A BILL TO BE ENTITLED
AN ACT to enact the north carolina public schools budget flexibility act.
The General Assembly of North Carolina enacts:

Part I. title
SECTION 1.1.  This act shall be known as the "North Carolina Public Schools Budget Flexibility Act of 2013."

part ii. budget flexibility

additional authority to transfer funds
SECTION 2.1.  G.S. 115C‑105.25 reads as rewritten:
"§ 115C‑105.25.  Budget flexibility.
(a)	Consistent with improving student performance, a local board shall provide maximum flexibility to schools in the use of funds to enable the schools to accomplish their goals.
(b)	Subject to the following limitations, local boards of education may transfer and may approve transfers of funds between funding allotment categories:
	(1a)	Funds for children with disabilities, career and technical education, and other purposes may be transferred only as permitted by federal law and the conditions of federal grants or as provided through any rules that the State Board of Education adopts to ensure compliance with federal regulations.
		(3)	No funds shall be transferred into the central office administration allotment category.
		(5a)	Positions allocated for classroom teachers may be converted to dollar equivalents to contract for visiting international exchange teachers. These positions shall be converted at the statewide average salary for classroom teachers, including benefits. The converted funds shall be used only to cover the costs associated with bringing visiting international exchange teachers to the local school administrative unit through a State‑approved visiting international exchange teacher program and supporting the visiting exchange teachers.
				
(10)	Funds to carry out the elements of the Excellent Public Schools Act, which are contained in Sections 7A.1 and 7A.6 of S.L. 2012‑142, shall not be transferred."

local flexibility regarding class size
SECTION 2.2.(a)  G.S. 115C‑301 reads as rewritten:
"§ 115C‑301.  Allocation of teachers; class size.
(a)	Request for Funds. – The State Board of Education, based upon the reports of local boards of education and such other information as the State Board may require from local boards, shall determine for each local school administrative unit the number of teachers and other instructional personnel to be included in the State budget request.
(b)	Allocation of Positions. – The State Board of Education is authorized to adopt rules to allot instructional personnel and teachers, within funds appropriated.
(c)	Class Size. – Local school administrative units shall have the maximum flexibility to use allotted teacher positions to maximize student achievement.		(f)	Second Month Reports. – At the end of the second month of each school year, each local board of education, through the superintendent, shall file a report for each school within the school unit with the State Board of Education. The report shall be filed in a format prescribed by the State Board of Education and shall include the organization for each school, the duties of each teacher, the size of each class, the teaching load of each teacher, and such other information as the State Board may require.(g)	Allotment Adjustments. – Local boards of education may request allotment adjustments and the State Board of Education, within funds available, may allot additional positions.
		(h)	State Board Rules. – The State Board of Education shall adopt rules necessary for the implementation of this section.
	"
SECTION 2.2.(b)  G.S. 115C‑47(10) reads as rewritten:
"§ 115C‑47.  Powers and duties generally.
In addition to the powers and duties designated in G.S. 115C‑36, local boards of education shall have the power or duty:
…
(10)	To Assure Appropriate Class Size. – It shall be the responsibility of local boards of education to assure that the teacher positions allotted by the State are used to maximize student achievement.
In addition, each local board of education shall also have the duty to provide an adequate number of classrooms."
SECTION 2.2.(c)  G.S. 115C‑276(k) reads as rewritten:
"(k)	To Submit Organization Reports and Other Information to the State Board. – Each year the superintendent of each local school administrative unit shall submit to the State Board of Education statistical reports, certified by the chairman of the board of education, showing the organization of the schools in his unit and any additional information the State Board may require. At the end of the second month of school each year, local boards of education, through the superintendent, shall report school organization, employees' duties, class sizes, and teaching loads to the State Board of Education."

part iii. transparency of reporting on expenditures
SECTION 3.1.  G.S. 115C‑105.25 is amended by adding a new subsection to read:
"(c)	To ensure that parents, educators, and the general public are informed on how State funds have been used to address local educational priorities, each local school administrative unit shall publish the following information on its Web site by October 15 of each year:
(1)	A description of each program report code, written in plain English, and a summary of the prior fiscal year's expenditure of State funds within each program report code.
(2)	A description of each object code within a program report code, written in plain English, and a summary of the prior fiscal year's expenditure of State funds for each object code.
(3)	A description of each allotment transfer that increased or decreased the initial allotment amount by more than five percent (5%) and the educational priorities that necessitated the transfer."

part iv. effective date
SECTION 4.1.  This act becomes effective July 1, 2013.