
farmers with an added tax burden at the very time that our nation's
family farmers are struggling with high fuel costs and record high
fertilizer prices while commodity prices are at record low levels.
Given these circumstances, where are the nation's family farmers
supposed to come up with the $231 million in additional taxes the IRS's
interpretation of CRP rental payments imposes on them?
In our judgment, the Congress never intended this tax result. In
fact, the U.S. Tax Court understood this very point, when it ruled in
1998 that the IRS's interpretation of CRP payments was improper and
that CRP payments are properly treated by farmers as rental payments
and, thus, not subject to self-employment taxes. Regrettably, the U.S.
Tax Court's ruling was later reversed by a federal appellate court as
the IRS continues to litigate the matter.
We think that most of our colleagues understand that the current IRS
position is not what Congress intended, nor is it supportable in law in
our judgment. That's probably why, for example, the Senate unanimously
agreed to an amendment I offered to the marriage penalty reduction bill
last summer that included language to clarify the proper tax treatment
of CRP payments as rentals not subject to self-employment taxes.
However, my amendment with its CRP language and other amendments were
stripped from the final version of that bill and this critical CRP
change was not included in any other tax bills signed into law by the
President in the last Congress.
With the legislation we introduce today, Congress can tell the IRS
that its mistaken effort to treat CRP payments as net earnings from
self-employment will not be allowed to stand. I, along with the other
cosponsors, urge you to support this change by cosponsoring our bill
and working with us to get it added to any major tax legislation passed
by Congress this year.
Mr. BURNS. Mr. President, I rise today to join Senator Brownback and
others to introduce the CRP, Conservation Reserve Program Tax Fairness
Act. This bill will clarify Congressional intent that the CRP was not
intended to be subject to self employment social security taxes.
In a 1999 decision, the 6th Circuit Court of Appeals concluded that
CRP payments could no longer be treated as real estate rental income a
status that would make those payments exempt from social security
taxes.
The CRP provides financial incentives for improving and preserving
environmentally sensitive land--taking it out of production and
enhancing its environmental benefit. The CRP program increases water
quality, wildlife habitat and prevents soil erosion--all factors which
have become even more important in light of recent concerns about
nonpoint source pollution in our nation's waterways.
This case overturned a 1998 Tax Court ruling that CRP payments are
not subject to social security taxes because they are a rental payment
the government makes in exchange for farmers taking environmentally
sensitive land out of production. Since other rental payments are
exempt from this additional tax, CRP payments were considered exempt as
well.

[[Page S1338]]

As a result of this confusion, there is now a discrepancy between
active farmers who take part in CRP--which are now subject to the tax
because it is considered income--and landowners who do not farm but
take part in CRP and are exempt from the tax. Clearly, this is not what
Congress intended when it set up this program.
This bill will allow farmers and ranchers the ability to rest assured
once and for all that conservation payments made by the government will
not be subject to the high tax rate imposed by social security self-
employment--a rate of 15 percent of the payment--in future years. As a
result, working farmers will enjoy the same status as non-farm
landowners in this program which encourages conservation of land, water
and wildlife.
______

By Mr. McCONNELL (for himself, Mr. Gregg, Mr. Frist, Mr. Miller,
Mr. Lott, Mr. DeWine, Mr. Enzi, Mr. Hutchinson, Mr. Sessions,
and Mr. Carper):
S. 316. A bill to provide for teacher liability protection; to the
Committee on the Judiciary.
Mr. McCONNELL. Mr. President, today I rise to introduce, with my
colleagues Senators Gregg, Frist, Miller, Lott, DeWine, Enzi,
Hutchinson, Sessions, and Carper, The Paul D. Coverdell Teacher
Liability Protection Act. This important legislation extends
protections from frivolous lawsuits to teachers, principals,
administrators, and other education professionals who are acting within
the scope of their professional responsibilities.
The Teacher Liability Protection Act builds upon the good work
Congress began in 1997 when it enacted the Volunteer Protection Act. As
you may recall, the Volunteer Protection Act provides liability
protections to individuals serving their communities as volunteers.
After bringing several volunteer protection amendments to the floor
throughout the 1990's and introducing the Volunteer Protection Act
during the 104th Congress, I was honored to work with our colleague,
Senator Paul Coverdell, to steer this measure through the 105th
Congress and have it enacted in 1997.
Now, we need to extend similar liability protections to our nation's
teachers, principals, and education professionals who are responsible
for the safety of our children when they are at school.
Everyone agrees that providing a safe, orderly environment is a
critical component of ensuring that every child is able to reach their
full academic potential. Teachers who are unable to maintain order in
the classroom cannot reasonably be expected to share their knowledge
with their pupils, whether it be in math, science, or literature.
Disruptive, rowdy, and sometimes violent students not only threaten the
immediate safety of their classmates, they threaten the very future of
our children by denying them the opportunity to learn.
Unfortunately, teachers, principals, and other education officials
share an impediment in their efforts to ensure that students can learn
in a safe, orderly learning environment: the fear of lawsuits. All too
often, these hard-working professionals find their reasonable actions
to instill discipline and maintain order are questioned and second
guessed by opportunistic trial lawyers.
Today's teachers will tell you that the threat of litigation is in
the back of their minds and forces them at times to act in a manner
which might not be in the best interests of their students. A 1999
survey of secondary school principals found that 25 percent of the
respondents were involved in lawsuits or out-of-court settlements in
the previous two years--an amazing 270 percent increase from only ten
years earlier. The same survey found that 20 percent of principals
spent 5-10 hours a week in meetings or documenting events in an effort
to avoid litigation. This is time that our educators should spend
counseling students, developing curriculum, and maintaining order--not
fending off frivolous lawsuits.
The legislation is structured similarly to the Volunteer Protection
Act of 1997 and is nearly identical to teacher protection legislation
introduced by Paul Coverdell (S. 1721) in the 106th Congress. Simply
put, the bill extends a national standard to protect from liability
those teachers, principals, and education professionals who act in a
reasonable manner to maintain order in the classroom. It does not
preempt those States that have already taken action to address this
problem and it allows any state legislature that disagrees with these
strong protections to opt out at any time. Since this bill builds on
Sen. Coverdell's fine work, my colleagues and I thought it would be
highly appropriate that it bear his name.
At the same time, it is important to note that this legislation is
not a ``carte blanche'' for that minuscule minority of school officials
who abuse their authority. The bill does not protect those teachers who
engage in ``willful misconduct, gross negligence, reckless misconduct,
or a conscious flagrant indifference to the rights or safety'' of a
student. Nor does the bill preclude schools or local law enforcement
entities from taking criminal, civil, or administrative actions against
a teacher who acts improperly. Rather, the bill is simply designed to
protect those teachers, principals, and educational professionals who
act responsibly from frivolous lawsuits.
From a historical context, this is not new ground for our colleagues
in the Senate. During the 106th Congress, Senator Coverdell sucessfully
included his legislation in the Senate's verison of the ESEA
Reauthorization bill. Unfortunately, as we all know, efforts to
reauthorize the ESEA stalled on the Senate floor. It is now appropriate
for the Senate to revisit this issue, and I hope give its full
endorsement.
I look forward to working with my fellow original co- sponsors and
the rest of the Senate to see that these important protections are
enacted into law on behalf of America's hard working and dedicated
teachers.
I ask unanimous consent that the text of the bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 316

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

SECTION 1. TEACHER LIABILITY PROTECTION.

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

``TITLE XV--TEACHER LIABILITY PROTECTION

``SEC. 15001. SHORT TITLE.

``This title may be cited as the `Paul D. Coverdell Teacher
Liability Protection Act of 2001'.

``SEC. 15002. FINDINGS AND PURPOSE.

``(a) Findings.--Congress makes the following findings:
``(1) The ability of teachers, principals and other school
professionals to teach, inspire and shape the intellect of
our Nation's elementary and secondary school students is
deterred and hindered by frivolous lawsuits and litigation.
``(2) Each year more and more teachers, principals and
other school professionals face lawsuits for actions
undertaken as part of their duties to provide millions of
school children quality educational opportunities.
``(3) Too many teachers, principals and other school
professionals face increasingly severe and random acts of
violence in the classroom and in schools.
``(4) Providing teachers, principals and other school
professionals a safe and secure environment is an important
part of the effort to improve and expand educational
opportunities.
``(5) Clarifying and limiting the liability of teachers,
principals and other school professionals who undertake
reasonable actions to maintain order, discipline and an
appropriate educational environment is an appropriate subject
of Federal legislation because--
``(A) the scope of the problems created by the legitimate
fears of teachers, principals and other school professionals
about frivolous, arbitrary or capricious lawsuits against
teachers is of national importance; and
``(B) millions of children and their families across the
Nation depend on teachers, principals and other school
professionals for the intellectual development of children.
``(b) Purpose.--The purpose of this title is to provide
teachers, principals and other school professionals the tools
they need to undertake reasonable actions to maintain order,
discipline and an appropriate educational environment.

``SEC. 15003. PREEMPTION AND ELECTION OF STATE
NONAPPLICABILITY.

``(a) Preemption.--This title preempts the laws of any
State to the extent that such laws are inconsistent with this
title, except that this title shall not preempt any State law
that provides additional protection from liability relating
to teachers.
``(b) Election of State Regarding Nonapplicability.--This
title shall not apply to any civil action in a State court
against a teacher with respect to claims arising within that
State if such State enacts a statute in

[[Page S1339]]

accordance with State requirements for enacting legislation--
``(1) citing the authority of this subsection;
``(2) declaring the election of such State that this title
shall not apply, as of a date certain, to such civil action
in the State; and
``(3) containing no other provisions.

``SEC. 15004. LIMITATION ON LIABILITY FOR TEACHERS.

``(a) Liability Protection for Teachers.--Except as
provided in subsections (b) and (c), no teacher in a school
shall be liable for harm caused by an act or omission of the
teacher on behalf of the school if--
``(1) the teacher was acting within the scope of the
teacher's employment or responsibilities related to providing
educational services;
``(2) the actions of the teacher were carried out in
conformity with local, State, and Federal laws, rules and
regulations in furtherance of efforts to control, discipline,
expel, or suspend a student or maintain order or control in
the classroom or school;
``(3) if appropriate or required, the teacher was properly
licensed, certified, or authorized by the appropriate
authorities for the activities or practice in the State in
which the harm occurred, where the activities were or
practice was undertaken within the scope of the teacher's
responsibilities;
``(4) the harm was not caused by willful or criminal
misconduct, gross negligence, reckless misconduct, or a
conscious, flagrant indifference to the rights or safety of
the individual harmed by the teacher; and
``(5) the harm was not caused by the teacher operating a
motor vehicle, vessel, aircraft, or other vehicle for which
the State requires the operator or the owner of the vehicle,
craft, or vessel to--
``(A) possess an operator's license; or
``(B) maintain insurance.
``(b) Concerning Responsibility of Teachers to Schools and
Governmental Entities.--Nothing in this section shall be
construed to affect any civil action brought by any school or
any governmental entity against any teacher of such school.
``(c) Exceptions to Teacher Liability Protection.--If the
laws of a State limit teacher liability subject to one or
more of the following conditions, such conditions shall not
be construed as inconsistent with this section:
``(1) A State law that requires a school or governmental
entity to adhere to risk management procedures, including
mandatory training of teachers.
``(2) A State law that makes the school or governmental
entity liable for the acts or omissions of its teachers to
the same extent as an employer is liable for the acts or
omissions of its employees.
``(3) A State law that makes a limitation of liability
inapplicable if the civil action was brought by an officer of
a State or local government pursuant to State or local law.
``(d) Limitation on Punitive Damages Based on the Actions
of Teachers.--
``(1) General rule.--Punitive damages may not be awarded
against a teacher in an action brought for harm based on the
action or omission of a teacher acting within the scope of
the teacher's responsibilities to a school or governmental
entity unless the claimant establishes by clear and
convincing evidence that the harm was proximately caused by
an action or omission of such teacher which constitutes
willful or criminal misconduct, or a conscious, flagrant
indifference to the rights or safety of the individual
harmed.
``(2) Construction.--Paragraph (1) does not create a cause
of action for punitive damages and does not preempt or
supersede any Federal or State law to the extent that such
law would further limit the award of punitive damages.
``(e) Exceptions to Limitations on Liability.--
``(1) In general.--The limitations on the liability of a
teacher under this title shall not apply to any misconduct
that--
``(A) constitutes a crime of violence (as that term is
defined in section 16 of title 18, United States Code) or act
of international terrorism (as that term is defined in
section 2331 of title 18, United States Code) for which the
defendant has been convicted in any court;
``(B) involves a sexual offense, as defined by applicable
State law, for which the defendant has been convicted in any
court;
``(C) involves misconduct for which the defendant has been
found to have violated a Federal or State civil rights law;
or
``(D) where the defendant was under the influence (as
determined pursuant to applicable State law) of intoxicating
alcohol or any drug at the time of the misconduct.
``(2) Rule of construction.--Nothing in this subsection
shall be construed to effect subsection (a)(3) or (d).

``SEC. 15005. LIABILITY FOR NONECONOMIC LOSS.

``(a) General Rule.--In any civil action against a teacher,
based on an action or omission of a teacher acting within the
scope of the teacher's responsibilities to a school or
governmental entity, the liability of the teacher for
noneconomic loss shall be determined in accordance with
subsection (b).
``(b) Amount of Liability.--
``(1) In general.--Each defendant who is a teacher, shall
be liable only for the amount of noneconomic loss allocated
to that defendant in direct proportion to the percentage of
responsibility of that defendant (determined in accordance
with paragraph (2)) for the harm to the claimant with respect
to which that defendant is liable. The court shall render a
separate judgment against each defendant in an amount
determined pursuant to the preceding sentence.
``(2) Percentage of responsibility.--For purposes of
determining the amount of noneconomic loss allocated to a
defendant who is a teacher under this section, the trier of
fact shall determine the percentage of responsibility of each
person responsible for the claimant's harm, whether or not
such person is a party to the action.

``SEC. 15006. DEFINITIONS.

For purposes of this title:
``(1) Economic loss.--The term `economic loss' means any
pecuniary loss resulting from harm (including the loss of
earnings or other benefits related to employment, medical
expense loss, replacement services loss, loss due to death,
burial costs, and loss of business or employment
opportunities) to the extent recovery for such loss is
allowed under applicable State law.
``(2) Harm.--The term `harm' includes physical,
nonphysical, economic, and noneconomic losses.
``(3) Noneconomic losses.--The term `noneconomic losses'
means losses for physical and emotional pain, suffering,
inconvenience, physical impairment, mental anguish,
disfigurement, loss of enjoyment of life, loss of society and
companionship, loss of consortium (other than loss of
domestic service), hedonic damages, injury to reputation and
all other nonpecuniary losses of any kind or nature.
``(4) School.--The term `school' means a public or private
kindergarten, a public or private elementary school or
secondary school (as defined in section 14101, or a home
school.
``(5) State.--The term `State' means each of the several
States of the United States, the District of Columbia, the
Commonwealth of Puerto Rico, the United States Virgin
Islands, Guam, American Samoa, the Commonwealth of the
Northern Mariana Islands, any other territory or possession
of the United States, or any political subdivision of any
such State, territory, or possession.
``(6) Teacher.--The term `teacher' means a teacher,
instructor, principal, administrator, or other educational
professional that works in a school.

``SEC. 15007. EFFECTIVE DATE.

``(a) In General.--This title shall take effect 90 days
after the date of the enactment of the Paul D. Coverdell
Teacher Liability Protection Act of 2001.
``(b) Application.--This title applies to any claim for
harm caused by an act or omission of a teacher if that claim
is filed on or after the effective date of the Paul D.
Coverdell Teacher Liability Protection Act of 2001, without
regard to whether the harm that is the subject of the claim
or the conduct that caused the harm occurred before such
effective date.''.

Mr. MILLER. Mr. President, today I add my support to the Teacher
Liability Protection Act, a bill first introduced by my predecessor
Senator Paul Coverdell. Like him, and like my colleagues with whom I
introduce this bill today, I firmly believe in the promise that the
education of our children provides. An important part of fulfilling
that promise is ensuring that our classrooms are a secure place in
which to learn. And, as a result, teachers and principals are called
upon every day to maintain order in our schools. In doing so, they
should not be subject to frivolous lawsuits. Nor should the fear of
such litigation prevent educators from acting reasonably and quickly in
this regard.
The bill we introduce today seeks to eliminate that fear and to
reassure educators that they can and should perform this necessary part
of their job without hesitation. The bill provides limited immunity for
teachers, principals, and other education professionals for any
reasonable actions they take in an effort to discipline students or
maintain order in the classroom. In addition, it limits the
availability of punitive damages and damages for non-economic loss in
those suits that do proceed.
I also think that it is important to discuss what this bill does not
do. It does not prevent proper accountability for teachers and
principals who act intentionally, or even recklessly. Nor does it
protect them if they violate state or federal law. Finally, this bill
recognizes the authority of states on this issue by allowing states the
ability to opt out of its provisions and leaving untouched any state
law that provides greater immunity from liability. In sum, this bill
provides an important and necessary baseline of protection for teachers
and principals who are on the front line of our national struggle to
improve education, and to fulfill the promise of our children's future.
I believe this Congress has a unique opportunity to improve education
in our country. I hope that my colleagues will give this bill careful
consideration, and support it as an important part of that effort.

[[Page S1340]]

Mr. GREGG. Mr. President, I rise today to join my colleague, Mitch
McConnell, in introducing the Paul Coverdell Teacher Liability
Protection Act of 2001.
Senator Coverdell, recognizing the value of those individuals who
sacrifice their time, money and energy to serve others, was a true
leader in protecting both volunteers and teachers. In 1997, he
successfully ushered the Volunteer Protection Act through Congress.
Today, as a result of Senator Coverdell's efforts, volunteers can
generously give their time and services without the threat of frivolous
lawsuits.
Last year I joined Senator Coverdell in offering a teacher amendment
during floor consideration of the Elementary and Secondary Education
Act, ESEA. That amendment contained several provisions impacting
teachers, but the bulk of the amendment was the Teacher Liability
Protection Act. I am pleased to say that this amendment was passed by
the Senate by a vote of 97 to 0, and a nearly identical measure was
passed by the House by a vote of 358 to 67. The overwhelming support
that this amendment received during the 106th Congress clearly
illustrates the bipartisan nature of this initiative. Although Congress
did not complete work on ESEA before the end of the session, I am very
optimistic that the new President will sign into law an education
reform bill this year and that bill will include the Paul Coverdell
Teacher Liability Protection Act.
Our nation's public schools have become more violent, and teachers do
not feel safe in their own classrooms. Today, more than half our
nation's school teachers have been verbally abused, 16 percent have
been threatened with injury and 7 percent have been physically
attacked. Parents and students alike report that the behavior of some
students completely interferes with the learning of others. As our
schools have increasingly felt the effects of violence, drug use and a
breakdown of discipline, it is necessary for teachers to use reasonable
means to maintain order, discipline and a positive educational
environment. However, teachers continuously find themselves the targets
of frivolous lawsuits when they are forced to restore order in the
classroom. Our nation's educators need to feel free to appropriately
and swiftly discipline disruptive, unruly and unmanageable students to
ensure the safety and education of all the children under their
supervision.
Currently, unless a teacher is fortunate enough to work in a state
that has liability laws that protect teachers, many teachers are
hesitant to take action or intervene for fear of a lawsuit. This
legislation would help to correct this sad situation.
The Paul Coverdell Teacher Liability Protection Act was modeled after
the Volunteer Protection Act of 1997 and several state liability laws.
The purpose of this legislation is to protect teachers from frivolous
law suits when attempting to remove a disruptive or belligerent student
from a classroom.
Specifically, it provides limited civil liability immunity for
teachers and principals who engage in reasonable acts to maintain order
and preserve a safe and educational environment in their classrooms and
schools. The bill is narrowly crafted to focus on protecting reasonable
acts that fall within the scope of a teacher's responsibilities in
providing education services. The bill does not protect teachers who
engage in wanton and willful acts of misconduct, criminal acts or
violations of state and federal civil rights laws. The Teacher
Liability Protection Act simply protects teachers and other education
professionals from liability for harm caused to an individual by
reasonable acts carried out in accordance with local, state and federal
laws, as well as rules and regulations for controlling, disciplining,
expelling or suspending a student from a classroom or school.
Additionally, this legislation stipulates that punitive damages may not
be awarded against a teacher unless the claimant establishes by clear
and convincing evidence that harm was caused by an action that
constituted willful or criminal misconduct, or a conscious, flagrant
indifference to the rights or safety of the individual harmed.
Furthermore, it is important to note that this legislation does not,
in any way, supercede any state law that provides teachers with greater
immunity from liability. Moreover, states can opt out of the provisions
of this bill by passing state legislation exempting them from the
Teacher Liability Protection Act.
I conclude by saying that we have a unique opportunity this year to
improve our nation's public schools, and we should start with
protecting its teachers. As you know, teachers are our most precious
resource in the classroom, and to continue to place them at risk in
their jobs, and not give them the protection they so desperately need
is a shame. It is high time that we recognize teachers and principals
for who they are; professionals that go to great lengths to help our
children learn. Creating a safe-zone in which they are not subject to
being dragged through the courts for ensuring the safety and education
of the students in their classrooms should be a priority as we
undertake education reform in the 107th Congress. That is why I stand
here today to join Senator McConnel in empowering our nation's teachers
to take back control of our classrooms and create an environment where
they can teach and their students can learn.
______

By Mr. DASCHLE (for himself, Mr. Harkin, Mr. Dodd, Mr. Kennedy,
Mr. Biden, Mr. Bingaman, Mrs. Clinton, Mr. Durbin, Mr. Inouye,
Mr. Kerry, Mr. Leahy, Ms. Mikulski, Mrs. Murray, Mr.
Rockefeller, Mr. Sarbanes, Mr. Schumer, and Mr. Corzine):
S. 318. A bill to prohibit discrimination on the basis of genetic
information with respect to health insurance; to the Committee on
Health, Education, Labor, and Pensions.
Mr. DASCHLE. Mr. President, yesterday we read the first news accounts
of the first analysis ever of the human genetic code--what some have
called ``the blueprint of human life'' itself. Today, Senators Kennedy,
Harkin, Dodd, and I are introducing a bill to make sure this stunning
new knowledge is used to help Americans, not hurt them. Our bill is
called the ``Genetic Nondiscrimination in Health Insurance and
Employment Act.'' It says simply that genetic information may not be
used to discriminate against Americans in health insurance or
employment. An identical measure will be introduced tomorrow in the
House by more than 150 Republican and Democratic co-sponsors.
The genetic revolution has the potential to dramatically improve
health care. Genetic technology can greatly improve our ability to
treat and even cure now-incurable illnesses. Genetic tests can tell
whether a person is at risk of developing certain diseases years before
symptoms appear, giving her either peace of mind--or critical time to
reduce her risks. But the scientific and commercial value of the human
genome project will be seriously undermined if people refuse to take
genetic tests because they fear the results may be used against them.
That is not just our opinion. That warning has been sounded
repeatedly by the two men who understand genetic testing better than
anyone in the world--the scientists in charge of the two teams that
mapped the human genome. Dr. Craig Venter and Dr. Francis Collins. At a
White House ceremony last June where Doctors Venter and Collins
unveiled the sequencing of the human genome, they warned that our laws
were not keeping pace with science and urged Congress to pass strong
federal protections against genetic discrimination. As Dr. Collins put
it: ``If we needed a wake-up call, isn't today the wake-up call?''
The question now is: Are we going to heed that warning? Or, are we
going to turn a deaf ear? This bill is the test. It has four major
components. First, it forbids employers from using genetic information
to decide who to hire or fire, and other terms and conditions of
employment. Second, it forbids insurers from using genetic information
to deny or restrict coverage, or raise premiums. Third, it prevents
disclosure of identifiable genetic information to health insurers,
health insurance data banks, employers--and anyone else who has no
legitimate need for the information. Finally, if these basic rights are
violated, our bill gives victims of genetic discrimination the right to
hold the violator accountable in court.

[[Page S1341]]

It's been nearly three years since we first introduced this bill.
Back then, some people said there was no need for these protections
because there was no proof that genetic discrimination ever actually
occurs. We got another wake-up call last Friday, when the Equal
Employment Opportunity Commission went to court to challenge genetic
testing by an employer. The EEOC has asked the court to order the
Burlington Northern Santa Fe Railroad to end its alleged policy of
requiring employees who claim work-related injuries related to carpel
tunnel syndrome to undergo genetic testing--or lose their jobs.

The Burlington Northern case marks the first time the EEOC has ever
brought a genetic discrimination in court. But it is not the first case
of genetic discrimination we've heard about in this Senate. Last July,
the Senate Health, Education, Labor, and Pensions Committee held a
hearing specifically on genetic discrimination in employment and what,
if anything, the Senate should do about it. I testified at that hearing
about a social worker who made the mistake of telling her co-workers
that she had been the primary care-giver for her mother, who had died
of Huntington's disease. Despite her own good health and her long
history of outstanding performance reviews, she was fired. Why? Because
there is a chance she might one day develop the same disease that
killed her mother.
I also testified about a 40-year-old mother of two young children who
agreed to participate in a genetic research study. She tested positive
for BRAC1, the gene implicated in breast and ovarian cancer. After
undergoing preventive surgery to remove her breast and ovaries to
minimize the risk of cancer, she lost the insurance she received from
her job. Then she lost her job. She, too, had a history of good work
evaluations. Now she says she will never again participate in any
health studies, and she will not allow her children to be tested.
While genetic discrimination may be relatively rare now, experts say
that's only because genetic tests are still relatively rare. As testing
becomes more affordable, and more common, experts tell us, the
incidence of discrimination is likely to increase dramatically.
How many more times do we need to hear about lives that have been
shattered by someone's misuse of genetic information before we say
clearly: ``In America, you cannot discriminate against people because
of their genetic makeup. Period.''
This is a matter that effects every one of us. We all have flaws in
our genes.
With rare exceptions, genetic tests can't confirm if we will ever
develop a particular disease. All they can tell us is that we might
some day develop the disease. Or we might not. Is it fair for employers
to use genetic information in deciding who to hire and who to fire?
More than 10 years ago, we passed the Americans with Disabilities
Act. We agreed then that, in this country, you can't discriminate
against someone because of a disability. Can we really believe now that
employers and insurers ought to be allowed to discriminate against
someone because he or she might someday develop a disability illness?
Last week, three insurance companies in England admitted for the
first time that they test for Huntington's disease, a progressive and
incurable neurological disorder. One insurer also admitted it uses
experimental tests for breast and ovarian cancer and Alzheimer's
disease.
Do we have to wait until insurers in this country start using genetic
screening routinely before we set some reasonable legal guidelines for
genetic tests? How many more wake-up calls do we need?
Last summer, shortly after he and Francis and Collins unveiled the
sequencing of the human genome, Craig Venter wrote me a letter. In it,
he warned that genetic discrimination ``is not a theoretical concern.
Today, people who know they may be at risk for a genetic disease are
foregoing diagnostic tests for fear they will lose their job or their
health insurance.'' As a result, he said, ``the incentives for new
discoveries and treatments based on our newly acquired genomic
information are diminished, and the promising new era in medicine is
delayed.''
There are some who say strong federal protections are not needed
because a number of states have already passed bills to prevent genetic
discrimination. They're right about one thing: many states have passed
laws. I'm proud to report that South Dakota became the latest last
Friday when it adopted legislation to curb the collection of a person's
genetic information without informed consent. In all, 37 states have
passed bills regarding genetic discrimination in health insurance, and
22 states have laws regarding genetic discrimination in the workplace.
Those laws represent progress. And they offer some protection. The
problem with the current patchwork of state laws is that it contains
major loopholes. For example: some states protect only DNA and RNA.
Other states extend protection to family history data and other medical
information that could offer some genetic clues. In addition, because
of federal exemptions, state laws offer no protections to the one-in-
three Americans who get their health insurance through their employer.
Others say this bill is not needed because the Americans with
Disabilities Act already prohibits discrimination based on disability.
The problem with that theory is: it's never been tested. The Burlington
Northern case represents that first time a genetic discrimination suit
has been brought specifically on the grounds that it violates the ADA.
Maybe the court will decide that the ADA does cover genetic
discrimination. Maybe it will decide that it doesn't. Either way, a
definitive answer could take years. What is the harm of us acting now
to say clearly that genetic discrimination will not be tolerated in
America? What is the worst thing that could happen? That we end up with
two laws, each protecting the same fundamental principle?
Last year, then-President Clinton signed an executive order banning
genetic discrimination in federal employment. Our bill seeks merely to
extend the same protections to private workplaces and insurers. The
principles in our bill are supported by both Dr. Craig Venter and Dr.
Francis Collins. They are also supported by the federal Advisory
Committee on Genetic Testing, the Equal Employment Opportunity
Commission and the departments of Labor, Justice, and Health and Human
Services. More important, they are supported by a strong majority of
the America people.
At the beginning of our nation's history, Thomas Jefferson wrote,
``laws and discoveries must go hand in hand with the progress of the
human mind. As . . . new discoveries are made . . . institutions must
advance also to keep pace with the times.''
Our new knowledge about the genetic blueprint has the potential to
dramatically improve our health and the quality of our lives. However,
if we don't respond to the wake-up call now, this new knowledge also
has the potential to destroy lives. We simply cannot afford to take one
step forward in science, while taking two steps backwards in civil
rights!
The legislation we offer today will enable us to move forward in a
way that will benefit--and protect--all Americans. I thank my
colleagues--Senators Kennedy, Dodd, and Harkin--for all their help in
this endeavor. I also thank our colleagues in the House--particularly
Congresswoman Louise Slaughter, for her tireless effort to move our
companion bill to the floor in that chamber. And I urge my colleagues
to join us in answering the wake-up call now so that we can make sure
the genetic revolution--which has been largely financed with American
tax dollars--helps people--instead of hurting them.
Mr. HARKIN. Mr. President, I am pleased to introduce the ``Genetic
Non-discrimination in Health Insurance and Employment Act'' with
Senator Daschle, Senator Dodd, Senator Kennedy, and other colleagues.
This bill would bring our nondiscrimination policies into the 21st
century.
Genetic discrimination is a terribly important issue and one that I
have been following for quite some time now. My interest started in the
late 1980s when I was first involved in the effort to fund the Human
Genome Project at NIH. Looking back over the past ten years, this was
one of the best investments our country has ever made. The advances in
the study of the human gene are mind-boggling. Last

[[Page S1342]]

year, the Human Genome Project and Celera Genomics announced that
scientists had mapped the entire human genome. Just yesterday, these
same scientists reported the probable number of human genes at 30,000
to 40,000 (only twice as many genes as your run-of-the-mill roundworm).
The impact of these discoveries will go far beyond the laboratory.
The mapping of the human genome will mean enormous gains in science and
the provision of health care. The identification of a number of
disease-related genes has already provided scientists with important
new tools for understanding the underlying mechanisms for many
illnesses. And genomic technologies have the potential to lead to
better diagnosis and treatment, and, ultimately, the prevention and
cure of many diseases and disabilities.
However, without genetic discrimination protections, people will be
deterred from using genetic technologies that detect and prevent the
onset of life-threatening diseases.
Discrimination in health insurance and employment, and the fear of
potential discrimination, threaten our ability to conduct the very
research we need to understand, treat, and prevent genetic disease.
Moreover, discrimination--and the fear of discrimination--threaten our
ability to use new genetic technologies to improve human health. As a
result, our rapid, scientific progress could be rendered meaningless
for the every day American.
Let me give you just a few examples:
In the early 1970's some insurance companies denied coverage and some
employers denied jobs to African-Americans who were identified as
carriers for sickle-cell anemia, even though they were healthy and
would never develop the disease.
More recently, in a survey of people in families with genetic
disorders, 22 percent indicated that they, or a member of their family,
had been refused health insurance on the basis of their genetic
information.
And a number of researchers have been unable to get individuals to
participate in cancer genetics research. Fear of discrimination is
cited as the reason why.
But this is more than just about numbers and anonymous individuals,
it's about real people--including my own family. As many of you know,
both my sisters died from breast cancer. And other members of my family
might be at risk. Should I counsel them to get tested for the BRCA1 and
BRCA2 mutations? Should I counsel them to disclose our family history
to their health care providers?
Right now, I'm torn. I know that if my family is to have access to
the best available interventions and preventive care, they should get
tested, and they should disclose our family's medical history to their
physicians. But, conversely, if they are to get any health care at all,
they must have access to health insurance. Without strong protections
against discrimination, access to health insurance is currently in
question.
In 1995, I introduced an amendment during the mark-up of the Health
Insurance Portability and Accountability Act. My amendment clarified
that group health plans could not establish eligibility, continuation,
enrollment, or contribution requirements based on genetic information.
The amendment became part of the manager's package that went to the
floor, and it ultimately became law.
HIPAA is a good first step. We should be proud of that legislation.
Yet if our goal is to ensure that individuals have access to health
insurance coverage and to employment opportunities--regardless of their
genetic makeup--we must ensure that they are protected against
discrimination on the basis of their genetic makeup.
Our proposed legislation offers such protections. Let me describe
them in brief:
First, this legislation prohibits insurers and employers from
discriminating on the basis of protected genetic information. It is
essential to prohibit discrimination both at work and in health
insurance coverage. If we only prohibit discrimination in the insurance
context, employers who are worried about future increased medical costs
or increased sick time will simply not hire individuals who have a
genetic predisposition to a particular disease.
Second, under our proposal, health insurance companies are prohibited
from disclosing genetic information to other insurance companies,
industry-wide data banks, and employers. If we really want to prevent
discrimination, we should not let genetic information get into the
wrong hands in the first place.
Finally, if protections against genetic discrimination are to have
teeth, we must include strong penalties and remedies to deter employers
and insurers from discriminating in the first place.
This bill will ensure that every American will enjoy the latest
advances in scientific research and health care delivery, without fear
of retribution on the basis of their sensitive genetic information. All
of us should be concerned about this issue, because all of us have
genetic information that could be used against us. As we move into the
new millennium, everyone should enjoy the benefits of 21st century
technologies--and not be harmed by 21st century discrimination.
I applaud the commitment of my fellow co-sponsors on this important
issue and look forward to working with my colleagues on both sides of
the aisle to pass federal legislation that will prohibit genetic
discrimination in the workplace and in health insurance.
Mr. DODD. Mr. President, over the past decade the science of
identifying genetic markers for diseases has evolved at an astonishing
pace. For an increasing number of Americans, science fiction has become
reality--their doctors can now scan their unique genetic blueprints and
predict the likelihood of their developing diseases like cancer,
Alzheimer's or Parkinson's.
Armed with this knowledge, individuals and families can make informed
decisions about their health care including, in some cases, even taking
steps to prevent the disease or to detect and treat it early.
Unfortunately, however, phenomenal advances in our knowledge about
genetics have outpaced the protections currently provided in law. Thus,
the potential also exists for this information to be used by health
insurers or employers to deny health coverage or job opportunities.
And, in fact, recent events have catapulted the issue of genetic
discrimination from a potential concern to a devastating reality. Just
this week, the U.S. Equal Employment Opportunity Commission filed a
lawsuit against an employer for requiring genetic testing of employees
who file injury claims. Additionally, a recent survey of over 2,000
companies conducted by the American Management Association showed that
18.1 percent of companies require genetic or medical family history
data from employees or job applicants. According to the same survey,
26.1 percent of the companies that require genetic or family medical
history tests use the results of those tests in hiring decisions.
We know that Federal and State laws currently offer only a patchwork
of protections against the misuse of genetic information. While the
Health Insurance Portability and Accountability Act of 1996 took
important first steps toward prohibiting genetic discrimination in
health insurance, it left large gaps. For example, it does not prohibit
insurers from requiring genetic testing or from disclosing genetic
information and offers no protection at all for people who must buy
their insurance in the individual market. And, while several States,
including Connecticut, have enacted legislation prohibiting health
insurance discrimination, these laws can not protect the 51 million
individuals in employer-sponsored ``self-funded'' health plans.
Additionally, few States have chosen to address the issues of
employment discrimination or the separate issue of the privacy of
genetic records.
I know from personal experience that this issue is not a partisan
one. Four years ago, I joined Senator Domenici in introducing one of
the first bills on this critical topic, addressing both insurance and
employment discrimination. And two years ago, along with many of my
Democrat colleagues, I joined Senator Snowe in supporting strong
legislation protecting patients from genetic discrimination in
insurance.
Today I am pleased to join my colleagues, Senator Daschle, Senator
Harkin and Senator Kennedy in introducing comprehensive legislation to

[[Page S1343]]

safeguard the privacy of genetic information and prohibit health
insurance or employment discrimination based on genetic information.
Specifically, this legislation would prohibit health insurers from
discriminating based on genetic predisposition to an illness or
condition and would prevent insurers from requiring applicants for
health insurance to submit to genetic testing. This bill would also
address concerns about employment discrimination by preventing
employers from firing or refusing to hire individuals who may be
susceptible to a genetic condition. Finally, this legislation holds
employers and insurers accountable by imposing strong penalties those
who violate these provisions.
Three years ago, in a visit to Yale University's Genetic Testing
Center I had the opportunity to glimpse cutting edge uses of that
technology. I also had the opportunity, however, to hear the fears
expressed by the patients at the center. On that visit I met with Keith
Hall, who has been a patient at Yale for several years--since he was
first diagnosed with Tuberous Sclerosis, a genetic disease that causes
tumors of the brain, kidney and other organs, and sometimes mental
retardation. Keith worries about what would happen to his insurance if
he ever had to switch jobs.
I also met with Ashley Przybylski, an 11-year-old girl from Oxford,
CT. Ashley suffers from a genetic nutritional disorder that can cause
seizures and brain damage. While currently the family's insurance
covers the exorbitant cost of the medication that keeps her healthy--
$33,000 a year--Ashley faces the prospect of being denied coverage when
she gets older.
While we as a Nation welcome these scientific achievements, it is
critical we ensure that they be applied for the purposes of preventing
or treating disease, rather than for denying health insurance or
employment to individuals. This issue is too important to ignore for
yet another year. Each day that passes more individuals suffer
discrimination. Each day that we fail to act, more families will be
forced to make decisions about genetic testing based, not on their
health care needs, but on fear.
I pledge my commitment to ensuring that continued progress in science
is matched by progress in creating protections against discrimination
and establishing fundamental rights to privacy. I'd like to again thank
my colleagues, Senator Daschle, Senator Kennedy and Senator Harkin for
joining me in introducing this legislation.
Mr. KENNEDY. Mr. President, this week, scientists announced the
completion of a task that once seemed unimaginable--deciphering the
entire DNA sequence of the human genetic code. This amazing
accomplishment is likely to affect the 21st century as profoundly as
the invention of the computer or the splitting of the atom affected the
20th century.
These new discoveries bring remarkable new opportunities for
improving health care. But they also carry the danger that genetic
information will be used--not to improve the lives of Americans--but as
a basis for discrimination. Discrimination on the basis of a person's
genetic traits--such as those associated with cancer, Huntington's
disease, or sickle cell anemia--is as unacceptable as discrimination on
the basis of gender, race, or religion. No American should be denied
health insurance or fired from a job based on the results of a genetic
test.
People need access to genetic testing, in order to seek treatments to
extend and improve their lives. Yet, the vast potential of genetic
knowledge to improve health care will go unfulfilled, if patients fear
that information about their genetic characteristics will be used as
the basis for discrimination. Congress has a responsibility to
guarantee that private medical information remains private, and that
genetic information cannot be used for improper purposes.
The Genetic Non-Discrimination in Health Insurance and Employment Act
guarantees these protections. It gives the American people the
protections they need and deserve against genetic discrimination. It
prohibits employers from using genetic information to discriminate in
the workplace in hiring, promotion, pay or other workplace rights and
privileges. And it gives victims of genetic discrimination the right to
seek remedies through legal action.
In too many cases today the promise of genetic research is being
squandered, because patients rightly fear that information about their
genes will be used against them in the workplace or in health
insurance. Study after study reports that the vast majority of
Americans are concerned about taking a genetic test, for fear that
employers will have access to the information. The Journal of the
American Medical Association reported that 57 percent of women at risk
for breast or ovarian cancer had refused to take a genetic test that
could have identified their risk for cancer and assisted them in
receiving medical treatment to prevent the onset of these diseases
because they feared reprisals for doing so. Tragically, the vast
potential of genetic knowledge to improve health care will go
unfulfilled if patients fear that information about their genetic
characteristics will be used as the basis for job discrimination or
other prejudices.
And that fear is clearly well-founded. Genetic discrimination is a
real and frightening problem, and it is happening right now. Last
Saturday reports of mandatory genetic testing of employees made
headline news--and the testing was being conducted by one of the
largest railroads in this country. One employee was informed by the
railroad that he would be fired for refusing to submit to the genetic
testing.
This is just the tip of the iceberg of what is becoming a routine and
pervasive employer practice as genetic testing becomes more accessible
and economical. Today, employers and insurers often require and use
this information to deny health coverage, refuse a promotion, or reject
a job applicant--all in the absence of any symptoms of disease.
According to a 1995 study by Georgetown University, people have been
required to provide information about genetic diseases, disabilities,
or family medical history on job applications and have been denied jobs
or have lost jobs because of a family genetic condition.
Moreover, a recent survey by the American Management Association of
over 2,000 companies showed that more than 18 percent of companies
require genetic tests or data on family medical history from employees
or job applicants. According to the same survey, more than 26 percent
of the companies that require this information use it in hiring
decisions.

Experts in genetics are virtually unanimous in calling for strong
protections to prevent this misuse and abuse of science. The Department
of Health and Human Services' advisory panel on genetic testing--
consisting of experts in law, science, medicine and business--
recommended unambiguously that ``Federal legislation should be enacted
to prohibit discrimination in employment and health insurance based on
genetic information.'' Dr. Craig Venter, the president of Celera
Genomics, who led the privately-financed aspect of the gene sequencing
research, has spoken of the ``immediate threat . . . [of] genetic
discrimination. . . . [H]uman rights and civil rights law will have to
be updated to include this new class of diagnosed person. At this
stage, one can only imagine the future potential of abuse,'' he said.
With time, the potential for genetic discrimination will only grow
stronger and federal legislation to establish minimum protections is
needed to ensure that advances in research and technology are not used
to discriminate against workers. Without strong protections
guaranteeing that private medical information remains private and that
genetic information can not be used for improper purposes, we will
squander the unprecedented opportunities presented by these new
discoveries, and the health and welfare of large numbers of our fellow
citizens will be put at risk.
I commend our leader, Senator Daschle, for introducing this important
legislation that will give the American people the protections against
genetic discrimination they need and deserve. The Genetic Non-
Discrimination in Health Insurance and Employment Act will prohibit
insurers from denying or abridging health care coverage on the basis of
genetic test results. It will protect employees from discrimination on
the basis of their unalterable genetic inheritance. The Act safeguards
Americans' private genetic information from

[[Page S1344]]

unauthorized disclosures to employers, banks, and others who should not
have access to this most sensitive of personal information. And,
because a right without a remedy is no right at all, this important
measure would provide persons who have suffered genetic discrimination
in either arena with the right to seek redress through legal action. I
urge my colleagues to join Senator Daschle and me in supporting the
Genetic Non-Discrimination in Health Insurance and Employment Act.
______

By Mr. McCAIN (for himself, Mr. Hollings, and Mrs. Hutchison):
S. 319. A bill to amend title 49, United States Code, to ensure that
air carriers meet their obligations under the Airline Customer Service
Agreement, and provide improved passenger service in order to meet
public convenience and necessity; to the Committee on Commerce,
Science, and Transportation.
Mr. McCAIN. Mr. President, this morning the Commerce Committee heard
testimony from the Department of Transportation Inspector General on
the airlines' efforts to meet their voluntary Airline Customer Service
Commitment. The IG reported that the airlines had made progress in
their customer service areas. He also noted that the airlines were
deficient in many areas of their commitment. The IG recommended that
Congress take some measures to ensure that the airlines continue to
make progress on the passenger service front.
To that end, I am introducing the Airline Customer Service
Improvement Act, along with Senators Hollings, Hutchison, and Wyden.
This bill implements the recommendations set forth by the Inspector
General in his final report. Specifically, the bill requires each air
carrier to incorporate the voluntary Airline Customer Service
Commitment into its contract of carriage. In addition, the bill
requires each air carrier to specifically disclose information
recommended by Mr. Mead, such as the on-time performance rates of
specific flights and the airlines' policy with respect to overnight
accommodations.
The bill also directs the Department of Transportation to raise the
compensation required for passengers involuntarily bumped from a
flight. This regulation has not been updated in more than 20 years.
The bill also directs the Department of Transportation to change the
way it calculates lost and mishandled baggage statistics, so that these
statistics will more accurately represent the problems that passengers
face.
Finally, consistent with the IG's recommendations, the bill requires
the airlines to report on their efforts to establish targets for
reducing the number of chronically-delayed and canceled flights, and
establishing a system passengers may use to determine if their flight
has been delayed or canceled.
In short, this legislation does not seek to legislate good customer
service. This legislation seeks to provide the airlines and the
Department of Transportation with the incentives to ensure that good
customer service remains high on everyone's priority list.
Let me make clear that this bill is just one small step towards
fixing the system. This bill does not begin to address the many
problems facing the airline industry. Capacity, congestion, antiquated
air traffic control systems, and labor all have had detrimental effects
on our system and, consequently, customer service. The Commerce
Committee will continue to explore ways to improve the efficiency of
our aviation system. We will all need to work together to fix the
multitude of problems that airline customers face everyday.
I look forward to working together with my fellow Senators on this
and other ways to address the needs of our aviation system.
I ask unanimous consent that the bill be printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 319

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Airline Customer Service
Improvement Act''.

SEC. 2. FINDINGS.

The Congress finds the following:
(1) The Inspector General of the Department of
Transportation has found that the airlines' voluntary
commitment to better service, set forth in the Airline
Customer Service Commitment, has resulted in positive changes
in how air travelers are treated.
(2) While the Inspector General's Final report noted that
the voluntary effort has produced benefits faster than a
legislative or regulatory mandate, which could have taken
years to implement, the Inspector General has recommended
additional changes that require legislation and regulations.
(3) The Airline Customer Service Commitment has prompted
the airlines to address consumer concerns in many areas,
ranging from providing information more accurately on delays
to explaining that lower fares may be available through the
Internet.
(4) The airlines were cooperative with, and responsive to,
many of the suggestions the Inspector General made in the
interim report last year.
(5) The Inspector General has determined that, while there
has been significant progress in improving airline customer
service, certain areas covered by the Airline Customer
Service Commitment are in need of significant clarification
and improvement and, where appropriate, enforcement action.

SEC. 3. DEPARTMENT OF TRANSPORTATION TO DEVOTE GREATER
RESOURCES TO AIRLINE PASSENGER CONSUMER
PROTECTION.

(a) In General.--The Secretary of Transportation shall
increase the resources of the Department of Transportation
allocated to providing--
(1) airline passenger consumer protection and related
services; and
(2) oversight and enforcement of laws and regulations
within the jurisdiction of the Department that provide
protection for air travelers.
(b) Report.--Within 60 days after the date of enactment of
this Act, the Secretary shall report to the Senate Committee
on Commerce, Science, and Transportation and the House
Committee on Transportation and Infrastructure measures taken
by the Secretary to carry out subsection (a), together with a
request for additional funds or measures, if necessary, to
carry out that subsection fully.

SEC. 4. AIRLINE CUSTOMER SERVICE COMMITMENT.

(a) In General.--Chapter 417 of title 49, United States
Code, is amended by adding at the end the following:

``SUBCHAPTER IV. AIRLINE CUSTOMER SERVICE

``Sec. 41781. Airline customer service requirements

``(a) In General.--Within 60 days after the date of
enactment of the Airline Customer Service Improvement Act,
each large air carrier shall incorporate the provisions of
the Airline Customer Service Commitment executed by the Air
Transport Association and 14 of its member airlines on June
17, 1999, in its contract of carriage.
``(b) Additional Obligations.--Within 60 days after the
date of enactment of the Airline Customer Service Improvement
Act, each large air carrier shall institute the following
practices:
``(1) Include fares available at the air carrier's ticket
offices and airport ticket service counters when quoting the
lowest fare available to passengers.
``(2) Notify customers that lower fares may be available
through other distribution systems, including Internet
websites.
``(3) Provide, no later than the 5th day of each month, the
air carrier's on-time performance rate for each scheduled
flight for the most recently-ended month for which data is
available through its Internet website.
``(4) Disclose, without being requested, the on-time
performance and cancellation rate for a chronically-delayed
or canceled flight whenever a customer makes a reservation or
purchases a ticket on such a flight.
``(5) Establish a plan with respect to passengers who must
unexpectedly remain overnight during a trip due to flight
delays, cancellations, or diversions.
``(6) Tell all passengers on a flight what the air carrier
is required to pay passengers involuntarily denied boarding
before making offers to passengers to induce them voluntarily
to relinquish seats.
``(c) Compliance Assurance.--
``(1) Air carrier functions.--Each large air carrier also
shall--
``(A) establish a customer service quality assurance and
performance measurement system within 90 days after the date
of enactment of the Airline Customer Service Improvement Act;
``(B) establish an internal audit process to measure
compliance with the commitments and its customer service plan
within 90 days after the date of enactment of the Airline
Customer Service Improvement Act; and
``(C) cooperate fully with any Department of Transportation
audit of its customer service quality assurance system or
review of its internal audit.
``(2) DOT functions.--The Secretary of Transportation
shall--
``(A) monitor compliance by large air carriers with the
requirements of this section and take such action under
subpart IV of this title as may necessary to enforce
compliance with this section under subpart IV of this title;
``(B) monitor air carrier customer service quality
assurance and performance measurement systems to ensure that
air carriers are meeting fully their airline passenger
service commitments; and

[[Page S1345]]

``(C) review the internal audits conducted by air carriers
of their air carrier customer service quality assurance and
performance measurement systems.
``(d) Definitions.--In this section--
``(1) Large air carrier.--The term `large air carrier'
means an air carrier holding a certificate issued under
section 41102 that--
``(A) operates aircraft designed to have a maximum
passenger capacity of more than 60 seats or a maximum payload
capacity of more than 18,000 pounds; or
``(B) conducts operations where one or both terminals of a
flight stage are outside the 50 states of the United States,
the District of Columbia, the Commonwealth of Puerto Rico and
the U.S. Virgin Islands.
``(2) Chronically delayed or canceled.--A flight shall be
considered to be chronically-delayed or canceled if at least
40 percent of the flight's departures are delayed for at
least 15 minutes or at least 40 percent of the flights are
canceled.''.
(b) Enforcement.--Section 46301(a)(7) of title 49, United
States Code, is amended by striking ``40112 or 41727'' and
inserting ``40112, 41727, or 41781''.
(c) Conforming Amendment.--The chapter analysis for chapter
417 of title 49, United States Code, is amended by adding at
the end the following:

``SUBCHAPTER IV. AIRLINE CUSTOMER SERVICE

``41781. Airline customer service requirements''.

SEC. 5. OTHER SERVICE-ENHANCING IMPROVEMENTS.

(a) In General.--Within 90 days after the date of enactment
of this Act, each large air carrier (as defined in section
41781(d)(1)) shall--
(1) establish realistic targets for reducing chronically-
delayed and canceled flights;
(2) establish a system passengers may use before departing
for the airport to determine whether there is a lengthy
flight delay or whether a flight has been canceled;
(3) develop and implement a system for tracking and
documenting the amount of time between the receipt of a
passenger's claim for missing baggage and the delivery of the
baggage to the passenger, including the time taken by a
courier or other delivery service to deliver found baggage to
the passenger;
(4) monitor and report its efforts to improve services
provided to passengers with disabilities and special needs,
including services provided at airports such as check-in,
passenger security screening (particularly for passengers who
use wheelchairs), boarding, and disembarkation;
(5) clarify terminology used to advise passengers of
unscheduled delays or interruptions in service, such as
``extended period of time'' and ``emergency'', in order
better to inform passengers about what they can expect during
on-board delays;
(6) ensure that comprehensive passenger service contingency
plans are properly maintained and that the plans, and any
changes to those plans, are coordinated with local airport
authorities and the Federal Aviation Administration;
(7) ensure that master airport flight information display
monitors contain accurate, up-to-date flight information and
that the information is consistent with that shown on the
carrier's flight information display monitors;
(8) establish a toll-free telephone number that a passenger
may use to check on the status of checked baggage that was
not delivered on arrival at the passenger's destination;
(9) if it maintains a domestic code-share arrangement with
another air carrier, conclude an agreement under which it
will conduct an annual audit of that air carrier's compliance
with the other air carrier's airline customer service
commitment; and
(10) if it has a frequent flyer program, make available to
the public a comprehensive report of frequent flyer
redemption information in their customer literature and
annual reports, including information on the percentage of
successful redemption of frequent flyer awards and the number
of seats available for such awards in the air carrier's top
100 origin and destination markets.
(b) Initial Response Reports.--
(1) Air carriers.--Within 90 days after the date of
enactment of this Act, each large air carrier shall report to
the Secretary of Transportation on its implementation of the
obligations imposed on it by this Act.
(2) Secretary.--Within 270 days after the date of enactment
of this Act, the Secretary of Transportation shall report to
the Congress on the implementation by large air carriers of
the obligations imposed on them by this Act, together with
such additional findings and recommendations for additional
legislative or regulatory action as the Secretary deems
appropriate.

SEC. 6. IMPROVED DOT STATISTICS.

(a) Missing Baggage.--In calculating and reporting the rate
of mishandled baggage for air carriers, the Department of
Transportation shall not take into account passengers who do
not check any baggage.
(b) Chronically Delayed or Canceled Flights.--The Office of
Aviation Enforcement and Proceedings of the Department of
Transportation in coordination with the Bureau of
Transportation Statistics of the Department of
Transportation, shall include a table in the Air Travel
Consumer Report that shows flights chronically delayed by 15
minutes or more and flights canceled 40 percent or more for 3
consecutive months or more.

SEC. 7. DOT REGULATIONS ON BUMPING.

(a) Uniform Check-in Deadline.--The Secretary of
Transportation shall initiate a rulemaking within 30 days
after the date of enactment of this Act to amend the
Department of Transportation's Regulations to establish a
uniform check-in deadline and to require air carriers to
disclose, both in their contracts of carriage and on ticket
jackets, their policies on how those deadlines apply to
passengers making connections.
(b) Bumped Passenger Compensation.--The Secretary of
Transportation shall initiate a rulemaking within 30 days
after the date of enactment of this Act to amend the
Department of Transportation's Regulation (14 C.F.R. 250.5)
governing the amount of denied boarding compensation for
passengers denied boarding involuntarily to increase the
maximum amount thereof.
(c) Clarify Certain Terms.--The Secretary of Transportation
shall clarify the terms ``any undue or unreasonable
preference or advantage'' and ``unjust or unreasonable
prejudice or disadvantage'', as used in section 250.3 of the
Department of Transportation's Regulations (14 C.F.R. 250.3),
for purposes of air carrier priority rules or criteria for
passengers denied boarding involuntarily.

Mr. HOLLINGS. Mr. President, I join with Senator McCain in co-
sponsoring the Airline Customer Service Improvement Act. The Commerce
Committee has spent a great deal of time seeking ways to hold the air
carriers accountable for their service and to force them to do a better
job. Deregulation was supposed to make the carriers compete for our
business, but it has failed. We now have hundreds of markets with no
competition, and without competition, you get no service. Carriers have
treated consumers like cattle in a stockyard, and that must end.
It is time to stand up for all travelers and demand basic
information, and to expect service if we are paying the high fares.
The Commerce Committee has held three hearings, enlisted the
Department of Transportation's Inspector General, and experienced the
lack of service, first hand. It is not complicated, but it does take a
commitment from the industry to hire more people and give them the
tools to tell consumers what is going on or why a flight is canceled or
delayed. Flights delayed 30, 40 percent of the time, according to DOT
statistics, or canceled that often, should be eliminated or schedules
changed.
Telling people truthfully what is happening, providing basic
necessities when flights are delayed for hours on end like they were in
Detroit in January 1999, is not hard.
The chairman and I have waited patiently to proceed with legislation
in anticipation of a final report by the Department of Transportation's
Inspector General, Ken Mead. The report, released Monday, is a
blueprint for change. Mr. Mead and his staff, David Dobbs, Lexi
Stefani, Brian Dettleback, and Scott Morris, worked long and hard to
find the best way to make improvements in service.
The report notes that reducing delays is a tough problem, requiring
funding and industry action. We have an air transportation system in
crisis, from every angle, nonetheless that is no excuse for poor
service. There are more people flying, more planes landing, an increase
in delays (up 33% since 1995), a critical shortage of runways, and
airlines able to dictate the price and quality of service offered in
many markets without regard to competition. Delays will continue to
plague the system, but the carriers know this, and their Customer
Service Commitments were done in light of known problems. We will work
with the industry on many facets of expanding capacity, but it is their
job to improve service.
The carriers all to often want to cite the government as the reason
for their problems. I do not buy that. These carriers have more data
than virtually any industry, and make educated guesses on pricing and
scheduling every day. They know the likelihood of delays. Even weather,
which is unpredictable on a daily basis, is something they can
anticipate. I know right now we will have thunderstorms this summer,
and snow storms next winter. How will the carriers treat people during
those times? I know my flight is likely to be delayed--the reasons may
vary, but the process by which you tell people basic information should
not be hard. Some of the carriers have attempted improvements. At a
hearing last June, one carrier demonstrated a

[[Page S1346]]

new automatic system that more quickly tells people what to expect.
Another carrier has ``chariots'' that set up temporary service counters
during emergency periods. An ad this past weekend touted ways to
electronically tell passengers that a flight is late. These are a
start, but there is a long road to go.
The Air Transport Association last month announced a number of
initiatives on ways to reduce delays. The ATA called on the President
to hire a 1000 more controllers, use satellites to track planes and to
redesign our airspace--all actions that could increase capacity. I
support those initiatives, but we had better tell the Administration
not to reduce the FAA's budget by hundreds of millions of dollars,
which they apparently are considering.
The Senate is going to spend the time to increase competition, to
improve service, and to put back the notion of the public's needs as a
priority.
______

By Mr. GRASSLEY (for himself, Mr. Kennedy, Mr. Jeffords, Mr.
Baucus, Ms. Snowe, Mr. Rockefeller, Mr. Daschle, Mr. Breaux,
Mr. Conrad, Mr. Graham, Mr. Bingaman, Mr. Kerry, Mr.
Torricelli, Mrs. Lincoln, Mr. Akaka, Mr. Bayh, Mr. Biden, Mrs.
Boxer, Mr. Byrd, Mr. Chafee, Mr. Cleland, Mrs. Clinton, Ms.
Collins, Mr. Corzine, Mr. Crapo, Mr. Dayton, Mr. DeWine, Mr.
Dodd, Mr. Domenici, Mr. Dorgan, Mr. Durbin, Mr. Edwards, Mrs.
Feinstein, Mr. Frist, Mr. Harkin, Mr. Helms, Mr. Inouye, Mr.
Johnson, Mr. Kohl, Mrs. Landrieu, Mr. Leahy, Mr. Levin, Mr.
Lieberman, Mr. Lugar, Ms. Mikulski, Mrs. Murray, Mr. Nelson of
Florida, Mr. Reed, Mr. Reid, Mr. Roberts, Mr. Santorum, Mr.
Sarbanes, Mr. Schumer, Mr. Smith of Oregon, Mr. Thomas, Mr.
Thurmond, Mr. Warner, and Mr. Wellstone):
S. 321. A bill to amend title XIX of the Social Security Act to
provide families of disabled children with the opportunity to purchase
coverage under the medicaid program for such children, and for other
purposes; to the Committee on Finance.
Mr. GRASSLEY. Mr. President, it is with great pleasure that I
announce the introduction of the Family Opportunity Act of 2001. I
pledge my commitment to working with Senator Kennedy and others in a
bi-partisan, bi-cameral way for the passage of the Family Opportunity
Act this year.
We have a common-sense bill. Our bill is pro-family because it keeps
families together. It's pro-work because it lets parents work without
losing their children's health care. It's pro-taxpayer because it lets
people earn money and help pay their own way for Medicaid coverage.
Why is this legislation so necessary? As a parent, your main
objective in life is to provide for your child to the best of your
ability. Our federal government takes this goal and turns it upside
down for the parents of children with special health care needs. The
government forces these parents to choose between family income and
their children's health care. That's a terrible choice.
Families have to remain in poverty just to keep Medicaid. Obviously
this affects entire families, not just the child with the health care
needs. The story of an Iowan family illustrates this point. Daniel, the
18-year-old son of Melissa Arnold, can't work part-time for fear of
jeopardizing his brother's Medicaid coverage.
I know of another family whose son was paralyzed after a diving
accident. The family exhausted $1 million of private insurance. Then
they had to pay $1,500 a day on their own just to keep their son alive.
Yet another family has a 4-year-old son who functions at an infant's
level. This little boy takes anti- seizure medication that costs about
$150 every two weeks. His nutritional supplement is $10 a day. He'll
always wear diapers. All of those costs come out of his parents'
pocket.
Most families just can't afford those costs.
Why is Medicaid so desirable? It's critical to the well-being of
children with multiple medical needs. Medicaid covers services that are
difficult to find in private health plans. A child with a severe
disability may need special medical equipment or physical therapy on a
regular basis just in order to be able to eat.
Our bill creates a state option to allow working parents who have a
child with a disability to keep working and to still have access to
Medicaid for their child. Parents would pay for Medicaid coverage on a
sliding scale. No one would have to become impoverished or stay
impoverished to secure Medicaid for a child.
The legislation recognizes a universal truth. Everybody wants to use
their talents to the fullest potential, and every parent wants to
provide as much as possible for his or her children. The government
shouldn't get in the way. I look forward to working with my colleagues
for passage of the Family Opportunity Act this year.
Mr. KENNEDY. Mr. President, it is an honor to once again join my
colleague Senator Chuck Grassley in introducing the Family Opportunity
Act of 2001--the hallmark of which is to remove the health care
barriers for children with disabilities that so often prevent families
from staying together and staying employed.
Despite the extraordinary growth and prosperity the country is
enjoying today, families of disabled and special needs children
continue to struggle to keep their families together, live
independently and become fully contributing members of their
communities.
More than 8 percent of children in this country have significant
disabilities, many of whom do not have access to critical health
services they need to maintain and prevent deterioration of their
health status. To get needed health services for their children,
families are being forced to become poor, stay poor, put their children
in out of home placements, or simply give up custody of their
children--all so that their children can qualify for the comprehensive
health coverage available under Medicaid.
In a recent survey of 20 states, families of special needs children
report they are turning down jobs, turning down raises, turning down
overtime, and are unable to save money for the future of their children
and family --so that their child can stay eligible for Medicaid through
the Social Security Income (SSI) Program.
Today we are reintroducing legislation intended to close the health
care gap for the Nation's most vulnerable population, and enable
families of disabled children in this country to be equal partners in
the American dream.
In the words of President George W. Bush in his ``New Freedom
Initiative'', ``Too many Americans with disabilities remain trapped in
bureaucracies of dependence, and are denied the access necessary for
success--and we need to tear down these barriers''.
The Family Opportunity Act of 2001 will tear down the unfair barriers
to needed health care that so many disabled and special needs children
are being denied.
It will make health insurance coverage more widely available for
children with significant disabilities, through opportunities to buy-in
to Medicaid at an affordable rate.
It will allow states to develop a demonstration program to provide a
medicaid buy-in for children with potentially significant disabilities
who without needed health services will become severely disabled.
States will have more flexibility to offer disabled children needed
health services at home and in their communities.
It will establish Family to Family Information Centers in each state
to help families with special needs children.
The passage of the Work Incentives Improvement Act of 1999 showed the
commitment of this Nation to ensure that people with disabilities have
the right to lead independent and productive lives without giving up
their health care. It is now time for Congress to show that same
commitment to our country's children with disabilities and their
families.
I look forward to working with all members of Congress to move this
legislation forward and give disabled children and their families
across the country a better opportunity to fulfill their dreams and
fully participate in the social and economic mainstream of our Nation.

[[Page S1347]]

______

By Mr. COCHRAN (for himself, Mr. Frist, and Mr. Leahy):
S.J. Res. 5. A joint resolution providing for the appointment of
Walter E. Massey as a citizen regent of the Board of Regents of the
Smithsonian Institution; to the Committee on Rules and Administration.
Mr. COCHRAN. Mr. President, today I am introducing a Senate joint
resolution appointing a citizen regent to the Board of Regents of the
Smithsonian Institution. I am pleased that my fellow Smithsonian
Institution Regents, the Senator from Tennessee, Mr. Frist, and the
Senator from Vermont, Mr. Leahy, are cosponsors.
At its meeting on January 22, 2001, the Smithsonian Institution Board
of Regents recommended Dr. Walter E. Massey for appointment to the
Smithsonian Institution Board of Regents.
I ask unanimous consent that the biography of the nominee and the
text of the joint resolution be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

S.J. Res. 5

Resolved by the Senate and House of Representatives of the
United States of America in Congress assembled,

SECTION 1. APPOINTMENT OF CITIZEN REGENT OF THE BOARD OF
REGENTS OF THE SMITHSONIAN INSTITUTION.

(a) In General.--In accordance with section 5581 of the
Revised Statutes (20 U.S.C. 43), the vacancy on the Board of
Regents of the Smithsonian Institution, in the class other
than Members of Congress, occurring by reason of the
expiration of the term of Frank A. Shrontz of Washington on
May 4, 2000, is filled by the appointment of Walter E. Massey
of Georgia.
(b) Term.--The appointment is for a term of 6 years
beginning on the date of enactment of this joint resolution.
____

Biography

Massey, Walter Eugene, physicist, science foundation
administrator; b. Hattiesburg, Miss., Apr. 5, 1938; s. Almor
and Essie (Nelson) M.; m. Shirley Streeter, Oct. 25, 1969;
children: Keith Anthony, Eric Eugene. BS, Morehouse Coll.,
1958; MA, Washington U., St. Louis, 1966, PhD, 1966.
Physicist Argonne (Ill.) Nat. Lab., 1966-68; asst. prof.
physics U. Ill., Urbana, 1968-70; assoc. prof. Brown U.,
Providence, 1970-75, prof., dean of Coll., 1975-79; prof.
physics U. Chgo., 1979-93; dir. Argonne Nat. Lab., 1979-84;
v.p. for rsch. and for Argonne Nat. Lab. U. Chgo., 1984-91;
dir. NSF, Washington, 1991-93; sr. v.p. acad. affairs U.
Calif. System, 1993-95; pres. Morehouse Coll., Atlanta,
1995--; mem. NSB, 1978-84; cons. NAS, 1973-76. A scientist
and educator for the past 30 years, with significant
influence in higher education (especially science and math
education) and in educational administration, Walter Massey
has done extensive research in the study of quantum liquids
and solids. In 1966, while a physics professor at the
University of Chicago, he was instrumental in the founding of
the Argonne National Laboratory for the University, where he
served as director from 1979-84. He was responsible for
budget planning and allocations and programmatic oversight of
the three national laboratories managed by the University of
California from 1993-95. He is currently the ninth president
of Morehouse College, the nation's only historical black,
four-year liberal arts college for men. Contbr. articles on
sci. edn. in secondary schs. and in theory of quantum fluids
to profl. jours. Bd. fellows Brown U., 1980-90, Mus. Sci. and
Industry, Chgo., 1980-89, Ill. Math. and Sci. Acad., 1985-88;
bd. dirs. Urban League R.I., 1973-75. NAS fellow, 1961, NDEA
fellow, 1959-60, AAAS fellow, 1962. Mem. AAAS (bd. dirs.
1981-85, pres.-elect 1987-88, pres. 1988-89, chmn. 1989-90),
Am. Phys. Soc. (councillor-at-large 1980-83, v.p. 1990),
Sigma Xi. Office: Morehouse Coll 830 Westview Dr SW Atlanta
GA 30314-3773.

____________________