North Carolina 2025-2026 Regular Session

North Carolina Senate Bill S112 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		GENERAL ASSEMBLY OF NORTH CAROLINA
2	2		SESSION 2025
3		-	S 1
4		-	SENATE BILL 112
	3	+	S D
	4	+	SENATE BILL DRS45061-NG-25
	5	+
5	6
6	7
7	8		Short Title: School Financial Flexibility Pilot Program. (Public)
8	9		Sponsors: Senator Sawyer (Primary Sponsor).
9		-	Referred to: ~~Rules and Operations of the Senate~~
10		-	~~February 18, 2025~~
11		-	~~S112 -v-1~~
	10	+	Referred to:
	11	+
	12	+	DRS45061 -NG-25
12	13		A BILL TO BE ENTITLED 1
13	14		AN ACT TO CREATE A PILOT PROGRAM TO ALLOW MORE FINANCIAL AND HIRING 2
14	15		FLEXIBILITY FOR CERTAIN SCHOOL DISTRICTS. 3
15	16		The General Assembly of North Carolina enacts: 4
16	17		SECTION 1.(a) Authorize Financial and Hiring Flexibility Plan; Purpose. – Prior to 5
17	18		the 2026-2027 school year, an eligible district (District) may submit a Financial and Hiring 6
18	19		Flexibility Plan (FHFP) to the State Board of Education (State Board) to permit the local board 7
19	20		of education (local board) to decide certain matters related to the operation of the schools under 8
20	21		the local board's control within the District, including the use of State funds, as provided in this 9
21	22		act. The purpose of operating a District under an FHFP shall be for the local board to design and 10
22	23		create a comprehensive, innovative, strategic vision allowing additional flexibility to the District 11
23	24		to provide a high-quality education to all students. 12
24	25		SECTION 1.(b) For purposes of this act, "eligible district" means a local school 13
25	26		administrative unit that meets both of the following criteria: 14
26	27		(1) The local school administrative unit has the authority to levy and lay special 15
27	28		taxes for the payment of bonds issued by the governing body of the unit. 16
28	29		(2) The local school administrative unit had an allotted average daily membership 17
29	30		of at least 5,000 for the 2023-2024 school year. 18
30	31		SECTION 2.(a) Submission of an FHFP. – A local board desiring to operate under 19
31	32		an FHFP shall submit an FHFP that meets the requirements of this section to the State Board by 20
32	33		January 15, 2026, to begin operation of the plan with the 2026-2027 school year. The local board 21
33	34		shall include at least the following components in its FHFP: 22
34	35		(1) A resolution adopted by the local board to implement the FHFP in the District. 23
35	36		(2) A detailed description of how the flexibility allowed under the FHFP will aid 24
36	37		the District in meeting each of the following goals by the conclusion of the 25
37	38		2030-2031 school year: 26
38	39		a. Ensure that one hundred percent (100%) of all students have 27
39	40		completed a career development plan by the beginning of their senior 28
40	41		year of high school. 29
41	42		b. Increase teacher retention to a ninety percent (90%) retention rate. 30
42	43		c. Improve the average growth index of District schools to 0.50 or 31
43	44		greater. 32
44	45		d. Increase the growth rate of any subgroups of students below the 33
45	46		average growth rate in the 2024-2025 school year to above the average 34
46		-	overall growth rate for the State. 35 General Assembly Of North Carolina Session 2025
47		-	Page 2 Senate Bill 112-First Edition
	47	+	overall growth rate for the State. 35
	48	+	FILED SENATE
	49	+	Feb 17, 2025
	50	+	S.B. 112
	51	+	PRINCIPAL CLERK General Assembly Of North Carolina Session 2025
	52	+	Page 2 DRS45061-NG-25
48	53		e. Quantify all other measures of success of the FHFP in achieving the 1
49	54		goals established in the FHFP. 2
50	55		SECTION 2.(b) State Board Approval. – The State Board shall approve an FHFP 3
51	56		that meets the requirements of this section by March 15, 2026, to begin implementation July 1, 4
52	57		2026. 5
53	58		SECTION 2.(c) State Board of Education Review; Termination of Plan. – The State 6
54	59		Board shall conduct a review of the operation and student performance of a District operating 7
55	60		under an approved FHFP following the end of the 2030-2031 school year, and at least every three 8
56	61		years thereafter, to ensure that the District is meeting the expected academic goals set forth in the 9
57	62		FHFP and complying with all financial and observance requirements in this act. The State Board 10
58	63		shall terminate an FHFP after a review for any of the following grounds: 11
59	64		(1) Failure to meet the academic strategic goals for student performance 12
60	65		contained in the plan. 13
61	66		(2) Identification of the majority of schools in the District as low-performing 14
62	67		schools in the two school years immediately preceding the review. 15
63	68		(3) Failure to meet generally accepted standards of fiscal management or 16
64	69		violation of State or federal law. 17
65	70		SECTION 2.(d) Early Termination. – If the State Board determines that a District 18
66	71		operating under an approved FHFP has failed to meet generally accepted standards of fiscal 19
67	72		management or violated State or federal law at any time, the State Board shall terminate the 20
68	73		FHFP. In addition, if the Superintendent of Public Instruction (Superintendent) finds that 21
69	74		satisfactory progress is not being made toward the strategic goals identified in an FHFP after 22
70	75		reviewing the reports required to be submitted under Section 8 of this act, the Superintendent 23
71	76		shall recommend to the State Board that the FHFP be terminated. The State Board may terminate 24
72	77		an FHFP if such a recommendation is made by the Superintendent. If an FHFP is terminated, the 25
73	78		District shall continue to operate under the FHFP until the end of the school year in which the 26
74	79		termination determination is made. 27
75	80		SECTION 2.(e) Transition. – If an FHFP is terminated, notwithstanding 28
76	81		G.S. 115C-105.26, the State Board may grant the District a waiver to the licensure requirements 29
77	82		of G.S. 115C-295 annually, for up to three years, to facilitate the transition to employment of 30
78	83		fully licensed teachers. 31
79	84		SECTION 3.(a) Teachers. – Notwithstanding G.S. 115C-295, beginning July 1, 32
80	85		2026, for as long as a District is operating under an FHFP, up to fifty percent (50%) of the 33
81	86		teachers in each school in the District may be employed as teachers despite not holding teacher 34
82	87		licenses if they meet the requirements set out in subsection (b) of this section. All teachers who 35
83	88		are teaching in the core subject areas of mathematics, science, social studies, and language arts 36
84	89		shall be college graduates. 37
85	90		SECTION 3.(b) Requirements for Unlicensed Teachers. – All teachers hired by a 38
86	91		local board operating under an FHFP who are not licensed as a teacher by the State shall complete 39
87	92		preservice training, which may be offered through an educator preparation program or by a local 40
88	93		school administrative unit, in all of the following areas prior to beginning instruction: 41
89	94		(1) The identification and education of children with disabilities. 42
90	95		(2) Positive management of student behavior. 43
91	96		(3) Effective communication for defusing and de-escalating disruptive or 44
92	97		dangerous behavior. 45
93	98		(4) Safe and appropriate use of seclusion and restraint. 46
94	99		SECTION 4. School Operation. – All schools in a District operating under an FHFP 47
95	100		shall be deemed to have been continuously operating under a modified calendar since the 48
96	101		2003-2004 school year for purposes of G.S. 115C-84.2(d). 49
97	102		SECTION 5. Available State Funds. – Beginning with the 2026-2027 fiscal year, 50
98	103		the Department of Public Instruction shall calculate the amount of State funds to be allocated to 51 General Assembly Of North Carolina Session 2025
99		-	~~Senate Bill 112-First Edition~~ Page 3
	104	+	DRS45061-NG-25 Page 3
100	105		a District operating under an FHFP on the same basis as other local school administrative units 1
101	106		and shall distribute those funds to the unit. The Department shall use statewide average salary 2
102	107		figures for the purpose of calculating the dollar equivalent of guaranteed positions as necessary. 3
103	108		The funds allocated to a District shall be subject to any restrictions as to use imposed by federal 4
104	109		law, the conditions of federal or State grants, or as provided through any rules that the State 5
105	110		Board adopts to ensure compliance with federal regulations. Notwithstanding G.S. 115C-105.25, 6
106	111		use of these funds shall otherwise be unrestricted except as provided in this act. 7
107	112		SECTION 6. Provision for Disbursement of State Money. – The deposit of money 8
108	113		in the State treasury to the credit of a District operating under an approved FHFP shall be made 9
109	114		as necessary for the operation of the District. The State Board may withhold money to be 10
110	115		distributed to a District if any report required to be filed with State school authorities is more 11
111	116		than 30 days overdue. Money in the State Public School Fund and State bond moneys shall be 12
112	117		released only on warrants drawn on the State Treasurer, signed by a local official as required by 13
113	118		the State Board. 14
114	119		SECTION 7. Withholding for Retirement Contributions. – Upon notification by the 15
115	120		Board of Trustees of the Teachers' and State Employees' Retirement System to the State 16
116	121		Treasurer and the Office of State Budget and Management as to any default of a District operating 17
117	122		under an approved FHFP, the State Board shall withhold from any State appropriation due to the 18
118	123		District an amount equal to the sum of all delinquent contributions and payments due to the 19
119	124		Retirement Systems Division and shall transmit that amount to the Retirement Systems Division. 20
120	125		SECTION 8. Reporting to Superintendent. – A District operating under an approved 21
121	126		FHFP shall report to the Superintendent no later than July 15, 2027, and each year thereafter as 22
122	127		follows: 23
123	128		(1) An annual report on the number of licensed and unlicensed teachers and use 24
124	129		of long-term substitutes in filling vacancies for classroom teachers. This report 25
125	130		shall also provide recruiting data on the number of licensed and unlicensed 26
126	131		teachers hired during the school year and overall employee retention in each 27
127	132		school year. In addition, the report shall also provide comparisons with the 28
128	133		data from the previous school year on the information required by this 29
129	134		subdivision at the local school administrative unit level. 30
130	135		(2) Specific actions taken to close academic gaps between student groups on State 31
131	136		assessments. 32
132	137		(3) A breakdown of how State funds are being spent in the District. 33
133	138		(4) Any available data on outcomes identified as goals in the FHFP. 34
134	139		(5) Any other reporting requirements deemed necessary by the Superintendent of 35
135	140		Public Instruction. 36
136	141		SECTION 9. Report to the General Assembly. – No later than November 15, 2027, 37
137	142		and each year thereafter that a District operates under an FHFP, the Superintendent shall report 38
138	143		to the Joint Legislative Education Oversight Committee on the progress of the FHFP on at least 39
139	144		the following topics: 40
140	145		(1) A summary of the data provided by Districts operating under an FHFP to the 41
141	146		Superintendent in the annual report. 42
142	147		(2) The effectiveness of the FHFP on hiring and retaining teachers in Districts, 43
143	148		determined by annual turnover rates and teacher vacancies, compared with 44
144	149		other local school administrative units not operating under an FHFP. 45
145	150		(3) An assessment of the financial flexibilities utilized by local boards operating 46
146	151		under an FHFP and any recommended changes or modifications. 47
147	152		(4) Any available data on outcomes identified as goals in any FHFP. 48
148	153		(5) Any other information the Superintendent deems relevant to the pilot program 49
149	154		authorized by this act. 50
150	155		SECTION 10. This act is effective when it becomes law. 51