A BILL TO BE ENTITLED
AN ACT to enact the education and economic competitiveness act of 2005.
The General Assembly of North Carolina enacts:

part I.  title of act

SECTION 1.1.  This act shall be known as the "Education and Economic Competitiveness Act of 2005".

part ii.  INVESTING MORE RESOURCES AND DEMANDING MORE ACCOUNTABILITY

REPORTS ON THE EXPENDITURE OF SUPPLEMENTAL FUNDS FOR LOW‑WEALTH COUNTIES
SECTION 2.1.  Local boards of education shall report to the State Board of Education by August 31 of each year on the expenditure of supplemental funds for low‑wealth counties and how these funds were targeted and used to implement specific improvement strategies of each local school administrative unit and its schools, such as teacher recruitment, closing the achievement gap, improving student accountability, addressing the needs of at‑risk students, and establishing and maintaining safe schools.  The State Board of Education shall report this information annually by October 31 to the Office of State Budget and Management, the Joint Legislative Education Oversight Committee, and the Fiscal Research Division.

evaluate the effectiveness of DISADVANTAGED STUDENT SUPPLEMENTAL FUNDING on the improvement of student achievement
SECTION 2.2.(a)  The State Board of Education may require local school administrative units receiving funding under the Disadvantaged Student Supplemental Fund to purchase the Education Value Added Assessment System in order to provide in‑depth analysis of student performance and help identify strategies for improving student achievement.
SECTION 2.2.(b)  To remain eligible for funding under the Disadvantaged Student Supplemental Fund, local school administrative units must submit a report to the State Board of Education by August 31 of each year detailing the expenditure of the funds and the impact of these funds on student achievement. The State Board of Education shall report this information annually by October 31 to the Office of State Budget and Management, the Joint Legislative Education Oversight Committee, and the Fiscal Research Division.

provide for NEW ACCOUNTABILITY FOR THE USE OF FUNDS IN the AT‑RISK AND  IMPROVING STUDENT ACCOUNTABILITY ALLOTMENTs 
SECTION 2.3.(a)  Funds appropriated for the At‑Risk/Alternative Schools allotment and the Improving Student Accountability allotment shall be used consistent with the policies and procedures adopted by the State Board of Education only:  (i) to provide instructional positions or instructional support positions and/or professional development; (ii) to provide intensive in‑school and/or after‑school remediation; and (iii) to purchase diagnostic software and progress monitoring tools.
SECTION 2.3.(b)  To remain eligible for funds appropriated for the At‑Risk/Alternative Schools allotment and the Improving Student Accountability allotment, local school administrative units must submit a report to the State Board of Education by October 31 of each year detailing the expenditure of the funds and the impact of these funds on student achievement. The State Board of Education shall report this information annually by October 31 to the Office of State Budget and Management, the Joint Legislative Education Oversight Committee, and the Fiscal Research Division.

Local school system ASSISTANCE PROGRAM
SECTION 2.4.  The State Board of Education shall develop: (i) the criteria for LEA Assistance Teams; (ii) the criteria for selecting LEAs and schools to receive assistance; (iii) measurable goals and objectives for the assistance program; and (iv) an explanation of the type of assistance to be provided with these combined resources. The Department shall develop a revised organizational structure and budget for providing assistance services to LEAs to ensure the Department can meet the needs of the LEAs. The State Board of Education must approve this structure and budget.
For fiscal year 2005‑2006 only, the State Board may, with the prior approval of the fiscal year Office of State Budget and Management, transfer General Fund appropriations between personal service and nonpersonal service line items within this fund to structure itself most efficiently for the delivery of services. All funds transferred under this provision are only for this program and for the services described herein. Funds shall not be used to raise the salary of existing employees.

PART III. RECRUITING AND RETAINING QUALITY TEACHERS AND PRINCIPALS ACROSS THE STATE

TWO‑YEAR TEACHING FELLOWS PROGRAM FOR SCIENCE AND MATHEMATICS
SECTION 3.1.(a)  Of the funds appropriated to the Department of Public Instruction for the Teaching Fellows Program, funds may be used for the administration of a Two Year Teaching Fellows Program focused on preparing math and science teachers for public middle and high schools.
SECTION 3.1.(b)  G.S. 115C‑363.23A reads as rewritten:
"§ 115C‑363.23A.  Teaching Fellows Program established; administration.
(a)	A Teaching Fellows Program shall be administered by the North Carolina Teaching Fellows Commission. The Teaching Fellows Program shall be used to provide a four‑year scholarship loan of six thousand five hundred dollars ($6,500) per year to North Carolina high school seniors interested in preparing to teach in the public schools of the State. Beginning July 1, 2006, the Teaching Fellows Program also may be used to provide 50 two‑year scholarship loans of six thousand five hundred dollars ($6,500) per year to North Carolina college juniors who intend to teach mathematics or science in the public middle schools or high schools of the State. The Commission shall adopt very stringent standards, including minimum grade point average and scholastic aptitude test scores, for awarding these scholarship loans to ensure that only the best high school seniors receive them.
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(c)	The Commission shall form regional review committees to assist it in identifying the best high school seniors or college juniors for the program. The Commission and the review committees shall make an effort to identify and encourage minority students and students who may not otherwise consider a career in teaching to enter the program.
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(e)	The Commission shall forgive a four‑year loan if, within seven years after graduation, the recipient teaches for four years at a North Carolina public school or at a school operated by the United States government in North Carolina. The Commission shall forgive a two‑year loan if, within five years after graduation, the recipient teaches for two years at a North Carolina public school or at a school operated by the United States government in North Carolina. The Commission shall also forgive a two‑year or a four‑year loan if it finds that it is impossible for the recipient to fulfill the teaching requirement due to  the death or permanent disability of the recipient.
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PRINCIPALS EXECUTIVE PROGRAM FOR NEW PRINCIPALS
SECTION 3.2.  Of the funds appropriated to the Board of Governors of The University of North Carolina, the sum of one hundred twenty-five thousand dollars ($125,000) for the 2005-2006 fiscal year and the sum of one hundred twenty-five thousand dollars ($125,000) for the 2006-2007 fiscal year may be used to support the development and implementation of a new program for all new public school principals. The program shall include a focus on the principal's responsibility for instructional leadership, data driven decision making, and positive teacher working conditions. All newly hired principals in North Carolina shall be required to attend this PEP developed program for new principals during their first year of employment as a principal.
TEACH FOR AMERICA
SECTION 3.3.  Of the funds appropriated to the Department of Public Instruction, the sum of two hundred thousand dollars ($200,000) for the 2005-2006 fiscal year and the sum of two hundred thousand dollars ($200,000) for the 2006-2007 fiscal year may be used to support the Teach for America Program in North Carolina for the purpose of recruiting teachers into high need schools.

part iv. Twenty‑first century high schools

SMALL SPECIALTY HIGH SCHOOLS PILOT PROgRAM
SECTION 4.1.(a)  Of the funds appropriated to the Department of Public Instruction, the sum of one million four hundred forty‑six thousand eight hundred seventy‑seven dollars ($1,446,877) for the 2005‑2006 fiscal year and the sum of one million four hundred forty‑six thousand eight hundred seventy‑seven dollars ($1,446,877) for the 2006‑2007 fiscal year may be used for a pilot program to create 11 small specialty high schools within existing schools. The purpose of the program shall be to improve graduation rates and achieve higher student performance as measured by standard tests and postgraduate gainful employment or admission into an institution of higher education. The State Board of Education shall work closely with the Education Cabinet and the New Schools Project in administering the program.
SECTION 4.1.(b)  The State Board of Education shall conduct an evaluation of this program.  The evaluation shall include measures as identified in G.S. 115C‑238.55. It shall also include: (i) an accounting of how funds and personnel resources were utilized and their impact on student achievement, retention, and employability; and (ii) recommendations for improvement of the program. The State Board of Education shall report the results of this evaluation to the Office of State Budget and Management, the Joint Legislative Education Oversight Committee, and the Fiscal Research Division by November 15, 2006.

part v.  effective date

SECTION 5.1.  This act becomes effective July 1, 2005.