LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 7477 NOTE PREPARED: Mar 20, 2025
BILL NUMBER: HB 1499 BILL AMENDED: Mar 20, 2025
SUBJECT: Education Matters.
FIRST AUTHOR: Rep. Behning BILL STATUS: CR Adopted - 2
nd
House
FIRST SPONSOR: Sen. Rogers
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
DEDICATED
FEDERAL
Summary of Legislation: (Amended) This bill provides that certain students have the opportunity to retake
the determinant evaluation of reading skills at least twice in the summer before grade 3 retention
requirements apply. The bill requires the Department of Education to establish a registration process for
schools to exempt certain English language learners from compliance with grade 3 retention requirements
until the beginning of the 2027-2028 school year. It allows required career fairs to be held off of school
property if the school provides transportation. The bill also amends agreement requirements with regard to
the Employment Aid Readiness Network (EARN) Indiana Program. It makes a technical correction.
Effective Date: July 1, 2025.
Explanation of State Expenditures: Third Grade Retainment: Provisions in the bill are expected to increase
annual state assessment expenditures beginning in FY 2026 by approximately $45,000. However, the bill is
also expected to decrease the number of third grade students who are retained in the third grade and
beginning in FY 2035, state tuition support expenditures are expected to decrease dependent on the number
of students who graduate a year earlier than they otherwise would have. Ultimately, the impact to state
expenditures is dependent on legislative actions.
EARN Indiana: The state currently matches 50% of the hourly wage for students participating in EARN
Indiana. The bill decreases the minimum hours EARN Indiana participants are required to work from 12, to
10 hours. This may increase the number of participating employers and participating students who participate
in EARN Indiana. The bill’s impact to state expenditures is expected to be minor. [EARN Indiana was
appropriated $2.6 M in FY 2025.]
(Revised) Additional Information - Tuition Support: Current statute requires certain third grade students who
are unable to pass the IREAD-3 assessment to be retained in the third grade beginning in FY 2026. Currently,
students who do not pass the IREAD-3 assessment in the spring must be given an opportunity to retake the
assessment in the summer. Provisions in the bill require these students to be given at least two opportunities
to retake the assessment over the summer. This represents an indeterminable reduction in the number of
students who may be required to be retained in the third grade.
HB 1499 1 The bill also allows schools whose third grade student population is comprised of at least 50% English
language learners to register their English language learner students for an exemption from current retention
statute until FY 2028 if they are unable to pass IREAD-3. This will exempt an estimated 797 third grade
English language learner students annually across 38 public schools who otherwise would have been retained
in the third grade.
IREAD-3 Assessments: In 2024, approximately 10,500 third grade students were still unable to pass the
IREAD-3 assessment after retaking the exam over the summer. This bill would require these students to be
given an opportunity to retake the exam over the summer at an estimated per-student cost of $4.25.
Explanation of State Revenues:
Explanation of Local Expenditures: Current statute requires high schools to host hold a career fair for
every 11
th
and 12
th
grade student. Provisions in this bill allow high schools to fulfill this requirement if they
provide transportation for students to attend a career fair outside of school property. This represents an
increase to transportation expenditures for public schools who elect to provide transportation to a career fair
in this manner.
Explanation of Local Revenues: Provisions in the bill decrease public school tuition support revenue
beginning in FY 2035. [See Explanation of State Expenditures.]
State Agencies Affected:.
Local Agencies Affected: Public schools.
Information Sources: Department of Education.
Fiscal Analyst: Kelan Fong, 317-232-9592.
HB 1499 2