2009 -- S 0921

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LC02549

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2009

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A N A C T

RELATING TO EDUCATION-- THE EDUCATION ADEQUACY ACT

     Introduced By: Senators Gallo, DeVall, P Fogarty, DiPalma, and Sosnowski

     Date Introduced: May 14, 2009

     Referred To: Senate Finance

It is enacted by the General Assembly as follows:

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     SECTION 1. Sections 16-2-9.3 and 16-2-9.4 of the General Laws in Chapter 16-2

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entitled "School Committees and Superintendents" are hereby amended to read as follows:

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     16-2-9.3. The advisory council on school finances. -- (a) The legislature hereby finds

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and declares that there is a need for an advisory council on school finances to strengthen the fiscal

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accountability of school districts, regional school districts, state schools and charter schools in

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Rhode Island. The council shall be composed of five (5) members as follows:

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      (1) The auditor general of the state of Rhode Island or his or her designee;

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      (2) The executive director of the Rhode Island association of school committees or his or

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her designee;

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      (3) The president of the Rhode Island association of school business officials or his or

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her designee;

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      (4) The commissioner of elementary and secondary education or his or her designee; and

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      (5) The director of the department of administration or his or her designee. The auditor

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general or his or her designee shall serve as chair of the council. By July 1, 2005, the council shall

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develop recommendations for a uniform system of accounting, including a chart of accounts for

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all school districts, regional school districts, state schools and charter schools. By July 1, 2009 the

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council shall develop recommendations for a uniform system of accounting, that may include a

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uniform chart of accounts, for all educational regional collaboratives identified in section 16-3.1.

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Said recommendations shall be advisory in nature and may be adopted by the office of auditor

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general and the department of elementary and secondary education in part or in whole.

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      (b) The council shall meet no less than annually and recommend changes in accounting

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procedures to be adopted by school districts, regional school districts, state schools and charter

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schools as well as apprise school business officials, charter school officials, school committees

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and school superintendents, school administrators and state school officials about professional

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development opportunities that promotes sound fiscal practices and a knowledge of current state

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and federal rules and regulations regarding school finance. The council shall also report, annually,

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its activities and recommendations to the house committee on education accountability, the senate

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committee on education and the office of the governor.

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     16-2-9.4. School district accounting compliance. -- (a) The office of auditor general

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and the department of elementary and secondary education shall promulgate a uniform system of

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accounting, including a chart of accounts based on the recommendations of the advisory council

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on school finance, and require all accounts of the school districts, regional school districts, state

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schools, and charter schools, and regional collaboratives to be kept in accordance therewith;

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provided, that in any case in which the uniform system of accounting is not practicable, the office

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of auditor general in conjunction with the department of elementary and secondary education

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shall determine the manner in which the accounts shall be kept.

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      (b) For the purpose of securing a uniform system of accounting and a chart of accounts

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the advisory council on school finances, as defined in section 16-2-9.2 may make such surveys of

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the operation of any school districts, regional school district, state school or charter school as they

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shall deem necessary.

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      (c) If any school district, regional school district, state school, regional collaborative or

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charter school fails to install and maintain the uniform system of accounting, including a chart of

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accounts, or fails to keep its accounts and interdepartmental records, or refuses or neglects to

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make the reports and to furnish the information in accordance with the method prescribed by the

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office of auditor general and the department of education or hinders or prevents the examination

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of accounts and financial records, the auditor general and the commissioner of education may

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make a report to the board of regents for elementary and secondary education in writing,

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specifying the nature and extent of the failure, refusal, neglect, hindrance, or prevention, and the

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board of regents is hereby authorized and directed to review the matter so reported. If the regents

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shall find that failure, refusal, neglect, hindrance, or prevention exists and that the school district,

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regional school district, state school, regional collaborative or charter school should properly

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comply in the matter so reported, the regents shall direct the school district, regional school

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district, state school, regional collaborative or charter school, in writing, to so comply. If the

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failure, refusal, neglect, hindrance, or prevention shall continue for a period of ten (10) days

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following the written direction, the regents may withhold distribution of state aid to said school

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district, regional school district, state school, regional collaborative or charter school.

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     SECTION 2. Section 16-5-34 of the General Laws in Chapter 16-5 entitled "State Aid" is

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hereby amended to read as follows:

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     16-5-34. Statewide purchasing system. -- The department of elementary and secondary

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education, pursuant to the collaborative established in Rhode Island General Laws section 6-2-9.2

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along with the department of administration, shall develop a plan for the establishment,

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facilitation and/or implementation of a statewide purchasing system for all public schools in this

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state. For the purposes of this chapter, the statewide purchasing system may include purchasing

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programs developed by any state agency, regional educational collaborative, or consortia of

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public school districts, and may be structured to allow participation by both public and private

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institutions of higher education, private elementary or secondary school systems, or public or

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private day care providers. Said statewide purchasing system shall develop requests for proposals

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relating to goods and services to enhance and support the mission of public schools and public

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education in general throughout this state, including, but not limited to, the purchase of the

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following goods, supplies, and services:

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      (a) General school supplies such as paper goods, office supplies, and cleaning products

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that are or may be utilized by school departments;

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      (b) Textbooks, telecommunications, wireless services, and software that have been

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identified by local school departments as needed to support local curriculum objectives;

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      (c) A statewide school transportation system for children with special needs. Local

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school departments shall be eligible to participate in this system by purchasing transportation

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services on a fee-for-service basis. It is stated herein that the goals and intent of establishing this

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state-wide transportation system for children with special needs shall be as follows:

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      (1) To reduce the duplication of bus routes;

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      (2) To improve services to children through the development of shorter, more efficient

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routes that minimize the amount of time spent by the student traveling on school transportation to

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and from school and school-related/sponsored activities; and

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      (3) To reduce transportation costs to local educational authorities through greater

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efficiency and cost-effective measures.

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      (d) General non-medical and dental insurance products and services, provided however,

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that the statewide purchasing system shall permit districts to establish their own benefit and

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coverage levels.

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     (e) Administrative functions, such as personnel, payroll services, accounting and data

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information services, student services, technology implementation, where and when possible.

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     (f) Insurance services such as property and casualty, workers' compensation and general

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liability insurance.

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     (g) Participation in any statewide purchasing system shall be compulsory, unless a district

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can demonstrate that such participation would increase the existing cost of any goods and/or

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services that the district is currently utilizing or contracted for. Exemptions to participation in

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any statewide purchasing system shall be at the discretion of the Rhode Island strategic

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purchasing advisory commission.

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      (e) (h) The department of elementary and secondary education, in collaboration with the

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department of administration, shall also develop policies and procedures to reduce the cost of

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health care insurance to local school departments by developing a collaborative process which

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shall include local educational authorities and representatives of local educational unions in

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discussions of cost saving efficiencies that could be achieved by including these employees in a

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state health insurance contract.

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     SECTION 3. Section 37-2-79 of the General Laws in Chapter 37-2 entitled "State

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Purchases" is hereby amended to read as follows:

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     37-2-79. Establishment of the Rhode Island Strategic Purchasing Advisory

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Commission. -- In order to provide a means of collaboration between the state, cities/towns and

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school committees a permanent advisory commission is established named the "Rhode Island

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Strategic Purchasing Advisory Commission." This Advisory Commission will consist of nine (9)

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members including: (1) the state purchasing agent or his or her designee, who will serve as chair,

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(2) a designee of the board of regents of the Rhode Island department of elementary and

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secondary education, (3) a designee of the board of governors of higher education, (4) a designee

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of the Rhode Island School Committees Association, (5) a designee of the Rhode Island League

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of Cities and Towns, (6) a designee of the Association of School Business Officials, (7) a

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designee of the Rhode Island Municipal Purchasing Agents Association, (8) a designee of the

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Rhode Island economic development corporation and, (9) a designee of the state budget officer.

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The advisory commission may exempt a school district or group of districts from compulsory

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participation in any statewide purchasing plan, if the district or group of districts can substantiate

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that participation in such statewide purchasing plan would increase the cost to the district. The

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advisory commission shall provide technical assistance to the Rhode Island department of

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administration, the Rhode Island department of elementary and secondary education, any regional

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educational collaborative, or school district consortia in implementing the mandates of section

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16-5-34. The advisory commission shall meet no less than four (4) times annually.

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     SECTION 4. Sections 16-7.1-1 and 16-7.1-2 of the General Laws in Chapter 16-7.1

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entitled "The Paul W. Crowley Rhode Island Student Investment Initiative" are hereby amended

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to read as follows:

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     16-7.1-1. Legislative findings. -- (a) Legislative intent. - (1) The intent of this legislation

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is to enact a comprehensive state education aid funding program which addresses four (4)

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fundamental principles:

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      (i) Closing the inequitable resource gaps among school districts and schools;

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      (ii) Closing inequitable gaps in performance and achievement among different groups of

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students, especially those correlated with poverty, gender, special needs, and language

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background;

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      (iii) Targeting investments to improve student and school performance; and

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      (iv) Establishing a predictable method of distributing state education aid in a manner that

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addresses the over-reliance on the property tax to finance education.

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      (2) This legislation is further designed to accelerate the implementation of the State

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Comprehensive Education Strategy. The strategy is an action plan for ensuring that all children

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achieve at high levels and become lifelong learners, productive workers, and responsible citizens.

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The standard for expected student achievement is currently being set at a high level both by the

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board of regents and in Rhode Island's districts and schools. High standards must be supported

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and these expectations must now be reached by all our students. All the state's children must

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enjoy the success that comes with proficiency in skill and knowledge.

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      (b) Evaluation of success. - Improved student and school performance is the key

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measure of the success of Rhode Island's schools. This success cannot occur without investment

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based on the four (4) fundamental principles as stated in subsection (a) of this section. The

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success of these investments shall be evaluated based on: accountability for student and school

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performance; accountability in terms of whether the state's investment is sufficiently adequate

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and equitable to support improvement in performance; and on accountability for district and

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school expenditures.

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     16-7.1-2. Accountability for student performance. -- (a) The board of regents shall

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adopt and publish statewide standards of performance and performance benchmarks in core

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subject areas to include writing and mathematics (grades four (4), eight (8), and ten (10)). These

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standards and performance benchmarks shall be ratified by the board and implemented, and

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performance standards and performance benchmarks for reading in two (2) grades shall be added.

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      (b) Districts and schools need to be held accountable for student performance results.

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Therefore, every school district receiving state education aid under this title shall develop a

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district strategic plan. The district strategic plan shall: (1) be based on high academic standards

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for student performance consistent with the statewide standards and benchmarks; (2) be the

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product of a shared community wide process which defines a vision of what students should

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know and be able to do; (3) address the needs of each school in the district; (4) encourage the

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development of school-based improvement planning and implementation; (5) include a process

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for mentoring of new teachers; (6) be designed to improve student achievement with emphasis on

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closing the performance gaps among groups of students such as the performance gaps correlated

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with poverty, gender, language background, and disability; (7) include establishment of student

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intervention teams to address the instructional needs of diverse learners, include high standards of

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student behavior designed to create an orderly educational environment with due regard for the

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rights of students, and an asset protection plan; and (8) be consistent with Rhode Island's

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comprehensive education strategy. In order to assure the most efficient use of resources

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implementing strategic plans, and to create economies of scale, districts and schools are

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encouraged to work together as consortia and as part of the regional collaboratives.

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      (c) (1) The strategic plan shall include strategies to improve the performance of students

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in mathematics, reading, and writing. Each plan must describe a scientific research based, as

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described in the No Child Left Behind Act of 2001, Title 1, Part B, Section 1208 [20 U.S.C.

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section 6368] reading instruction to improve the reading skills of all students in the early grades

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(kindergarten through grade five (5)) that is aligned with the board of regents reading policy. The

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district must develop, implement and evaluate a Personal Literacy Program for each student in

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these grades who is performing below grade level. These strategies shall be based on the adequate

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yearly progress expected for students and schools. Annual performance targets for determining

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whether schools and districts have made adequate yearly progress will be set by the commissioner

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of elementary and secondary education. The general assembly expects these district strategies to

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increase the number of fourth grade students performing at or above the proficient standard in

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mathematics, reading, and writing in each district and school. The increase shall be established

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annually in accordance with section 16-7.1-4.

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      (2) The general assembly recognizes the contribution of school counselors to positive

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educational change, to the implementation of the No Child Left Behind Act of 2001, and to the

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success of students in three (3) developmental domains: academic, career, and personal/social. It

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endorses the National Standards for School Counseling Programs as developed by the American

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School Counselor Association (ASCA). Further, the general assembly encourages every district

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to implement a K-12 standards-based comprehensive, developmental school counseling program.

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      (d) Each strategic plan must indicate the manner in which self-studies will be completed

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at the school level in accordance with guidelines established by the commissioner. Funds shall be

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appropriated to the department of elementary and secondary education to assist districts with on-

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site reviews. Schools to be visited shall be determined by the commissioner.

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      (e) Each strategic plan must indicate the method in which school administrators and staff

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shall achieve and maintain an orderly educational environment in accordance with due process

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and with due regard for the rights of students.

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      (f) Each strategic plan shall include the development of inter-agency agreements for the

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coordination of services among state and local agencies responsible for service to children and

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families. These agreements shall address the identification and provision of services to pre-school

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children with disabilities and children and youth with behavioral health care needs.

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      (g) All district strategic plans and annual updates shall be submitted to the commissioner

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of elementary and secondary education no later than May 1, of each year.

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      (h) All strategic plans shall include strategies to decrease obesity and improve the health

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and wellness of students and employees through nutrition, physical activity, health education, and

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physical education. Said strategies shall be submitted by May 1st of each year to the Rhode Island

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department of elementary and secondary education and the Rhode Island department of health.

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     SECTION 5. Section 16-7.2-1 of the General Laws in Chapter 16-7.2 entitled "The

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Education Equity and Property Tax Relief Act" is hereby amended to read as follows:

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     16-7.2-1. Legislative findings. -- (a) The general assembly recognizes the need for an

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equitable distribution of resources among the state's school districts, property tax relief and a

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predicable method of distributing education aid. The general assembly finds that there is a need to

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reform the way public education is financed because:

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      (1) All children should have access to an adequate and meaningful education regardless

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of their residence or economic means;

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      (2) A school funding system should treat property taxpayers equably equitably, limit the

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portion of school budgets financed by property taxes, and establish sufficient cost controls on

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school spending, and promote efficiency in the use and distribution of limited resources;

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      (3) The state should ensure that its school funding structure adequately reflects the

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different needs of students, and closes the educational inequities among the state's school

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districts; and

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      (4) The state education funding system should provide a predicable amount and source

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of funding to ensure stability in the funding of schools.; and

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     (5) The state education funding system must be anchored in systems of fiscal and

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programmatic accountability that measure whether state and local programs and expenditures

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actually provide the opportunity for a sound basic education in a manner consistent with Rhode

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Island law.

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      (b) The intent of this chapter is to promote a school finance system in Rhode Island that

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is predicated on student need and property taxpayer ability to pay. A new school funding system

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in the state should promote educational equity for all students and reduce the reliance on the

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property tax to fund public education. This legislation is intended to ensure educational

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opportunity to each pupil in each city or town on substantially equal terms. Adequate per pupil

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support will be provided through a combination of state school aid and local education property

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tax levies. The successful implementation of this comprehensive funding system will require the

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full implementation of the uniform system of accounting established by section 16-2-9.4, as well

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as incorporation of fiscal oversight into the state system of accountability as set forth in chapter

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16-7.1. Funding shall be allocated on a annual basis to the department of elementary and

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secondary education for the purpose of implementing an accountability framework designed to

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ensure fiscal efficiency and program effectiveness.

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     SECTION 6. Section 16-7.2-2 of the General Laws in Chapter 16-7.2 entitled "The

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Education Equity and Property Tax Relief Act" is hereby repealed.

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     16-7.2-2. Joint legislative committee to establish a permanent education foundation

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aid formula for Rhode Island. -- (a) There is hereby established a joint legislative committee to

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develop a basic foundation support program and an appropriate transition plan to fully implement

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a new funding system.

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      The committee shall consist of ten (10) members, five (5) of which shall be appointed by

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the speaker of the house, one (1) of which shall be from the minority party, and five (5) members

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appointed by the president of the senate, one (1) of which shall be from the minority party. The

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speaker of the house and president of the senate shall each appoint a committee co-chair.

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      The joint legislative committee is directed to consider the following framework in

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developing a new education foundation support program:

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      (1) A state education funding formula that is student population and needs driven.

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Student counts should include enrollments, students eligible for free and reduced lunch, those

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participating in language assistance programs, and special education. Provisions should be made

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for those school districts that experience declining enrollments.

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      (2) The accounting for "extraordinary special education expenditures" in special

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education spending for one child in a given fiscal year.

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      (3) A per pupil foundation amount to be used in the calculation of school funding. The

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per pupil foundation amount should be based on what the cost is to provide an equitable and

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adequate education, and consider various cost factors, such as pupil-teacher ratios, teacher and

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staff compensation, technology investments, educational supplies, teacher training and

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professional development, student performance assessments, curriculum offerings and support

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services and other costs associated with the delivery of educational services.

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      (4) Per pupil cost, based on a least cost option plan to provide purchase of service

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contracts in areas such as equipment, repair, benefits, transportation, general purchasing, capital

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construction, data processing and health and other insurance programs. In addition, the

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department of education should assist regional collaboratives in identifying opportunities to

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maximize multiple school district participation for "high cost" programs.

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      (5) Various methods of funding the system.

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      (6) A transition education funding plan.

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      (b) The speaker of the house and president of the senate, in consultation with the

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committee co-chairs, are hereby directed to appoint a foundation aid technical advisory group,

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and a property tax relief technical advisory group.

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      (c) The foundation aid technical advisory group shall advise and assist the committee in

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recommending foundation aid amounts by:

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      (1) Identifying specific resources and least cost options to provide every child the

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opportunity to necessary educational opportunities to meet education performance standards; and

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      (2) Systematically calculating the amount of per pupil funding necessary to support an

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effective and efficient educational system. The group may create task forces to consider the needs

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of special populations, comprehensive education programs, and noneducational support activities,

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composed of experts in these areas. In developing a foundation aid amount, the group shall

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consider, among other factors, pupil-teacher ratios, compensation, collective bargaining practices,

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technology investments, educational supplies, teacher training and professional development,

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student performance assessments, curriculum offerings and support services and all other costs

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and needs associated with the delivery of educational services.

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      (d) The property tax relief technical advisory group shall advise and assist the committee

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in identifying the options and the impact of replacing existing local education property tax levies

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that support the funding of elementary and secondary education with other resources.

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      (e) The joint committee shall issue a report outlining its findings and recommendations

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no later than May 15, 2007.

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      All state agencies and departments shall be directed to cooperate with and provide all

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necessary information to the joint legislative committee.

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     SECTION 7. Chapter 16-7 of the General Laws entitled "Foundation Level School

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Support" is hereby amended by adding thereto the following sections:

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     16-7-20.8. Permanent education foundation aid formula established. – (a) Beginning

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in the first fiscal year following the 2010 fiscal year, in which the revenue and caseload

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estimating conference publishes findings that estimate an increase in general revenues for two (2)

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consecutive annual fall reports, the following foundation education aid formula shall take effect.

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The foundation education aid for each district shall consist of three (3) components:

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     (1) An amount equal to the total dollar amount received by each district, in the fiscal year

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two (2) years prior to the revenue and caseload estimating conference, estimates of an increase in

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general revenues, and pursuant to sections 16-7.1-8, 16-7.1-9, 16-7.1-10, 16-7.1-11, 16-7.1-11.1,

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16-7.1-12, 16-7.1-15, 16-7.1-16, 16-7.1-19, and 16-64-1.1.

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     (2) An amount equal to the statewide per pupil core instruction amount for the reference

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year as defined in 16-7-16 multiplied by the district resident average daily membership as defined

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in 16-7-22 multiplied by the district state share calculated pursuant to 16-7-20.9; and

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     (3) An amount in support of high need students based on the correlation between poverty

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and concentrations of such students. These funds shall be determined on a per pupil basis by the

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percentage of each district's resident children in grades pre-kindergarten through six eligible for

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USDA reimbursable meals relative to the total number of pre-kindergarten through grade six

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students as follows: Four thousand dollars ($4,000) for districts over seventy percent (70%);

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Three thousand dollars ($3,000) for districts between forty percent (40%) and seventy percent

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(70%); Two thousand dollars ($2,000) for districts between twenty percent (20%) and forty

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percent (40%); One thousand dollars ($1,000) for districts between ten percent (10%) and twenty

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percent (20%); and Five hundred dollars ($500) for districts ten percent and below. Total aid

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provided pursuant to this subsection is per pupil amount times the district resident average daily

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membership as determined pursuant to the provisions of section 16-7-22.

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     (b) The statewide per pupil core instruction amount shall be adjusted on an annual basis

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by the CPI-U, All Urban Consumers, for the northeast region when applying such index to the

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amount used for aid calculations in the preceding fiscal year results in a higher per pupil than

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actual. The per pupil amounts for the poverty concentration calculation contained in subsection

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(a) above shall be adjusted on an annual basis by the CPI-U, All Urban Consumers for the

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northeast region.

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     (c) The board of regents for elementary and secondary education shall annually determine

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the appropriation of education aid pursuant to this section based on a ratable reduction of the fully

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funded foundation aid calculated pursuant to subdivisions (a)(2) and (a)(3) of this section.

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     16-7-20.9. Determination of state's share. – For each district the state's share of the per

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pupil core instruction foundation amount shall be calculated by taking 1.0 minus fifty percent

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(50%) times one-half (1/2) of the district full value per pupil divided by the statewide full value

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per pupil plus one-half (1/2) of the district median family income divided by the statewide

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median family income as follows:

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     R = the calculated share ratio, as calculated via the following formula:

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     R = 1.0 - 0.5((0.5 x v/m / V/M) + 0.5 (i/I))

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     v = full assessed valuation for the community as defined in subsection 16-7-21(1) and 16-

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7-21(2)

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     V = sum of all values of v for all communities

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     m = average daily membership of pupils in the community as defined in section 16-7-22

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     M = total average daily membership of the state

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     i = median family income of the community as determined by the American Community

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Survey (ACS) or the US Census, whichever is most current

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     I = median family income of the state as determined by the American Community Survey

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(ACS) or the US census, whichever is most current.

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     In no case shall R be less than twenty-five percent (25%); provided, however, that during

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the implementation period no district shall receive in any given fiscal year an increase greater

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than fifteen percent (15%) of the prior year's aid. In addition, no district shall receive an increase

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in aid in any given year if current aid for that district is greater than the total formula aid

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calculated pursuant to subdivisions 16-7-20.8(a)(2) and 17-7-20.8(a)(3).

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     16-7-20.10. State funded expenses. – In addition to the foundation aid provided pursuant

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to sections 16-7-20.8 and 16-7-20.9 the permanent foundation aid program will provide direct

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state funding for excess costs associated when an individual special education student shall be

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deemed to be "extraordinary." Excess costs are defined as exceeding five (5) times the current

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fiscal year's statewide per pupil foundation amount as determined pursuant to section 16-7-20.8

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of this chapter.

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     16-7-20.11. Formula adjustment. – Annually, upon the effective date of the formula as

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defined in section 16-7-20.8, the fiscal budget funding for the foundation aid program, including

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increases in aid to districts and state assumption of costs, shall increase at an overall rate of not

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less than three percent (3%), but not greater than six percent (6%) over the prior fiscal year, as

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determined by the general assembly and subject to availability of funds.

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     SECTION 8. This act shall take effect upon passage.

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LC02549

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO EDUCATION-- THE EDUCATION ADEQUACY ACT

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     This act would establish a permanent education foundation aid formula for calculating

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state aid to public education.

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     This act would take effect upon passage.

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LC02549

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