GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1991

S	1 

SENATE BILL 975

Short Title:  Local Flexibility/Schools.	(Public)
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Sponsors: Senators Perdue, Cooper, Conder; Smith, Daniel, and Warren.
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Referred to:  Education.
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May 27, 1992

A BILL TO BE ENTITLED
AN ACT TO PROVIDE MANAGEMENT FLEXIBILITY TO LOCAL BOARDS OF EDUCATION AND TO INDIVIDUAL SCHOOLS REGARDING THE OPERATION OF THE PUBLIC SCHOOLS AND EXPENDITURES FOR THE PUBLIC SCHOOLS.
The General Assembly of North Carolina enacts:
Section 1.  (a) The General Assembly finds that it is appropriate to consolidate certain funding categories in the Public School Fund; therefore, 35 of the existing funding categories in the Public School Fund are combined into 15 categories as follows:
(1)	6602 - Asst Superintendent
	6612 - Supervisors 
(2)	6603 - Clerical Asst
	6627 - Clerical School Based
(3)	6614 - Substitute Pay
	6303 - Substitute Pay-Voc Ed
(4)	6642 - Summer School
	6672 - Remediation
(5)	6684 - Instruction Equipment
	6623 - Instruction Supplies
	6644 - Testing Support
	8124 - Textbooks
(6)	5400 - Driver Education Cars
	6657 - Driver Education
(7)	6636 - Alcohol/Drug Abuse Prev
	6635 - Alcohol/Drug Defense
	6630 - Substance Abuse Counselor
(8)	6659 - Staff Development
	6691 - Staff Dev-Finance Officer
	6617 - Staff Dev-Child Nutr Supr
(9)	6670 - Exceptional Children
	6696 - Except Child Related Ser
(10)	6610 - Bus Driver
	6611 - Transportation Personnel
(11)	6624 - Tires, Repair Parts
	6625 - Fuel-Buses
	6626 - Transportation-Other Exp
(12)	6619 - Social Security
	6304 - Soc Security-Voc Ed
(13)	6618 - State Retirement
	6305 - State Retirement-Voc Ed
(14)	6615 - Medical Insurance
	6306 - Medical Insurance-Voc Ed
(15)	6669 - Longevity
	6347 - Longevity-Voc Ed
(b) The following four funding categories are transferred from the Public School Fund to Fund 1900 - Reserves and Transfers:
(1)	6991 - Health Adventure
(2)	6992 - Cued Speech Center
(3)	6993 - Public School Forum
(4)	8180 - Children's Trust Fund.
(c) The Office of State Budget and Management shall retain the funding categories for the Public School Fund not combined or transferred by subsections (a) and (b) of this section and shall reorganize them in a more rational and orderly manner.
Sec. 2.  G.S. 115C-238.3 reads as rewritten:
"§ 115C-238.3.  Development of local plans; elements of local plans.
(a)	Development of systemwide plan by the local board of education. – The board of education of a local school administrative unit that elects to participate in the Program shall develop and submit a local school improvement plan for the entire local school administrative unit to the State Superintendent of Public Instruction before April 15 of the fiscal year preceding the fiscal year in which participation is sought.
The local board of education shall actively involve an advisory panel composed of a substantial number of teachers, school administrators, other school staff, and parents of children enrolled in the local school administrative unit, in developing the systemwide local school improvement plan.  It is the intent of the General Assembly that teachers have a major role in developing the local school improvement plan; therefore, at least half of the staff members participating in this advisory panel shall be teachers.  The teachers in the local school administrative unit shall select the teachers who are involved in the advisory panel.
(b)	Establishment of student performance goals by the local board of education for the systemwide plan. –The local board of education shall, with the assistance of its advisory panel, establish student performance goals for the local school administrative unit.  The performance goals for the local school administrative unit shall address specific, measurable goals for all student performance indicators adopted by the State Board.  Factors that determine gains in achievement vary from school to school; therefore, socioeconomic factors and previous student performance indicators shall be used as the basis of the local school improvement plan.
(b1)	Development by each school of strategies for attaining local student performance goals. –The principal of each school, the building-level staff, and parents of children enrolled in the school, shall develop a building-level plan to address student performance goals appropriate to that school from those established by the local board of education.  These strategies may include requests for waivers of State laws, regulations, or policies for that school.  A request for a waiver shall (i) identify the State laws, regulations, or policies that inhibit the local unit's ability to reach its local accountability goals, (ii) set out with specificity the circumstances under which the waiver may be used, and (iii) explain how a waiver of those laws, regulations, or policies will permit the local unit to reach its local goals.
Support among affected staff members is essential to successful implementation of a building-level plan to address student performance goals appropriate to a school; therefore, the principal of the school shall present the proposed building-level plan to all of the staff assigned to the school building for their review and vote.  The vote shall be by secret ballot.  The principal may submit the building-level plan to the local board of education for inclusion in the systemwide plan only if the proposed building-level plan has the approval of a majority of the staff who voted on the plan.
The local board of education, with the assistance of its advisory panel, shall accept or reject the building-level plan.  The local board shall not make any substantive changes in any building-level plan that it accepts; the local board shall set out any building-level plan that it accepts in the systemwide plan.  If the local board rejects a building-level plan, the local board shall state with specificity its reasons for rejecting the plan;  the principal of the school for which the plan was rejected, the building-level staff, and parents of children enrolled in the school may then prepare another plan, present it to the building-level staff for a vote, and submit it to the local board for inclusion in the systemwide plan.  If no building-level plan is accepted for a school before March 15 of the fiscal year preceding the fiscal year in which participation is sought, the local board, with the assistance of its advisory panel, may develop a plan for the school for inclusion in the systemwide plan; the General Assembly urges the local board to utilize the proposed building-level plan to the maximum extent possible when developing such a plan.
(c)	Development by each school of a differentiated pay plan for that school; development by the local board of education of a differentiated pay plan for central office personnel. –
(1)	The local school administrative unit shall consider a plan for differentiated pay.  The local plan shall include a plan for differentiated pay, in accordance with G.S. 115C-238.4, unless the local school administrative unit elects not to participate in any differentiated pay plan.
(2)	The principal of each school, the building-level staff, and parents of children enrolled in the school shall develop a building-level differentiated pay plan for the school when they develop their building-level plan to address student performance goals appropriate to the school.
		Support among affected staff members is essential to successful implementation of a building-level differentiated pay plan; therefore, the principal of the school shall present the proposed building-level plan to all of the staff eligible to receive differentiated pay, in accordance with G.S. 115C-238.4(a),  for their review and vote.  The vote shall be by secret ballot.  The principal may submit the building-level differentiated pay plan to the local board of education only if the proposed building-level differentiated pay plan has the approval of a majority of the staff who voted on the plan.
		The local board of education, with the assistance of its advisory panel, shall accept or reject the building-level differentiated pay plan.  The local board shall not make any substantive changes in any building-level plan that it accepts; the local board shall set out any building-level plan that it accepts in the systemwide differentiated pay plan.  If the local board rejects a building-level plan, the local board shall state with specificity its reasons for rejecting the plan; the principal of the school for which the plan was rejected, the building-level staff, and parents of children enrolled in the school may then prepare another plan, present it to all of the staff eligible to receive differentiated pay, in accordance with G.S. 115C-238.4(a), for a vote, and submit it to the local board for inclusion in the systemwide plan.  If no building-level plan is accepted for a school before March 15 of the fiscal year preceding the fiscal year in which participation is sought, the local board, with the assistance of its advisory panel, may develop a plan for the school building for inclusion in the systemwide plan; the General Assembly urges the local board to utilize the proposed building-level plan to the maximum extent possible when developing such a plan.
(3)	The local board of education, with the assistance of its advisory panel, shall develop a plan for differentiated pay for all central office personnel eligible to receive differentiated pay, in accordance with G.S. 115C-238.4(a), and shall include the plan in the systemwide differentiated pay plan.
(4)	A systemwide differentiated pay plan shall remain in effect for no more than three years.  At the end of three years, a plan to continue, discontinue, or modify that differentiated pay plan shall be developed in accordance with subdivisions (2) and (3) of this subsection.
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Sec. 3.  G.S. 115C-238.4 reads as rewritten:
"§ 115C-238.4.  Differentiated pay.
(a)	Local school administrative units may include, but are not required to include, a systemwide differentiated pay plan for certified instructional staff, certified instructional support staff, and certified administrative staff as a part of their local school improvement plans.  Units electing to include differentiated pay plans in their school improvement plans shall base their differentiated pay plans on:
(1)	The Career Development Pilot Program;
(2)	The Lead Teacher Pilot Program;
(3)	A locally designed school-based performance program, subject to limitations and guidelines adopted by the State Board of Education;
(4)	A differentiated pay plan that the State Board of Education finds has been successfully implemented in another state; or
(5)	A locally designed plan including any combination or modification of the foregoing plans.
A differentiated pay plan may also authorize the use of State differentiated pay funds for staff development and planning activities and for paying substitute teachers as is necessary to provide time for staff development and planning activities.
	(c)	Local school administrative units electing to participate in a differentiated pay plan shall receive State funds according to the terms of the plan but not to 
					exceed the amount appropriated by the General Assembly for differentiated pay.  It is the intent of the General Assembly that this amount never be less than the percentage of teacher and administrator salaries and employers' contributions for social security and retirement appropriated by the General Assembly for the prior fiscal year; it is further the intent of the General Assembly to increase this amount to seven percent (7%) of teacher and administrator salaries and employers' contributions for social security and retirement.
Any differentiated pay plan developed in accordance with this section shall be implemented within State and local funds available for differentiated pay.
(d)	Attainment of the equivalent of Career Status I shall be rewarded through a new salary schedule that provides a salary differential when a certified educator successfully completes his probationary period.
(e)	Any additional compensation received by an employee as a result of the unit's participation in the Program shall be paid as a bonus or supplement to the employee's regular salary.  If an employee in a participating unit does not receive additional compensation, such failure to receive additional compensation shall not be construed as a demotion, as that term is used in G.S. 115C-325.
Payments of bonuses or supplements shall be made no more frequently than once every calendar quarter: Provided, however, prior to the 1994-95 school year, payments in the career development pilot units may be made on a monthly basis.
(f)	If a local school administrative unit bases its differentiated pay plan on a locally designed school-based performance program, pursuant to subdivision (a)(3) of this section, the plan shall provide that following the attainment of the local school goals, the local board of education shall make a determination of which certified staff members contributed to the attainment of those goals.  Differentiated pay bonuses shall then be distributed to those designated employees.  The local board of education shall make the determination upon recommendation of (i) the superintendent and (ii) any other person or committee designated in the local differentiated pay plan.  The other person or committee designated in the local differentiated pay plan may be the principal, a school-based committee, or any other person or local committee."
Sec. 4.  G.S. 115C-238.6 reads as rewritten:
"§ 115C-238.6.  Approval of local school administrative unit plans by the State Superintendent; conditions for continued participation.
(a)	Prior to June 30 each year, the State Superintendent shall review local school improvement plans submitted by the local school administrative units in accordance with policies and performance indicators adopted by the State Board of Education.  If the State Superintendent approves the plan for a local school administrative unit, that unit shall participate in the Program for the next fiscal year.
If a local plan contains a request for a waiver of State laws, regulations, or policies, in accordance with G.S. 115C-238.3(d), the State Superintendent shall determine whether and to what extent the identified laws, regulations, or policies should be waived.  The State Superintendent shall present that plan and his determination to the State Board of Education.  If the State Board of Education deems it necessary to do so to enable a local unit to reach its local accountability goals, the State Board, only upon the recommendation of the State Superintendent, may grant waivers of:
(1)	State laws pertaining to class size, teacher certification, assignment of teacher assistants, the use of State-adopted textbooks, and the purposes for which State funds for the public schools, except for funds for school health coordinators, may be used: Provided, however, the State Board of Education shall not permit the use of funds for teachers for expanded programs under the Basic Education Program for any other purpose;
(2)	All State regulations and policies, except those pertaining to State salary schedules and employee benefits for school employees, the instructional program that must be offered under the Basic Education Program, the system of employment for public school teachers and administrators set out in G.S. 115C-325, health and safety codes, compulsory school attendance, the minimum lengths of the school day and year, and the Uniform Education Reporting System.
Waivers shall be granted only for the specific schools for which they are requested in building-level plans and shall be used only under the specific circumstances for which they are requested.
(b)	Local school administrative units shall continue to participate in the Program and receive funds for differentiated pay, if their local plans call for differentiated pay, so long as (i) they demonstrate satisfactory progress toward student performance goals set out in their local school improvement plans; or (ii) once their local goals are met, they continue to achieve their local goals and they otherwise demonstrate satisfactory performance, as determined by the State Superintendent in accordance with guidelines set by the State Board of Education.
If the local school administrative units do not achieve their goals after two years, the Department of Public Instruction shall provide them with technical assistance to help them meet their goals.  If after one additional year they do not achieve their goals, the State Board of Education shall decide what steps shall be taken to improve the education of students in the unit."
Sec. 5.  Section 1 of this act becomes effective July 1, 1992.  The remainder of this act is effective upon ratification and applies to all local school improvement plans developed for school years beginning with the 1993-94 school year.